Emmis Q3 Radio Revenue Down, Income Increases

Emmis Communications Corporation today announced results for its third fiscal quarter, ending November 30, 2016.

Emmis' radio net revenues for the third fiscal quarter were down slightly, from $42.6 million to $42.5 million. Per Miller Kaplan reporting, which excludes barter and syndication revenues, Emmis radio revenues were down 1.8% in markets up 2.5%.

For the third fiscal quarter, operating income rose to $23.8 million from $11.6 million in the same quarter of the prior year, due to a gain on the sale of Texas Monthly, which closed during the third quarter.

Reported publishing net revenues were down 18% in the third fiscal quarter, from $16.6 million to $13.6 million.  Pro forma for the sale of Texas Monthly, publishing net revenues were down 6%.

Jeff Smulyan

On August 18, the Company announced that it was exploring strategic alternatives for its publishing division, excluding Indianapolis Monthly magazine.  The Company also announced it was exploring strategic alternatives for its Terre Haute radio stations and WLIB-AM in New York. Emmis expects to close on the sale of its Terre Haute radio stations at the end of January, and is working to close additional asset sales before the end of its fiscal year in February.

"Emmis Radio is not accustomed to underperforming its markets," said Jeff Smulyan, Chairman & CEO of Emmis. "I was disappointed in our performance, but remain hopeful that recent ratings gains in Los Angeles and Austin, coupled with continued stellar performance in St. Louis, will lead to better performance in fiscal 2018.

"The general sluggishness in the radio industry makes the need for NextRadio all the more important," Smulyan continued.  "NextRadio, the smartphone app that provides free, portable FM radio listening, recently surpassed 10 million downloads and 25 million listening hours.  The Samsung Galaxy S7 and S7 Edge are now FM-enabled across all major wireless carriers in the United States and we reached an agreement with Sprint that keeps NextRadio preloaded on their Android devices.

"If NextRadio succeeds, as I believe it will, it will help solve major challenges for every radio station, including ours: establishing a one-to-one relationship with our listeners, regaining our portability, and making us relevant to a generation that thinks terrestrial radio is uncool. NextRadio gives us new, interactive revenue opportunities with current and potential advertisers – and it takes the compelling content created every day and provides a new platform for it," Smulyan said.

Smulyan also noted that Digonex, the dynamic pricing service that Emmis began operating in June 2014, has begun integrating with several ticketing platforms, helping to accelerate client adoption.  Booked business heading into calendar 2017 is nearly triple that of calendar 2016.