Nexstar Broadcasting Group Reports 2004 Fourth Quarter and Year-End Results.IRVING, Texas Irving (pronounced 'er-ving') is a city located in the U.S. state of Texas within Dallas County. According to the 2000 U.S. Census, the city population was 191,615; the 2006 estimate was 201,927 according to the North Central Texas Council of Governments, and 196,084 according to -- Nexstar Broadcasting Group, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : NXST) today reported financial results for the fourth quarter and year ended December December: see month. 31, 2004 ahead of previously issued guidance. Summary Reported 2004 Fourth Quarter and Year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. Highlights: Total net revenue for the 2004 fourth quarter was $70.5 million, an increase of 19.5% over net revenue of $59.0 million in the 2003 fourth quarter. Nexstar's previous guidance, issued on November November: see month. 4, 2004, was for 2004 total net revenue to be approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $66.0 to $68.0 million, or an increase of approximately 12.0% - 15.0%. For the full year, Nexstar's total net revenue increased 14.7% to $245.7 million from $214.3 million in 2003. The following table summarizes reported highlights for the three and twelve-month periods ended December 31, 2004:
Summary 2004 Highlights:
(dollars and shares in Three Months Twelve Months
millions, except per Ended Ended December
share data) December 31, 31,
-------------------------
2004 2003 Change 2004 2003 Change
------ ------- ------ ------- ------- -------
Gross local and national
advertising revenue,
excluding political $57.7 $54.5 5.9% $219.7 $203.8 7.8%
Gross political
advertising revenue $12.9 $2.2 486.4% $26.7 $4.4 506.8%
Total gross advertising
revenue $70.6 $56.7 24.5% $246.4 $208.2 18.3%
Total net revenue (1) $70.5 $59.0 19.5% $245.7 $214.3 14.7%
Station direct operating
expenses, SG&A expenses
and cash program
payments $34.3 $33.5 2.4% $129.7 $125.2 3.6%
Broadcast cash flow (2) $29.6 $20.3 45.8% $95.2 $70.8 34.5%
Corporate expenses $4.1 $4.4 (6.8)% $10.9 $12.6 (13.5)%
Adjusted EBITDA (2) $25.5 $15.8 61.4% $84.2 $58.2 44.7%
Net income (loss)
attributable to common
shareholders (3) $0.7 $(24.4) 102.9% $(20.5) $(87.1) 76.5%
Diluted net income (loss)
per share attributable
to common shareholders $0.03 $(1.29) 102.3% $(0.72) $(5.59) 87.1%
Weighted basic and
diluted shares
outstanding 28.4 19.0 28.4 15.6
Free cash flow (2) $12.1 $(25.1) 148.2% $31.2 $(16.1) 293.8%
(1) Total net revenue is the sum of total gross advertising revenue,
network compensation, trade and barter revenue, and other sources
of revenue, less national rep and agency commissions.
(2) "Broadcast cash flow", "adjusted EBITDA" and "free cash flow" are
non-GAAP financial measures. For a definition of these measures
and reconciliation to comparable GAAP financial results, please
see the "Definitions and Disclosure Regarding non-GAAP Financial
Information" section and supplemental reconciliation tables at the
end of this release.
(3) The 2003 fourth quarter net loss attributable to common
shareholders includes a $5.0 million loss on the extinguishment of
debt.
Summary Pro Forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma Highlights Pro forma results reflect the completed acquisitions of certain television stations as if they had occurred on January January: see month. 1, 2003. The following table summarizes pro forma highlights for the three and twelve-month periods ended December 31, 2004:
Summary 2004 Pro Forma Three Months Twelve Months
Highlights: (1) Ended Ended
(dollars in millions) December 31, December 31,
---------------------------
2004 2003 Change 2004 2003 Change
------ ------ ------ ------- ------- ------
Total net revenue (1) $71.0 $62.1 14.3% $252.3 $230.8 9.3%
Station direct operating
expenses, SG&A expenses
and cash program payments $34.7 $36.7 (5.4)% $135.5 $141.1 (4.0)%
(1) "Pro forma" is a non-GAAP financial measure. For a more complete
definition of "pro forma" and reconciliation of these results to
comparable GAAP financial results, please see the "Definitions and
Disclosure Regarding non-GAAP Financial Information" section and
supplemental reconciliation tables at the end of this release.
CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Comment Perry A. Sook, Chairman, President and Chief Executive Officer of Nexstar Broadcasting Group, Inc., commented, "Fourth quarter operating results benefited from election year political advertising revenue and several acquisitions completed in 2004. Excluding political advertising revenue, our core local and national revenues continued to grow, highlighting both our sales and local content leadership as well as strengthening economies in the markets we serve. "In 2004, we successfully integrated over twenty television stations into Nexstar's operating model Operating Model is a term that is used in many contexts. In essence an operating model describes how an organization operates across both business and technology domains. The Operating Model describes what is important for the organization. , more than doubling the size of our portfolio. Completing the successful integration of so many new stations in such a short period of time was a significant accomplishment for our team in 2004. Our focus on achieving cost reductions contributed to an 4.0% decline in pro forma station direct operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. , selling, general and administrative expenses and cash program payments during the year. When coupled with our revenue gains, these efficiencies helped Nexstar achieve record levels of broadcast cash flow, EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become and free cash flow in 2004. "2005 will be a period of focused execution for Nexstar Broadcasting Group. We will concentrate our time and resources on operating our existing station group. We believe our integration success in 2004 places us in a good position to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the improving economy and continue growing our core business, exclusive of political revenue. We are also well positioned to build on our cost containment cost containment, n the features of a dental benefits program or of the administration of the program designed to reduce or eliminate certain charges to the plan. efforts from 2004 and capture any remaining expense savings from our recently acquired stations. "At the corporate level, we are pursuing strategies to reduce cash obligations related to our debt structure which, if successful, will result in free cash flow gains. We plan to use our free cash flow to pay down debt and strengthen our balance sheet in 2005. We are also pursuing opportunities to divest To deprive or take away. Divest is usually used in reference to the relinquishment of authority, power, property, or title. If, for example, an individual is disinherited, he or she is divested of the right to inherit money. certain non-strategic assets, and if progress is made on this front, we anticipate using the proceeds to further reduce debt." Additional Expense Detail on Reported 2004 Fourth Quarter Results Depreciation and amortization was $10.8 million in the fourth quarter of 2004, compared to $12.3 million in the fourth quarter of 2003. The decrease in depreciation and amortization expense for the fourth quarter of 2004 is primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to depreciable depreciable Of, relating to, or being a long-term tangible asset that is subject to depreciation. assets at certain stations becoming fully depreciated Fully depreciated An asset that has already been charged with the maximum amount of depreciation allowed by the IRS for accounting purposes. fully depreciated Of or relating to a fixed asset that has been depreciated to a book value of zero. in the first quarter of 2004 and amortizable am·or·tize tr.v. am·or·tized, am·or·tiz·ing, am·or·tiz·es 1. To liquidate (a debt, such as a mortgage) by installment payments or payment into a sinking fund. 2. assets at certain stations becoming fully amortized in the third quarter of 2004. Interest expense in the fourth quarter of 2004 was $13.3 million, compared to $25.3 million for the same period in 2003. Included in the 2003 amount are non-recurring items of $6.7 million related to call premiums and accelerated amortization on Quorum's senior discount notes and $3.9 million related to the adoption of Statement of Financial Accounting Standards No. 150, "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity" ("SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System No. 150") on July July: see month. 1, 2003. SFAS No.150 required the Company to account for the change in fair value of certain of its mandatory Peremptory; obligatory; required; that which must be subscribed to or obeyed. Mandatory statutes are those that require, as opposed to permit, a particular course of action. redeemable Redeemable Eligible for redemption under the terms of an indenture. units from implementation date as an adjustment to interest expense. The decrease is partially attributed to lower interest rates on our senior credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities and the redemption The liberation of an estate in real property from a mortgage. Redemption is the process by which land that has been mortgaged or pledged is bought back or reclaimed. It is accomplished through a payment of the debt owed or a fulfillment of the other conditions. of Nexstar's 16% senior discount notes in January 2004. Capital expenditures in the fourth quarter of 2004 were $3.2 million, compared to $1.8 million in the fourth quarter of 2003. Cash interest for the fourth quarter of 2004 was $10.1 million, compared to $21.9 million in the fourth quarter of 2003. Cash interest excludes non-cash interest related to amortization of debt financing Debt Financing When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise to repay costs and accretion The act of adding portions of soil to the soil already in possession of the owner by gradual deposition through the operation of natural causes. The growth of the value of a particular item given to a person as a specific bequest under the provisions of a will between the of the discount on Nexstar's 11.375% senior discount notes and 12% senior subordinated Subordinated A claim ranked lower in priority than other claims. Common stock claims are always subordinated to debt. notes. Liquidity and Cash Flow Free cash flow for the 2004 fourth quarter rose to $12.1 million from a