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SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Amendment No. __)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[X] Soliciting Material Pursuant to Section 240.14a-12
CITADEL COMMUNICATIONS CORPORATION
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(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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(NAME OF PERSON(S) FILING PROXY STATEMENT IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule O-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
O-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(4) Date Filed:
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[CITADEL LOGO]
NEWS ANNOUNCEMENT FOR IMMEDIATE RELEASE
CONTACT:
Lawrence R. Wilson, CEO Stewart A. Lewack
Donna L. Heffner, CFO Jennifer L. Colbert
Citadel Communications Corporation Jaffoni & Collins Incorporated
702/804-5200 212/835-8500 or citc@jcir.com
CITADEL COMMUNICATIONS CORPORATION AND CITADEL BROADCASTING
COMPANY REPORT FOURTH QUARTER AND YEAR END RESULTS
ANNUAL BROADCAST CASH FLOW REACHES ALL TIME HIGH -- EXCEEDING $100 MILLION
LAS VEGAS, Nevada, February 26, 2001 - Mid-sized market radio broadcaster
Citadel Communications Corporation (Nasdaq: CITC) ("the Company") and its
operating subsidiary, Citadel Broadcasting Company ("Citadel"), today announced
results for the three-month and twelve-month periods ended December 31, 2000.
The Company is a holding company for Citadel.
For the three months ended December 31, 2000, consolidated net revenue increased
66.3% to $92.3 million from $55.5 million in the same period of 1999. Broadcast
cash flow (BCF) (defined as station operating income excluding depreciation,
amortization, corporate general and administrative expenses, non-recurring items
and other non-cash charges) rose 63.5% to $34.5 million for the fourth quarter
of 2000, compared to $21.1 million in the corresponding period of 1999. Earnings
before interest, taxes, non-cash deferred compensation, depreciation and
amortization (EBITDA) for the fourth quarter of 2000 was $32.0 million, up 71.1%
from $18.7 million in the corresponding 1999 period. After-tax cash flow (ATCF)
(defined as net income or loss, plus depreciation, amortization, non-recurring
items and other non-cash charges less deferred tax benefit) declined to $0.18
per diluted share in the fourth quarter of 2000, compared to $0.27 per diluted
share in the fourth quarter of 1999, primarily as a result of higher interest
expense related to recently completed acquisitions.
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City Center West, 7201 West Lake Mead Boulevard, Suite 400, Las Vegas, NV 89128.
702/804-5200. FAX 702/804-5936
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CITADEL COMMUNICATIONS/CITADEL BROADCASTING, 2/26/01 page 2
Commenting on the results, Chairman and Chief Executive Officer, Larry Wilson,
stated, "During 2000, we were faced with the challenges of integrating 77 newly
acquired stations while operating in a slowing economy as the year progressed.
Our net revenue and BCF growth through this difficult environment reflect
favorably upon the quality of our asset base and the talents and efforts of our
employees. In addition to having achieved annual BCF in excess of $100 million
for the first time in our history, we are also proud of improving the Company's
overall BCF margin for the year to 37.7%, especially in view of the fact that
most of our newly integrated stations initially operate at lower margin levels."
On a same-station basis, fourth quarter 2000 net revenue (generated from
stations in markets where Citadel operated for the full 2000 and 1999 periods,
excluding one market in the early stages of development and excluding trade
revenue) increased 5.2% to $46.4 million, compared to $44.1 million in the
fourth quarter of 1999. BCF, excluding trade revenue and trade expense, on this
same-station basis, increased 16.7% to $19.6 million for the fourth quarter of
2000 from $16.8 million for the same period of 1999.
On a pro forma basis - as if recently completed and pending transactions were
completed on January 1, 1999 and after giving effect to discontinued operations
- - consolidated net revenue for the fourth quarter of 2000 would have been $95.0
million and BCF for that quarter would have been $35.9 million. Pro forma
results reflect Citadel's acquisition and disposition of various radio stations
on or prior to February 26, 2001, including the pending acquisition of five
stations in Tucson, Arizona and the pending divestiture of four stations in
Monroe, Louisiana.
For the fourth quarter of 2000, the Company reported a net loss applicable to
common shares of $22.1 million, or $0.60 per share, compared to a net loss of
$7.7 million, or $0.24 per share, in the fourth quarter of 1999. Citadel
reported a net loss applicable to common shares of $22.1 million, or $491.27 per
share, for the fourth quarter of 2000, compared to a net loss of $7.7 million,
or $170.14 per share, in the fourth quarter of 1999. The net loss is primarily
due to higher non-cash depreciation and amortization expenses related to station
acquisitions, higher non-cash deferred compensation expense relating to stock
options and higher interest expense. The Company's weighted average number of
shares outstanding for the quarter increased to 36,970,729 from 31,475,276 in
the year-ago period primarily due to a follow-on offering of common stock in
February 2000.
