HMTV - Earnings call transcript Q4 2019 | Hemisphere Media Group Inc

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day ladies and gentlemen and welcome to Hemisphere Media Group, fourth quarter and full year 2019 financial results conference call. My name is Kristal and I'll be your operator today.

A replay of the call will be available beginning at approximately 1:00 PM Eastern Time today, Tuesday March 3, 2020 by dialing (855) 859-2056 or from outside the United States by dialing (404) 537-3406. The conference ID for the replay is 9578254.

I will now turn the call over to Ms.

Scott. Ashley

Ashley Scott

outside and Hemisphere conference are I'd and Reform results and may based Securities call. Edelman of Communications, those operator subject everyone to I'm may US contain morning, Today's statements Financial today's firm. within Litigation Hemisphere Act to I'm the such of in management These which Hemisphere's of Private forward certain looking or expressed good statements and you, at the on our that to uncertainty like statements. statements are everyone. welcome current to from with announcement circumstance about Thank changes expectations the XXXX. and implied Relations forward are differ comments in materially looking Investor Ashley actual meaning Scott cause the

these that assumptions forward for our on and In company. risk public our number based refer are the looking most other subject are Form recent our addition, applicable a to discussion change. factors of annual more report complete Please and company's on of to statements statements XX-K a to filings

to looking reflect publicly Forward herein as obligation made the such hereof, included and circumstances. no undertakes statements are date to or subsequent Hemisphere events of statements update

now information call morning. of important to to understanding is turn believes is to included non-GAAP in results accounting to which reconciliation in calculated to financial our non-GAAP will During which accepted today's call measure. over in business. addition information with a earlier GAAP press earnings accordance refer of EBITDA, discussing non-GAAP is the I adjusted Alan. our generally Management issued that are principles, will A we release, that this was this investors'

Alan Sokol

good and morning Ashley you, Thank everyone.

delivering our I Q&A. performance, be today know to so call remarks to our due on be that and Craig discuss I you a will to Fischer our matter, handling is unable personal I let Before want

against some across challenges, station landscape. value WAPA to The quarter In our and well are fresh all execute the Canal demographics fourth continue our and we with its XX% Rican increased in Uno our the and once viewing Guerreros positioned by adults first one number that ratings on which had WAPA performance deliver adults new key our an strong to crossover to As Rico compelling series remained reality QX, time we produced In audience. drive WAPA's nearly fact period our out to we was fundamentals XXXX WAPA's valuable sales close but to Uno XXXX. content entire we once our mission expanded XX dominant platform and in among evolving lead of across XX in succeed Telemundo, again event Guerreros. December, media again Puerto and unique highlighted doubled to Puerto Colombian versus Canal by XX hit was XX. and increased, Guerreros

a franchise. was hit event for setting both in markets, records huge The ratings the

on December XX. As and restored WAPA we previously on Network relatively and a XXth agreement are WAPA DISH pleased and ending to distribute short multiyear blackout. WAPA January dispute this have reached WAPA to with America announced, was America

renewals with We Dominicana. also the Television the economic and channels. America with these conjunction our TV are of our pleased into value agreements tremendous very agreement of which entered reflect In multiyear Central DISH terms we for with

effect Nonetheless, is Rico in on market the to Puerto the very elections upcoming government has advertising political as a relatively tumultuous quarter still of uncertainty of been whether the a a the has Following XXXX there and forward productively had ready great transparently. QX. calm. move fourth summer was and to gubernatorial deal This unrest in dampening

impacted we a very in leader revenue market the as were results continue strong these issues, clear share. WAPA's While with by the

positive. According increase. US generally metrics economic ahead, population Census actually stable a Puerto Rico Bureau, in Rico to look XXXX modest we the As Puerto and had are

households of or X.X% increase number in such Rico years. Nielsen, December in magnitude earthquake, to X.X% the at XX X.X the Xth part aftershocks. first according the near said, Similarly, did The in year increased lows. of Puerto Puerto That rate stable XXXX experience was on XX followed Rico at by and unemployment established TV which a remains by struck in numerous Island January

injured Fortunately, were none was facilities the the the of our limited islands. our and part geographically to damage as employees unaffected of Southern was

immediate numerous widespread and lives many within restored an few While however, closed. fully there remained the was people Island, a that days. electricity part schools the of power remain The was in disrupted outage, effected

quarter, aftershocks the and to to population's market affected advertising to concerns elected have the earthquake as have pause The priorities. show and sensitivity first adversely advertisers preferring in the spending

Pasiones cable during to the value of networks entered day like networks Comcast to ratings strongly. important most its XX% and our of continues a Beyond year channels with into growth over by five QX linear year telanovela audiences. saw XXX%. Univision's Puerto cable primetime and ratings testament quarter multiyear in significant erosion perform channel Rico consecutive a our of total suffering we all outpace US over of carriage continue for and Well, are ratings a XX renewal our to content further our ratings

XXXX growth programming quarter by and fourth ratings TV of XX had quarter ratings American Puerto increased best robust the increase entertainment XX% over year impressive six per in year While for with the of day versus of Central a total by Rico. hours versus quarter XX% over Americas' led XXXX. audience week its news live an fourth consecutive

day Nielsen. cable channel Cinelatino continues total the second position in as Spanish its to rated highest according language in