negative $25.1 million in the fourth quarter of 2003. At December 31, 2004, the Company's total debt was approximately $629.9 million and cash balances were $18.5 million. Nexstar Broadcasting, Inc., a subsidiary of the Company, and Mission Broadcasting Mission Broadcasting, Inc. is a television station group that owns 15 television stations operated by Nexstar Broadcasting. The group's President is David S. Smith. The broadcasting group was founded in 1998 and was founded by Smith[1]. , Inc., are borrowers under senior secured credit facilities. As defined per the credit agreement, consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: total debt under the credit facilities of $521.7 million at December 31, 2004, net of cash on hand, resulted in a leverage ratio as defined per the credit agreement of 5.9x, compared to a permitted leverage covenant covenant (kŭv`ənənt), agreement entered into voluntarily by two or more parties to do or refrain from doing certain acts. In the Bible and in theology the covenant is the agreement or engagement of God with man as revealed in the of 6.5x. Covenants under the credit facilities exclude Nexstar Finance Holdings, Inc.'s 11.375% notes, which have accreted to $90.7 million, as of December 31, 2004. 12% Senior Subordinated Notes Redemption On March 2, 2005, Nexstar Broadcasting Group called for redemption of all $160 million in aggregate principal amount of Nexstar Broadcasting, Inc.'s outstanding 12% Senior Subordinated Notes due April 1, 2008. Nexstar Broadcasting is a subsidiary of Nexstar Broadcasting Group. The redemption price Redemption price See: Call price redemption price 1. The price at which an open-end investment company will buy back its shares from the owners. In most cases, the redemption price is the net asset value per share. 2. is $1,060 per $1,000 principal amount, plus accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. and unpaid interest to the scheduled redemption date Redemption date The date on which a bond matures or is redeemed. redemption date The date on which a debt security is scheduled to be redeemed by the issuer. The redemption date is the scheduled maturity date or, if applicable, a call date. , which is April 1, 2005. The Company intends to fund the redemption of the Notes from committed financing sources. Completed Acquisitions On November 30, 2004, Nexstar completed its acquisition of KLST-TV, the CBS (Cell Broadcast Service) See cell broadcast. affiliate Affiliate Relationship between two companies when one company owns substantial interest, but less than a majority of the voting stock of another company, or when two companies are both subsidiaries of a third company. See: Subsidiaries, parent company. in San Angelo, Texas San Angelo is a city in and the county seat of Tom Green CountyGR6, Texas, United States. It is also the principal city of the "San Angelo, Texas Metropolitan Statistical Area" that includes all of Irion and Tom Green county. . Nexstar had been operating KLST KLST is the CBS affiliate serving San Angelo, Texas, in the United States. It is owned by the Irving, TX based Nexstar Broadcasting Group. KLST was purchased by Nexstar Broadcasting in 2004 from the Jewell Television Corporation. under a Time Brokerage BROKERAGE, contracts. The trade or occupation of a broker; the commissions paid to a broker for his services. Agreement (TBA TBA See: To be announced ) effective June June: see month. 1, 2004. Operations under that TBA terminated ter·mi·nate v. ter·mi·nat·ed, ter·mi·nat·ing, ter·mi·nates v.tr. 1. To bring to an end or halt: on November 30, 2004. On January 4, 2005, Mission Broadcasting closed its acquisition of WTVO-TV, the ABC ABC in full American Broadcasting Co. Major U.S. television network. It began when the expanding national radio network NBC split into the separate Red and Blue networks in 1928. affiliate in Rockford, Illinois Rockford is a mid-sized city located on both banks of the Rock River in far northern Illinois. Rockford is often referred to as "The Forest City" and is the county seat of Winnebago County, Illinois, USA. As reported in the 2000 U.S. . Nexstar entered into local service agreements with Mission for WTVO WTVO (Channel 17) is the Rockford, Illinois-based affiliate of the ABC television network. The station is owned by Mission Broadcasting, a subsidiary of Nexstar Broadcasting Group. and began providing services to the station through its owned and operated station, WQRF-TV WQRF-TV (Fox 39) is the Rockford, Illinois-based television affiliate of FOX. The station began its operations in November 1978, and became the area's Fox station in August 1989. , on November 1, 2004. On January 7, 2005, Nexstar closed on its acquisition of KFTA/KNWA, the NBC NBC in full National Broadcasting Co. Major U.S. commercial broadcasting company. It was formed in 1926 by RCA Corp., General Electric Co. (GE), and Westinghouse and was the first U.S. company to operate a broadcast network. affiliate in Fort Smith-Fayetteville-Springdale-Rogers, Arkansas Arkansas, river, United States Arkansas (ärkăn`zəs, är`kənsô'), river, c.1,450 mi (2,330 km) long, rising in the Rocky Mts., central Colo. . Nexstar had been operating KFTA/KNWA under a TBA effective October October: see month. 16, 2003. Operations under that TBA terminated on January 7, 2005. Summary 2005 First-Quarter Outlook Nexstar issued the following outlook for the three-month period ending March 31, 2005:
Reported 2005 First Quarter Three Months Ended
Estimates March 31,
(in millions)
2004 - Approximate
2005 - Est. Actual Change
------------- -------- ---------------
Gross local and national
advertising revenue, excluding
political $50.0 - 51.0 $49.9 0.2 - 2.2%
Gross political advertising
revenue $0.1 - 0.2 $3.4 (97.1) - (94.1)%
Total gross advertising revenue $50.1 - 51.2 $53.3 (6.0) - (3.9)%
Total net revenue $51.5 - 52.5 $54.2 (5.0) - (3.1)%
Station direct operating
expenses, SG&A expenses
and cash program payments $32.3 - 32.8 $31.5 2.5 - 4.1%
