Exhibit 99.1
REGENT COMMUNICATIONS, INC.
REGENT REPORTS RECORD SECOND QUARTER 2004 RESULTS
- Regent Reports Record Net Revenue and Operating Income
for the Second Quarter 2004 -
- Company Completes $10 Million Share Buyback Program;
Board of Directors Authorizes Additional $20 million -
COVINGTON, KY, JULY 30, 2004 - Regent Communications, Inc. (Nasdaq: RGCI)
announced today financial results for the quarter ended June 30, 2004.
For the second quarter of 2004, net broadcast revenues increased 3.6% to $22.2
million from $21.5 million reported for the second quarter of 2003. For the same
period, station operating expenses increased to $14.4 million from $14.3
million. The Company reported net income of $2.3 million for the quarter, or
$0.05 per share, compared with reported net income of $1.9 million, or $0.04 per
share, in the same period last year.
For the first six months of 2004, net broadcast revenues increased 5.7% to $40.1
million from $37.9 million reported for the same period of 2003. For the same
period, station operating expenses increased to $27.8 million from $27.1
million. The Company reported net income of $2.7 million for the first six
months, or $0.06 per share, compared with reported net income of $2.0 million,
or $0.04 per share, in 2003. Below is the Company's statement of operations
prepared in accordance with generally accepted accounting principles ("GAAP")
(in thousands, except per share amounts):
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Three Months Ended Six Months Ended
June 30, June 30,
2004 2003 2004 2003
---- ---- ---- ----
Broadcast revenues, net of agency commissions $ 22,227 $ 21,453 $ 40,053 $ 37,882
Station operating expenses 14,379 14,255 27,790 27,135
Corporate general and administrative expenses 1,927 1,589 3,790 3,314
Depreciation and amortization 1,182 1,065 2,330 2,012
Loss (gain) on sale of long-lived assets 19 (1) 24 5
----------------------- -----------------------
Operating income 4,720 4,545 6,119 5,416
Interest expense (785) (1,506) (1,571) (1,952)
Other (expense) income, net (50) 3 (90) (104)
----------------------- -----------------------
Income from continuing operations
before income taxes 3,885 3,042 4,458 3,360
Income tax expense (1,515) (1,156) (1,738) (1,277)
----------------------- -----------------------
Income from continuing operations 2,370 1,886 2,720 2,083
Discontinued operations, net of income tax (35) 38 (66) (49)
----------------------- -----------------------
Net income $ 2,335 $ 1,924 $ 2,654 $ 2,034
======================= =======================
Basic and diluted income per common share:
Net income from continuing operations $ 0.05 $ 0.04 $ 0.06 $ 0.04
Net (loss) income from discontinued operations $ 0.00 $ 0.00 $ 0.00 $ 0.00
Net income $ 0.05 $ 0.04 $ 0.06 $ 0.04
Weighted average number of common shares:
Basic 46,344 46,484 46,449 46,509
Diluted 46,782 46,776 46,981 46,736
Terry Jacobs, Chairman and CEO of Regent Communications, commented, "We are
pleased with our ability to deliver 5.4% same station revenue growth. This
growth highlights the attractive characteristics of our focused strategy and
reflects our success in operating leading station clusters in the attractive
middle and small-sized markets. In addition, we were able to convert this
top-line performance into 13.4% growth in same station operating income, to date
outperforming the industry as a whole. "
NON-GAAP FINANCIAL
MEASURES Regent utilizes certain financial measures that are not calculated in
accordance with GAAP to assess its financial performance. The non-GAAP
performance and liquidity measures presented in this release are station
operating income, same station operating income, proforma net broadcast revenues
and proforma station operating income, and free cash flow. Regent's management
believes these non-GAAP measures provide useful information to investors, as
discussed in more detail below, regarding Regent's financial condition and
results of operations and liquidity; however, these measures should not be
considered as an alternative to net broadcast revenue, operating income, net
income (loss), or cash provided by operating activities as an indicator of
Regent's performance or liquidity.
