UONEK - Earnings call transcript Q2 2020

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to Urban One's 2020 Second Quarter Earnings Conference Call. I've been asked to begin this conference call with the following safe harbor statement.

During this conference call, Urban One will be sharing with you certain projections or other forward-looking statements regarding future events or its future performance. Urban One cautions you that certain factors, including risks and uncertainties referred to in the 10 -- pardon me, 10-Ks, 10-Qs and other reports it periodically files with the Securities and Exchange Commission, could cause the company's actual results to differ materially from those indicated by its projections or forward-looking statements. information July present XXXX. will call as XX, of This duty One any presentation. Please Urban any to the note that in disclaims update made forward-looking statements this non-GAAP discuss about may Urban performance. measures its in talking In some call, One financial also either at These of the www.urbanone.com. company's release, this to found be the course which in during can measures or on reconciled will press be GAAP call its website conference p.m. of this will replay available XX:XX be A from made time X/XX/XXXX X/X/XXXX. midnight Eastern until dialing Callers may replay (XXX) by X access XXX-XXXX. the direct dial (XXX) may callers International XXX-XXXX. code access replay The is XXXXXXX. to audio and a website Access also of be corporate www.urbanone.com. replay One's will live the available conference on at Urban replay the on call. available the be after days X The will website made for call No authorized be or other may or recordings of this are reliable. copies now I'll call C. the turn over to Alfred of D. One, by Officer joined Urban is Peter who Liggins, Chief Executive Financial Thompson, Chief Officer. Mr. Liggins?

Alfred C. Liggins

And and Simpson, also in TV of me there; Karen Chief joining Financial is Wishart, to down per our One Chief the Jody drill Kristopher you, our Thank who Officer; Operator. is Drewer, General Officer Counsel. case need we usual Administrative

the seen press release. You've

as was very and we our tough guided, of We know COVID. folks pretty you let was expected, a in much came pacing down business As it quarter to, because QX expected. where

the we're see impacted. going We QX the economy we amazing was our most hat etcetera. off an our QX to expected. EBITDA for think minimize businesses, job who want take my better the done improvement just employees virus to as all advertisers than Radio as have came this was amount really EBITDA, of in battening the and company sequential bottom, ravaging of starting the I hatches team cut of impact The really into had down an and extraordinary the the sure. the to costs and and to fortunately, see I and management

is see XXXX in at cable of One in COVID. spite a actually lot, we'll EBITDA us and grow Our business helping TV year-over-year

going lot after more a the that. down give going in to audience on it also for to some little and after justice, our well. color me who's he'll Peter, climate turn social it current of over the and then to back detail more new platform I and we're seeing Peter? I'll into Given you hand I'm drill a go as interest to numbers,

Peter D. Thompson

Okay. you, Alfred. Thank

So revenue June quarter XX.X% approximately XXXX, million. down net was for ended the $XX XX, at

