"Given the ongoing uncertainty surrounding the duration and magnitude of the COVID-19 pandemic and its impact on the U.S. economy, we believe it is appropriate to withdraw our full-year 2020 guidance. While we cannot determine the full extent of COVID-19’s impact on our business at this time, we are monitoring this rapidly evolving situation closely and look forward to discussing our business in greater detail as part of our first quarter 2020 earnings results investor call," said Bob Pittman, iHeart’s Chairman and Chief Executive Officer.
"iHeartMedia had a strong January and February before the effects of COVID-19 began to unfold into a global pandemic in early March. The challenges that COVID-19 has created for advertisers and consumers has impacted iHeart’s revenue in recent weeks, creating a less clear business outlook in the near term," said Rich Bressler, iHeart’s President, Chief Operating Officer and Chief Financial Officer.
"To maintain maximum financial flexibility during this period, we have drawn $350 million on our $450 million senior secured asset-based revolving credit facility ("ABL Facility"). We believe that the additional funds from drawing on our ABL Facility, in combination with our cash balance, provides us with a prudent level of liquidity at this time. We fully appreciate the unprecedented challenges posed by this crisis, however, we remain confident in our business, our employees and our strategy. With our experienced management team and our leadership position in the audio sector, we are committed to navigating this period while serving our audiences and other constituents."
Also, Salem Media Group is withdrawing its revenue and operating expense guidance for the first quarter of 2020 due to the growing social and economic impact of the COVID-19 pandemic. Based on current indications, Salem expects total first quarter 2020 revenue will be less than previously projected as a result of decreased revenues from advertising, programming, events and book sales.
And there are reports of paycuts.Adams Radio Group is cutting the salary for every employee by 10%. CEO Ron Stone announced that “all employees agreed to take a ten percent temporary pay cut to prevent any downsizing of our staff. "I could not be prouder of our 7employees. Every employee of Adams Radio stepped up to do their part to ensure that no Adams employee would lose their position. We are a family. Our goal is singular. To ensure everyone in our company gets through this crisis with the least amount of harm. This test of our country’s ability to weather a storm is unlike anything any of us have seen, but we will get through this together, and be stronger for it. What seems like a huge sacrifice today, is miniscule compared to what our fathers, mothers, grandfathers and grandmothers sacrificed --Things could be much worse.”
Starting April 1, Beasley is reducing pay through June 30. In a memo, CEO Caroline Beasley stated she would be taking a 20% pay reduction.
Meanwhile, ViacomCBS has also pulled its FY20 outlook, citing the coronavirus pandemic. The company reaffirms its expectation to achieve $750M of full run-rate merger-related cost synergies over the next three years. It also reiterates the forecast of having 16M domestic paid streaming subscribers and 30M MAUs on Pluto TV at the end of 2020.
ViacomCBS says the coronavirus has created production delays, but the company has also seen increased viewership numbers across its properties.