Saga Communications, Inc. Reports 1st Quarter 2008 Results

Saga Communications, Inc. Reports 1st Quarter 2008 Results

GROSSE POINTE FARMS, Mich., May 8 /PRNewswire-FirstCall/ -- Saga Communications, Inc. (NYSE:SGA) today reported net income increased 23.0% to $910 thousand ($.05 per fully diluted share) for the quarter ended March 31, 2008 compared to $740 thousand ($.04 per fully diluted share) for the same period in 2007. Net operating revenue for the quarter decreased $351 thousand over the comparable period in 2007 to $31.5 million. Station operating expense decreased $574 thousand to $25.4 million (station operating expense includes depreciation and amortization attributable to the stations) and operating income was approximately even with 1st quarter 2007 at $3.6 million. Gross political revenue for the quarter was $651 thousand compared to $59 thousand for the same period last year. Free cash flow increased 93.5% to $1.7 million for the quarter. On a same station basis for the year, net operating revenue decreased 2.0% to $31.2 million, operating income decreased 2.4% to $3.5 million and station operating expense decreased 3.1% to $25.2 million.

Capital expenditures in the first quarter of 2008 were $2.0 million compared to $2.4 million for the comparable period in 2007. The Company expects capital expenditures to total $9.0 million for 2008.

During the quarter ended March 31, 2008, the Company bought back 239,113 shares of stock for a total purchase price of $1.4 million. Since inception of the program and through May 6, 2008, the Company has bought back 2,267,063 shares of stock.

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 2008 and 2007 acquisitions and dispositions occurred as of January 1, 2007.

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 26 markets, including 61 FM and 30 AM radio stations, 3 state radio networks, 2 farm radio networks, 5 television stations and 4 low-power television stations. For additional information, contact us at (313) 886-7070 or visit our website at www.sagacommunications.com .

Saga's first quarter 2008 results conference call will be on Thursday, May 8, 2008 at 2:00 PM EDT. The dial in number for domestic calls is 888/428-4479. For international callers the number is 612/332-0903. The call can be replayed for 7 days by calling domestically 800/475-6701 or internationally 320/365-3844 and referring to access code 918955. Thereafter, a transcript of the call will be available on our website.

The Company requests that all parties that have a question that they would like to submit to the Company to please email the inquiry by 1:00 PM EDT on May 8, 2008 to SagaIR@sagacom.com. The Company will discuss, during the limited period of the conference call, those inquiries it deems of general relevance and interest. Only inquiries made in compliance with the foregoing will be discussed during the call.

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, including Item 1A of our annual report on Form 10-K. 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 Months Ended
March 31, 2008 and 2007
(amounts in 000's except per share data)
(Unaudited)

Three Months Ended
March 31,
2008 2007
Operating Results
Net operating revenue $31,532 $31,883
Station operating expense 25,421 25,995
Corporate general and administrative 2,552 2,316
Operating income 3,559 3,572
Interest expense 1,995 2,297
Other expense, net 20 35
Income before income tax 1,544 1,240
Income tax expense 634 500
Net income $910 $740
Earnings per share
Basic $0.05 $0.04
Diluted $0.05 $0.04
Weighted average common shares 20,078 20,221
Weighted average common shares and
common shares equivalents 20,087 20,242

Free Cash Flow
Net income $910 $740
Plus: Depreciation and amortization:
Station 1,957 1,895
Corporate 53 47
Deferred tax provision 402 270
Non-cash compensation 366 286
Other expense (income), net 20 35
Less: Capital expenditures (2,046) (2,414)
Free cash flow $1,662 $859

Balance Sheet Data
Working capital $18,838 $18,544
Net fixed assets 76,358 74,146
Net intangible assets and other
assets 228,981 211,929
Total assets 338,455 318,564
Long term debt (including current portion
of $1,061 and $0, respectively) 134,411 131,911
Stockholders' equity 149,168 137,306

Saga Communications, Inc.
Selected Supplemental Financial Data
For the Three Months Ended
March 31, 2008 and 2007
(amounts in 000's except per share data)
(Unaudited)

As-Reported Same Station Pro Forma(1)
Three Months Three Months Three Months
Ended Ended Ended
March 31, March 31, March 31,
2008 2007 2008 2007 2008 2007

Consolidated
Net operating
revenue $31,532 $31,883 $31,233 $31,883 $31,532 $32,193
Station operating
expense 25,421 25,995 25,193 25,995 25,421 26,284
Corporate general
and administrative 2,552 2,316 2,552 2,316 2,552 2,316
Operating income 3,559 3,572 $3,488 $3,572 3,559 3,593
Interest expense 1,995 2,297 1,995 2,297
Other expense, net 20 35 20 35
Income tax expense 634 500 634 509
Net income $910 $740 $910 $752
Earnings per share:
Basic $0.05 $0.04 $0.05 $0.04
Diluted $0.05 $0.04 $0.05 $0.04

As-Reported Same Station Pro Forma(1)
Three Months Three Months Three Months
Ended Ended Ended
March 31, March 31, March 31,
2008 2007 2008 2007 2008 2007
Radio Segment
Net operating
revenue $27,381 $27,893 $27,082 $27,893 $27,381 $28,203
Station operating
expense 21,913 22,513 21,685 22,513 21,913 22,802
Operating income $5,468 $5,380 $5,397 $5,380 $5,468 $5,401

As-Reported Same Station Pro Forma(1)
Three Months Three Months Three Months
Ended Ended Ended
March 31, March 31, March 31,
2008 2007 2008 2007 2008 2007
Television Segment
Net operating
revenue $4,151 $3,990 $4,151 $3,990 $4,151 $3,990
Station operating
expense 3,508 3,482 3,508 3,482 3,508 3,482
Operating income $643 $508 $643 $508 $643 $508

As-Reported Same Station Pro Forma(1)
Three Months Three Months Three Months
Ended Ended Ended
March 31, March 31, March 31,
2008 2007 2008 2007 2008 2007
Depreciation and
amortization
by segment
Radio Segment $1,562 $1,506 $1,533 $1,506 $1,562 $1,566
Television Segment 395 389 395 389 395 389
Corporate and
Other 53 47 53 47 53 47
$2,010 $1,942 $1,981 $1,942 $2,010 $2,002

(1) Pro Forma results assume all acquisitions and dispositions in 2007
and 2008 occurred as of January 1, 2007.