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CITADEL COMMUNICATIONS/CITADEL BROADCASTING, 2/26/01 page 3
For the fiscal year ended December 31, 2000, consolidated net revenue increased
59.6% to $284.8 million compared to $178.5 million in the fiscal year ended
December 31, 1999. BCF for the year ended December 31, 2000 rose 70.1% to $107.5
million from $63.2 million in fiscal 1999. EBITDA in the year ended December 31,
2000 rose 75.1% to $98.4 million, compared to $56.2 million in fiscal 1999. ATCF
in fiscal 2000 rose to $0.97 per diluted share, compared to $0.62 per diluted
share in fiscal 1999.
On the same-station basis described earlier, net revenue increased 7.6% to
$129.5 million for the year ended December 31, 2000 from $120.4 million for
fiscal 1999. BCF, on this same-station basis, increased 16.7% to $52.4 million
for fiscal 2000 from $44.9 million in fiscal 1999.
On a pro forma basis - as if recently completed and pending transactions as
described above were completed on January 1, 1999 and after giving effect to
discontinued operations - consolidated net revenue for the year ended December
31, 2000 would have been $356.7 million and BCF would have been $133.5 million.
For fiscal year 2000, the Company reported a net loss applicable to common
shares of $51.3 million, or $1.41 per share, compared to a net loss of $23.0
million, or $0.80 per share, in fiscal 1999. Citadel reported a net loss
applicable to common shares of $51.3 million, or $1,139.42 per share, for fiscal
year 2000, compared to a net loss of $23.0 million, or $540.77 per share, for
fiscal 1999. The Company's weighted average number of shares outstanding was
36,340,978 and 28,779,712 for fiscal years 2000 and 1999, respectively.
In January 2001, the Company agreed to be acquired by an affiliate of Forstmann
Little & Co., a leading acquirer and owner of businesses, for $26 per share in
cash, or a total transaction value of approximately $2.0 billion, including
assumed and refinanced debt and preferred stock. The transaction, which has been
approved by the Board of Directors of the Company, is expected to close in the
second half of 2001, following receipt of Federal Communications Commission
(FCC) and shareholder approval.
ABOUT THE COMPANY AND CONFERENCE CALL INFORMATION
Citadel is a radio broadcasting company that, upon completion of pending
transactions, will own or operate 143 FM and 66 AM stations concentrated in 43
mid-sized markets.
The Company and Citadel will host a conference call and simultaneous Webcast at
4:30 p.m. EST on February 26, 2001 that are open to the general public.
Conference call dial-in numbers are 212/346-0220 and 415/247-8535. The Webcast
of the call will be available at www.citadelcommunications.com.
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CITADEL COMMUNICATIONS/CITADEL BROADCASTING, 2/26/01 page 4
FORWARD-LOOKING STATEMENTS
This news announcement contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based on current expectations and projections
about future events and financial trends. The words or phrase "is expected" and
similar words or expressions are intended to identify such forward-looking
statements. In addition, any statements that refer to expectations or other
characterizations of future events or circumstances are forward-looking
statements. The forward-looking statements are subject to risks, uncertainties
and assumptions that could cause actual results to differ materially from those
described in the forward-looking statements, including, among other things,
general economic changes and changes in the radio broadcast industry,
fluctuations in the demand for advertising, possible difficulties in integrating
recently acquired radio stations, the timing of future acquisition closings and
variations in interest rates. Other key risks are described in the Company's and
Citadel's reports filed with the U.S. Securities and Exchange Commission ("the
SEC"). Except as otherwise stated in this news announcement, neither the Company
nor Citadel undertakes any obligation to publicly update or revise any
forward-looking statements because of new information, future events or
otherwise.
CERTAIN ADDITIONAL INFORMATION
In connection with the proposed acquisition of the Company by an affiliate of
Forstmann Little discussed above, the Company will be filing a definitive proxy
statement with the SEC. INVESTORS AND STOCKHOLDERS ARE URGED TO READ THIS PROXY
STATEMENT WHEN IT BECOMES AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION. Investors and stockholders will be able to obtain free copies of
the proxy statement when it becomes available as well as other material filed by
the Company or Citadel with the SEC through the website maintained by the SEC at
www.sec.gov. Free copies of the proxy statement will also be available from the
Company upon request made to the Secretary of the Company by mail at City Center
West, Suite 400, 7201 West Lake Mead Boulevard, Las Vegas, Nevada 89128 or by
telephone at (702) 804-5200.
