( BW)(GRUPO-RADIO-CENTRO)(RC) Grupo Radio Centro Reports First Quarter
2003 Results
Business Editors
MEXICO CITY--(BUSINESS WIRE)--April 28, 2003--Grupo Radio Centro,
S.A. de C.V. (NYSE: RC)
-- Grupo Radio Centro announces the significant recovery of its
operating and net income, as a result of revenue increases and
improved management of its operating costs
-- The Company reduced its bank debt by approximately Ps. 75.8
million, from Ps. 384.0 million to Ps. 308.2 million in the
first quarter of 2003
Grupo Radio Centro, S.A. de C.V. (NYSE: RC, BMV: RCENTRO-CPO) (the
"Company"), Mexico's leading radio broadcasting company, announced
today its results of operations for the three months ended March 31,
2003.
All figures were prepared in accordance with generally accepted
accounting principles in Mexico and have been restated in constant
pesos as of March 31, 2003.
For the first quarter of 2003, broadcasting revenue was Ps.
187,968,000, representing an increase of 51.4% compared to Ps.
124,146,000 reported for the same period of 2002. This growth was
mainly attributable to several accounts where advertising expenditures
from political parties rose in connection with the upcoming
congressional elections which will take place in July 2003.
The Company's broadcasting expenses (excluding depreciation,
amortization and corporate, general and administrative expenses) for
the first quarter of 2003 were Ps. 110,989,000, a decrease of 11.1%
compared to Ps. 124,816,000 reported for the same period of 2002. This
decrease was primarily attributable to the cancellation of
unprofitable programming and lower operating expenses of the Company
including a reduction in personnel expenses during the first quarter
of 2003 compared with the same period of 2002.
The Company reported broadcasting income (i.e., broadcasting
revenue minus broadcasting expenses, excluding depreciation,
amortization and corporate, general and administrative expenses) of
Ps. 76,979,000 for the first quarter of 2003, compared to a
broadcasting loss of Ps. 670,000 reported for the same period in 2002.
This significant recovery was mainly attributable to the increase in
broadcasting revenue as well as improved management of the Company's
operating expenses during the quarter.
Depreciation and amortization for the first quarter of 2003
amounted to Ps. 28,236,000, a 16.3% increase as compared with Ps.
24,269,000 reported for the same period of 2002. The rise was mainly
due to the accelerated amortization, in the first quarter of 2003, of
the goodwill associated with the purchase of one of the Company's
subsidiaries.
The Company's corporate, general and administrative expenses for
the first quarter of 2003 were Ps. 11,230,000, compared with Ps.
11,123,000 reported for the same period of 2002.
Primarily, as a result of the increase in broadcasting income, the
Company reported operating income of Ps. 37,513,000 for the first
quarter of 2003 as compared to an operating loss of Ps. 36,062,000
reported for the same period of 2002.
For the first quarter of 2003, the Company had a comprehensive
financing cost of Ps. 12,525,000, compared with comprehensive
financing income of Ps. 2,894,000 for the same period of 2002. This
unfavorable change was primarily attributable to a foreign exchange
loss of Ps. 6,892,000 for the first quarter of 2003 compared with a
foreign exchange gain of Ps. 4,469,000 reported for the same period of
2002. The foreign exchange loss resulted from the weakening of the
peso against the U.S. dollar during the first quarter of 2003 while
the foreign exchange gain resulted from the strengthening of the peso
against the U.S. dollar during the first quarter of 2002.
From March 31, 2002 to March 31, 2003, the Company's total bank
debt decreased by approximately Ps. 75.8 million, from Ps. 384.0
million to Ps. 308.2 million. Of the Ps. 308.2 million in bank loan
debt, 77% is peso-denominated while the remaining 23% is U.S.
dollar-denominated. The Company is in compliance with all of the
financial covenants stipulated under its loan agreements.
Other expenses, net, for the first quarter of 2003 were Ps.
17,121,000, as compared with Ps. 15,267,000 reported for the same
period in 2002. This 12.1% increase is primarily attributable to
severance payments made during the first quarter of 2003 in connection
with the personnel reductions made by the Company during this quarter.
The Company's income before provisions for income tax and employee
profit sharing for the first quarter of 2003 was Ps. 7,867,000,
compared with a loss before provisions for income tax and employee
profit sharing of Ps. 48,435,000 reported for the same period in 2002.
Primarily due to the availability of tax loss carry-forwards, the
Company recorded no provisions for income tax and employee profit
sharing for the first quarter of 2003.
As a result of the foregoing, the Company's net income for the
first quarter of 2003 was Ps. 7,867,000, as compared with a net loss
of Ps. 48,435,000 reported for the first quarter of 2002.
Company Description:
Grupo Radio Centro owns and/or operates 14 radio stations, 12 of
which are located in Mexico City. The Company's principal activities
are the production and broadcasting of musical and entertainment
programs, talk shows, news and special events programs. Revenue is
primarily derived from the sale of commercial airtime. The Company
also operates a radio network, Organizacion Impulsora de Radio, which
acts as the national sales representative for, and provides
programming to, Grupo Radio Centro-affiliated radio stations.
- ----------------------------------------------------------------------
GRUPO RADIO CENTRO, S.A. DE C.V.
CONSOLIDATED UNAUDITED STATEMENTS OF INCOME
for the three month periods ended March 31, 2003 and 2002 expressed
in Mexican pesos ("Ps.") with purchasing power as of March 31, 2003
(figures in thousands of Ps. and U.S. dollars ("U.S. $")(1), except
per Share and per ADS amounts)
- ----------------------------------------------------------------------
March 31
2003 2002
---------------- --------
U.S.$ Ps. Ps.