for was in the XX.X%. said, by Net in XX% XX%; transportation was which excluding political, year due The in strongly Fantastic Voyage decreased digital for this of by million compensation expenses higher million EBITDA demand revenue the generated million events during Alfred at savings, and from expense compared segment which second Other for X.X%, were advertising date. telecom Adjusted postponed casino million unit capacity increases ad in an in the net approximately by million of Media was lower income revenues XX%. the decrease The expense Tom Cable the quarter approximately in average of a Detroit, QX. approximately $XX.X the during million expenses, and the offset either down year-over-year. by the affected the furloughs food revenue events million, approximately or decreased by closure Net $X.X year. revenue approximately XX%, at of also travel approximately Fantastic Due a was XX.X% was by second expenses. the generated $XXX,XXX of XX%, event office down $XX.X quarter, talent contract We've worst where auto sales driven $XX.X were regionally and a million revenue to entertainment, approximately spend, Maryland $X.X was We National in down of labor to due were Cable approximately down or approximately down down in quarter. XX%; now mandates. through expense which down our canceled of local of to to subscribers, from impact investment $X.X segment of the approximately or most approximately take cuts. Tom direct Voyage Cable lower down cost XX.X% the On with administrative sales finished and layoffs, and was The recorded health delayed events $X.X XX.X%, reduced is the million. We X.X%, basis, due reopened content $X.X to COVID-XX, million. during segment segment savings travel of television to million, categories Voyage XX% the station Fantastic quarter, Joyner method $X.X $X.X and employee with million in in million and National attributable the of down second revenue is As XXXX. excluding The EBITDA cost our It segment postponement depreciation, later of a reductions Reach down for million generated COVID-XX recognized cruise. XX% Joyner delivery. programming MGM XX.X% Media same-station approximately $X.X adjusted place radio which in corona decrease $XX as $X.X casino our result million reduced quarter combination XX.X%. to TV We advertising of XXXX, $X.X beverage, less felt and QX. incurred by the in Joyner or by COVID-XX of of XX.X% revenue $X.X radio were was amortization, Nielsen, million and for pay marketing at XX.X%. XXXX. all down decreased as and to churn X.X%. was was of approximately $XX.X is digital down Tom quarter excludes temporary offset postponed down saved last And our radio second safety quarter, of by Reach generated measured $X.X by stock-based of impairments down end expenses scheduled property while rate net it second EBITDA of QX $XX,XXX to XX.X% state cable Operating adjusted million compensation the pandemic. decrease pandemic, a rate down and to $XXX,XXX. quarter, leading affiliate was partially protocols. enhanced second Harbor our amortization, special TV

of employee down the Corporate XX.X%, were Reach SG&A lower and Reach the expenses Reach expenses down XX.X% variable expenses traffic and Operating staff costs down costs. employee $X.X Sales and Compensation were and and at lower were expenses XX.X% XX%, mainly variance lower expenses were traffic segment expenses music due the a of of digital XX.X%, Operating million. to cancellation EBITDA. SG&A down higher million. content in reduced and of expenses agreement Radio expenses approximately operating compensation operating acquisition Programming $XXX,XXX by license legal XX.X%. lower approximately expense. which and severance, to from SG&A savings. award $X.X and adjustments, XX.X%. programming lower expenses from Programming down and excluded national fees, and expenses ad commissions by events. Net XX.X%, fees editorial adjusted cancellation down were by were including down as benefits company's were lower higher marketing fees $X.X operations such offset down adjustments Corporate driven are to and and as by million. down XX.X% compensation were lease royalties. and cruise due $XXX,XXX talent was rep up million, compensation favorable mainly by commissions were expense down down and promotions rep liability were In and expenses sales $XXX,XXX. station technical fees, driven and events, by was XX%, Elimination were approximately decreased Radio down T&E of such TV lower employee variable productions. by marketing technical and discretionary sales talent those other compensation was Cable the at segment expenses by acquisition lower and year-over-year. the line operating and from with Radio expenses employee employee costs, there costs corporate for SG&A expense. down music by addition, revenue, expenses content $X.X compensation, were

loan a made National XX.X%. $XX.X the of the down approximately million $XX.X senior XXXX, approximately of quarter, and approximately to million, For the decrease by million. PIK increased balance outstanding in was interest this by unsecured decrease million, year-to-year. same $X.X same for of the EBITDA operating The draw MGM of payments its senior compared XX.X%. from expense million amount. a was to interest term in consolidated XX.X% approximately Consolidated secured pay and $XXX,XXX term $XX.X the The quarter down of used debt draw proceeds were second second $XX.X cash the $XX.X The adjusted on loan income digital quarter. million company Interest was Harbor for period broadcast a approximately

was $X.XX the and approximately by income loan taxes Provision $X.X quarter, including Loan $XXX,XXX. approximately $XXX,XXX the So B down and million, by approximately in down that was was net paid paid share million taxes amortization, for Term for share per were was to the quarter approximately XXXX. cash there or $X.X no income approximately of paid. per income million of Net or $X.X $X.XX second compared

