Saga Communications, Inc. Reports 1st Quarter 2016 Results

Saga Communications, Inc. Reports 1st Quarter 2016 Results

Free Cash Flow Increased 35.4%

GROSSE POINTE FARMS, Mich., May 5, 2016 /PRNewswire/ -- Saga Communications, Inc. (NYSE MKT: SGA) today reported free cash flow increased 35.4% to $4.9 million for the quarter ended March 31, 2016. Net revenue increased 12.7% to $32.8 million. Operating Income increased 40.1% to $5.3 million. Station operating expense increased 8.4% to $24.7 million (station operating expense includes depreciation and amortization attributable to the stations). Same Station net revenue increased 7.0% to $31.0 million and same station operating expense increased 3.0% to $23.2 million. Net income for the period was $3.0 million ($0.52 per fully diluted share compared to $0.36 for the same period last year).

Capital expenditures were $1 million in the 1(st) quarter which was approximately comparable to the same period last year. The Company currently expects to spend approximately $5.0 million to $5.5 million for capital expenditures during 2016.

During the 1(st) Quarter the Company closed on its purchase of WLVQ-FM in Columbus, OH for $13 million. The Company began operating WLVQ - FM pursuant to a Local Marketing Agreement as of November 16, 2015.

Saga's 2016 1st Quarter conference call will be on Thursday, May 5, 2016 at 11:00 a.m. EDT. The dial-in number for the call is (612) 332-0345. A transcript of the call will be posted to the Company's website as soon as it is available after the call.

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 10:00 a.m. EDT on May 5, 2016 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.

The attached Selected Supplemental Financial Data tables disclose "actual", "same station" and "proforma" information by segment as well as the Company's trailing 12 month consolidated EBITDA. The "actual" 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 "proforma" amounts assume all acquisitions and dispositions in 2015 and 2016 occurred as of January 1, 2015.

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 same station financial information, 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.

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 is a broadcasting company whose business is devoted to acquiring, developing and operating broadcast properties. Saga owns or operates broadcast properties in 26 markets, including 67 FM and 32 AM radio stations, 4 television stations and 5 low-power television stations. For additional information, contact us at (313) 886-7070 or visit our website at www.sagacom.com.


Saga Communications, Inc.

Selected Consolidated Financial Data

For The Three Months Ended

March 31, 2016 and 2015

(amounts in 000's except per share data)

(Unaudited)


Three Months Ended

March 31,

2016 2015
---- ----

Operating Results

Net operating revenue $32,745 $29,061

Station operating
expense 24,685 22,765

Corporate general and
administrative 2,717 2,482

Operating income 5,343 3,814

Interest expense 189 241

Other income - (8)

Income before income tax
expense 5,154 3,581

Income tax expense 2,130 1,450
----- -----

Net income $3,024 $2,131
====== ======


Earnings Per Share

Basic $0.52 $0.37
=====

Diluted $0.52 $0.36
=====


Weighted average common
shares 5,751 5,710

Weighted average common
and common

equivalent shares 5,759 5,762


Free Cash Flow

Net income $3,024 $2,131

Plus: Depreciation and
amortization:

Station 1,667 1,521

Corporate 69 68

Deferred tax provision 575 360

Non-cash compensation 528 462

Other income - (8)

Less: Capital
expenditures (1,010) (950)

Free cash flow $4,853 $3,584
====== ======


March 31,

2016 2015
---- ----

Balance Sheet Data

Working capital $25,003 $33,262

Net fixed assets $57,924 $54,557

Net intangible assets and other
assets $110,795 $93,477

Total assets $209,727 $195,548

Long-term debt $36,365 $36,078

Stockholders' equity $125,162 $116,897



Saga Communications, Inc.

