Entravision Communications Corporation Reports First Quarter 2011 Results

Entravision Communications Corporation Reports First Quarter 2011 Results

SANTA MONICA, Calif., May 5, 2011 /PRNewswire/ -- Entravision Communications Corporation (NYSE: EVC) today reported financial results for the three-month period ended March 31, 2011.

Historical results, which are attached, are in thousands of U.S. dollars (except share and per share data). This press release contains certain non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measure most directly comparable to each of these non-GAAP financial measures, and a table reconciling each of these non-GAAP financial measures to its most directly comparable GAAP financial measure, is included beginning on page 7. Unaudited financial highlights are as follows:

Three-Month Period
Ended March 31,
---------------
%
2011 2010 Change
---- ---- -------
Net revenue $44,044 $43,073 2%
Operating expenses (1) 30,064 29,824 1%
Corporate expenses (2) 3,745 3,748 (0)%

Consolidated adjusted EBITDA (3) 10,408 9,528 9%

Free cash flow (4) $(1,550) $(2,600) (40)%
Free cash flow per share (4) $(0.02) $(0.03) (33)%

Net income (loss) applicable to common
stockholders $(4,432) $(2,184) 103%

Net income (loss) per share applicable
to common stockholders, basic and
diluted $(0.05) $(0.03) 67%

Weighted average common shares
outstanding, basic and diluted 85,039,298 84,430,204

(1) Operating expenses include direct operating, selling, general and
administrative expenses. Included in operating expenses are $0.2
million and $0.3 million of non-cash stock-based compensation for
the three-month periods ended March 31, 2011 and 2010,
respectively. Operating expenses do not include corporate expenses,
depreciation and amortization, impairment charge, gain (loss) on
sale of assets and gain (loss) on debt extinguishment.
(2) Corporate expenses include $0.2 million and $0.2 million of non-
cash stock-based compensation for the three-month periods ended
March 31, 2011 and 2010, respectively.
(3) Consolidated adjusted EBITDA means net income (loss) plus gain
(loss) on sale of assets, depreciation and amortization, non-cash
impairment charge, non-cash stock-based compensation included in
operating and corporate expenses, other income (loss), net interest
expense, gain (loss) on debt extinguishment, income tax (expense)
benefit, equity in net income (loss) of nonconsolidated affiliate,
non-cash losses and syndication programming amortization less
syndication programming payments. We use the term consolidated
adjusted EBITDA because that measure is defined in our revolving
credit facility and does not include gain (loss) on sale of assets,
depreciation and amortization, non-cash impairment charge, non-
cash stock-based compensation, other income (loss), net interest
expense, gain (loss) on debt extinguishment, income tax (expense)
benefit, equity in net income (loss) of nonconsolidated affiliate,
non-cash losses and syndication programming amortization and does
include syndication programming payments. While many in the
financial community and we consider consolidated adjusted EBITDA to
be important, it should be considered in addition to, but not as a
substitute for or superior to, other measures of liquidity and
financial performance prepared in accordance with accounting
principles generally accepted in the United States of America, such
as cash flows from operating activities, operating income and net
income. As consolidated adjusted EBITDA excludes non-cash gain
(loss) on sale of assets, non-cash depreciation and amortization,
non-cash impairment charge, non-cash stock-based compensation
expense, other income (loss), net interest expense, gain (loss) on
debt extinguishment, income tax (expense) benefit, equity in net
income (loss) of nonconsolidated affiliate, non-cash losses and
syndication programming amortization and includes syndication
programming payments, consolidated adjusted EBITDA has certain
limitations because it excludes and includes several important non-
cash financial line items. Therefore, we consider both non-GAAP and
GAAP measures when evaluating our business. Consolidated adjusted
EBITDA is also used to make executive compensation decisions.
(4) Free cash flow is defined as consolidated adjusted EBITDA less
cash paid for income taxes, net interest expense and capital
expenditures. Net interest expense is defined as interest expense,
less non-cash interest expense relating to amortization of debt
finance costs, less non-cash interest expense relating to discount
amortization on our $400 million aggregate principal amount of
8.750% senior secured first lien notes due 2017 (the "Notes"), less
interest income and less the change in the fair value of our
interest rate swaps. Free cash flow per share is defined as free
cash flow divided by the basic or diluted weighted average common
shares outstanding.