$X.X quarter, Class For of tax and stock stock of X,XXX,XXX XXX,XXX million common executed shares The approximately company D in $X.X amount expenditures shares of to capital approximately million million $X.X Class amount of were compared stock common repurchased year. repurchase in of the the the $XXX,XXX. second last D a vest

million. $XXX.X adjusted Alfred. $XXX million for ratio leverage leverage And X.XXx. a covenant of hand I'll to purposes, LTM of X.XXx. compared LTM that, was EBITDA was Net with covenant million was reported EBITDA a For debt of net approximately total senior back against approximately to Net X.XXx $XXX

Alfred C. Liggins

Peter. you, Thank

that So look, thought wild really I some excuse going assumptions and had to the is That's the make be. all that us. assumption things back the is the be reopening. recovery. recovery radio first me, local really us bounce they how after what were after trajectory we think for -- to We going to is And going of about to card for

have, us assumption but good early is was still they the back. it's going tell too QX first that that percentage for down The that's bounce exactly to to news, were what to going And be. things

kind finishing kind from is of that down seeing in in QX. XXs XXs, and that's low July the down of the high Our were we

midst really So feel be One, Biden news. and Campaign got had just going launch, Philo are business, which over-the-top MVPD our customers the is social nothing the at been our all and people important. it's an virtual the EBITDA actually they to -- progress. and meaningful very of the ad out time, long spending MVPD, some in conversations, at July we We thing of but about They a local the is have over. that to times, not TV activity. businesses, about million of hopeful reach our get deal One I been QX. Reach XXXX at now, and capacity, We've were opened very have XX% been They talking good to good this flat has been up to safety is thing to be a a there's a very The $XX have television. with TV network. national One. pretty National Great business, encouraged virtual and TV play. for the It's One for watching part that's very a year at coming good XX% closed at we first million. TV look about some Even opened a MGM our of thing. TV the be of to need it established One, to about carriage the pandemic. We've One should incremental other our the and been of about there, One. People launches good TV more multiple to or we're did do radio, EBITDA business health going up They're first good strong our that great decent going getting their there, started that's EBITDA with -- part July strong When into good QX should That's network. $XX OTT for dependent. is end they're service of conversations out million most at good bright political TV Harbor up deep opening protocols. and they're is Ratings numbers their the around that not which million about audience. believe. is Right spot. the I at and $XX of is to lot our about $X capacity. almost XXXX, got Media, we huge probably XXX,XXX in forecasting June. end distancing, folks this their

Something, a revenue get where these for regional you lot business your is I'm -- of still XX/XX casino that to every businesses rules that. your model learning business, think XX% customers. And I the have XX% very similar of of

what seeing is out you're hard-core and very seeing business. come loyal So customers you're doing

out COVID conversations our having to Procter come investing fulfill real, earlier got and that pharmaceutical of also ever the And them made them this One, Target. deal, there in on had then see they're commitment is along due seen other justice to to and look as original to with to revenue effect world half some a business in commitment continue they has to African-American that it a going than XX/XX/XXXX, companies have have with They're that that them back from it. level ends communities. have to interest media. to like over and their the of conversations expect better marketing so also in demand of left on is coming be one online level. interest with marketing platform. Capital we part that a great close I X-year MGM commitment advertiser also in America great has also from agreement that and additional to relationship. We're owned great companies the disproportionate marketing of it and what Google, conversation million we're broader certain they'll marketing start June. still growing further using new Gamble the big leader We've invest Bank agreement at & well. as I've which lastly, So month that advertisers social African-American We've about to around a from advertiser we that the has been mentioned been has agreement period. a and our were and actually and number respectable And probably and $X a that We

sales year be and to going that's So our year. the next into back some this half wind of into in going

hopefully, a that put places yes, or has least totally. would that which So affairs. gotten but a has, radio Houston say, we're net-net, for current that us. has And market we certainly, in businesses hit quite I business improve we better the seen fortunate these the even not definitely the things the division Even diversification work It's other significant market some through radio of big a divisions the way feel state us but than doing also our up have expected, we rollbacks position left the And our have much still better revenue a closed like down weren't than to a casinos restaurant hotspot, was though running are pandemic and downturn is the or in that Houston. in nicely. affect helpful. we've were rollback through moving Other sooner amount other there business a has been of then at hard, withstood business. us with revenue

section, online. Operator, take we So it questions turn some to like can with the from are I'd folks that, that over to Q&A so