The Company's financial outlook for the first quarter ending March 31, 2005 assumes there will be no new acquisitions or local service agreements entered into during the period. The outlook also assumes no debt restructuring Debt Restructuring A method used by companies with outstanding debt obligations to alter the terms of the debt agreements in order to achieve some advantage. Notes: costs will be reported during the period. The outlook is subject to, and could be affected by: economic developments, regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. developments, the timing of any investments, dispositions or other transactions, and major news events, among other circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or . Reference is made to the "Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " statement regarding forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. comments at the end of this press release. While the Company may, from time to time, issue updated guidance, it assumes no obligation to do so. Fourth-Quarter Conference Call Nexstar will host a conference call at 10:00 a.m. ET today. Senior management will discuss the financial results and host a question and answer session. A live audio webcast of the call will be accessible to the public on the Company's web site, www.nexstar.tv. A recording of the webcast will subsequently be archived on the site. The dial in number for the audio conference call is 800-310-1961; no access code is needed. A replay of the call will be available through March 11, 2005 by dialing 888-203-1112, (719-457-0820 for International callers), and entering access code 4771667. Definitions and Disclosures Regarding non-GAAP Financial Information Broadcast cash flow is calculated as operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. plus corporate expenses plus depreciation and amortization of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. and broadcast rights (excluding barter barter: see exchange. barter Direct exchange of goods or services without the use of money or any other intervening medium of exchange. Barter is conducted either according to established rates of exchange or by bargaining. ) plus other non-recurring items minus broadcast rights payments. Adjusted EBITDA is calculated as broadcast cash flow less corporate expenses. Free cash flow is calculated as income from operations plus depreciation and amortization of intangible assets and broadcast rights (excluding barter), less payments for broadcast rights, cash interest expense, capital expenditures and net cash taxes. Pro forma results reflect the completed acquisitions of certain television stations as if they had occurred on January 1, 2003. Pro Forma results for the three months ended December 31, 2004 and 2003 include Nexstar's acquisition of KFTA/KNWA in Fort Smith-Fayetteville-Springdale-Rogers, AR, which Nexstar began operating under a TBA in October 2003, and KLST in San Angelo San Angelo (săn ăn`jəlō), city (1990 pop. 84,474), seat of Tom Green co., W Tex., where two forks join to form the Concho River; laid out 1869, inc. 1903. , TX, which Nexstar began operating under a TBA in June 2004. These periods also include the acquisition of WUTR WUTR is the ABC affiliate for Utica, New York. The station is owned by Mission Broadcasting (and thus is operated by Nexstar Broadcasting Group, along with WFXV and WPNY-LP) and broadcasts its signal on UHF channel 20, with a digital signal on channel 30. in Utica Utica, ancient city, N Africa Utica (y  `tĭkə), ancient N African city, c.25 mi (40 km) NW of Carthage. According to tradition, it was founded by Phoenicians from Tyre c. , NY by Mission Broadcasting, Inc.,
Nexstar's broadcasting associate, which Mission completed in April
2004, as well as Mission's acquisition of WBAK in Terre Haute Terre Haute (tĕr`ə hōt, tĕr`ē hŭt), city (1990 pop. 51,483), seat of Vigo co., W Ind., on the Wabash River; inc. 1816. , IN,
which Mission began operating under a TBA in May 2003, and WTVO in
Rockford Rockford, industrial city (1990 pop. 139,426), seat of Winnebago co., N Ill., on the Rock River near the Wis. line; inc. 1839 with the merger of two settlements on opposite sides of the river. , IL, which Nexstar began providing services to in November
2004. Pro forma results for the year ended December 31, 2004 and 2003
include the stations mentioned above, as well as KARK in Little Rock, AR
and WDHN WDHN is an ABC-affiliated television station in Dothan, Alabama, broadcasting on channel 18. The station's transmitter is located behind its studios on Route 52 in Webb, Alabama, approximately 6 miles east of Dothan. The signal has little reach outside the greater Dothan area. in Dothan Dothan, in the BibleDothan (dō`thăn) or Dothaim (dōthā`ĭm), city, central ancient Palestine, in the uplands NE of Samaria. , AL, both of which Nexstar began operating under a TBA in February February: see month. 2003. Broadcast cash flow, adjusted EBITDA, free cash flow and Pro Forma results are non-GAAP financial measures. Nexstar believes the presentation of these non-GAAP measures are useful to investors because they are used by lenders to measure the Company's ability to service debt; by industry analysts to determine the market value of stations and their operating performance; by management to identify the cash available to service debt, make strategic acquisitions and investments, maintain capital assets capital assets n. equipment, property, and funds owned by a business. (See: capital, capital account) and fund ongoing operations and working capital needs; and, because they reflect the most up-to-date operating results of the stations inclusive of inclusive of prep. Taking into consideration or account; including. pending acquisitions, TBAs or LMAs. Management believes they also provide an additional basis from which investors can establish forecasts and valuations for the Company's business. For a reconciliation of these non-GAAP financial measurements to the GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). financial results cited in this news announcement, please see the supplemental tables at the end of this release. About Nexstar Broadcasting Group, Inc. Nexstar Broadcasting Group owns, operates, programs or provides sales and other services to 46 television stations in 27 markets in the states of Illinois Illinois, river, United States Illinois, river, 273 mi (439 km) long, formed by the confluence of the Des Plaines and Kankakee rivers, NE Ill., and flowing SW to the Mississippi at Grafton, Ill. It is an important commercial and recreational waterway. , Indiana Indiana, state, United States Indiana, midwestern state in the N central United States. It is bordered by Lake Michigan and the state of Michigan (N), Ohio (E), Kentucky, across the Ohio R. (S), and Illinois (W). , Maryland Maryland (mâr`ələnd), one of the Middle Atlantic states of the United States. It is bounded by Delaware and the Atlantic Ocean (E), the District of Columbia (S), Virginia and West Virginia (S, W), and Pennsylvania (N). , Missouri Missouri, state, United States Missouri (mĭz  r`ē, –ə), one of the midwestern states of the United States. , Montana Montana (mŏntăn`ə), Rocky Mt. state in the NW United States. It is bounded by North Dakota and South Dakota (E), Wyoming (S), Idaho (W), and the Canadian provinces of British Columbia, Alberta, and Saskatchewan (N). , Texas,
