International Entertainment News: Saga Communications, Inc. Reports 1st Quarter 2005 Results

Saga Communications, Inc. Reports 1st Quarter 2005 Results

GROSSE POINTE FARMS, Mich., May 3 /PRNewswire-FirstCall/ -- Saga Communications, Inc. (NYSE:SGA) today reported net operating revenue increased 9.1% over the comparable period in 2004 to approximately $31.8 million, operating income increased 1.9% to approximately $5.4 million and net income was approximately $2.2 million ($.10 per fully diluted share) for the quarter ended March 31, 2005 compared to $2.5 million ($.12 per fully diluted share) for the comparable period in 2004. For the same period, station operating expense increased 11.3% to approximately $24.7 million (station operating expense includes depreciation and amortization attributable to the stations). On a same station basis for the quarter, net operating revenue increased 2.9% to approximately $29.8 million, operating income increased 1.5% to $5.3 million and station operating expense increased 3.3% to $22.8 million.

Capital expenditures in the first quarter of 2005 were approximately $4.3 million of which approximately $1.7 million was routine capital expenditures and $2.6 million resulted from other activities including $628 thousand as a result of acquisitions which included $428 thousand on the expansion and renovation of our Columbus, OH studio facilities due to the purchase of WJZA- FM and WJZK-FM and $200 thousand on the completion of our tower project to move WINQ-FM into the Keene, NH market where we already operate 2 AM's and 2 FM's. Saga's Des Moines, IA studio site that was previously leased was purchased for $1.1 million eliminating future lease expense and our DTV and related television projects continued with approximately $907 thousand being spent during the quarter.

The attached Selected Supplemental Financial Data table discloses "as reported," "same station" and "pro forma" information by segment. The "as reported" amounts reflect our historical financial results and include the results of operations for stations that we did not own for the entire comparable period. The "same station" amounts reflect only the results of operations for stations that we owned for the entire comparable period. The "pro forma" amounts assume the 2005 and 2004 acquisitions and dispositions occurred as of January 1, 2004.

Saga Communications utilizes certain financial measures that are not calculated in accordance with generally accepted accounting principles (GAAP) to assess its financial performance. Such non-GAAP measures include same station financial information and free cash flow. These non-GAAP measures are generally recognized by the broadcasting industry as measures of performance and are used by Saga to assess its financial performance including but not limited to evaluating individual station and market-level performance, evaluating overall operations and as a primary measure for incentive based compensation of executives and other members of management. Saga's management believes these non-GAAP measures are used by analysts who report on the industry and by investors to provide meaningful comparisons between broadcasting groups, as well as an indicator of their market value. These measures are not measures of liquidity or of performance in accordance with GAAP, and should be viewed as a supplement to and not as a substitute for the results of operations presented on a GAAP basis including net operating revenue, operating income, and net income. Reconciliations for all of the non-GAAP financial measures to the most directly comparable GAAP measure are attached in the Selected Financial Data Non-GAAP Disclosures tables.

Saga Communications, Inc. is a broadcasting company whose business is devoted to acquiring, developing and operating broadcast properties. The company owns or operates broadcast properties in 25 markets, including 55 FM and 27 AM radio stations, 3 state radio networks, 2 farm radio networks, 5 television stations and 4 low-power television stations. As previously disclosed, Saga has entered into an agreement to acquire an FM station serving the Asheville, NC radio market, and an agreement to acquire 2 FM stations and 2 AM stations serving the Ithaca, NY radio market. For additional information, contact us at 313-886-7070 or visit our website at http://www.sagacommunications.com/ .

Saga's first quarter 2005 results conference call will be on Tuesday, May 3 at 2:00 p.m. The dial in number for domestic calls is 888-273-9885. For international callers the number is 612-332-0802. The call can be replayed for 7 days by calling domestically 800-475-6701 or internationally 320-365-3844 and referring to access code 728081. Thereafter, a transcript of the call will be available on our website.

This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as "believes," "expects," "anticipates," "guidance" and similar expressions are intended to identify forward-looking statements. Key risks, including risks associated with Saga's ability to effectively integrate the stations it acquires and the impact of federal regulation on Saga's business, are described in the reports Saga Communications, Inc. periodically files with the U.S. Securities and Exchange Commission. Readers should note that these statements may be impacted by several factors, including national and local economic changes and changes in the radio and television broadcast industry in general, as well as Saga's actual performance. Results may vary from those stated herein and Saga undertakes no obligation to update the information contained here.