Commenting on the Company's earnings results, Walter F. Ulloa, Chairman and Chief Executive Officer, said, "During the first quarter, we achieved revenue growth primarily driven by retransmission consent revenue despite continuing challenges in the advertising environment. Our audience shares remain strong, and we believe we are well positioned to benefit as the U.S. Hispanic market continues to expand and advertisers increasingly recognize the importance of reaching our target audience. The release of the 2010 U.S. census data reconfirms the growth and importance of the U.S. Hispanic population and our position in some of the fastest-growing and most densely-populated Hispanic markets. We remain focused on improving our operating performance while continuing to carefully manage our costs."

Financial Results

Three Months Ended March 31, 2011 Compared to Three Months Ended
March 31, 2010
(Unaudited)

Three-Month Period
Ended March 31,
---------------
%
2011 2010 Change
---- ---- -------
Net revenue $44,044 $43,073 2%
Operating expenses (1) 30,064 29,824 1%
Corporate expenses (1) 3,745 3,748 (0)%
Depreciation and amortization 4,732 4,723 0%

Operating income (loss) 5,503 4,778 15%
Interest expense, net (9,441) (5,431) 74%
Other income (loss) 687 - NM

Income (loss) before income taxes (3,251) (653) 398%

Income tax (expense) benefit (1,181) (1,410) (16)%
------ ------
Net income (loss) before equity in net
income (loss) of
nonconsolidated affiliates (4,432) (2,063) 115%
Equity in net income (loss) of
nonconsolidated affiliates, net of tax - (121) (100)%
--- ----

Net income (loss) $(4,432) $(2,184) 103%
======= =======

(1) Operating expenses and corporate expenses are defined on page 1.

Net revenue increased to $44.0 million for the three-month period ended March 31, 2011 from $43.1 million for the three-month period ended March 31, 2010, an increase of $0.9 million. The increase came from our television segment and was primarily attributable to retransmission consent revenue.

Operating expenses increased to $30.1 million for the three-month period ended March 31, 2011 from $29.8 million for the three-month period ended March 31, 2010, an increase of $0.3 million. The increase was primarily attributable to an increase in salary expense as a result of the partial restoration of employee salaries in 2011 and expenses associated with Lotus/Entravision Reps LLC, partially offset by a decrease in salary expense due to reductions of personnel and other cost reduction measures.

Corporate expenses were $3.7 million for each of the three-month periods ended March 31, 2011 and 2010.

Segment Results

The following represents selected unaudited segment information:

Three-Month Period
Ended March 31,
---------------
%
2011 2010 Change
---- ---- ------
Net Revenue
Television $30,668 $29,645 3%
Radio $13,376 $13,428 (0)%
Total $44,044 $43,073 2%

Operating Expenses (1)
Television $17,830 $17,957 (1)%
Radio 12,234 11,867 3%
Total $30,064 $29,824 1%

Corporate Expenses (1) $3,745 $3,748 (0)%

Consolidated adjusted EBITDA (1) $10,408 $9,528 9%

(1) Operating expenses, Corporate expenses, and Consolidated adjusted
EBITDA are defined on page 1.

Entravision Communications Corporation will hold a conference call to discuss its 2011 first quarter results on May 5, 2011 at 5 p.m. Eastern Time. To access the conference call, please dial 412-858-4600 ten minutes prior to the start time. The call will be webcast live and archived for replay on the investor relations portion of the Company's Web site located at www.entravision.com.