Pennsylvania Pennsylvania (pĕnsəlvā`nyə), one of the Middle Atlantic states of the United States. It is bordered by New Jersey, across the Delaware River (E), Delaware (SE), Maryland (S), West Virginia (SW), Ohio (W), and Lake Erie and New York , Louisiana Louisiana (ləwē'zēăn`ə, lē'–), state in the S central United States. It is bounded by Mississippi, with the Mississippi R. , Arkansas, Alabama Alabama, indigenous people of North AmericaAlabama (ăləbăm`ə), indigenous people of North America whose language belongs to the Muskogean branch of the Hokan-Siouan linguistic stock (see Native American languages). and New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of . The Company's television station group includes affiliates of NBC, CBS, ABC, Fox and UPN UPN User Principal Name (Microsoft Windows 2000) UPN United Paramount Network UPN Unión del Pueblo Navarro (Navarrese People Union) UPN Umgekehrte Polnische Notation , and reaches approximately 7.4% of all U.S. television households. The following is a list of Nexstar's owned properties, as well as those with which it has local service agreements:
Market
Rank(1) Market Station Affiliation Status (2)
-------- --------------------------- ---------- ----------- ----------
Washington, DC/Hagerstown, WHAG NBC O&O
8 MD(3)
53 Wilkes Barre-Scranton, PA WBRE NBC O&O
WYOU CBS LSA
56 Little Rock-Pine Bluff, AR KARK NBC O&O
75 Rochester, NY WROC CBS O&O
78 Springfield, MO KOLR CBS LSA
KSFX(4) Fox O&O
81 Shreveport, LA KTAL NBC O&O
Champaign-Springfield- WCIA CBS O&O
82 Decatur, IL
WCFN UPN O&O
99 Evansville, IN WTVW Fox O&O
105 Ft. Wayne, IN WFFT Fox O&O
Ft. Smith - Fayetteville - KFTA(5)/ NBC O&O(6)
108 Springdale - Rogers, AR KNWA(5)
117 Peoria-Bloomington, IL WMBD CBS O&O
WYZZ Fox LSA
129 Amarillo, TX KAMR NBC O&O
KCIT Fox LSA
KCPN-LP -- LSA
Rockford, IL WQRF Fox O&O
133 WTVO ABC LSA(7)
135 Monroe, LA-El Dorado, AR KARD Fox O&O
138 Beaumont-Port Arthur, TX KBTV NBC O&O
141 Erie, PA WJET ABC O&O
WFXP Fox LSA
Market
Rank(1) Market Station Affiliation Status (2)
-------- --------------------------- ---------- ----------- ----------
Wichita Falls, TX- Lawton, KFDX NBC O&O
143 OK
KJTL Fox LSA
KJBO-LP UPN LSA
146 Joplin, MO-Pittsburg, KS KSNF NBC O&O
KODE ABC LSA
147 Lubbock, TX KLBK CBS O&O
KAMC ABC LSA
Terre Haute, IN WTWO NBC O&O
148 WBAK Fox LSA
157 Odessa-Midland, TX KMID ABC O&O
163 Abilene-Sweetwater, TX KTAB CBS O&O
KRBC NBC LSA
167 Utica, NY WUTR ABC LSA
WFXV Fox O&O
WPNY-LP UPN O&O
170 Billings, MT KSVI ABC O&O
KHMT Fox LSA
171 Dothan, AL WDHN ABC O&O
San Angelo, TX KSAN NBC LSA
195 KLST CBS O&O
201 St. Joseph, MO KQTV ABC O&O
(1) Market rank refers to ranking the size of the Designated Market
Area ("DMA"), in which the station is located in relation to other
DMAs. Source: Investing in Television Market Report 2004 3rd
Edition, as published by BIA Financial Network, Inc.
(2) O&O refers to stations that Nexstar owns and operates. LSA, or
local service agreement, is the general term we use to refer to a
contract under which we provide services to a station owned and/or
operated by an independent third party. Local service agreements
include time brokerage agreements, shared services agreements,
joint sales agreements, and outsourcing agreements.
(3) Although WHAG is located within the Washington, DC DMA, its signal
does not reach the entire Washington, DC metropolitan area. WHAG
serves the Hagerstown, MD sub-market within the DMA.
(4) Effective January 17, 2005, KDEB changed its call letters to KSFX.
(5) Effective August 13, 2004, KPOM changed its call letters to KFTA
and KFAA changed its call letters to KNWA.
(6) Acquisition was consummated on January 7, 2005.
(7) Acquisition by Mission was consummated on January 4, 2005.
Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. This news release includes forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events. Forward-looking statements include information preceded by, followed by, or that includes the words "guidance," "believes," "expects," "anticipates," "could," or similar expressions. For these statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. The forward-looking statements contained in this news release, concerning, among other things, changes in net revenue, cash flow and operating expenses, involve risks and uncertainties, and are subject to change based on various important factors, including the impact of changes in national and regional economies, our ability to service and refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. our outstanding debt, successful integration of acquired television stations (including achievement of synergies and cost reductions), pricing fluctuations in local and national advertising, future regulatory actions and conditions in the television stations' operating areas, competition from others in the broadcast television markets served by the Company, volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the in programming costs, the effects of governmental regulation of broadcasting, industry consolidation, technological developments and major world news events. Unless required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this news release might not occur. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this release. For more details on factors that could affect these expectations, please see our filings with the Securities and Exchange Commission.
Contact:
G. Robert Thompson Stewart Lewack, Joseph Jaffoni
Chief Financial Officer Jaffoni & Collins Incorporated
Nexstar Broadcasting Group, Inc. (212) 835-8500 or nxst@jcir.com
Nexstar Broadcasting Group, Inc.