Broadcasting revenue (2) 17,458 187,968 124,146
Broadcasting expenses, excluding depreciation
and amortization and corporate expenses 10,308 110,989 124,816
------- -------- --------
Broadcasting income (loss) 7,150 76,979 (670)
------- -------- --------
Depreciation and amortization 2,622 28,236 24,269
Corporate, general and administrative
expenses 1,043 11,230 11,123
------- -------- --------
Operating income (loss) 3,485 37,513 (36,062)
------- -------- --------
Comprehensive financing cost:
Interest expense (726) (7,814) (4,905)
Interest income (2) 43 460 89
Foreign exchange gain (loss), net (640) (6,892) 4,469
Gain on monetary position, net 160 1,721 3,241
------- -------- --------
(1,163) (12,525) 2,894
Other expenses, net (1,590) (17,121) (15,267)
------- -------- --------
Income (loss) before the following provisions 732 7,867 (48,435)
------- -------- --------
Provisions for income tax & employee profit
sharing - - -
------- -------- --------
Net income (loss) 732 7,867 (48,435)
------- -------- --------
Net income (loss) applicable to:
Majority interest 732 7,864 (48,433)
Minority interest - 3 (2)
------- -------- --------
732 7,867 (48,435)
======= ======== ========
Net income (loss) for the LTM per Series A
Share (3) 0.033 0.359 (0.103)
Net income (loss) for the LTM per ADS (3) 0.297 3.231 (0.927)
Weighted average common shares outstanding
for the LTM (000's) (3) 162,959 163,890
- ----------------------------------------------------------------------
(1) Peso amounts have been translated into U.S. dollars, solely for
the convenience of the reader, at the rate of Ps. 10.7671 per U.S.
dollar, the noon buying rate for pesos on March 31, 2003.
(2) Broadcasting revenue for a particular period includes (as a
reclassification of interest income) interest earned on funds
received by the Company pursuant to advance sales of commercial
air time to the extent that the underlying funds were earned by
the Company during the period in question. Advances from
advertisers are recognized as broadcasting revenue only when the
corresponding commercial airtime has been transmitted. Interest
earned and treated as broadcasting revenue for the first quarters
of 2003 and 2002 was Ps. 104,000 and Ps. 171,000, respectively.
(3) Earnings per share calculations are made for the last twelve
months ("LTM") as of the date of the income statement, as required
by the Mexican Stock Exchange.
- ----------------------------------------------------------------------
GRUPO RADIO CENTRO, S.A. DE C.V.
CONSOLIDATED UNAUDITED BALANCE SHEETS
as of March 31, 2003 and 2002 expressed
in Mexican pesos ("Ps.") with purchasing power as of March 31, 2003
(figures in thousands of Ps. and U.S. dollars ("U.S. $" ) (1))
- ----------------------------------------------------------------------
March 31
2003 2002
--------------------- ----------
U.S. $ Ps. Ps.
ASSETS
------
Current assets:
Cash and temporary investments $ 9,244 99,516 35,411
---------- ---------- ----------
Accounts receivable:
Broadcasting 17,789 191,533 116,547
Other 841 9,059 5,706
Income tax recoverable - - 49,400
Value added tax recoverable - - 12,509
---------- ---------- ----------
18,630 200,592 184,162
Guarantee deposit 642 6,915 7,298
Prepaid expenses 1,478 15,919 15,485
---------- ---------- ----------
Total current assets 29,994 322,942 242,356
Prepaid expenses 9,501 102,298 117,554
Property and equipment 43,986 473,607 505,567
Deferred charges 1,602 17,241 16,049
Guarantee deposit 535 5,763 13,379
Excess cost over net book value of
assets of subsidiaries, net 74,253 799,492 877,010
Other assets 292 3,141 4,273
---------- ---------- ----------
Total assets $ 160,163 1,724,484 1,776,188
========== ========== ==========
LIABILITIES
-----------
Current:
Notes payable 13,907 149,741 162,000
Advances from customers 6,907 74,364 70,099
Other accounts payable and accrued
expenses 5,810 62,557 85,164
Income tax and other taxes payable 1,891 20,358 4,764
---------- ---------- ----------
Total current liabilities 28,515 307,020 322,027
Long-Term:
Bank loans 14,720 158,487 222,034
Deferred taxes 5,294 57,004 88,401
Reserve for labor obligations 2,453 26,416 21,148
---------- ---------- ----------
Total liabilities $ 50,982 548,927 653,610
---------- ---------- ----------
STOCKHOLDERS' EQUITY:
---------------------
Capital stock 96,856 1,042,853 1,049,474
Retained earnings 16,638 179,140 120,675
Reserve for repurchase of shares 3,435 36,983 35,128
Stock premium - - -
Accumulated effect of deferred income
tax (8,184) (88,121) (87,218)
Deficit on restatement of capital 391 4,213 4,050
Minority interest 45 489 469
---------- ---------- ----------
Total stockholders' equity $ 109,181 1,175,557 1,122,578
---------- ---------- ----------
Total liabilities and
stockholders' equity $ 160,163 1,724,484 1,776,188
========== ========== ==========
(1) Peso amounts have been translated into U.S. dollars, solely for
the convenience of the reader, at the rate of Ps. 10.7671 per U.S.
dollar, the noon buying rate for pesos on March 31, 2003.
CONTACT: Investor Relations:
Grupo Radio Centro, S.A. de C.V., Mexico
Pedro Beltran/Alfredo Azpeitia, 52-57-28-48 81 or 52-57
28-49-11
or
i-advize Corporate Communications, Inc., New York
Maria Barona/Blanca Hirani, 212/406-3690
Email: grc@i-advize.com