STATION OPERATING INCOME
Second quarter 2004 station operating income increased 9.0% to $7.8 million from
$7.2 million reported for the same period in 2003. For the first six months of
2004, station operating income increased 14.1% to $12.3 million from $10.7
million reported for the same period in 2003.
The Company believes that station operating income is a performance measure that
helps investors better understand radio station operations. Additionally, the
Company and other media companies have customarily been measured by analysts and
other investors on their ability to generate station operating
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income. The following table reconciles operating income, which the Company
believes is the most directly comparable GAAP financial measure, to station
operating income (in thousands):
Three Months Ended Six Months Ended
STATION OPERATING INCOME June 30, June 30,
2004 2003 2004 2003
- ----------------------------------------------------------------------- --------------------
Operating income $ 4,720 $ 4,545 $ 6,119 $ 5,416
PLUS:
Depreciation and amortization 1,182 1,065 2,330 2,012
Corporate general and administrative expenses 1,927 1,589 3,790 3,314
Loss (gain) on sale of long-lived assets 19 (1) 24 5
-------------------- --------------------
Station operating income $ 7,848 $ 7,198 $12,263 $10,747
==================== ====================
SAME STATION RESULTS
On a same station basis, which includes results from stations owned and operated
during the entire second quarter for both the 2004 and 2003 periods and excludes
barter, net broadcast revenue for the second quarter of 2003 increased 5.4% to
$19.3 million compared to the second quarter of 2003. Station operating income
increased 13.4% to $7.1 million in the second quarter of 2004 compared to the
second quarter of 2003. The Company believes that a same station presentation is
important to investors as it provides a measure of performance of radio stations
that were owned and operated by Regent in the second quarter of 2003 as well as
the current quarter and eliminates the effect of acquisitions and dispositions
on comparability. Additionally, the Company has excluded barter in this
comparison as barter customarily results in volatility between quarters,
although differences over the full year are not material. The following tables
reconcile net broadcast revenue and operating income to same station net
broadcast revenue and same station operating income (in thousands):
Three Months Ended
SAME STATION NET BROADCAST REVENUE June 30,
2004 2003
- ---------------------------------------------------------------------------------------------------
Net broadcast revenue $22,227 $21,453
ADJUSTMENTS:
Net results of stations not included in same station category (1,863) (1,877)
Barter transactions (1,018) (1,223)
----------------------
Same station net broadcast revenue $19,346 $18,353
======================
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Three Months Ended
SAME STATION OPERATING INCOME June 30,
2004 2003
- -----------------------------------------------------------------------------------------------
Operating income $4,720 $4,545
PLUS:
Depreciation and amortization 1,182 1,065
Corporate general and administrative expenses 1,927 1,589
Loss (gain) on sale of long-lived assets 19 (1)
----------------------
Station operating income 7,848 7,198
ADJUSTMENTS:
Net results of stations not included in same station category (653) (757)
Barter transactions (137) (215)
----------------------
Same station operating income $7,058 $6,226
======================
PROFORMA RESULTS
On a proforma basis, which includes results of stations acquired by Regent
subsequent to January 1, 2003 as well as stations operating under a time
brokerage agreement ("TBA"), net broadcast revenue of $22.2 million for the
second quarter of 2004 was up 4.9% compared to the second quarter of 2003 and
station operating income of $7.8 million increased 10.0% compared to the second
quarter of 2003. The Company believes that proforma presentation is useful to
investors as it provides for a comparison of results as if the Company had made
acquisitions or dispositions at the beginning of 2003. The following tables
reconcile net broadcast revenue and operating income to proforma net broadcast
revenue and proforma station operating income (in thousands):
Three Months Ended
PROFORMA NET BROADCAST REVENUE June 30,
2004 2003
- ----------------------------------------------------------------------------------------
Net broadcast revenue $22,227 $21,453
PLUS:
Results of stations acquired or operated under a TBA - 1,775
LESS:
Results of stations disposed of or pending disposition - 2,031
-----------------------
Proforma net broadcast revenue $22,227 $21,197
=======================
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Three Months Ended
PROFORMA STATION OPERATING INCOME June 30,
2004 2003