Entravision Communications Corporation is a diversified Spanish-language media company utilizing a combination of television, radio and digital operations to reach Hispanic consumers across the United States, as well as the border markets of Mexico. Entravision is the largest affiliate group of both the top-ranked Univision television network and Univision's TeleFutura network, with television stations in 20 of the nation's top 50 Hispanic markets. The company also operates one of the nation's largest groups of primarily Spanish-language radio stations, consisting of 48 owned and operated radio stations. Additionally, Entravision has a variety of cross-platform digital content and sales offerings designed to capitalize on the company's leadership position within the Hispanic broadcasting community. Entravision shares of Class A Common Stock are traded on The New York Stock Exchange under the symbol: EVC.

This press release contains certain forward-looking statements. These forward-looking statements, which are included in accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, may involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results and performance in future periods to be materially different from any future results or performance suggested by the forward-looking statements in this press release. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that actual results will not differ materially from these expectations, and the Company disclaims any duty to update any forward-looking statements made by the Company. From time to time, these risks, uncertainties and other factors are discussed in the Company's filings with the Securities and Exchange Commission.

(Financial Table Follows)

Entravision Communications Corporation
Consolidated Statements of Operations
(In thousands, except share and per share data)
(Unaudited)

Three-Month Period
Ended March 31,
---------------
2011 2010
---- ----

Net revenue $44,044 $43,073
------- -------

Expenses:
Direct operating expenses 20,821 20,768
Selling, general and administrative
expenses 9,243 9,056
Corporate expenses 3,745 3,748
Depreciation and amortization 4,732 4,723
38,541 38,295
------ ------
Operating income (loss) 5,503 4,778
Interest expense (9,443) (5,514)
Interest income 2 83
Other income (loss) 687 -
Income (loss) before income taxes (3,251) (653)
Income tax (expense) benefit (1,181) (1,410)
------ ------
Income (loss) before equity in net
income (loss) of
nonconsolidated affiliate (4,432) (2,063)
Equity in net income (loss) of
nonconsolidated affiliate - (121)
--- ----
Net income (loss) applicable to
common stockholders $(4,432) $(2,184)
======= =======

Basic and diluted earnings per
share:
Net income (loss) per share
applicable to common stockholders,
basic and diluted $(0.05) $(0.03)
====== ======

Weighted average common shares
outstanding, basic and diluted 85,039,298 84,430,204
========== ==========

Entravision Communications Corporation
Consolidated Statements of Cash Flows
(Unaudited; in thousands)

Three-Month Period
Ended March 31,
---------------
2011 2010
---- ----

Cash flows from operating activities:
Net income (loss) $(4,432) $(2,184)
Adjustments to reconcile net income
(loss) to net cash provided by (used
in) operating activities:
Depreciation and amortization 4,732 4,723
Deferred income taxes 638 1,213
Amortization of debt issue costs 539 104
Amortization of syndication contracts 290 272
Payments on syndication contracts (480) (704)
Equity in net income (loss) of
nonconsolidated affiliate - 121
Non-cash stock-based compensation 363 459
(Gain) loss on equity investment (687) -
Change in fair value of interest rate
swap agreements - (3,930)
Changes in assets and liabilities, net
of effect of acquisitions and
dispositions:
(Increase) decrease in accounts
receivable 6,807 5,040
(Increase) decrease in prepaid expenses
and other assets (598) (92)
Increase (decrease) in accounts
payable, accrued expenses and other
liabilities (10,627) 112
------- ---
Net cash provided by (used in)
operating activities (3,455) 5,134
------ -----
Cash flows from investing activities:
Purchases of property and equipment and
intangibles (2,513) (2,674)
Purchase of a business (348) -
Net cash provided by (used in)
investing activities (2,861) (2,674)
------ ------
Cash flows from financing activities:
Proceeds from issuance of common stock 27 150
Payments on long-term debt - (3,458)
Payments of deferred debt and offering
costs (29) (362)
Net cash provided by (used in)
financing activities (2) (3,670)
--- ------
Net increase (decrease) in cash and
cash equivalents (6,318) (1,210)
Cash and cash equivalents:
Beginning 72,390 27,666
------ ------
Ending $66,072 $26,456
======= =======