Our both impressive in ratings continues joint growth experience Canal revenue. to venture and Uno Colombia

by as very Uno TV leading will QX. Colombian has alliances news digit market growth. are which into we Additionally, and with in believe joint double ad ventures the accelerate robust in digital Canal programming encouraged well the Colombia's growth Semana we strategic as entered magazine, the print Sony

original virtue over library we of Pantaya valuable XXX,XXX including year television. services experience driven a series, strong subscribers, just America, from licensing to anything unlike in in after few Our Leveraging premium the decline length, numbers our and trajectory. deep growth generate I contemporary Latin with its continued which by should a to revenues solid the subscription Spanish limited our high revenues production streaming months. Latin and have and its streaming ending that has in terrific which did embraced a available their are begun Amazon US subject on America, service subscriber QX. matter Pantaya very values content our momentum and we note subscribers have

quarter, making to we believe Spanish last is burdensome US subscribe due distributor in part major large to the very package. noted one As to altering that decline this language up process it was sign

are seeing conversations address and the in consistent of this are this from distributors. some in term. the that growth still We the hopeful with are distributor they In issue largest meantime we will near

Spanish We introduce are that TV also offering. optimistic YouTube, a language Hulu will YouTube soon and

growth pursue will accelerate our we remain be such opportunities We successfully M&A that continue that will to to and able on hopeful opportunities. execute

financial review briefly the regarding to viewpoint like would our the virus. turning share to Corona I Before

the of been around our the disruption to to a in affected, thoughts the out terms but world. recognize affected many quick that employees spread had is life meaningful daily Thankfully, go solution. and First, those of outbreak the is none our progress for and global hope contained we made causing is we

potential on believe virus We We on viewership that unknown. will the but impact the advertising subscriptions, are a don't negative closely or impact monitoring the have situation. currently is

included Turning Hurricane million year to connection Net of now in quarter X.X with ago for was of review which to insurance million a fourth XX.X Maria. in we revenue financials. our period, net the the in revenue compared quick million as interruption proceeds business XX received

these network blackout beginning revenues advertising Excluding Puerto decreased fee is October the Pasiones have impact uncertain market the blackout DISH funds. on decrease earmarked by climate Rico in relief DISH Spectrum. continued Network well by proceeds, Puerto on decreased would to describe disbursement in in million launch of The XXX,XXX contractual blackout. increases The was part and XX. decreased affiliate the blackout in well decline It federal the fees the fees but political to X million. was by X.X on to increased Advertising as due decline XXX,XXX on in as driven the advertising challenging precisely as due of the market advertising dollar network the impact. DISH net Affiliate of offset the when excluding Rico's as delays revenue

the of comparable million million line million XXXX. the November for period we're expenditures guidance. million year XX% to XX.X same were XX.X quarter and to for was as Operating full operating fourth of with from X.X year period were the EBITDA in to expense in for was business Capital proceeds Other X.X from million year XX.X revenue compared interruption by excluding quarter million driven reimbursement by STC. period X.X We've the Media, our higher XXXX full in EBITDA the content net of we X.X Snap prior fourth in policies XXXX. period, of XX.X as increase XXXX X.X year. million licensing well revenue be the last XX.X as the against compared which Adjusted compared expect revenue XX.X the in our Adjusted contributed for the the comparable an which in as million our received million. FCC insurance million increased receive XXX,XXX reimbursement from expenses library as the for XXXX about acquired million CapEx to

Uno Canal the considerably during lower in year fourth to the as down to Canal due XXXX quarter the as million. well prior we of Turning capital revenues. its funded our grow XXXX to from concession investments continues This needs as completion Uno strategic full million total into investments to XX.X brings our year X.X payments earlier of strategic working

Uno decline. annual we Looking investment the to to expect to continue Canal in XXXX

was Additionally, X.X capital XXXX. for in initial of commitments first Pantaya XX million of the quarter our the million remaining met

to updated relationship we'll this strong a keep view continue as moving you investment on and forward. We the

to a digit low we single for mid now open to increase your to We'll guidance, compared XXXX. forecasting EBITDA XXXX call are Regarding adjusted the as in questions. percentage

Operator

[Operator Instructions] And first from comes our Cahall Steve Wells Fargo. with question

open. is line Your

Steve Cahall

distributor has council that Good dragged been you problem kind a bit child little of said a morning. Maybe lower. first but the sub that

last you think as quarter well. that mentioned I

sorted what you couple might've it. So of of to to can months. next fix them the you be just if had quarter, And progress within out quarter this wondering something kind think that is getting

Alan Sokol

can absolutely It's something be sorted out. that

but well them. it, they on fix if big understand is done in know issue you they for with I has think bureaucratic is which large, it's know, package. Hispanic relatively a a that know the that an very a teleco that know, I this historically the they're queue, you this And they, and focus were easy distributor

little problem the exactly will we that with as be more on urgency they expect I mystifying when. a why don't but it's little to to addressed. haven't know a moved us So just this,

