Saga Communications, Inc. Reports 2nd Quarter Results

Saga Communications, Inc. Reports 2nd Quarter Results

GROSSE POINTE FARMS, Mich., Aug. 11, 2014 /PRNewswire/ -- Saga Communications, Inc. (NYSE MKT: SGA) today reported net operating revenue of $33.8 million for the quarter ended June 30, 2014 which was flat with the same period last year. Operating income from continuing operations was $8.2 million. Net income for the period was $4.8 million ($0.82 per fully diluted share) and free cash flow was $5.9 million. Station operating expense was $23.5 million (station operating expense includes depreciation and amortization attributable to the stations).

Net operating revenue for the period ended June 30, 2014 increased 0.7% to $63.3 million compared to $62.8 million for the same period last year. Operating income from continuing operations was $12.5 million. Net income for the period was $7.2 million ($1.24 per fully diluted share) and free cash flow was $9.3 million. Station operating expense was $46.5 million (station operating expense includes depreciation and amortization attributable to the stations).

Capital expenditures in the 2nd quarter of 2014 were $1.5 million compared to $1.3 million for the same period last year. The Company currently expects to spend approximately $5.5 million for capital expenditures during 2014.

Saga 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 free cash flow, trailing 12 month consolidated EBITDA, and leverage ratio. 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, as a primary measure for incentive based compensation of executives and other members of management and as a measure of financial position. 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 Consolidated and Supplemental Financial Data tables.

Saga is a broadcasting company whose business is devoted to acquiring, developing and operating broadcast properties. Saga owns or operates broadcast properties in 25 markets, including 62 FM and 30 AM radio stations, 3 state radio networks, 2 farm radio networks, 4 television stations and 4 low-power television stations. For additional information, contact us at (313) 886-7070 or visit our website at www.sagacom.com.

Saga's 2nd Quarter 2014 conference call will be on Monday, August 11, 2014 at 2:00 p.m. EDT. The dial-in number for all calls is (612) 288-0337. A transcript of the call will be posted to the Company's 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 p.m. EDT on August 11, 2014 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 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 and Six Months Ended

June 30, 2014 and 2013

(amounts in 000's except per share data)

(Unaudited)


Three Months Ended Six Months Ended

June 30, June 30,

2014 2013 2014 2013
---- ---- ---- ----

Operating Results

Net operating revenue $33,831 $33,832 $63,254 $62,789

Station operating expense 23,499 23,493 46,446 45,581

Corporate general and administrative 2,120 1,982 4,273 3,930

Operating income from continuing operations 8,212 8,357 12,535 13,278

Interest expense 272 357 544 715

Other (income) expense, net (30) 66 (45) 91
--- --- --- ---

Income from continuing operations before income tax 7,970 7,934 12,036 12,472

Income tax expense 3,193 3,130 4,820 4,942
----- ----- ----- -----

Income from continuing operations, net of income taxes 4,777 4,804 7,216 7,530

Income from discontinued operations, net of income taxes - - - 223
--- --- --- ---

Net income $4,777 $4,804 $7,216 $7,753
====== ====== ====== ======

Basic earnings per share:

From continuing operations $0.83 $0.85 $1.26 $1.33

From discontinued operations - - - 0.04
--- --- ---

Earnings per share $0.83 $0.85 $1.26 $1.37
===== ===== =====

Diluted earnings per share:

From continuing operations $0.82 $0.84 $1.24 $1.31

From discontinued operations - - - 0.04
--- --- ---

Earnings per share $0.82 $0.84 $1.24 $1.35
===== ===== =====

Weighted average common shares 5,699 5,683 5,695 5,677

Weighted average common and common

equivalent shares 5,754 5,745 5,755 5,740


Free Cash Flow

Net income $4,777 $4,804 $7,216 $7,753

Plus: Depreciation and amortization:

Station 1,582 1,599 3,157 3,183

Corporate 58 56 128 113

Deferred tax provision 810 985 1,420 1,600

Non-cash compensation 191 - 379 16

Gain on disposal of television station - - - (223)

Other (income) expense, net (30) 66 (45) 91

Less: Capital expenditures (1,455) (1,288) (2,914) (2,465)

Free cash flow $5,933 $6,222 $9,341 $10,068
====== ====== ====== =======


Balance Sheet Data

Working capital $33,182 $30,985

Net fixed assets $56,304 $57,656

Net intangible assets and other assets $95,214 $95,932

Total assets $201,988 $197,983

Long-term debt (including current

portion of $5,000 and $1,078, respectively) $46,078 $51,078

Stockholders' equity $117,783 $112,272





Saga Communications, Inc.

