Grupo Radio Centro Reports First Quarter 2011 Results

Grupo Radio Centro Reports First Quarter 2011 Results

MEXICO CITY, April 15, 2011 /PRNewswire/ -- Grupo Radio Centro, S.A.B. de C.V. (NYSE: RC, BMV: RCENTRO-A) (the "Company"), one of Mexico's leading radio broadcasting companies, announced today its results of operations for the quarter ended March 31, 2011. All figures were prepared in accordance with the International Financial Reporting Standards (IFRS).

First Quarter Results

Broadcasting revenue in the first quarter of 2011 was Ps. 188,766,000, 13.5% higher than Ps. 166,281,000 in the first quarter of 2010. This increase was mainly attributable to higher advertising expenditures by the Company's clients in Mexico during the first quarter 2011 compared to the same period 2010.

The Company's broadcasting expenses (excluding depreciation, amortization and corporate, general and administrative expenses) in the first quarter of 2011 totaled Ps. 170,656,000, a 6.1% increase compared to Ps. 160,783,000 in the first quarter of 2010. This increase was primarily due to (i) higher commissions paid to the Company's sales force and to advertising agencies due to higher broadcasting revenue in the first quarter 2011 compared to the same period in 2010, (ii) higher costs and expenses related to sales, and (iii) increased production costs of talk shows.

The Company's broadcasting income (i.e., broadcasting revenue minus broadcasting expenses, excluding depreciation, amortization and corporate, general and administrative expenses) in the first quarter of 2011 was Ps. 18,110,000, a 229.4% increase compared to Ps. 5,498,000 in the first quarter of 2010. This increase was attributable to the increase in broadcasting revenue described above.

Depreciation and amortization expenses in the first quarter of 2011 were Ps. 5,611,000, an 8.7% decrease compared to Ps. 6,144,000 in the first quarter of 2010. This decrease was attributable to a reduction in the amount of depreciable assets.

The Company's corporate, general and administrative expenses in the first quarter of 2011 totaled Ps. 3,778,000, compared to Ps. 3,778,000 in the first quarter 2010.

For the first quarter of 2011 the Company reported an operating income of Ps. 8,721,000, compared to an operating loss of Ps. 4,424,000 in the first quarter of 2010, mainly due to the increase in broadcasting income described above.

For the first quarter of 2011, other expenses, net, were of Ps. 15,020,000, an 11.6% increase compared to Ps. 13,455,000 in the first quarter 2010. This increase was mainly attributable to expenses incurred during the first quarter of 2011 in connection with the Los Angeles radio station.

The Company's comprehensive financing cost in the first quarter of 2011 was Ps. 4,760,000 from Ps. 7,360,000 in the first quarter of 2010. This 35.3% decrease was mainly attributable to a reduction in the interest expense paid in the first quarter of 2011 due to a reduction in the annual interest rate from 13% through March 18, 2010 to 9.5% thereafter combined with a reduction in the principal amount of the Company's loan with Inbursa.

The Company reported a loss before income taxes in the first quarter of 2011 of Ps. 11,059,000, compared to loss before income taxes of Ps. 25,239,000 reported in the first quarter of 2010.

The Company recorded income taxes of Ps. 6,237,000 in the first quarter 2011, compared to Ps. 2,358,000 in the first quarter 2010 due to an increase in taxable income.

As a result of the foregoing, the Company's net loss in the first quarter of 2011 was Ps. 17,296,000, compared to net loss of Ps. 27,597,000 in the first quarter of 2010.

Recent Events

The Company announced that its Audit Committee and Board of Directors have resolved that its new auditors for the fiscal year beginning January 1, 2011 will be Galaz, Yamazaki, Ruiz Urquiza, S.C., a member firm of Deloitte Touche Tohmatsu, Limited.

The Company's Board of Directors and Audit Committee have adopted in advance International Financial Reporting Standards (IFRS) applicable to financial information as of January 1, 2011. Financial results included in this press release from both first quarter 2011 and first quarter 2010 were prepared based on such standards and are fully comparable.

