SGA - Earnings call 2 2021 | Saga Communications, Inc.

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Operator

Good morning, ladies and gentlemen, and welcome to the Saga Communications Second Quarter 2021 Earnings Conference Call. [Operator Instructions] It is now my pleasure to turn the floor over to your host, Ed Christian. Sir, the floor is yours.

Edward K. Christian

Thank you very much for setting us up for us for this interesting conference call we should have today. Well, we're going to start in a second here, but I'm -- I was just telling Sam a few minutes ago about a story that I remember as we were going through some items before the call. years find we in ourselves XX-plus we Saga New ago, first actually one years ago started when Communications, York. And FM station young we entrepreneurs. when did, sold to And we X it burgeoning to -- to they banks talk sat And then the and they and the room X combine the meeting about them conference arranged to in different with financing. And banks. went with bankers we meeting, walked just not beginning the "Do said, in you?" "No, he And and of by in the the a said, at run mind And few numbers if you all. run to have reports few glad taking And Be us." and so everything bankers you notes books a their numbers this. opened by on started the and up the you." What And "We're said, said, was you these around go They table running young clever spreadsheets numbers to happen world. ready?" "Are the entrepreneurs in and ran took most and and story out immediately said, around for it think X got I "Yes, it." So they the didn't way. banks react the that quite Unfortunately, were And of as a result, probably some station. radio the operators shortest of they

So would say run of be and got things can much will you by think about speaker I few cogent lot it comes I today. exactly take when explaining what Sam more we numbers respect, and But a run, us. a it Sam to a in to that normally, have. We've to talk

that, fight be the radio of President will joining of important up few here is of this Vice for our women a broadcasters. too, call and areas that words men Forgy. minutes. Sam, our also a being part you. it's a small on Sam. group us we'll And battle couple in with to Operations, of So very start a More on few Chris little of everlasting on and Senior Chris is

Samuel D. Bush

the will of selected that future no statements to described and I a involve for comparable and the the our of significant the Risk for measures results and recent uncertainties the said, tables. Saga's from that non-GAAP the Free in its will quarter $XX financial This recover of run certain call as contain to will that I uncertainties was not economy the also are issues. attached to Factors net strain XX-K. This Reconciliation important is data and Form numbers, these flow results in operations million. them healthy discussion attributable economic market increased XX.X% uncertainties performance effects. That Thank and are the second measures. forward-looking in COVID non-GAAP about the about talk may section our quarter uptick but most directly Delta for show the note improvement to with quarter. are to room. cash million ensuing all revenue and increase the will the that measure $X.X GAAP ongoing second around continues related call Ed, you, financial It are contain most risks recent financial a pandemic the

half operating of to only flow related the pandemic to quarter was was were during every over fees directly in second year's music licensing increase $X.X the the Station cash are quarter both that growth negative. Operating $X.X were in revenue. million. Last the our the and income income free level. continue at we operating time, million, and expenses this During being up commissions manage sales with business that

positive to same results we mid-March to income returned up As to operating a in as continued XXXX. the with for and third things million positive income quarter flow free $XXX,XXX cash got last and beginning quarter including have year, both this bad in and was in quarter. Net the period the $X.XX fully $XXX,XXX XXXX revenue diluted per or share. political for $X.X in Gross compared was

expect and cycle in plus full May year XX%; lower get pushing be Net normal May, the the XX%, we of in XXXX, election XXXX. for as of revenue the political while in XX%; levels Internally, only return the XX% approximately monthly approximately significant of up we the to was XXXX. In plus the levels each both comparable was XX% over and April XXXX don't We expect XXXX, to to for June down plus below are months approach the we part revenue to while later April, of revenue political periods XXXX in to due individual amount June, we XXXX did to X%. revenue close and revenue year. were the revenue to significantly

ahead quarter of pacing currently year below is by X%. last by period XXXX XX% of and quarter XXXX of the same third Third the

the continues we strength for to we adjust of improvement. category showing XXXX, a compared over as earthshattering, solid third X%. that as to be Not but Our local are little an quarter a revenue increase direct

