Beasley Reports 3Q Net Revenue Down 5 Percent Y2Y

Beasley Broadcast Group today announced operating results for the three and nine month periods ended September 30, 2014.

• A $0.7 million, or 5.0%, year-over-year decline in net revenue during the three months ended September 30, 2014, primarily reflects lower advertising revenue at the Company's Wilmington and Greenville-New Bern-Jacksonville market clusters which more than offset net revenue increases at the Company's Las Vegas and Ft. Myers market clusters.
• Station operating expenses in the 2014 third quarter increased by $0.2 million, or 1.8%, which coupled with the revenue decline resulted in a $0.8 million, or 18.9%, decline in third quarter 2014 station operating income to $3.6 million compared to the 2013 third quarter. 
• The $0.8 million, or 45.4% year-over-year reduction in 2014 third quarter operating income, reflects the year-over-year revenue decline, the increase in station operating expenses and a 0.8% increase in total operating expenses in the third quarter of 2014 compared with the same period in 2013.

Commenting on the results, George G. Beasley, Chairman and Chief Executive Officer, said, "We don't believe third quarter operating results from continuing operations reflect the strength, ratings and local relevance of our platform, as the lower level of reported net revenue from continuing operations is temporarily mis-matched with certain expenses that will be better amortized across the Company's larger revenue base once we complete the asset exchange with CBS Radio.

George Beasley

"We are very excited by the potential presented by the CBS transaction as we will exchange five stations in Philadelphia and Miami for fourteen stations in Tampa-St. Petersburg, Charlotte and Philadelphia. Throughout Beasley Broadcast Group's 53-year history, we have actively managed our station portfolio with the goal of serving the local communities where we operate, diversifying our operations, managing risk and improving financial results. The planned asset exchange with CBS Radio addresses these strategic objectives and upon completion, we will expand our owned and operated station base by nine stations increasing Beasley's portfolio to 53, including 33 FM and 20 AM stations, in twelve markets with approximately 7.7 million weekly listeners.  Importantly, we will add completed clusters in the Tampa and Charlotte markets which complement our already strong mid-Atlantic presence.

"In addition to our initiatives during the quarter to expand and diversify our station and digital media operations, we continue to focus on debt reduction and returning capital to shareholders. During the third quarter we made credit facility repayments totaling $3.3 million, reducing borrowings to $99.0 million at September 30, 2014 and declared our fourth consecutive quarterly cash dividend. Notably, the asset exchange agreement with CBS Radio has been structured to allow us to meaningfully expand our operating and revenue base without incurring additional borrowings or using cash from operations. Based on our expectation that the transaction will lead to station operating income accretion in the first eighteen months after closing, we expect to further reduce the Company's leverage ratio which is presently near its lowest level in ten years."