Company Description

Grupo Radio Centro owns and/or operates 15 radio stations. Of these 15 radio stations, 12 are located in Mexico City, two AM stations in Guadalajara and Monterrey, and one FM station in Los Angeles. The Company's principal activities are the production and broadcasting of musical and entertainment programs, talk shows, news and special events programs. Revenue is primarily derived from the sale of commercial airtime. In addition to the Organizacion Radio Centro radio stations, the Company also operates Grupo RED radio stations and Organizacion Impulsora de Radio (OIR), a radio network that acts as the national sales representative for, and provides programming to 110 Grupo Radio Centro-affiliated radio stations throughout Mexico.

Note on Forward Looking Statements

This release may contain projections or other forward-looking statements related to Grupo Radio Centro that involve risks and uncertainties. Readers are cautioned that these statements are only predictions and may differ materially from actual future results or events. Readers are referred to the documents filed by Grupo Radio Centro with the United States Securities and Exchange Commission, specifically the most recent filing on Form 20-F, which identifies important risk factors that could cause actual results to differ from those contained in the forward-looking statements. All forward-looking statements are based on information available to Grupo Radio Centro on the date hereof, and Grupo Radio Centro assumes no obligation to update such statements.

IR Contacts
In Mexico: In NY:
Pedro Beltran / Alfredo Azpeitia Maria Barona / Peter Majeski
Grupo Radio Centro, S.A.B. de C.V. i-advize Corporate Communications, Inc.
Tel: (5255) 5728-4800 Ext. 4910 Tel: (212) 406-3690
aazpeitia@grc.com.mx grc@i-advize.com.mx

GRUPO RADIO CENTRO, S.A.B. DE C.V.
CONSOLIDATED UNAUDITED BALANCE SHEET
as of March 31, 2011 and 2010
(figures in thousands of Mexican pesos ("Ps.") and U.S. dollars
("U.S. $")(1) )

March 31
--------
2011
U.S.
$(1) Ps.
----- ---
ASSETS
------
Current assets:
Cash and temporary investments 12.105 144.868
------ -------

Accounts receivable:
Broadcasting, net 17.414 208.407
Other 647 7.747

18.061 216.154

Prepaid expenses 2.348 28.106
----- ------
Total current assets 32.514 389.128

Property and equipment, net 36.041 431.327
Prepaid expenses 0 0
Deferred charges, net 394 4.721
Excess of cost over book value of net assets of
subsidiaries, net 69.258 828.863
Other assets 288 3.416
--- -----
Total assets 138.495 1.657.455
======= =========

LIABILITIES
-----------
Current:
Short-term debt 3.424 40.981
Advances from customers 6.487 77.631
Suppliers and other accounts payable 5.420 64.860
Taxes payable 4.432 53.040
----- ------
Total current liabilities 19.763 236.512

Long-Term:
Long-term debt 6.685 80.000
Reserve for labor liabilities 4.345 51.997
Deferred taxes 802 9.594
--- -----
Total liabilities 31.595 378.103
------ -------

SHAREHOLDERS' EQUITY
--------------------
Capital stock 88.568 1.059.962
Cumulative earnings 4.107 49.151
Reserve for repurchase of shares 2.506 29.989
Effect from Initial Adoption of IFRS 11.693 139.934
------ -------
Majority shareholders' equity 106.874 1.279.036
Minority interest 26 316
--- ---
Total shareholders' equity 106.900 1.279.352
------- ---------
Total liabilities and shareholders' equity 138.495 1.657.455

March 31
--------
2010
Ps.
---
ASSETS
------
Current assets:
Cash and temporary investments 35.071
------

Accounts receivable:
Broadcasting, net 201.376
Other 8.446

209.822

Prepaid expenses 110.754
-------
Total current assets 355.647

Property and equipment, net 453.203
Prepaid expenses 3.636
Deferred charges, net 2.704
Excess of cost over book value of net assets of
subsidiaries, net 828.863
Other assets 3.353
-----
Total assets 1.647.406
=========

LIABILITIES
-----------
Current:
Short-term debt 40.591
Advances from customers 95.820
Suppliers and other accounts payable 81.976
Taxes payable 34.891
------
Total current liabilities 253.278