- ------------------------------------------------------------------------------------------
Operating income $4,720 $4,545
PLUS:
Depreciation and amortization 1,182 1,065
Corporate general and administrative expenses 1,927 1,589
Loss (gain) on sale of long-lived assets 19 (1)
----------------------
Station operating income 7,848 7,198
PLUS:
Results of stations acquired or operated under a TBA - 716
LESS:
Results of stations disposed of or pending disposition (1) 776
----------------------
Proforma station operating income $7,849 $7,138
======================
FREE CASH FLOW
Regent also reported free cash flow (defined as net income plus depreciation,
amortization and other non-cash expenses, less maintenance capital expenditures
and other non-cash income) for the second quarter of 2004 of $4.4 million
compared to $4.4 million for 2003. For the first six months of 2004 free cash
flow was $5.9 million compared to free cash flow of $5.3 million for the first
six months of 2003, an increase of 11.8%. The Company believes that free cash
flow is a liquidity measure that helps investors evaluate the ability of the
Company to generate excess cash flow for investing and financing uses. The
following table displays how the Company calculates free cash flow (in
thousands):
Three Months Ended Six Months Ended
June 30, June 30,
2004 2003 2004 2003
- --------------------------------------------------------------------------------------- -------------------------
Net Income $2,335 $1,924 $2,654 $2,034
ADD:
Depreciation and amortization(1) 1,243 1,095 2,391 2,042
Non-cash interest expense 102 1,079 204 1,149
Non-cash taxes 1,378 1,120 1,566 1,182
Cumulative effect of accounting change, net of taxes - - - -
Other non-cash items, net(2) 58 (159) 303 (41)
LESS: Maintenance capital expenditures 751 671 1,169 1,046
---------------------- ------------------
Free cash flow $4,365 $4,388 $5,949 $5,320
====================== ==================
1) Includes depreciation and amortization for discontinued operations.
2) Includes non-cash compensation, barter and non-cash gain on sale of stations.
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The most directly comparable GAAP measure to free cash flow is net cash provided
by operating activities. The following table reconciles net cash provided by
operating activities to free cash flow (in thousands):
Three Months Ended Six Months Ended
June 30, June 30,
2004 2003 2004 2003
- -------------------------------------------------------------------------------------- ------------------
Net cash provided by operating activities $2,781 $ 704 $6,708 $3,795
LESS:
Other non-cash expense, net 163 536 356 473
PLUS:
Changes in operating assets and liabilities 2,498 4,891 766 3,044
LESS: Maintenance capital expenditures 751 671 1,169 1,046
---------------------- ------------------
Free cash flow $4,365 $4,388 $5,949 $5,320
====================== ==================
SELECTED DATA
At the end of the second quarter total debt was $73.9 million and cash was $2.1
million. Total capital expenditures in the second quarter were $1.4 million.
OUTLOOK
Regent has adopted a policy to provide guidance to investors regarding our
financial prospects. The following statements are based on current expectations.
These statements are forward-looking, and actual results may differ materially.
Regent undertakes no obligation to update these statements.
Regent expects third quarter 2004 reported consolidated net broadcast revenues
and station operating income of approximately $22.2 to $22.5 million and $7.8 to
$8.0 million, respectively. Regent expects earnings per share to be $0.05 for
the third quarter of 2004. This is before $0.13 to $0.15 per share related to
the transaction Regent entered into with Citadel Communications whereby Regent
is exchanging four stations in Erie, PA and two stations in Lancaster, PA for
five stations serving the Bloomington, IL market. Total earnings per share,
therefore, is expected to be $0.18 to $0.20. The following table reconciles
projected operating income, which the Company believes is the most directly
comparable GAAP measure to station operating income (in millions):
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Three Months Ending
STATION OPERATING INCOME September 30,
Guidance Range
Lower Upper
- ----------------------------------------------------------------------------------
Operating income $4.7 $4.9
PLUS:
Depreciation and amortization 1.3 1.3
Corporate general and administrative expenses 1.8 1.8
---------------------
Station operating income $7.8 $8.0
=====================
The Company expects three to five percent same station net broadcast revenue
growth in the third quarter of 2004 compared to the third quarter of 2003. The
Company believes that same station percent disclosures are important to
investors, analysts and other users of media financial information because it
enables the users of such information to compare the performance of various size
companies against industry standards.