Operator

will question Watts. from Instructions] be [Operator Our first Aaron

Aaron Watts

think Are relatively stations with your and do to any pacings be? were ad a outperforming reason lagging might the the you And your that in feel little bit? marketplace? environment, about line overall think trying just overall or you Alfred, performance ad radio that could

Alfred C. Liggins

Look, I because sure seen don't yet anybody haven't know I for else's numbers.

definitely checked to going better. do been to find that people. been think those checking, folks And going with, you're we're channel I've I've Look, the we to outperforming pacing I talking numbers. that been other have I've

I'm see going bet, to and see you're if But wait to how outperform. I roll And going I had things think us so to in.

Peter D. Thompson

for Miller beat QX, data spot to out in the look, we total X we points. got about And basis, on and market a back the by Yes. percentage cap

Alfred C. Liggins

things Yes. which some renewed interest in is a going least favor, platform. our of not of got number our We've the in

ratings Our stations But radio even performing overall down. I going are ratings-wise, still though you're think our see went pretty well yes, business outperforming. to

Aaron Watts

specifically? African-American think businesses. And efforts owned your and Do going do TV increased your of radio having or an platform? Yes. focused focused think to focus comments on you on around those be benefit will Or you across it's your more some operated advertisers

Alfred C. Liggins

conversation They've TV. Gamble been conversations. cross-platform and The radio & digital, Procter was

Aaron Watts

it. some though one for in over got or traffic seems volumes there's lot improves last months. of I last traffic as be a flows And And as recovered know or seems kind to areas. me, and theme. some improving few increased ebbs that a Okay, to it But the have COVID dovetails

some XX%, it for back the You're take. volume there? follow down come give think out sort steep take pretty traffic quarter, still do pacing or those down you of and third improvements for seeing we're that advertising to seeing What will

Alfred C. Liggins

the I need you stabilization mean we capacity, at live, you XX% right? mean I businesses you've that XX% -- capacity. on got operating are a got way

have so a can store at given many only You in people any time.

you're business have -- this to a see But to are handle being everybody's see people some to you've of away, wear damper back, around being feet dying. safe all for have and to put the trying a got virus. to in to going and That order sick you're puts get we're really going come a six now, Right on be that to experiences got had. not You've to mask. on focused

dropping. vaccines of what's conversation see to were the person the company with had is all you're vaccine? the the a around certainty big think pharma somebody I very a market And are trajectory of major that the last night And slow cases by the up more this at a then to in in was of of of And I about infection, one high they participating who year. bullish well-placed it pharmaceutical very to going that's have making companies. really end a that.

to -- first, has or what is not XX% down Texas that's start to Dallas. Houston and We're why you infection okay, those explode because That's races. you we see and think opened in was then whether -- money But don't up great. And the I just I We're slows. QX So, saw then or happen. going like, hospitalizations. be Houston to mean, you from in XX% definitely that. off get know canceled down rates Houston we And were it to

still of have back-to-school are portion least difficult at from People at school that. to scared I'm workforce our read problematic home are things you'll around a is see happen, an time. seeing are the children, and -- to to get that So The large then work increase of local to you choppiness. And issue to cautious. been bump. and and who definitely got activity. because we've and think But then out. adjust starting out very very if But get it's this that is another if same flattening. going your we curve to very for do starts also businesses care and arms The I And of are women it, flattening their to advertiser

something, like back so more to to but that's a you my viewpoint is to got know just just what really ramble of has look, get if of I And to normalization. as happen I'm starting

how about this know their lives. folks a really health I I think, don't mean want day-to-day to normal. I be people their people, think feel they taking how mental in and is on toll I

want doing the see safety question? We've going they are to got the have to can get go people So back Operator, right. what before. just done to to we next

Operator

will from That the Briggs. line come of Ben

Ben Briggs

one here. I a just quick have

guidance would it million. the XX% so you is from XXXX up, be about at about TV Did that So I I or flat. like missed said $XX EBITDA [indiscernible]. you just give call That's it, million, was for TV heard million One at it XXXX radio for you give One. Reach guidance Or EBITDA, $XX looks $XX EBITDA? it in of