Long-Term:
Long-term debt 120.000
Reserve for labor liabilities 47.838
Deferred taxes 2.166
-----
Total liabilities 423.282
-------

SHAREHOLDERS' EQUITY
--------------------
Capital stock 1.059.962
Cumulative earnings (18.428)
Reserve for repurchase of shares 29.989
Effect from Initial Adoption of IFRS 152.295
-------
Majority shareholders' equity 1.223.818
Minority interest 306
---
Total shareholders' equity 1.224.124
---------
Total liabilities and shareholders' equity 1.647.406

(1) Peso amounts have been translated into U.S. dollars, solely for
the convenience of the reader, at the rate of Ps. 11.9678 per
U.S. dollar, the rate on March 31, 2011.

GRUPO RADIO CENTRO, S.A.B. DE C.V.
CONSOLIDATED UNAUDITED STATEMENT OF INCOME
for the three-month periods ended March 31, 2011 and 2010
(figures in thousands of Mexican pesos ("Ps.") and U.S. dollars
("U.S. $")(1), except per Share and per ADS amounts)

March 31
--------
2011
U.S.$
(1) Ps.
----- ---

Broadcasting revenue (2) 15.773 188.766
Broadcasting expenses, excluding depreciation,
amortization and corporate, general and administrative
expenses 14.260 170.656
------ -------
Broadcasting income 1.513 18.110

Depreciation and amortization 469 5.611
Corporate, general and administrative expenses 316 3.778
--- -----
Operating (loss) income 728 8.721

Other expenses, net -1.255 -15.020

Comprehensive financing income (cost):
Interest expense -392 -4.691
Interest income (2) -3 -39
Gain (loss) on foreign currency exchange, net -3 -30
--- ---
-398 -4.760

(Loss) income before income taxes -925 -11.059

Income taxes 521 6.237
--- -----
Net (loss) income -1.446 -17.296

Net (loss) income applicable to:
Majority interest -1.446 -17.298
Minority interest 0 2
--- ---
-1.446 -17.296
====== =======

Net income (loss) per Series A Share (3) 0,036 0,4345
Net income (loss) per ADS (3) 0,327 3,9105
Weighted average common shares outstanding (000's) (3) 162.724

March 31
--------
2010
Ps.
---

Broadcasting revenue (2) 166.281
Broadcasting expenses, excluding depreciation,
amortization and corporate, general and administrative
expenses 160.783
-------
Broadcasting income 5.498

Depreciation and amortization 6.144
Corporate, general and administrative expenses 3.778
-----
Operating (loss) income -4.424

Other expenses, net -13.455

Comprehensive financing income (cost):
Interest expense -7.620
Interest income (2) 9
Gain (loss) on foreign currency exchange, net 251
---
-7.360

(Loss) income before income taxes -25.239

Income taxes 2.358
-----
Net (loss) income -27.597

Net (loss) income applicable to:
Majority interest -27.600
Minority interest 3
---
-27.597
=======

Net income (loss) per Series A Share (3) 0,0992
Net income (loss) per ADS (3) 0,8928
Weighted average common shares outstanding (000's) (3) 162.724

(1) Peso amounts have been translated into U.S. dollars, solely for
the convenience of the reader, at the rate of Ps. 11.9678 per U.S.
dollar, the rate on March 31, 2011.

(2) Broadcasting revenue for a particular period includes (as a
reclassification of interest income) interest earned on funds
received by the Company pursuant to advance sales of commercial
airtime to the extent that the underlying funds were earned by the
Company during the period in question. Advances from advertisers are
recognized as broadcasting revenue only when the corresponding
commercial airtime has been transmitted. Interest earned and treated
as broadcasting revenue for the first quarter of 2011 and 2010 was
Ps. 461,000 and Ps. 920,000, respectively.

(3) Earnings per share calculations are made for the last twelve
months as of the date of the income statement, as required by the
Mexican Stock Exchange.

SOURCE Grupo Radio Centro, S.A.B. de C.V.

Grupo Radio Centro, S.A.B. de C.V.

-------
Profile: intent