Condensed Consolidated Statements of Operations
(dollars and shares in thousands, except per share amounts)
Three Months Ended Year Ended
December 31, December 31,
------------------ -------------------
2004 2003 2004 2003
-------- --------- --------- ---------
Revenue
(excluding trade and barter) $74,030 $60,246 $259,664 $222,427
Less: commissions (10,184) (7,813) (35,005) (28,884)
-------- --------- --------- ---------
Net broadcast revenue
(excluding trade and barter) 63,846 52,433 224,659 193,543
Trade and barter revenue 6,617 6,591 21,081 20,789
-------- --------- --------- ---------
Total net revenue 70,463 59,024 245,740 214,332
-------- --------- --------- ---------
Operating expenses:
Station direct operating
expenses, net of trade
(exclusive of depreciation
and amortization shown
separately below) 15,103 14,158 58,426 54,310
Selling, general, and
administrative expenses
(exclusive of depreciation
and amortization shown
separately below) 16,554 15,291 60,725 57,385
Merger related expenses - 11,754 456 11,754
IPO related expenses - 4,058 - 4,058
Time brokerage agreement
expenses 143 150 653 389
Trade and barter expense 6,587 6,445 20,965 20,576
Corporate expenses 4,080 4,377 10,941 12,607
Amortization of broadcast
rights, excluding barter 2,627 3,599 11,458 11,816
Amortization of intangible
assets 6,266 7,226 26,463 24,934
Depreciation 4,511 5,115 17,949 20,467
-------- --------- --------- ---------
Total operating expenses 55,871 72,173 208,036 218,296
-------- --------- --------- ---------
Income (loss) from operations 14,592 (13,149) 37,704 (3,964)
Interest expense, including
amortization of debt financing
costs (13,260) (25,293) (52,265) (68,342)
Loss on extinguishment of debt - (4,953) (8,704) (10,767)
Interest income 51 135 113 606
Other income, net 363 1,013 4,931 3,860
-------- --------- --------- ---------
Income (loss) before income
taxes 1,746 (42,247) (18,221) (78,607)
Income tax benefit (expense) (1,548) 17,344 (4,385) 14,920
-------- --------- --------- ---------
Income (loss) before cumulative
effect of change in accounting
principle and minority
interest in consolidated entity 198 (24,903) (20,606) (63,687)
Cumulative effect of change in
accounting principle, net of
tax - - - (8,898)
Minority interest in
consolidated entity 543 523 2,106 786
-------- --------- --------- ---------
Net income (loss) $741 $(24,380) $(20,500) $(71,799)
Accretion of preferred interests - - - (15,319)
-------- --------- --------- ---------
Net income (loss) attributable
to common shareholders $741 $(24,380) $(20,500) $(87,118)
======== ========= ========= =========
Basic and diluted net income
(loss) per share:
Net income (loss) attributable
to common shareholders $0.03 $(1.29) $(0.72) $(5.59)
Weighted average number of
shares outstanding:
Basic and diluted 28,363 18,971 28,363 15,576
Nexstar Broadcasting Group, Inc.
Reconciliation Between Actual Consolidated Statements of Operations
and Broadcast Cash Flow/Adjusted EBITDA (Non-GAAP Measures)
(dollars in thousands)
Three Months Ended Year Ended
December 31, December 31,
------------------------------------
2004 2003 2004 2003
-------- --------- -------- --------
(Unaudited) (Unaudited)
Income (loss) from operations $14,592 $(13,149) $37,704 $(3,964)
Add:
Depreciation 4,511 5,115 17,949 20,467
Amortization of intangible
assets 6,266 7,226 26,463 24,934
Amortization of broadcast
rights, excluding barter 2,627 3,599 11,458 11,816
Merger and related expenses - 11,754 456 11,754
IPO related expenses - 4,058 - 4,058
Time brokerage agreement
expenses 143 150 653 389
Corporate expenses 4,080 4,377 10,941 12,607
Program buyouts - 1,152 55 1,152
Less:
Payments for broadcast rights 2,622 4,122 10,520 12,395
-------- --------- -------- --------
Broadcast cash flow $29,597 $20,160 $95,159 $70,818
Less:
Corporate expenses 4,080 4,377 10,941 12,607
-------- --------- -------- --------
Adjusted EBITDA $25,517 $15,783 $84,218 $58,211
======== ========= ======== ========
Nexstar Broadcasting Group, Inc.
Reconciliation Between Actual Consolidated Statements of Operations
and Free Cash Flow (Non-GAAP Measure)
(dollars in thousands)
Three Months Ended Year Ended
December 31, December 31,
-------------------------------------
2004 2003 2004 2003
-------- --------- -------- ---------
(Unaudited) (Unaudited)
Income (loss) from operations $14,592 $(13,149) $37,704 $(3,964)
Add:
Depreciation 4,511 5,115 17,949 20,467
Amortization of intangible
assets 6,266 7,226 26,463 24,934
Amortization of broadcast
rights, excluding barter 2,627 3,599 11,458 11,816
Less:
Payments for broadcast rights 2,622 4,122 10,520 12,395
Cash interest expense 10,085 21,907 40,482 46,437
Capital expenditures 3,182 1,786 10,552 10,311
Cash taxes, net of refunds 16 27 818 210
-------- --------- -------- ---------
Free Cash Flow $12,091 $(25,051) $31,202 $(16,100)
======== ========= ======== =========
Nexstar Broadcasting Group, Inc.