Saga Communications, Inc.
Selected Consolidated Financial Data
For The Three Month Periods
Ended March 31, 2005 and 2004
(amounts in 000's except per share data)
(Unaudited)

Three Months Ended March 31,
2005 2004
Operating Results
Net operating revenue $31,830 $29,173
Station operating expense 24,698 22,185
Corporate general and administrative 1,778 1,732
Operating income 5,354 5,256
Interest expense 1,623 1,095
Other expense, net 67 8
Income before income tax 3,664 4,153
Income tax expense 1,499 1,622
Net income $2,165 $2,531
Earnings per share:
Basic $.10 $.12
Diluted $.10 $.12
Weighted average common shares 20,631 20,809
Weighted average common shares and
common equivalent 20,941 21,281

Free Cash Flow
Net income $2,165 $2,531
Plus: Depreciation and amortization:
Station 2,095 1,667
Corporate 50 49
Deferred tax provision 561 665
Less: Capital expenditures (4,267) (2,531)
Free cash flow $604 $2,381

Balance Sheet Data
Working capital $17,141 $24,048
Net fixed assets 71,268 63,418
Net intangible and other assets 196,568 164,094
Total assets 302,243 265,835
Long term debt (including current portion
of $1,061 and $18, respectively) 140,911 121,178
Stockholders' equity 118,665 109,508

Saga Communications, Inc.
Selected Supplemental Financial Data
For the Three Months Ended
March 31, 2005 and 2004
(amounts in 000's except per share data)
(Unaudited)

As-Reported Same Station Pro Forma (1)
Three Months Ended Three Months Ended Three Months Ended
March 31, March 31, March 31,
2005 2004 2005 2004 2005 2004
Consolidated
Net operating
revenue $31,830 $29,173 $29,844 $29,003 $31,830 $31,003
Station operating
expense 24,698 22,185 22,812 22,093 24,698 23,741
Corporate general
and administrative 1,778 1,732 1,778 1,732 1,778 1,732
Operating income 5,354 5,256 5,254 5,178 5,354 5,530
Interest expense 1,623 1,095 1,623 1,296
Other expense, net 67 8 67 8
Income tax expense 1,499 1,622 1,499 1,656
Net income $2,165 $2,531 $2,165 $2,570
Earnings per share:
Basic $0.10 $0.12 $0.10 $0.12
Diluted $0.10 $0.12 $0.10 $0.12

As-Reported Same Station Pro Forma (1)
Three Months Ended Three Months Ended Three Months Ended
March 31, March 31, March 31,
2005 2004 2005 2004 2005 2004
Radio Segment
Net operating
revenue $28,372 $26,019 $26,386 $25,849 $28,372 $27,849
Station operating
expense 21,409 19,149 19,523 19,057 21,409 20,705
Operating income $6,963 $6,870 $6,863 $6,792 $6,963 $7,144

As-Reported Same Station Pro Forma (1)
Three Months Ended Three Months Ended Three Months Ended
March 31, March 31, March 31,
2005 2004 2005 2004 2005 2004
Television Segment
Net operating
revenue $3,458 $3,154 $3,458 $3,154 $3,458 $3,154
Station operating
expense 3,289 3,036 3,289 3,036 3,289 3,036
Operating income $169 $118 $169 $118 $169 $118

As-Reported Same Station Pro Forma (1)
Three Months Ended Three Months Ended Three Months Ended
March 31, March 31, March 31,
2005 2004 2005 2004 2005 2004
Depreciation and
amortization
by segment
Radio Segment $1,653 $1,252 $1,310 $1,252 $1,653 $1,611
Television Segment 442 415 442 415 442 415
Corporate and Other 50 49 50 49 50 49
$2,145 $1,716 $1,802 $1,716 $2,145 $2,075

(1) Pro Forma results assume all acquisitions and dispositions in 2004 and 2005 occurred as of January 1, 2004.