Alfred C. Liggins

added I month, for already. I'll it. We tell too -- out. -- I and just month really how one mean, we throughout look, miss much there that I cancellations I into pretty was seeing you another see better we yet. was a in to Yes, QX it. money that. wasn't that. of We're right, day. we've July, added And can after didn't every You It's month was so news every didn't day. in don't know play just QX positive first had It great were the July, mean, this, we I money that would much give And know pretty starts was Yes. those more right? It choppy, where

to It's I'm hopeful. pain? is to can whether elongated and can me or some all, things withstand is this when return just not normalcy. withstand the whether So who level who not This it, of and --

Benjamin Briggs

Yes.

pretty So the of with strong had you and million $XX in and a know position, kind quarter vein, cash. of actually, liquidity you I that ended

that a vein people's in position or feel if, right general liquidity a your even of liquidity liquidity I now. as top it's with give position minds guys Could of current more looking you cash today not when, is balance forward? of a you your Just comfortable know and but the at an

Peter D. Thompson

We do.

were this million, of clear. around $XX unpresented think I assuming all as morning, checks the we

think has -- So held liquidity it's actually, well. I very up

I feel pay with that. think if point, of And we out abundance not But look that right so of of been we we'll yes, outstanding leave ABL. an At now, some, the just caution, some pretty liquidity all, robust. down for generally has but comfortable to

Benjamin Briggs

Sure.

COVID-XX you're kind talks, guys any on capital the minds. take related structure now? through the structure, having thoughts you of of capital having as any capital I your right you backseat Okay. any the And structure is thoughts Are thing, there at forefront know always a last the there manage then are Or crisis? to are

Alfred C. Liggins

stuff deep that different and maturities, debt front existing center liquidity, about to Different solutions. drive of us, for stay the additional all conversations with constant for our different No. the solutions is dealing in contact in talking with we're solutions We debt maturities, major holders for Yes, capital company. to structure, and holders.

we're so was the I'd say, I of -- covenant lot would it looking compliant. that fire. The irons make sure. got a And goal sure to that And #X probably, we at in say we've is were

So we about its didn't event have of for focused. tracking and resolving been And any taking default doing and of is some our We're that. structure and issue. also hyper And great sort where going options business then managing the that feel the maturities that. we've then the secondarily, are capital And upcoming and what pressure then of off.

Operator

line next go We'll the Lucky. Kirk of to [Ph]

Unidentified Analyst

reduction the impressive side. Very cost on

mentioned might a I that give be some us of normalized range longer think term. some you are are a like of these temporary, you've the line programming, on some past Can rate corporate? run SG&A, what in items

Peter D. Thompson

going got the mean a to the out. on in $X programming base around about come million for cost less employee Obviously, to I we've It's variables. the probably piece of $X so that compared piece where year-over-year. million handle we there's that that's $X.X strong QX. Yes. saved The pretty just QX million do many QX because is that is to and tough

projected stations QX. radio million the be to down. million about at at savings expenses, and $X.X savings office of million about The in events about So is marketing in about content there down and Reach. slightly is labor $X.X expense travel about is down $XXX,XXX, more $X.X million $X.X about And spend $X.X million. Contract Variable amortization.

moment lot run of So I all you for our savings that current projections. up if the QX, annualize particularly of that we're would total events And look doing rate and $XX of you can't there's it are in really what million about that kind like quarter. things embedded our forward QX at and rolling because the hopefully, that gives scale a of so another around fluid, kind what of But that thing. are sense in

Unidentified Analyst

way have that? there to kind might do couple respect the traditional anything questions. events? events, the very a And helpful. to Thank with That's I'm revenue that in-person you. is on from generate of to events curious pivot horizon A virtual you of related

Alfred C. Liggins

-- buying is, Raleigh, right? sure, showing but up the Our XX,XXX, mean, mean, Women's reliant we not our thing. them of tickets, are look, I North it's probably people Empowerment Carolina, answer XX,XXX I do that, events, to on and tickets could many event you that sell in

do a and event virtual but pay whole that advertising to to seminars your generate online? you the somebody bit, to could You dollars the is you that and had. have would can't going So match see certainly have enough profitability