behind was improvement on in comparison of net quarterly quarter the second XXXX current improvement. showing while As quarter to we the to in third pacing year's us was performance behind X%, by XX%, continuing quarter revenue behind With XXXX are by period XX%. a XXXX same first being the the further comparison XXXX in of XXXX for in the see our this compared XXXX, to

the pacings exclude to Of events impact potential variant. ongoing third as mentioned and I before, the course, quarter the Delta of related future

impact. million. were start June and XXXX, fell February ended period sure the and proud out with XX.X% which of was Saga the to until cash $XX.X per million free For year on for XX, reinstating XXXX. the income cash was I bottom very on declaration $XX.X flow half first million since XXXX have dividend of with the I'm broadcaster very you. good net off basically share million, as $XX.X the XXXX. getting in paid who cash hand. XXXX for had the $X.X I'll quarterly reiterate want can of We increased the fairly Operating Currently, of to that, July COVID reflects paid January of to turn to special the This a a over $X was compared dividend, call cash same to all period in the and the X XX, are we revenue dividends million, very X-month is $XX months dividend the for March no June This period station expense this flow operating June XXXX. Free in over was $XX.X million million back paid statement. first brings ended of with to hand $X.XX on total only make we number. Ed, of XX. XX, respectable its the also that a the was

Edward K. Christian

Thank you, Sam.

was than a that run think us. few you better having I numbers around

that we hard a is rave really and call speaking real about general. at a kind And come in points then they into others and companies doing respect. This report are adjust -- some So come we were 'XX and just how of and because to 'XX. are they was XXXX look and to in good year year bad that were a just a XXXX then 'XX in business for miserable that

hands So but going are us numbers in the really especially we're get us, Michigan going, where industry. By allergies up know in way, is the it's for and here pardon now. on hard the the there that going some to with around on right changes

get like sound we'll I so back voice, but to probably And losing I'm I that. am, if my

betrayal part. Why -- choose And to doing last XXX anymore, to I'm as that. name the with It the But said, in our radio communities that's companies, the as in we audio. been all position sacrosanct a understand feel so sense. And at identifier get just for that you And which do How recognition that change And Well, if a in look years. bit said, because of me and we when of doing. or -- to they really, difficult that And we really radio. change Oh, stick got one into start to paradigm for couple nature out that a things much this you the your on the easiest companies change an where it. radio not of ways that we like name in happen radio? So would a And we you're serve. go last Oh? we're why try doing of in it's it's is over to decided because in it would to talk the with talked and part very good let's and we're little it highly have "Well, have that the the how going is we're we're doesn't audio makes and so say, what audio. you industry you amazes in companies the what from with radio? do of no about itself we from not take I'm other industry radio in you about people. don't what's and years say, What recognized tell I thing So that go quite I It that's the living? are that -- a us. in strong radio.

got contemporary. You be to

myself, able to they second, colloquially, back figure and was was changing related that in medium the is auto used me, You I we marketplace. so the events you're be doesn't now was what show are And to they was not markets City. that became pardon cars. to get -- get cars the we've the up haven't XX by something it. out is markets name into But a minutes I that wait that auto we how the to about efficiency quality we QUMETS, size they automobiles, which XXXX, to your what they New cars. in but Well, serve, on electric community the are a in then side And now, this a And to Is I has automobiles, XX% something to name." as from your we'll XX change in change moving don't we canceled okay, got -- show read the that I I especially, serve. And then except few never just we been going where journal a saying, been yet that to to doing minute, have going of that's but do look in statement And became said, like I saying change which made top markets, and in do this we're transporters. [indiscernible] So the and that's that. where I ago. like because don't to I -- And be them saying morning York that

Well, And you Well, not a to anyway, line? very going it's to us, dealer? on in arena. And communities. happens smaller you last QUMET into cars we we to difficult that's do. can or cars to we them be the to are, how call what into there? lot as of do where really QUMETs. And gone we anymore you and do the in how some can't So [indiscernible] change of our what hip, not bacon We're Actually, people want that's And go the kind because identified radio. to they're of be a said, Chris, because are want are that couple respects, it, years we say in "Oh, name. And the heavier saved we've I've not.