Selected Supplemental Financial Data

For the Three Months Ended

March 31, 2016 and 2015

(amounts in 000's except per share data)

(Unaudited)


Actual Same Station (1) Pro Forma (2)

Three Months Ended Three Months Ended Three Months Ended

March 31, March 31, March 31,

2016 2015 2016 2015 2016 2015
---- ---- ---- ---- ---- ----

Consolidated

Net operating revenue $32,745 $29,061 $31,008 $28,991 $32,745 $31,015

Station operating expense 24,685 22,765 23,221 22,551 24,700 24,457

Corporate general and administrative 2,717 2,482 2,717 2,482 2,717 2,482

Other operating (income) expense, net - - (2) - - -

Operating income 5,343 3,814 $5,072 $3,958 5,328 4,076

Interest expense 189 241 189 241

Other income - (8) - (8)
--- --- --- ---

Income before income tax expense 5,154 3,581 5,139 3,843

Income tax expense 2,130 1,450 2,124 1,557

Net income $3,024 $2,131 $3,015 $2,286
====== ====== ====== ======

Earnings per share:

Basic $0.52 $0.37 $0.52 $0.40
===== ===== ===== =====

Diluted $0.52 $0.36 $0.52 $0.40
===== ===== ===== =====


Actual Same Station (1) Pro Forma (2)

Three Months Ended Three Months Ended Three Months Ended

March 31, March 31, March 31,

2016 2015 2016 2015 2016 2015
---- ---- ---- ---- ---- ----

Radio Segment

Net operating revenue $27,464 $24,276 $25,727 $24,206 $27,464 $26,230

Station operating expense 21,140 19,422 19,676 19,208 21,155 21,114

Other operating (income) expense, net (3) - (5) - (3) -

Operating income $6,327 $4,854 $6,056 $4,998 $6,312 $5,116
====== ====== ====== ====== ====== ======



Actual Same Station (1) Pro Forma (2)

Three Months Ended Three Months Ended Three Months Ended

March 31, March 31, March 31,

2016 2015 2016 2015 2016 2015
---- ---- ---- ---- ---- ----

Television Segment

Net operating revenue $5,281 $4,785 $5,281 $4,785 $5,281 $4,785

Station operating expense 3,545 3,343 3,545 3,343 3,545 3,343

Other operating (income) expense, net 3 - 3 - 3 -

Operating income $1,733 $1,442 $1,733 $1,442 $1,733 $1,442
====== ====== ====== ====== ====== ======



Actual Same Station (1) Pro Forma (2)

Three Months Ended Three Months Ended Three Months Ended

March 31, March 31, March 31,

2016 2015 2016 2015 2016 2015
---- ---- ---- ---- ---- ----

Depreciation and amortization

by segment

Radio Segment $1,346 $1,174 $1,151 $1,166 $1,361 $1,381

Television Segment 321 347 321 347 321 347

Corporate and Other 69 68 69 68 69 68

$1,736 $1,589 $1,541 $1,581 $1,751 $1,796
====== ====== ====== ====== ====== ======


(1) Same station includes only the results of stations we owned and operated for the entire comparable
period.

(2) Pro Forma results assume all acquisitions and dispositions in 2015 and 2016 occurred as of January 1,
2015.



Saga Communications, Inc.

Selected Supplemental Financial Data

March 31, 2016

(amounts in 000's except ratios)

(Unaudited)




Less: Plus: Trailing

12 Mos Ended 3 Mos Ended 3 Mos Ended Add: 12 Mos Ended

December 31, March 31, March 31, Proforma March 31,

2015 2015 2016 Acquisitions 2016
---- ---- ---- ------------ ----

Trailing 12 Month Consolidated Earnings Before Interest

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

Net income $13,414 $2,131 $3,024 $703 $15,010

Exclusions:

Gain (loss) on sale of assets (541) 8 - (549)

Gain on insurance claim 417 - - 417

Impairment of intangible assets (874) - - (874)

Write-off of debt issuance costs (557) - - (557)