Reconciliation of Historical GAAP and Pro Forma Results (unaudited)
(dollars in thousands)
Q1 2003 Q1 2003
GAAP Adjustments Pro Forma
---------- ----------- ---------
Revenue
Local $30,041 $3,810 $33,851
National 14,435 1,776 16,211
Political 257 15 272
Network Compensation 2,088 233 2,321
Other 1,480 61 1,541
---------- ----------- ---------
Gross Revenue 48,301 5,895 54,196
National Rep and Agency Commissions 6,207 869 7,076
---------- ----------- ---------
Net Broadcast Revenue 42,094 5,026 47,120
Trade and Barter Revenue 5,160 176 5,336
---------- ----------- ---------
Total Net Revenue 47,254 5,202 52,456
Station Direct Operating expenses,
net of trade 12,840 2,487 15,327
Selling, General and Administrative
expenses 12,921 2,648 15,569
Corporate Overhead 2,255 -- 2,255
Merger related expenses -- -- --
IPO related expenses -- -- --
Trade and barter expense 5,200 151 5,351
Depreciation and amortization 10,756 349 11,105
Amortization of Broadcast rights,
excluding barter 2,706 163 2,869
---------- ----------- ---------
Total operating expenses 46,678 5,798 52,476
Income (loss) from operations 576 (596) (20)
Supplemental information:
Broadcast film payments 2,849 163 3,012
Overhead related to Quorum 1,106 -- 1,106
Program buyouts -- -- --
Q2 2003 Q2 2003
GAAP Adjustments Pro Forma
---------- ----------- ---------
Revenue
Local $35,690 $2,981 $38,671
National 17,464 1,606 19,070
Political 1,533 44 1,577
Network Compensation 2,169 225 2,394
Other 1,636 53 1,689
---------- ----------- ---------
Gross Revenue 58,492 4,909 63,401
National Rep and Agency Commissions 7,653 738 8,391
---------- ----------- ---------
Net Broadcast Revenue 50,839 4,171 55,010
Trade and Barter Revenue 4,346 63 4,409
---------- ----------- ---------
Total Net Revenue 55,185 4,234 59,419
Station Direct Operating expenses,
net of trade 13,184 1,868 15,052
Selling, General and Administrative
expenses 14,878 2,105 16,983
Corporate Overhead 2,471 -- 2,471
Merger related expenses -- -- --
IPO related expenses -- -- --
Trade and barter expense 4,136 71 4,207
Depreciation and amortization 10,602 251 10,853
Amortization of Broadcast rights,
excluding barter 2,655 163 2,818
---------- ----------- ---------
Total operating expenses 47,926 4,458 52,384
Income (loss) from operations 7,259 (224) 7,035
Supplemental information:
Broadcast film payments 2,648 163 2,811
Overhead related to Quorum 1,093 -- 1,093
Program buyouts -- -- --
Q3 2003 Q3 2003
GAAP Adjustments Pro Forma
---------- ----------- ---------
Revenue
Local $34,103 $2,801 $36,904
National 16,471 1,296 17,767
Political 1,045 79 1,124
Network Compensation 2,143 222 2,365
Other 1,626 51 1,677
---------- ----------- ---------
Gross Revenue 55,388 4,449 59,837
National Rep and Agency Commissions 7,211 669 7,881
---------- ----------- ---------
Net Broadcast Revenue 48,177 3,780 51,956
Trade and Barter Revenue 4,692 109 4,802
---------- ----------- ---------
Total Net Revenue 52,869 3,889 56,758
Station Direct Operating expenses,
net of trade 14,128 1,916 16,044
Selling, General and Administrative
expenses 14,534 2,097 16,630
Corporate Overhead 3,506 -- 3,508
Merger related expenses -- -- --
IPO related expenses -- -- --
Trade and barter expense 4,795 92 4,886
Depreciation and amortization 11,702 245 11,947
Amortization of Broadcast rights,
excluding barter 2,854 169 3,020
---------- ----------- ---------
Total operating expenses 51,519 4,519 56,035
Income (loss) from operations 1,350 (630) 723
Supplemental information:
Broadcast film payments 2,776 169 2,943
Overhead related to Quorum 1,780 -- 1,780
Program buyouts -- -- --
Q4 2003 Q4 2003
GAAP Adjustments Pro Forma
---------- ----------- ---------
Revenue
Local $37,861 $2,287 $40,148
National 16,586 925 17,511
Political 2,236 57 2,293
Network Compensation 1,929 199 2,128
Other 1,633 65 1,698
---------- ----------- ---------
Gross Revenue 60,245 3,533 63,778
National Rep and Agency Commissions 7,812 482 8,294
---------- ----------- ---------
Net Broadcast Revenue 52,433 3,051 55,484
Trade and Barter Revenue 6,591 74 6,665
---------- ----------- ---------
Total Net Revenue 59,024 3,125 62,149
Station Direct Operating expenses,
net of trade 14,158 1,311 15,469
Selling, General and Administrative
expenses 15,435 1,509 16,944
Corporate Overhead 4,377 -- 4,377
Merger related expenses 11,754 -- 11,754
IPO related expenses 4,058 -- 4,058
Trade and barter expense 6,445 72 6,517
Depreciation and amortization 12,341 183 12,524
Amortization of Broadcast rights,
excluding barter 3,605 183 3,788
---------- ----------- ---------
Total operating expenses 72,173 3,258 75,431
Income (loss) from operations (13,149) (133) (13,282)
Supplemental information:
Broadcast film payments 4,123 183 4,306
Overhead related to Quorum 1,680 -- 1,680
Program buyouts 1,152 -- 1,152
Nexstar Broadcasting Group, Inc.