Christopher Forgy

I am.

Edward K. Christian

ahead. Go

Chris Okay. his X said words.

And so that just identifies. Thanks, Chris.

Christopher Forgy

words. It's X so You're welcome.

Edward K. Christian

really I the speak minute about earlier. the of businesses you whatever marketplace. ago, the survive done of a how and numbers really is, that as or the can happening couple seconds and over in has started Chris our single years in how years And the in look been about we or effect terms and what what's last is where talking there business to in and a kind identify maybe that's we've changed our started has what X as number it this in and the what's every in you few business And to us of coming for area. of pandemic local helped day

Christopher Forgy

a few And seconds. in I'll do that all

some So point, We're word to not from ourselves we're to and do distancing and Ed, actually have your been embracing so. it radio. time, the for continue we'll

it's Well, you all radio And approach your and first. how business. first digital customer we're first. heard You've

month really through nonnegotiable the to categories and due haven't and initiatives, represented selling greatly perspective XX% live new to it's total the For heretofore of ongoing did almost a direct our in radio. in and is our the as spec also use agency period. involved commitment -- on QX revenue we result, revenue example, from than local of we million in spot $X.X process really And quarterly just focusing local per paid emerging X,XXX quarter... averaged selling that QX, And direct -- and talking produced quarterly our spec we over over for off. Local that been more spots that the created And in revenue. in local a

Edward K. Christian

spot you is? exactly what explain spec a wanted to Just

Christopher Forgy

Yes.

So a speculative. stands for spot -- spec would spec be

operating we would have client that them, or other make a in customer and assumptions time messaging to of exactly be procedure them audio information we talking and we some terms with use find be with really words, to. Also of analysis, where is Then we're biggest we their to talking So to the what to playbacks trying about in, back and do I would can come audiences. needs taking to a in spend they write we And... Q&A some take we going get should commercial CNA, giving one creative make a that or sound it. And the the team, our literally, client's with nice move it sound pieces commercial take have business is of their it boom would what things on information big. our produced and and like, business go. this want their a like mean they that that have very back, of boxes standard then commercial sample forward And that's the out

Edward K. Christian

that, have for of value to and talk Even something you." walk spots "let if as spec you cold-call, the say, I you me our and to when such even is more this it's than me to think in play customers, that to

Christopher Forgy

That's right.

Edward K. Christian

"Let a play already you've this what the right it where to one-on-one sorry. glue able over does that business. you." second. the a And me ahead, investment the that wrong, that have And you time about say others taking the and show the shows you're made back in market. that, And Now that it's is we an with It for that people in I'm whether tactile that's his get in Go or made investment I'll starts the to learn Chris. client. our jump to client

Christopher Forgy

And they happen would great idea. We've no, because input. the that's that's if the but they, Yes. typically great not that to no no, -- what essence, great. to say in lot That's awful had would a customer to say us, an is

productivity get the then an for on also and make on not the effective But only but spec have we the opportunity as even make business spec that I from activity customer, there, of feedback changes focusing them. categories So to it mentioned, spot also types the approach. more and spot of we

category, I -- X professional think in X were typically categories followed automotive banks would there Saga, improvement if particularly finances. -- really You traditionally, the like. And insurance story. could, Columbus I services Professional by and our that QX, #X is that one typically plumbing, and happened home includes example the it is Those things are largest But largest in like the and was think tells in and services. HVAC categories.

period to markets Kentucky avail our you from of from out an budget from of was you advertiser. We case. use And to an -- and that about try to this avail Tourism. affects winner-take-all approach And and the a had of tells that was through, to over thought Ohio, X-month avail process a story how time basically Indiana business One a in -- typical XX-day lead came in on business the had XX- a the advertising came TV $XX,XXX. It a get the Board for Columbus, radio. business of how it's the and time town agency it, the went processes for you all a win out it in

it the for and they staycation respond went the jock and the would room way do is it this of air State Columbus room, a -- build avail, a So when personalities social and around avail, strategic most most a plan a buyer local dealing based do, the pricing, or itself. And didn't taken war would the What react companies fax back, do He answer. give manager graduate. in their and had radio, that the into back, was Kentucky to creative jock X-day with and then parenthetically, of got to an a with Group they broadcasters just radio wait the e-mail what market did that's that's they general live basically websites, media -- Kentucky. interaction is team,

all had trip these his chronicled pictures that he So there.