The Company, its directors, executive officers and certain other members of
management and employees may be deemed to be soliciting proxies of Company's
stockholders to approve the proposed merger agreement between the Company and
Forstmann Little's wholly owned subsidiary, FLCC Holdings, Inc. A description of
any interests that such directors, executive officers and employees have in the
transaction will be available in the Company's proxy statement referenced above.
(tables follow)
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CITADEL COMMUNICATIONS/CITADEL BROADCASTING, 2/26/01 page 5
CITADEL COMMUNICATIONS CORPORATION AND SUBSIDIARY
Consolidated Statements of Operations
(in thousands, except per share data)
Three Months Ended Year Ended
December 31, December 31,
---------------------------------- ----------------------------------
2000 1999 2000 1999
---- ---- ---- ----
(unaudited) (unaudited) (unaudited) (audited)
----------- ----------- ----------- ---------
Net revenue $ 92,293 $55,523 $284,824 $178,495
Station operating expenses 57,819 34,459 177,359 115,312
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Broadcast cash flow (1) 34,474 21,064 107,465 63,183
Depreciation and amortization 26,626 11,279 76,502 35,749
Corporate general & administrative 2,517 2,342 9,092 7,010
Non-cash deferred compensation 2,642 1,474 12,246 1,727
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Operating income 2,689 5,969 9,625 18,697
Interest expense 22,156 7,883 53,135 25,385
Interest income (188) (345) (3,914) (1,877)
Other (income)/expense, net 103 1,192 (684) 1,489
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Net loss before income taxes (19,382) (2,761) (38,912) (6,300)
Income tax benefit (1,345) (360) (4,022) (1,647)
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Net loss from continuing
operations $(18,037) $(2,401) $(34,890) $ (4,653)
Net loss from discontinued
operations, net of tax (358) (2,474) (1,904) (4,275)
Loss on disposal of discontinued
operations, net of tax (603) ( - ) (2,430) ( - )
---------- ------------ ------------ ------------
Net loss (18,998) (4,875) (39,224) (8,928)
Dividend requirement for Exchangeable
Preferred Stock 3,109 2,781 12,050 14,103
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Net loss applicable to
common shares $(22,107) $(7,656) $(51,274) $(23,031)
========== ============ ============ ============
Net loss per common share $(0.60) $(0.24) $(1.41) $(0.80)
========== ========== ========== ==========
Weighted average common shares
outstanding 36,970,729 31,475,276 36,340,978 28,779,712
========== ========== ========== ==========
(1) Broadcast cash flow consists of station operating income excluding
depreciation, amortization, corporate general and administrative expenses,
non-recurring items and other non-cash charges.
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CITADEL COMMUNICATIONS/CITADEL BROADCASTING, 2/26/01 page 6
CITADEL COMMUNICATIONS CORPORATION AND SUBSIDIARY
Summary Data
(unaudited)
(dollars in thousands)
Three Months Ended Year Ended
December 31, December 31,
------------------------- -------------------------
2000 1999 2000 1999
---- ---- ---- ----
HISTORICAL:
Net revenue $92,293 $55,523 $284,824 $178,495
Broadcast cash flow 34,474 21,064 107,465 63,183
BCF Margin 37.4% 37.9% 37.7% 35.4%
EBITDA 31,957 18,722 98,373 56,173
ATCF (Per diluted share) 0.18 0.27 0.97 0.62
SAME STATION:
Net revenue $46,446 $44,056 $129,528 $120,413
Broadcast cash flow 19,615 16,825 52,403 44,856
BCF Margin 42.2% 38.2% 40.5% 37.3%
PRO FORMA:
Net revenue $94,979 $92,902 $356,741 $330,513
Broadcast cash flow 35,888 35,291 133,538 117,673
BCF Margin 37.8% 38.0% 37.4% 35.6%
EBITDA 33,371 32,948 124,446 110,795
CITADEL COMMUNICATIONS CORPORATION AND SUBSIDIARY
Selected Balance Sheet Data
(in thousands)
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CONSOLIDATED BALANCE SHEET DATA DECEMBER 31, 2000 DECEMBER 31, 1999
(UNAUDITED) (AUDITED)
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Cash and cash equivalents $ 8,092 $ 17,981
Working capital 58,268 54,777
Total assets 1,485,564 716,613
Long term debt 863,373 345,025
Total stockholders' equity 414,271 219,209
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