Entercom Communications (ETM) Misses Q1 EPS by 1c, Revenues Miss

Entercom Communications (NYSE: ETM) reported Q1 EPS of ($0.01), $0.01 worse than the analyst estimate of $0.00. Revenue for the quarter came in at $297.03 million versus the consensus estimate of $304.04 million.

First Quarter Summary

• Net revenues for the quarter were $297.0 million, down 4% compared to $309.0 million in the first quarter of 2019
• Operating income for the quarter was $11.4 million, which included a non-cash impairment charge of $1.1 million, compared to $30.4 million in the first quarter of 2019
• Adjusted EBITDA for the quarter was $34.5 million, down 19% compared to $42.7 million in the first quarter of 2019
• Net loss per diluted share for the quarter was $0.07 compared to net income of $0.02 per diluted share in the first quarter of 2019
• Adjusted net loss per diluted share for the quarter was $0.01 compared to adjusted net income of $0.03 per diluted share in the first quarter of 2019

Key Highlights

• After being up over 7% February YTD, net revenues for the quarter were down 4% to $297 million due to the impact of COVID-19
• Digital revenues were up 41% YoY for the quarter, propelled by strong audience and revenue growth in podcasting and digital audio advertising
• To mitigate the impact of the downturn in revenues and to preserve liquidity, the Company rapidly executed the following actions:
  • Reduced fixed costs by $150 million during the remainder of 2020. The Company will also realize reduced variable expenses tied to revenues.
  • Cut planned capital expenditures by over 40% to a revised range of between $25 -$30 million for 2020.
  • Due to benefits provided by the CARES Act, cash income tax payments now expected to be less than $10 million for 2020.
  • Realized $10.8 million of proceeds from the sale of WAAF-FM in Boston in April.
• Strong liquidity position and no near term maturities
  • $189 million of cash on-hand at March 31st
  • 98% of outstanding debt matures November 2024 or later

David J. Field, President and Chief Executive Officer, stated: “I want to salute the outstanding work and dedication of the Entercom team, which has risen to the unique challenges of these unprecedented times to serve the American public, our customers and our communities. Entercom began the year on a strong note driving revenues up over 7% through February before facing the impact of the COVID-19 pandemic. We have taken important actions to mitigate the impact of the pandemic and are well positioned financially to operate effectively through the crisis. Strategically, we are well positioned to fully participate in the recovery and the attractive growth opportunities in the audio space, with strong leadership positions in broadcast radio and podcasting, the fastest growing digital audio platform, unparalleled leadership in news and sports, and strong data and analytics capabilities.”

For earnings history and earnings-related data on Entercom Communications (ETM) click here.

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