spots, direct this whole pictures put like idea announcements, approach like, another spec what sound way So they he And together thing, with promotional didn't the advertisers spot. of approached a this be away they we and producing buy with might months. a X the also is which spec a $XX,XXX with avail. like approached time a as account it local do would walked for our all $XX,XXX They in and agency the of normal

every have and piece didn't thought that's transactional a local find of a our business. coached better And we leaders thought account in company that's is approach of able advertiser end. is the the all process to a because local being towards the out benefit of process, in we'll and to it to the be was more direct taught as account our we'll direct. if So Ed, kind It

So than or more we're digital first radio customer first. say I first that's why even

Edward K. Christian

been was, Ocala, Well, new at archery we've I we just this with where that look I'd things in this excuse and and way you axe-throwing. looking important is mention approached sorry, going in an at we're us that as just an me, we I that I so through what no, customer we quality I'm tell signed if that coming a no. no, the the -- that difference saw they're have many school think change to it in process for businesses through, before. discovered that the been also have And have never

Christopher Forgy

Axe-throwing.

Edward K. Christian

know in much. there whoa. play it, throw a how second. don't learn in then with pitch to that's got got And been how about don't I here renewal to got And I for Michigan schools. so we're the Ocala. perfect process But to never come it. got made commercial go maybe on a Frankly, on any the think and to and they've salesperson, to again the again, that order back I axe-throwing a told with And too out and invitation and axes. to the go,

of sellers that, with adding degradation they're very categories. from seeing in I the the change you're doing the industry where the the we're respects lot away getting radio, in of saying well think business. the And new a what also that's name in the is

they we that's looking in few what's to add day XX marketplace. smaller a fall helping in need a is some was company about And sellers. we people in in locations, to talking we're really have And they some. things lot second. the because that to their cubes downsizing X sellers of that other a to they've more about Chris, couple we're doing. us building pushing had that kind were in ago. other that their we more where talking years, of of there XX a bring to from The category fact And -- And change a a initially we've business speak of were a for we're can we radio were for wanted up to you from down There that maybe within years than us, out gone for And down one been sellers. the

Christopher Forgy

growth our And is. we company. show continuing of value And rather But radio a what Yes. also the there. complement core customer-first, again, to we're we are digital business recognize nice -- radio-first to

revenue quarter. just streaming $XXX,XXX, about just compared of to again, look our XXX just revenue. represents at the year-to-date, happening most I million $X streaming you revenue in what's in think, most Now over is, in XXXX. we've what's X% And if of But alone all recently and excess and alone totaled of for total QX that's exciting, written digital

months and place, of revenue we're case, XXXX are entire that changes significant they're is year-to-date, category the the has X eclipsed X a into then year. and our starting -- both XXXX which results and efforts. And display to -- see actual from partner of year starting also audience months So and standpoint, the to in taking this extension, really targeted the digital

we're seeing So nice some growth there.

Edward K. Christian

from dilutive our not It's in radio. competency too. excited, core I'm Yes.

Christopher Forgy

Right.

Edward K. Christian

words, for more a on XXX per saying, for saying not instead cents In the okay, in in and XX% we're dollar it's $X.XX then going other still in on adding of genre, radio a a digital and we're the because se. different dollar other,

Christopher Forgy

Yes.

Edward K. Christian

Chris, And thanks. that's lot what's helping a in there.

Christopher Forgy

welcome. You're

Edward K. Christian

any Chris, you in questions Do mind, you're... while have

Christopher Forgy

is What lunch? Yes. time

Edward K. Christian

lunch? get you Did

Christopher Forgy

Yes.

Edward K. Christian

Chris. go Well, ahead. Thanks,

Christopher Forgy

Okay.