Saga Communications, Inc.
Selected Supplemental Financial Data
Quarterly Proforma Information
March 31, 2008 and 2007
(amounts in 000's except per share data)
(Unaudited)

Pro Pro Pro Pro
Forma(1) Forma(1) Forma(1) Forma(1)
Three Three Three Three
Months Months Months Months
Ended Ended Ended Ended
March 31, June 30, September 30, December 31,
2008 2007 2007 2007 2007
Consolidated
Net operating
revenue $31,532 $32,193 $38,752 $36,500 $37,537
Station
operating
expense 25,421 26,284 27,284 26,239 27,352
Corporate
general and
administra-
tive 2,552 2,316 2,606 2,272 2,606
Operating
income 3,559 3,593 8,862 7,989 7,579
Interest
expense 1,995 2,297 2,281 2,283 2,093
Other
expense, net 20 35 47 60 131
Income tax
expense 634 509 2,686 2,315 2,222
Net income $910 $752 $3,848 $3,331 $3,133
Earnings
per share:
Basic $0.05 $0.04 $0.19 $0.17 $0.16
Diluted $0.05 $0.04 $0.19 $0.17 $0.16

Pro Pro Pro Pro
Forma(1) Forma(1) Forma(1) Forma(1)
Three Three Three Three
Months Months Months Months
Ended Ended Ended Ended
March 31, June 30, September 30, December 31,
2008 2007 2007 2007 2007
Radio
Segment
Net operating
revenue $27,381 $28,203 $34,174 $32,186 $32,992
Station
operating
expense 21,913 22,802 23,723 22,756 23,738
Operating
income $5,468 $5,401 $10,451 $9,430 $9,254

Pro Pro Pro Pro
Forma(1) Forma(1) Forma(1) Forma(1)
Three Three Three Three
Months Months Months Months
Ended Ended Ended Ended
March 31, June 30, September 30, December 31,
2008 2007 2007 2007 2007
Television
Segment
Net operating
revenue $4,151 $3,990 $4,578 $4,314 $4,545
Station
operating
expense 3,508 3,482 3,561 3,483 3,614
Operating
income $643 $508 $1,017 $831 $931

Pro Pro Pro Pro
Forma(1) Forma(1) Forma(1) Forma(1)
Three Three Three Three
Months Months Months Months
Ended Ended Ended Ended
March 31, June 30, September 30, December 31,
2008 2007 2007 2007 2007
Depreciation
and
amortization
by segment
Radio Segment $1,562 $1,566 $1,599 $1,660 $1,723
Television
Segment 395 389 400 405 425
Corporate
and Other 53 47 51 48 58
$2,010 $2,002 $2,050 $2,113 $2,206

(1) Pro Forma results assume all acquisitions and dispositions in 2007
and 2008 occurred as of January 1, 2007.

Saga Communications, Inc.
Selected Financial Data Non-GAAP Disclosures
For the Three Months Ended
March 31, 2008 and 2007
(amounts in 000's)
(Unaudited)

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

Adjustment Adjustment
For For
As- Acquisitions Same As- Acquisitions Same
Reported and Station Reported and Station
Three Dispositions Three Three Dispositions Three
Months Not Included Months Months Not Included Months
Ended in Entire Ended Ended in Entire Ended
March 31, Comparable March 31, March 31, Comparable March 31,
2008 Period 2008 2007 Period 2007

Consolidated
Net
operating
revenue $31,532 $(299) $31,233 $31,883 - $31,883
Station
operating
expense 25,421 (228) 25,193 25,995 - 25,995
Corporate
general and
administra-
tive 2,552 - 2,552 2,316 - 2,316
Operating
income $3,559 $(71) $3,488 $3,572 - $3,572

Adjustment Adjustment
For For
As- Acquisitions Same As- Acquisitions Same
Reported and Station Reported and Station
Three Dispositions Three Three Dispositions Three
Months Not Included Months Months Not Included Months
Ended in Entire Ended Ended in Entire Ended
March 31, Comparable March 31, March 31, Comparable March 31,
2008 Period 2008 2007 Period 2007
Radio
Segment
Net
operating
revenue $27,381 $(299) $27,082 $27,893 - $27,893
Station
operating
expense 21,913 (228) 21,685 22,513 - 22,513
Operating
income $5,468 $(71) $5,397 $5,380 - $5,380

Adjustment Adjustment
For For
As- Acquisitions Same As- Acquisitions Same
Reported and Station Reported and Station
Three Dispositions Three Three Dispositions Three
Months Not Included Months Months Not Included Months
Ended in Entire Ended Ended in Entire Ended
March 31, Comparable March 31, March 31, Comparable March 31,
2008 Period 2008 2007 Period 2007
Television
Segment
Net
operating
revenue $4,151 - $4,151 $3,990 - $3,990
Station
operating
expense 3,508 - 3,508 3,482 - 3,482
Operating
income $643 - $643 $508 - $508

First Call Analyst:
FCMN Contact: aparks@sagacom.com

Source: Saga Communications, Inc.

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

Web site:

http://www.sagacommunications.com/

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