Cumulus Media Swings To Profit

Cumulus Media Inc. Monday announced operating results for the three months and year ended December 31, 2018.

For the three months ended December 31, 2018, the Company reported net revenue of $309.2 million, up 5.2% from the three months ended December 31, 2017, net income of $43.7 million and Adjusted EBITDA of $65.6 million, up 31.6% from the three months ended December 31, 2017.

For the year ended December 31, 2018, the Company reported net revenue of $1,140.4 million, an increase of 0.4% from the year ended December 31, 2017, net income of $757.6 million and Adjusted EBITDA of $234.3 million, an increase of 7.6% from the year ended December 31, 2017.  Net income for the year ended December 31, 2018 included after-tax gains associated with the Company's emergence from Chapter 11 of $641.0 million.

The operating results herein are not adjusted to reflect the impact of the recently announced divestiture of six stations to Educational Media Foundation.  If the stations subject to this transaction were excluded for the twelve months ended December 31, 2018, net revenue would have been lower by $23 to $25 million and Adjusted EBITDA would have been lower by $5 to $7 million.

Earlier Monday, the Cumulus Mdia  completed a prepayment of $25.4 million principal amount of the Term Loan for $25.0 million, a discount to par value of 1.50%. This transaction was funded with cash from operations and the availability on the Revolving Credit Agreement remained unchanged.

Mary Berner

Mary G. Berner, President and Chief Executive Officer of Cumulus Media said, “We are delighted by the Company’s strong 2018 performance. Despite the challenges presented by our bankruptcy in the first half of the year and industry headwinds throughout the year, Cumulus was able to deliver its first full year of revenue growth in four years fueled by digital growth of more than 60%, its eighth straight quarter of increased market revenue share and its second consecutive year of EBITDA growth after years of declines. That EBITDA growth, in conjunction with our October 2018 $50 million voluntary debt prepayment, brought our net leverage down to 5.2x at year end.

"Additionally, as previously announced, we entered into two station transactions this quarter, which should further reduce net leverage when completed later this year. In combination, these results demonstrate our firm commitment to the execution of our strategic priorities - maximizing operating performance, growing our digital businesses, and optimizing our asset portfolio - and the achievement of our financial goals of annually generating up to $100 million of free cash flow, reducing our net leverage to below 4.0x, and reinvesting in meaningful growth opportunities. With the entire Cumulus team, I look forward to demonstrating continued progress against all these objectives in coming quarters.”

Podcast Business Journal reports Berner had a lot of great things to say about the Westwood One Podcast Network during the earnings calls with investor analysts.

Berner reported that Cumulus’ overall digital business – what’s called C-Suite – grew by more than 60% in 2018. And, she said that digital “meaningfully outpaced the radio industry.”

Starting off at 46% growth in Q1 of 2018, digital revenue in Q4 grew by 76% according, to Berner, who added the digital and podcasting businesses are hitting their stride for the company and have been solidly profitable from the beginning.;

And Berner says podcasting has been a nice addition to the Cumulus portfolio. The Westwood One Podcast Network includes show from Ben Shapiro, Mark Levin, Suze Orman, Dennis Miller and others. In 2016, according to Berner, Cumulus’ podcasting division generated $100,000 in revenue. In 2018 she says podcasting generated $12.5 million in profitable podcasting revenue and she remains excited about the future of podcasting. “We are thoughtfully building a profitable business despite ambitious growth targets.”