Selected Supplemental Financial Data

For the Three and Six Months Ended

June 30, 2014 and 2013

(amounts in 000's)

(Unaudited)


Corporate

Radio Television and Other Consolidated
----- ---------- --------- ------------

Three Months Ended June 30, 2014:

Net operating revenue $28,851 $4,980 $ - $33,831

Station operating expense 20,200 3,299 - 23,499

Corporate G&A - - 2,120 2,120

Operating income (loss) from continuing operations $8,651 $1,681 ($2,120) $8,212
====== ====== ======= ======

Depreciation and amortization $1,236 $346 $58 $1,640
====== ==== === ======


Corporate

Radio Television and Other Consolidated
----- ---------- --------- ------------

Three Months Ended June 30, 2013:

Net operating revenue $28,674 $5,158 $ - $33,832

Station operating expense 20,215 3,278 - 23,493

Corporate G&A - - 1,982 1,982

Operating income (loss) from continuing operations $8,459 $1,880 $(1,982) $8,357
====== ====== ======= ======

Depreciation and amortization $1,249 $350 $56 $1,655
====== ==== === ======


Corporate

Radio Television and Other Consolidated
----- ---------- --------- ------------

Six Months Ended June 30, 2014:

Net operating revenue $53,776 $9,478 $ - $63,254

Station operating expense 39,939 6,507 - 46,446

Corporate G&A - - 4,273 4,273

Operating income (loss) from continuing operations $13,837 $2,971 ($4,273) $12,535
======= ====== ======= =======

Depreciation and amortization $2,466 $691 $128 $3,285
====== ==== ==== ======


Corporate

Radio Television and Other Consolidated
----- ---------- --------- ------------

Six Months Ended June 30, 2013:

Net operating revenue $53,136 $9,653 $ - $62,789

Station operating expense 39,222 6,359 - 45,581

Corporate G&A - - 3,930 3,930

Operating income (loss) from continuing operations $13,914 $3,294 $(3,930) $13,278
======= ====== ======= =======

Depreciation and amortization $2,491 $692 $113 $3,296
====== ==== ==== ======





Saga Communications, Inc.

Selected Supplemental Financial Data

June 30, 2014

(amounts in 000's except ratios)

(Unaudited)




Less: Plus: Trailing

12 Mos Ended 6 Mos Ended 6 Mos Ended 12 Mos Ended

December 31, June 30, June 30, June 30,

2013 2013 2014 2014
---- ---- ---- ----

Trailing 12 Month Consolidated Earnings Before Interest

Taxes, Depreciation and Amortization ("EBITDA") (1)

Net income $15,273 $7,753 $7,216 $14,736

Exclusions:

(Loss) gain on sale of assets 126 (15) 45 186

Impairment of intangible assets (2,033) - - (2,033)

Gain on sale of television station 223 223 - -

Other (39) (37) 213 $211

Total exclusions (1,723) 171 258 (1,636)
------ --- --- ------


Consolidated adjusted net income (1) 16,996 7,582 6,958 16,372

Plus: Interest expense 1,305 715 544 1,134

Income tax expense 9,992 4,942 4,820 9,870

Depreciation & amortization expense 6,768 3,296 3,285 6,757

Amortization of television syndicated programming contracts 637 320 308 625

Non-cash stock based compensation expense 135 16 379 498

Less: Cash television programming payments (628) (317) (309) (620)

Trailing twelve month consolidated EBITDA (1) $35,205 $16,554 $15,985 $34,636
======= ======= ======= =======


Total long-term debt, including current maturities $46,078

Divided by trailing twelve month consolidated EBITDA (1) 34,636

Leverage ratio 1.3
===



(1) As defined in the Company's credit facility.





SOURCE Saga Communications, Inc.

Saga Communications, Inc.

CONTACT: Samuel D. Bush, 313/886-7070

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


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