iHM Reports Sharp Decline In March Revenue

iHeartMedia, Inc. late Thursday reported financial results for the quarter ended March 31, 2020.

Financial Highlights

• Strong financial performance in January and February was followed by a sharp decline in revenue in March resulting from the effects of the coronavirus ("COVID-19") pandemic.
• Continued audience and revenue growth in podcasting and digital
• Strong liquidity position and resilient capital structure:
• Cash balance of $646.8 million as of March 31, 2020
• Over 90% of long-term debt maturing in 2026 or later
• Favorable debt terms: no maintenance covenants for Term Loan Facility or Senior Secured Notes
• Total direct operating expense savings in 2020 are expected to be approximately $250 million
• Modernization initiatives continue: anticipating $100 million in run-rate savings by 2021 with approximately $50 million run-rate achieved in 2020
• New cost-saving actions: anticipating an additional $200 million in operating expense savings achieved in 2020
• New capital expenditure actions: reducing capital expenditures by expected $80 million in 2020
• CARES Act free cash flow benefit: estimating approximately $100 million reduction in tax-related cash payments in 2020

First Quarter

• Revenue of $780.6 million, down 1.9% year-over-year driven by effects of the COVID-19 pandemic; excluding political revenue1, revenue decreased 4.8%
• Digital revenue increased 22.2% year-over-year led by an 80% increase in podcasting revenue
• GAAP Operating loss of $1,730.8 million, driven primarily by non-cash impairment charges
• Adjusted EBITDA1 of $140.3 million, down 10.6% year-over-year
• Cash flows provided by operating activities from continuing operations of $91.5 million, a decrease of $45.1 million or 33.0%

“As America’s #1 audio company, with unparalleled reach both nationally and locally, we play a critically important role in providing companionship, connection and key information to all the communities we serve, and we are incredibly proud of our employees’ commitment to that mission in response to the COVID-19 pandemic,” said Bob Pittman, Chairman and Chief Executive Officer of iHeartMedia, Inc.

“Although businesses and brands across the country have been impacted, we are working closely with them on their marketing needs and are focused on helping them generate the consumer demand to reopen or ramp up. Our multiplatform offering, our unparalleled reach and our unique data and analytics position us well to benefit as a company from this returning advertising demand.”

“Given the current economic environment, iHeart has taken actions that we believe expand the Company’s financial flexibility and provide sufficient liquidity to operate effectively even in an extended period of economic weakness,” said Rich Bressler, iHeartMedia, Inc. President, Chief Operating Officer and Chief Financial Officer.

“We believe that iHeart's fundamentally strong free cash-generation model, substantial current cash balances, incremental benefits from our cost savings initiatives, and flexible capital structure will enable us to build effectively on our audio market leadership and position us favorably to capitalize on the eventual recovery in advertising demand. With our experienced management team and our unparalleled assets, we are confident in our business and continue our focus on driving shareholder value.”