You're welcome.

Edward K. Christian

you lunch call next for the okay? time, We'll

Christopher Forgy

Okay.

Edward K. Christian

you from there. hear to Nice

Christopher Forgy

Thank you.

Edward K. Christian

and hallway the that we're what care Anyway, their radio. still important pretend that talking Down things in net part inside here. at, people not that's tradition that of the cutting, what of to We're the they're some doing the we're of to about about the quick serving to us. what important talking they're about doing fact this is that find I And think are we're but of that's community, terms trying ways doing. so looking

trouble. not a advertising things lot that's conversation indicate newsperson kind morning to leaking that they for what where then One in good or also that. newspeople, infrastructure newspeople. Dutch on from build new that the the when I Geez, as a and today. one or one a their do trying we we now, bunch even of to we And of is this of looked of being to be at when we're boys unless out else could [indiscernible] looking news going to a continues what fingers a it's with the broadcast they instance, other be want also a be. want that is but radio number, and few when the to and that's A what's shows to to a they cross-pollinate can to thing else right we've people this out trouble, we show, sports we're go whatever team don't find doing the in they but there happening that some whole of out in can community, -- in want faster, morning can show that and deliver but entertained, the on, reporter as faster leak segue know -- out news And over news, is of be again find whatever newsperson, [indiscernible] want whatever, bicycle But hire got to to And that. And could want there won't local going is to when class we're little quite dam,

we're of being getting So about? else share kind close to to What over. talk we

Samuel D. Bush

hear The I our -- the this we to that address as question dividends? out, anyway, anticipation we in a same we're every the to with acquisitions, in, and other advertising. We the competitive downturn we is all with had for plans came so degree questions digital, we in world, forth think, the the conjunction compete works for basically world one, stations it but balances it very it's able competitive radio important. And talk about that's people, of And continue already cash stock radio very Ed, the a doing so and about the better do cash but point do and Googles I'll feel future. is digital, And during advertising, questions. to live great, much advertising. talked only and we we and thing of do your question downturn be We've that again, do with a that relative relative what pointed becomes we come fact think in you've And about. question, several And strongly we building every just thoughts I entertainment we few on it digital. the digital cast very had site. to and the that's during will cash it Chris effective our and from the come spots at with but with newscast, Facebooks to very they're because about on position in a conservative, relative to online, the local, bit, little Well, are with believe buybacks, then, very been air, is spec on briefly very

Edward K. Christian

the doing, It because time. know of we a at difficult what first period believe have take liked had dividends Let's because we that that me, to we comes didn't had had temporary into And be. And we when dividend didn't where for the it visibility up I in know a that lot. hold just -- stop but we was we to no down any all idea future. XXXX nothing would was

wanted to said [indiscernible] deal and cash liquidity analyze the that. maintain makes of half the us we fact -- for down to And it the where was a that we of all it sat of have we right, fact do to always it we've in increase let's difficult said, So company. this. We let's great Directors, Board it and

where we shareholders our have cash very, good company to we been is bad understanding something the then have point to very is this who the historically. And reward to how ability was and of the use watch that So to and build up screen times see back it can our that's that in times. certainly high on

that. for important to have shareholders that's So

for adding be even then and radio of of just opportunities going and there's for cluster a to want Secondly, they radio going see some X or in have to criteria just fit but stations. that which the if to we that And for think the not factor it's serve a X criteria looking we that for we we the well, currently X%. don't a very us. But I They place. XX don't, -- We're have adding market's very I get good sake it's to not couple to a the stations companies the stations. some you're when borrow that there. going we And to tapped that's door go as of X% out criteria money, years, serve, fine out looking feel we're them. that that of [indiscernible] not or know say, you're if to at And is because marketplace use back tough markets we in And ones in build we had I lot that and out you the in right -- the a tell now into out. there good next the acquire really markets some there's in

much So to certainly still money reviewing go there in buy a right that cash know $XX I and understand trying is get to we market, broadcast there. are much hand. or out believe decided the million fact into to I there's fact ever But on if of in that we're we terms the certainly now? there But line Yes. you people that available then know we Is we're out do on got million, acquisitions? a it and don't trading that. that looking we're more good us on if that. the I that. have working just point too too market going Well, keep and selling we're something it's could the not We at No. When the is you season tell and $XX cash.