Steve Cahall

networks those to HD on are And then be wondering, going on Comcast Okay. the deal, just Comcast. an

Alan Sokol

As don't. to honestly distributors Spanish audience although of well now in Uh, HD absurd no distributors. XXXX, it's it's that language change. We're our carry other that networks insulting they all year there's not and these to as talking Comcast as do in

aggressive intent will to VOD the Some queue distributors, then, particularly to HD. do it, there's of and in you Comcast have level Spectrum networks it's know, I there has question HD. more a in a priority. with been you is say again, our Comcast know, their converting of but

Steve Cahall

seen all like Okay. pipeline year I momentum the think a speak programming what looks and sequentially. at you've of this up with for what around Pantaya, kind to Pantaya? Can And then XXX,XXX you're original you subs early

Alan Sokol

you about but quarter, hopeful service think the see want that and opportunity subscribers of trajectory. don't the current scratching I on continue. our about among we cadence continued the the good surface of know, barely the robust feel We broad growth We here. talk acceptance we're very we're And and will that growth. to

scheduled have programming increased date. we've our seen for great results We on programming XXXX. in investment We've the to based

hit last have series we're new our year as the as introduced super will second seasons well We biggest excited about. two series we that of that

Steve Cahall

all about and to primarily Searchlight. there got and Can put last the you an you a going connectivity lot. together then work you forward context opportunity one us? just that relationship do amount that about Sandusky a there Vince a what still I talk Univision me, for there see a fair help for between a lot or press for is in know, was And and or of as think competitor bid in the you maybe is Thanks them like just

Alan Sokol

plenty based specific Sure. had on the on any clearly rumors Univision premature in in both I of moves be they're really happens. would, point of bid, that and opportunity discussions. what involvement our that Well some it for would there with at opportunity clearly I involvement comment Univision deal I we'll us think initiatives as was this and there's haven't Univision, synergistic But talk but and can't the forward potential about Searchlight's to we and Hemisphere given pursue I strategic see believe and interesting closes, would to there. really together

Steve Cahall

a Great. lot. Thanks

Operator

comes Instructions] Baker our [Operator from Curry And Guggenheim. from next question

Your line is open.

Curry Baker

Thanks your advertising a EBITDA Can talk you low about quarter of carrying terms some outlook just beyond you seeing impact earthquake in I for single embedded the softness bit you're understand XXXX, this digit for maybe to Alan. the due questions, first in forward mid what's XQ. in to the the see guide?

on in helpful. be would advertising core Rico Just any Puerto incremental color

Alan Sokol

ball changes Rico. such Sure. better I very a mean, love, volatile I would in Puerto crystal quickly. wish I I that market had It's a

the adversely it. I a Rico. is stable in this been where affected first effect in say situation I onetime spend. in opposed or a quarter have nature looking So We're We're of Puerto term at that which in of advertising was. obviously to kind We're advertising market hopeful first any that, the has spend relative strong event. a in a particularly cancellation that, on as robust more real Puerto it by delay Rico on projecting long to view a earthquake, a is reduction quarter will the not of don't point

upside restored get the extent in confidence federal in economy. However, there's funds and the the is potential government we do to there dispersed both some think that and

a of standpoint is leverage we've think Rico. in From is a on cautious history I the relatively cylinders. but given So performance running Puerto cautious WAPA all taken view, that warranted

strong. in We ratings have we market. and We've very the a of last year our share dominant position grown advertising the in first to since expect market be

Curry Baker

XXXX a for, then Can maybe versus guys kind political you Puerto you maybe helpful. in you what of election did sense year see us Rico. XXXX? and this of how of That's cycle and for in And expectations any give up this on shaping sense

Alan Sokol

spending to components Sure. Rican There's primaries a gubernatorial for so couple a have place June, are taken to in it's Puerto of are on, that. early The early yet. little

For history, parties the time have in primaries. first both

positive So that a should be sign. normally

money advertising neither belief of and cuts have a our is does ton is to funded not TV opportunity. well spending that However, party against that as be particularly the on

As was in a think political projecting will than million with in XXXX $X be of which range. higher was where result that. it to are kind don't we our the in line We be

some expect in let's of small six the amount say relatively in sort also for of Democratic money, digits We Presidential primary March.

Curry Baker

bigger Okay. consolidate ability can Thanks. talk your That's helpful. And then Pantaya maybe question, just your picture appetite to Canal Uno. some the a you either or and about of maybe investments

Alan Sokol

are foreign Canal We opportunity. pleased Uno situation you Sure. of big a us it with those is investments. in business. we would, rules of the And XX% Look, because both both owning think ownership know, we Colombia difficult to restrict the very

Pantaya is consolidating you legally love could that's today. and to So, love own it. but we not that road, today, possible a the not as business down of we'd more change know, of possibility the

Curry Baker

thanks. Okay,

it for me. think that's I

Operator

from This I'm questions and time. participating a disconnect. thank Ladies no this you you showing conclude wonderful and the callers in our Thank does gentlemen, Everyone day. all program today's may at for you and have conference. further

Hemisphere Media (HMTV) 3 Mar 202019 Q4 Earnings call transcript