Entravision Communications Corporation
Reconciliation of Consolidated Adjusted EBITDA to Cash Flows From
Operating Activities
(Unaudited; in thousands)

The most directly comparable GAAP financial measure is operating cash
flow. A reconciliation of this non-GAAP measure to cash flows from
operating activities for each of the periods presented is as
follows:

Three-Month Period
Ended March 31,
---------------
2011 2010
---- ----

Consolidated adjusted EBITDA (1) $10,408 $9,528

Interest expense (9,443) (5,514)
Interest income 2 83
Income tax (expense) benefit (1,181) (1,410)
Amortization of syndication contracts (290) (272)
Payments on syndication contracts 480 704
Non-cash stock-based compensation
included in direct operating
expenses (51) (105)
Non-cash stock-based compensation
included in selling, general
and administrative expenses (156) (148)
Non-cash stock-based compensation
included in corporate expenses (156) (206)
Depreciation and amortization (4,732) (4,723)
Gain (loss) on equity investment 687 -
Equity in net income (loss) of
nonconsolidated affiliates - (121)
Net income (loss) (4,432) (2,184)

Depreciation and amortization 4,732 4,723
Deferred income taxes 638 1,213
Amortization of debt issue costs 539 104
Amortization of syndication contracts 290 272
Payments on syndication contracts (480) (704)
Equity in net income (loss) of
nonconsolidated affiliate - 121
Non-cash stock-based compensation 363 459
(Gain) loss on equity investment (687) -
Change in fair value of interest rate
swap agreements - (3,930)
Changes in assets and liabilities, net of
effect of acquisitions and dispositions:
(Increase) decrease in accounts
receivable 6,807 5,040
(Increase) decrease in prepaid expenses
and other assets (598) (92)
Increase (decrease) in accounts payable,
accrued expenses and other liabilities (10,627) 112
------- ---
Cash flows from operating activities $(3,455) $5,134
======= ======

(1) Consolidated adjusted EBITDA is defined on page 1.

Entravision Communications Corporation
Reconciliation of Free Cash Flow to Net Income (Loss)
(Unaudited; in thousands)

The most directly comparable GAAP financial measure is net income
(loss). A reconciliation of this non-GAAP measure to net income
(loss) for each of the periods presented is as follows:

Three-Month Period
Ended March 31,
---------------
2011 2010
---- ----
Consolidated adjusted EBITDA (1) $10,408 $9,528
Net interest expense (1) 8,902 9,257
Cash paid (refunded) for income taxes 543 197
Capital expenditures (2) 2,513 2,674
----- -----
Free cash flow (1) (1,550) (2,600)

Capital expenditures (2) 2,513 2,674
Amortization of debt issue costs (539) (104)
Change in fair value of interest rate swap
agreements - 3,930
Non-cash income tax expense (638) (1,213)
Amortization of syndication contracts (290) (272)
Payments on syndication contracts 480 704
Non-cash stock-based compensation
included in direct operating
expenses (51) (105)
Non-cash stock-based compensation
included in selling, general
and administrative expenses (156) (148)
Non-cash stock-based compensation
included in corporate expenses (156) (206)
Depreciation and amortization (4,732) (4,723)
Equity in net income (loss) of
nonconsolidated affiliates - (121)
Gain (loss) on equity investment 687 -
--- ---
Net income (loss) $(4,432) $(2,184)
======= =======

(1) Consolidated adjusted EBITDA, net interest expense and free cash
flow are defined on page 1.
(2) Capital expenditures is not part of the consolidated statement
of operations.

SOURCE Entravision Communications Corporation

Entravision Communications Corporation

CONTACT: Christopher T. Young, Chief Financial Officer, Entravision Communications Corporation, +1-310-447-3870; or Mike Smargiassi or Brad Edwards, Brainerd Communicators, Inc., +1-212-986-6667

Web Site: http://www.entravision.com

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