Cumulus Reports 1.2% Revenue Increase

Cumulus Media Inc. last Monday announced operating results for the three and six months ended June 30, 2017.

For the three months ended June 30, 2017, the Company reported net revenue of $290.5 million, up 1.2% from the three months ended June 30, 2016, net income of $5.7 million and Adjusted EBITDA of $67.4 million which was up 6.7% from the three months ended June 30, 2016.

For the six months ended June 30, 2017, the Company reported net revenue of 554.6 million, down 0.2% from the six months ended June 30, 2016, net loss of $1.7 million and Adjusted EBITDA of $106.1 million which was up 1.0% from the six months ended June 30, 2016.

Mary Berner, President and Chief Executive Officer of Cumulus Media Inc. said, "Our second quarter results provide further evidence of the success of our turnaround strategies as we posted a year-over-year increase in Adjusted EBITDA for the first time in over three years despite what continues to be a tough market environment."

During a conference call with analysts, Berner stated the quarter's performance "was driven by both our continued focus on judicious cost reductions to offset the contractual expense escalators that we've discussed in the past and our relentless effort to expand the topline."  She shared her thoughts:

"The Market remains tough with the outlook in September particularly showing softness and for our business in Q3, we're currently pacing down slightly for the quarter and at on ex-political basis we're pacing almost flat.

Ratings: "We maintained our ratings share out performance in PPM markets through the quarter even though we are now lapping some considerable share growth in Q2 2016. Nonetheless, we were up again this quarter and Q2 2017 marks seven straight quarters of PPM ratings share growth which we converted to revenue share growth of 3% in PPM markets in Q2.

"On the diary side, after two consecutive quarters of share growth, we gave back ratings share in the spring 2017 books for our 4-book markets driven by some fairly isolated challenges. Six markets out of 27 drove the entirety of the decline with two markets representing nearly half of the impact and of course we are very focused on riding the ship in those situations.

Company Culture: "As I said from day one fixing Cumulus' culture was a top priority because a committed energized and highly engaged workforce is essential to the successful execution of the challenging operational agenda we've undertaken in this turnaround. Today are 180-degree change in culture is evident in every corner of our business and has become an ongoing contributor to financial progress we’re seeing.

"For example I talked before about our Be a LEADer sales lead-generation program, which is a cultural initiatives as much as it is a lead generator because its designed to connect non-sales employees more directly to the core of our advertising sales effort and thus our financial success.

"To-date the program has generated nearly 500 new advertisers for the company and millions of dollars in incremental revenue. Our cultural initiatives are even having the impact externally as positive employee sentiment has helped us recruit additional high-quality talent to the organization. It should go without saying that if preparing the culture was a precondition to our turnaround maintaining it is just as critical to our future success.

"And the result of our forthcoming wide survey demonstrate continued commitment to the turnaround plan with 90% of employees saying they are proud to work at Cumulus and 91% of our employees expressing a believe that Cumulus is changing for the better.

"Our turnover statistics also continued to beat our internal goals with overall turnover down to 24% and voluntary sales turnover down to 23% from the high 40s and the high 30s respectively when we began our turnaround effort."

Westwood One: It "is well positioned to take advantage of the rapidly growing podcast space, where industry revenue is projected to grow anywhere from $150 million to $200 million last year to as much as $500 million by 2020.

"With its massive promotional reach high quality audio production capabilities, relationships with virtually all of the advertisers that are spending on podcast today and significant connections with talent Westwood One brings to the table all the necessary elements to be a meaningful player in the space.

"In fact the entirety of our 6% revenue growth in Q2 the entirety was driven by this new business development effort which was virtually nonexistent a year ago. And importantly Westwood One is now leading the industry with its recent exclusive, big data partnerships that for the first time ever allow us to connect over the air radio listening directly with product purchasing behavior which of course is the Holy Grail for advertisers more on this exciting development in the future.

"Additionally we have fined tuned are stable of content partnerships, terminating certain relationships and enhancing others in the spirit of focusing on the areas that best serve our affiliates and listeners and are ultimately profitable for the business."