Reconciliation of Historical GAAP and ProForma Results (unaudited)
(dollars in thousands)
Q1 2004 Q1 2004
GAAP Adjustments Pro Forma
-------- ----------- ---------
Revenue
Local $33,849 $1,737 $35,586
National 16,075 724 16,799
Political 3,383 187 3,570
Network Compensation 2,078 209 2,287
Other 1,042 64 1,106
-------- ----------- ---------
Gross Revenue 56,427 2,921 59,348
National Rep and Agency Commissions 7,459 420 7,879
-------- ----------- ---------
Net Broadcast Revenue 48,968 2,501 51,469
Trade and Barter Revenue 5,268 55 5,323
-------- ----------- ---------
Total Net Revenue 54,236 2,556 56,792
Station Direct Operating expenses, net
of trade 14,307 1,109 15,416
Selling, General and Administrative
expenses 14,458 1,151 15,609
Corporate Overhead 2,036 -- 2,036
Merger and time brokerage agreement
expenses 681 -- 681
Trade and barter expense 5,049 66 5,115
Depreciation and amortization 12,043 273 12,316
Amortization of Broadcast rights,
excluding barter 3,003 185 3,188
-------- ----------- ---------
Total operating expenses 51,577 2,784 54,361
Income (loss) from operations 2,659 (228) 2,431
Supplemental information:
Broadcast film payments 2,782 185 2,967
Q2 2004 Q2 2004
GAAP Adjustments Pro Forma
-------- ----------- ---------
Revenue
Local $39,066 $1,572 $40,638
National 18,485 583 19,068
Political 4,293 6 4,299
Network Compensation 2,151 189 2,340
Other 1,264 54 1,318
-------- ----------- ----------
Gross Revenue 65,259 2,404 67,663
National Rep and Agency Commissions 8,791 339 9,130
-------- ----------- ----------
Net Broadcast Revenue 56,468 2,065 58,533
Trade and Barter Revenue 4,688 28 4,716
-------- ----------- ----------
Total Net Revenue 61,156 2,093 63,249
Station Direct Operating expenses,
net of trade 14,184 767 14,951
Selling, General and Administrative
expenses 14,592 831 15,423
Corporate Overhead 2,205 -- 2,205
Merger and time brokerage agreement
expenses 128 -- 128
Trade and barter expense 4,522 28 4,550
Depreciation and amortization 11,177 200 11,377
Amortization of Broadcast rights,
excluding barter 2,656 113 2,769
-------- ----------- ----------
Total operating expenses 49,464 1,939 51,403
Income (loss) from operations 11,692 154 11,846
Supplemental information:
Broadcast film payments 2,649 113 2,762
Q3 2004 Q3 2004
GAAP Adjustments Pro Forma
-------- ----------- ---------
Revenue
Local $36,876 $1,089 $37,965
National 17,627 267 17,894
Political 6,052 27 6,079
Network Compensation 2,181 186 2,366
Other 1,212 19 1,232
-------- ----------- ---------
Gross Revenue 63,948 1,588 65,536
National Rep and Agency Commissions 8,571 215 8,786
-------- ----------- ---------
Net Broadcast Revenue 55,377 1,373 56,750
Trade and Barter Revenue 4,507 13 4,520
-------- ----------- ---------
Total Net Revenue 59,884 1,386 61,270
Station Direct Operating expenses, net
of trade 14,832 563 15,395
Selling, General and Administrative
expenses 15,121 593 15,714
Corporate Overhead 2,620 -- 2,620
Time brokerage agreement expenses 157 -- 157
Trade and barter expense 4,807 16 4,823
Depreciation and amortization 10,415 146 10,561
Amortization of Broadcast rights,
excluding barter 3,172 69 3,241
-------- ----------- ---------
Total operating expenses 51,124 1,387 52,511
Income (loss) from operations 8,760 (1) 8,759
Supplemental information:
Broadcast film payments 2,467 69 2,536
Q4 2004 Adjustments Q4 2004
GAAP Pro Forma
-------- ----------- ----------
Revenue
Local $39,856 $415 $40,271
National 17,855 106 17,961
Political 12,938 48 12,986
Network Compensation 2,098 37 2,135
Other 1,283 7 1,290
-------- ----------- ----------
Gross Revenue 74,030 613 74,643
National Rep and Agency Commissions 10,184 87 10,271
-------- ----------- ----------
Net Broadcast Revenue 63,846 526 64,372
Trade and Barter Revenue 6,617 5 6,622
-------- ----------- ----------
Total Net Revenue 70,463 531 70,994
Station Direct Operating expenses,
net of trade 15,103 205 15,308
Selling, General and Administrative
expenses 16,554 217 16,771
Corporate Overhead 4,080 -- 4,080
Time brokerage agreement expenses 143 -- 143
Trade and barter expense 6,587 3 6,590
Depreciation and amortization 10,777 58 10,835
Amortization of Broadcast rights,
excluding barter 2,627 21 2,648
-------- ----------- ----------
Total operating expenses 55,871 504 56,375
Income (loss) from operations 14,592 27 14,619
Supplemental information:
Broadcast film payments 2,622 20 2,642
Note: Adjustments reflect amounts contributed by certain stations
prior to Nexstar or Mission Broadcasting commencing operation under a
local service agreement (or closing of acquisition), as if Nexstar or
Mission had been operating those stations since January 1, 2003. Those
stations include KARK in Little Rock, AR and WDHN in Dothan, AL, both
of which Nexstar began operating under a TBA in February 2003; WBAK in
Terre Haute, IN, which Mission began operating under a TBA in May
2003; KFTA/KNWA in Fort Smith-Fayetteville-Springdale-Rogers, AR,
which Nexstar began operating under a TBA in October 2003; KLST, which
Nexstar began operating under a TBA in June 2004; WUTR, which Mission
began operating on April 1, 2004; and, WTVO in Rockford, IL, which
Mission began operating under a TBA in November 2004.
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