Beasley Broadcast Group today announced operating results for the three-month and nine-month periods ended September 30, 2018.
As previously reported, on May 1, 2017, the Company completed the sale of six stations in GreenvilleNew Bern-Jacksonville, and on December 19, 2017, Beasley completed an asset exchange transaction whereby the Company exchanged its Boston adult contemporary station WMJX-FM and $12.0 million for Boston’s sports station WBZ-FM. On September 27, 2018, Beasley completed the acquisition of WXTU-FM in Philadelphia from Entercom Communications Corp. for $38.0 million.
Prior to the acquisition closing, on July 23, 2018, the Company began operating WXTU-FM under a local marketing agreement (“LMA”). During the term of the LMA, the Company included net revenues and station operating expenses, including the associated LMA fee from operating WXTU-FM, in its consolidated financial statements.
The reported results reflect the operations and results from WBZ-FM in the three and nine months ended September 30, 2018 and WMJX-FM in the three and nine months ended September 30, 2017.
The results also reflect approximately two months of contribution from WXTU-FM in the three
and nine months ended September 30, 2018 and four months of contribution from the Greenville-New Bern-Jacksonville stations in the nine-month period ended September 30, 2017.
The $6.2 million, or 10.6%, year-over-year increase in net revenue during the three months ended September 30, 2018, reflects the inclusion WBZ-FM Boston and a partial quarter contribution from WXTU-FM Philadelphia, partially offset by the disposition of WMJX-FM Boston. Net revenue in the 2018 third quarter increased year-over-year in the Company’s Tampa, Philadelphia, Fort Myers, Las Vegas, Augusta, Boca Raton and Boston clusters compared to the same period of 2017.
The year-over-year decrease is primarily attributable to $1.7 million of additional bad debt expense due to financial issues at USTN and higher station operating expenses related to the operations of WBZ-FM Boston, WXTU-FM Philadelphia and our Tampa-Saint Petersburg market cluster.
Commenting on the financial results, Caroline Beasley, Chief Executive Officer, said, “In the third quarter, we continued to execute on our integration strategy focused on premium local programming to support our goals of ratings and market leadership at acquired stations, while remaining opportunistic in further building our scale and revenue diversification to drive growth and SOI margin expansion.
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