Saga Communications, Inc.
Selected Supplemental Financial Data
Quarterly Proforma Information
March 31, 2005 and 2004
(amounts in 000's except per share data)
(Unaudited)

Pro Forma(1) Pro Forma(1) Pro Forma(1) Pro Forma(1)
Three Months Three Months Three Months Three Months
Ended Ended Ended Ended
March 31, June 30, September 30, December 31,
2005 2004 2004 2004 2004
Consolidated
Net operating
revenue $31,830 $31,003 $36,306 $35,362 $37,318
Station operating
expense 24,698 23,741 24,805 24,866 25,885
Corporate general
and administrative 1,778 1,732 2,279 1,927 2,405
Operating income 5,354 5,530 9,222 8,569 9,028
Interest expense 1,623 1,296 1,286 1,237 1,507
Other (income)
expense, net 67 8 65 210 (251)
Income tax expense 1,499 1,656 3,069 2,780 3,553
Net income $2,165 $2,570 $4,802 $4,342 $4,219
Earnings per share:
Basic $0.10 $0.12 $0.23 $0.21 $0.20
Diluted $0.10 $0.12 $0.23 $0.21 $0.20

Pro Forma(1) Pro Forma(1) Pro Forma(1) Pro Forma(1)
Three Months Three Months Three Months Three Months
Ended Ended Ended Ended
March 31, June 30, September 30, December 31,
2005 2004 2004 2004 2004
Depreciation and
amortization
by segment
Radio Segment $1,653 $1,611 $1,643 $1,647 $1,709
Television Segment 442 415 426 422 454
Corporate and Other 50 49 50 49 50
$2,145 $2,075 $2,119 $2,118 $2,213

(1) Pro Forma results assume all acquisitions and dispositions in 2004 and 2005 occurred as of January 1, 2004.

Saga Communications, Inc.
Selected Financial Data Non-GAAP Disclosures
For the Three Months Ended
March 31, 2005 and 2004
(Unaudited)

Reconciliation of As Reported (historical) information to Same Station Operating Income

Adjustment
As-Reported For Acquisitions Same Station
Three Months and Dispositions Three Months
Ended Not Included in Ended
March 31, Entire Comparable March 31,
2005 Period 2005
Consolidated
Net operating revenue $31,830 ($1,986) $29,844
Station operating expense 24,698 (1,886) 22,812
Corporate general and
administrative 1,778 - 1,778
Operating income $5,354 ($100) $5,254

Adjustment
As-Reported For Acquisitions Same Station
Three Months and Dispositions Three Months
Ended Not Included in Ended
March 31, Entire Comparable March 31,
2004 Period 2004
Consolidated
Net operating revenue $29,173 ($170) $29,003
Station operating expense 22,185 (92) 22,093
Corporate general and
administrative 1,732 - 1,732
Operating income $5,256 ($78) $5,178

Adjustment
As-Reported For Acquisitions Same Station
Three Months and Dispositions Three Months
Ended Not Included in Ended
March 31, Entire Comparable March 31,
2005 Period 2005
Radio Segment
Net operating revenue $28,372 ($1,986) $26,386
Station operating expense 21,409 (1,886) 19,523
Operating income $6,963 ($100) $6,863

Adjustment
As-Reported For Acquisitions Same Station
Three Months and Dispositions Three Months
Ended Not Included in Ended
March 31, Entire Comparable March 31,
2004 Period 2004

Radio Segment
Net operating revenue $26,019 ($170) $25,849
Station operating expense 19,149 (92) 19,057
Operating income $6,870 ($78) $6,792

Adjustment
As-Reported For Acquisitions Same Station
Three Months and Dispositions Three Months
Ended Not Included in Ended
March 31, Entire Comparable March 31,
2005 Period 2005
Television Segment
Net operating revenue $3,458 $0 $3,458
Station operating expense 3,289 0 3,289
Operating income $169 $0 $169

Adjustment
As-Reported For Acquisitions Same Station
Three Months and Dispositions Three Months
Ended Not Included in Ended
March 31, Entire Comparable March 31,
2004 Period 2004

Television Segment
Net operating revenue $3,154 $0 $3,154
Station operating expense 3,036 0 3,036
Operating income $118 $0 $118

Source: Saga Communications, Inc.

CONTACT: Samuel D. Bush of Saga Communications, Inc., +1-313-886-7070

Web site: http://www.sagacommunications.com/

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International Entertainment News

Tuesday, May 03, 2005

Saga Communications, Inc. Reports 1st Quarter 2005 Results

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