Other 119 21 70 168

Total exclusions (1,436) 29 70 0 (1,395)
------ --- --- --- ------

Consolidated adjusted net income (1) 14,850 2,102 2,954 703 16,405

Plus: Interest expense 888 241 189 836

Income tax expense 9,640 1,450 2,130 489 10,809

Depreciation & amortization expense 6,824 1,589 1,736 378 7,349

Amortization of television syndicated programming contracts 637 162 158 633

Non-cash stock based compensation expense 1,655 462 528 1,721

Less: Cash television programming payments (635) (159) (158) (634)

Trailing twelve month consolidated EBITDA (1) $33,859 $5,847 $7,537 $1,570 $37,119
======= ====== ====== ====== =======


Total long-term debt, including current maturities $36,365

Divided by trailing twelve month consolidated EBITDA (1) 37,119

Leverage ratio 1.0
===


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



Saga Communications, Inc.

Selected Financial Data Non-GAAP Disclosures

For the Three Months Ended

March 31, 2016 and 2015

(amounts in 000's)

(Unaudited)



Reconciliation of Actual (historical) Information to Same Station Operating Income
----------------------------------------------------------------------------------


Adjustment Adjustment

Actual For Acquisitions Same Station Actual For Acquisitions Same Station

Three Months and Dispositions Three Months Three Months and Dispositions Three Months

Ended Not Included in Ended Ended Not Included in Ended

March 31, Entire Comparable March 31, March 31, Entire Comparable March 31,

2016 Period 2016 2015 Period 2015
---- ------ ---- ---- ------ ----

Consolidated

Net operating revenue $32,745 $(1,737) $31,008 $29,061 $(70) $28,991

Station operating expense 24,685 (1,464) 23,221 22,765 (214) 22,551

Corporate general and
administrative 2,717 - 2,717 2,482 - 2,482

Other operating (income) expense,
net - (2) (2) - - -

Operating income $5,343 $(271) $5,072 $3,814 $144 $3,958
====== ===== ====== ====== ==== ======


Depreciation and amortization $1,736 $(195) $1,541 $1,589 $(8) $1,581
====== ===== ====== ====== === ======


Adjustment Adjustment

Actual For Acquisitions Same Station Actual For Acquisitions Same Station

Three Months and Dispositions Three Months Three Months and Dispositions Three Months

Ended Not Included in Ended Ended Not Included in Ended

March 31, Entire Comparable March 31, March 31, Entire Comparable March 31,

2016 Period 2016 2015 Period 2015
---- ------ ---- ---- ------ ----

Radio Segment

Net operating revenue $27,464 $(1,737) $25,727 $24,276 $(70) $24,206

Station operating expense 21,140 (1,464) 19,676 19,422 (214) 19,208

Other operating (income) expense,
net (3) (2) (5) - - # -

Operating income $6,327 $(271) $6,056 $4,854 $144 $4,998
====== ===== ====== ====== ==== ======


Depreciation and amortization $1,346 $(195) $1,151 $1,174 $(8) $1,166
====== ===== ====== ====== === ======


Adjustment Adjustment

Actual For Acquisitions Same Station Actual For Acquisitions Same Station

Three Months and Dispositions Three Months Three Months and Dispositions Three Months

Ended Not Included in Ended Ended Not Included in Ended

March 31, Entire Comparable March 31, March 31, Entire Comparable March 31,

2016 Period 2016 2015 Period 2015
---- ------ ---- ---- ------ ----

Television Segment

Net operating revenue $5,281 $ - $5,281 $4,785 $ - $4,785

Station operating expense 3,545 - 3,545 3,343 - 3,343

Other operating (income) expense, 3 - 3 - - -
net

Operating income $1,733 $ - $1,733 $1,442 $ - $1,442
====== ======================= ====== ====== ======================= ======


Depreciation and amortization $321 $ - $321 $347 $ - $347
==== ======================= ==== ==== ======================= ====


SOURCE Saga Communications, Inc.

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Saga Communications, Inc.

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

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


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