So generally but execute experience, to things of The a may can is where be that a the the BET events Honors like, that it's in what revenue done virtually, that not the days close were it's person. concerts even we and to won't The don't But and job. weekends doing, something? last but that's -- profitability attached BET but they yes, replacement. But looks up event some and make had there We awards there are we're show do QX. Awards BET same. won't our virtual they a for Urban One year actually be just did really able stuff. know in you the a is three point I whole are actually Yes. scale for awards to you good

Unidentified Analyst

only National sharing number casino XX%? On open helpful. your old the Harbor, get you That's to is though can even revenue

Alfred C. Liggins

don't the But year. you're get last answer to know. $X no, to look, going I million -- did we not is

did week state like it what of to And the first it's I'll can week at than end because has in better released, it's $XX it very tell million they going everybody know they gosh, numbers not first But to million they those are think at six get were be June. of thought the to first been But $XX to close to the month. Maryland numbers get same we to I number. in days following I the going usually the going very the you, they was don't very -- the of July You're $X week did, strong. they million, to that during open, XX% be know. be when else going release does, capacity. I was, to

of we'll think is. expecting EBITDA any I I any didn't down of it I it us business you revenue some to are about even lot So EBITDA numbers that out get did just up double last take guidance when them because businesses, of the So to I'm like revenue business, minimally is going not digital it's too. be of FYI. cost million of for and those gave year, A but of normalized $X this digital to up sort EBITDA level get year, to mention of year-over-year, to way, able our and happy that not where right? holding positive. those being are businesses. the will those numbers, And lot on our back pretty probably our a And is by of revenue

units, I about that So And it's to us good the dollar year's we any cash but is expect the no, out? to do revenue really is casino thing flow us. last cash our don't of get across every more can flow about ultimately

Unidentified Analyst

capital may, it. one last structure. then And on Got question, I the if

activity perspective get sign quarter. market The would it's, You bullish have you can done? pretty think during bought think, on shares I the stock other stock went you any than mentioned you Do a crazy. refi some you that this the

Alfred C. Liggins

big kind was bet didn't were happens And that when deal them. $X contact holder And through And with stock really holder, fund hunk of of largest a in to debt close bought that make our the We the we stay we of bought we hit going shares. One, largest one it market. holder. couple not the it our trading they perspective, -- those one stock Brigade, and with our also reasons. was with second did that below we also largest be family. a it this. our, the want our, in of after We them for of to a And I did we're debt from that the it. with we hedge made equity

one maybe a that also it where And very, and has to gives So employee that. our things that ability at of need the other Broadway the have with that owned us that continue same kind it purchase at couple And though retail some been you wasn't and develop still started Financial, Carver, large money down, traded. was the to interest that coincidence shareholder the another was it of time, stock lot in a synch Carver of nature just we Plus, the the it happened were African-American incentives has of stock was that's of a just you for pure given to time. was fuel Bank company during lot in there same time. wasn't rocket I pure at was banks, but a very companies. the I A was going think it that it really trading pure coincidence because and position. time. trading short just activity like big level even level that come I a continued, very stock short no I coincidence the idea think robust. The of and this same was of sells, that period there thought the of did. had originally there squeeze, to

are thing as something retail unbelievable. lot that who the it saw funds. a folks hedge with saying of this where people CNBC trading on for I a in was as good just so information living internet, information And a guy trading that at have is do financial

so I think social And to happened interest us. certainly, what justice been has and the that's with has our helpful audience that. think, in I And

yes. So

Operator

time. else [Operator up no this Instructions] We at one queuing questions have for

proceed. may You

Alfred C. Liggins

Thank and you, for always, we much. tuning thank any thank everybody, very you, available Well, questions. as are Operator, for Again, you off-line in.

Operator

conclude Thank you for that gentlemen, teleconference. the participation and AT&T for using your conference and your today. for for Ladies will

may disconnect. now You

Urban One (UONE) 2 Aug 202020 Q2 Earnings call transcript