Audacy: Digital Growth Can't Offset Radio Revenue Loss

Audacy Communications today reported financial results for the 3Q ending September 30, 2022:

Third Quarter Summary

• Net revenues for the quarter were $317.0 million, down 4% compared to $329.4 million in the third quarter of 2021
• Radio revenues (spot plus network revenue) were down 6% compared to the third quarter of 2021, with network revenues up 1% and spot down 7%
• Digital revenues were $62.7 million, up 2% compared to the third quarter of 2021, with both digital marketing solutions and streaming up 14%
• Total operating expenses for the quarter were $468.8 million which include a non-cash impairment charge of $176.8 million, compared to $300.2 million in the third quarter of 2021. Cash operating expenses were approximately flat with the third quarter of 2021.
• Operating loss for the quarter was $151.9 million, compared to operating income of $29.3 million in the third quarter of 2021
• Adjusted EBITDA for the quarter was $36.3 million, compared to $49.3 million in the third quarter of 2021
• During the quarter, the Company completed the sale of land and property in Houston, Texas for $15.6 million in cash. In November, the Company completed the sale of land and property in Las Vegas, Nevada for $40 million in cash. In addition, and to facilitate the Las Vegas sale, the Company announced that it entered into an asset exchange agreement with Beasley Media Group, LLC to exchange an FM station in Las Vegas for an AM station and a FM translator in that market.

David Field

David J. Field, Chairman, President and Chief Executive Officer, stated: “Our third quarter revenues declined 3.8% as advertising headwinds impacted company performance. Solid double digit growth in streaming audio and digital marketing solutions were offset by declining radio revenues. Our radio revenues were negatively impacted by our concentration in the country’s largest markets as small to medium market radio outperformed large market radio by 8% during the quarter.

"We remain deeply focused on executing our action plan to navigate the storm and emerge healthy and strong. We completed the sale of $56 million in real estate to enhance our financial position with additional sales in the pipeline. We launched the next generation of our Audacy streaming platform with innovative features including segment chaptering of live spoken word radio shows. Since launch, digital listeners are up 25% while registrations have increased 15% and we have high expectations for the impact of the new platform on our future growth. We also continue to make progress on core strategic growth drivers such as national enterprise business development and our ad tech product roadmap to open important pools of demand and accelerate future performance."