Commenting on the Company's outlook, Terry Jacobs said, "We are very optimistic
about the long-term growth of Regent. We continue to experience healthy rating
improvements in our start-up and developing stations, and our more mature
properties are contributing solid revenue and cash flow. Our disciplined
approach to managing our inventory combined with operating market leading
stations places us in an excellent position to deliver above average growth in
the second half of the year and beyond."
SHARE BUYBACK UPDATE
Regent Communications also announced today that the Company's previous
repurchase program of $10 million, which was authorized on October 24, 2002, is
now complete. Prior to the second quarter of 2004 the Company had repurchased
201,500 shares for a total consideration of $999,719. During the second quarter
of 2004, Regent repurchased 1,204,920 shares of its common stock at an average
price of $5.83 per share, for a total cost of $7,028,396. Additionally, in the
month of July, the Company repurchased another 335,100 shares at an average
price of $5.87, for a total cost of $1,967,941.
On July 28, 2004, Regent's Board of Directors voted to increase the amount of
common stock that could be purchased under the stock buyback program, which now
gives the Company the ability to purchase, in total, up to an additional $20.0
million of its common stock, subject to necessary lender approvals.
Regent's Chief Financial Officer, Tony Vasconcellos, commented, "Regent is
focused on building shareholder value over the long-term, and we believe that
utilizing our free cash flow to repurchase our stock is a way to achieve this
goal, especially given the value afforded by recent market conditions."
Regent Communications is a radio broadcasting company focused on acquiring,
developing and operating radio stations in middle and small-sized markets. Upon
the close of all announced transactions, Regent will own and operate 75 stations
located in 15 markets. Regent Communications, Inc. shares are traded on the
Nasdaq under the symbol "RGCI."
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Regent Communications will host a teleconference to discuss its results at 9:00
a.m. Eastern Time today. To access the teleconference, please dial 973-582-2706
ten minutes prior to the start time. The teleconference will also be available
via live webcast on the investor relations portion of the Company's website,
located at www.regentcomm.com. If you cannot listen to the teleconference at its
scheduled time, there will be a replay available through August 6, 2004, which
can be accessed by dialing 877-519-4471 (U.S) or 973-341-3080 (Int'l), passcode
4956293. The webcast will also be archived on the Company's website for one
month. In addition, this press release and other material financial information,
if any, discussed during the teleconference will be posted on our website.
This press release includes certain forward-looking statements with respect to
Regent Communications, Inc. for which we claim the protections of the safe
harbor for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995. These forward-looking statements involve certain
risks and uncertainties and include statements preceded by, followed by or that
include words such as "anticipate," "believe," "plan," "estimate," "expect,"
"intend," "project" and other similar expressions. Although we believe our
expectations reflected in these forward-looking statements are based on
reasonable assumptions, such statements are influenced by our financial
position, business strategy, budgets, projected costs, and plans and objectives
of management for future operations. Actual results and developments may differ
materially from those conveyed in the forward-looking statements based on
various factors including, but not limited to: changes in economic, business and
market conditions affecting the radio broadcast industry, the markets in which
we operate, and nationally; increased competition for attractive radio
properties and advertising dollars; fluctuations in the cost of operating radio
properties; our ability to manage our growth; our ability to integrate these and
other acquisitions; and changes in the regulatory climate affecting radio
broadcast companies, including uncertainties surrounding recent Federal
Communication Commission rules regarding broadcast ownership limits. Further
information on other factors that could affect the financial results of Regent
Communications, Inc. is included in Regent's filings with the Securities and
Exchange Commission. These documents are available free of charge at the
Commission's website at http://www.sec.gov and/or from Regent Communications,
Inc.
CONTACT:
Terry Jacobs John Buckley
Chairman and CEO Brainerd Communicators, Inc.
Regent Communications, Inc. 212-986-6667
859-292-0030 buckley@braincomm.com
Tony Vasconcellos
Senior Vice President and Chief Financial Officer
Regent Communications, Inc.
859-292-0030
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