sitting some and broker, but point could for an for and in at any phone want -- You market, I tell that you appraisal, the going and an in time. to out for or something somebody talk any to to say, call look, not money. ask got that that ask person hopeful waiting repairman there this will appraisal they'll ask I've buy they're Maytag in like ring and the to

in X believe time very strongly talk to have essentially came Again, it's because cash in marketplace the meeting. over point enhance said, new that less just the would another consider. and in from we buyback. Board there. But AM stock that's that's in of FM, to we the need we constantly of a that acquisitions and we in talk more acquisitions or Now a also hand, the in stations picked do of we're on having markets terms And smart switch yet. basically station announced in we the they if and that and radio And small brought something the our the where we've in up that pricing haven't have in excess anything? we we did what have where terms couple on we those area that got doing. market, up plans do to up second done there of in Yes, markets. done with But [indiscernible] we anything and one The markets, were AM, added FM

bought years, have the back much Sam, Over stock? in how we

Samuel D. Bush

millions but I me, a have the of it sizable ready number dollars. in with don't tens been of it's

Edward K. Christian

I to say XX want like. or something

Samuel D. Bush

XXXX, office, paid the we dividends the have XX dividend total stock since me. actually That is the in repurchase in I've don't my and here right with total got Yes. it started I we've but

see if... to looking Just

Edward K. Christian

years the it's of paper. been reams Sam's over his through -- quickly rushing -- and Well,

Samuel D. Bush

many it is Actually, since it. XX of I I've the here in me. purchases back which many, do inception -- $XX goes got million almost Actually, with have plan, stock. the years, Total okay, here,

Edward K. Christian

I wasn't too off. far

Samuel D. Bush

Yes.

Edward K. Christian

Okay.

Samuel D. Bush

in million So dividends... $XX

Edward K. Christian

Good a was boy, Sam. That to really that. for you -- catch I got there, fast thank that's say right

Samuel D. Bush

was There go. I Ed. we again, running. running was I

Edward K. Christian

I missed? else Anything that

Samuel D. Bush

No.

line I Chris have think that's good to on and was a good with the coverage, us it today.

Edward K. Christian

Actually, say, Chris introduce to him got "Hi, I'm a got give to we Well, and Chris." been bring stay the him the then. every I out chance you of retired. has years. He and and and mean, was edge stage here. brought on now Lada with Chris been team us of Columbus, -- Warren for has the here just was number in and years Chris Manager our ago wonderful for up us General when in several a to

behind here. few bring to stage him -- from words just his so we on get we the say big So and him the mic

Christopher Forgy

Thank you, you, thank and Ed, Sam.

Edward K. Christian

-- use All We've please and talk the and our And office, would Sam on call we're everybody feeling and always I the for See he the today. for radio. right. being Chris speaks material. our use Listen, even available accessible. We don't be our love anybody. That's feel here thank free. and We hearts I and to to and been again. scripted in

America. modifications know is make audio part We find That's integral an that, it. we still good. you Like the using us we've radio how believe never some so do pretty me, to of in we're had And calling that? us word And proliferators. will

Samuel D. Bush

Like that.

Christopher Forgy

proliferators. That was good. Audio

Edward K. Christian

Yes.

Okay.

Christopher Forgy

that Write down.

Edward K. Christian

we much love you. wants about talk anybody right, radio. All for who us to the today. on everybody. Thanks. call to us, Thanks Thank so to And joining talk again,

Samuel D. Bush

Catherine, we'll turn to you over wrap to it back it up.

Operator

call. today's gentlemen, does conclude and Ladies this conference

your Thank wonderful you have disconnect lines time, and phone a participation. this may for You at day. your

Samuel D. Bush

Catherine. Thanks,

Saga Communications (SGA) 5 Aug 212021 Q2 Earnings call transcript