Nexstar Broadcasting Group Reports Second Quarter 2003 Results.Business EditorsIRVING Irving, city (1990 pop. 155,037), Dallas co., N Tex., a suburb of Dallas; inc. as a city 1952. Building supplies, chemicals, electronic equipment, and airplane parts are manufactured in Irving. , Texas--(BUSINESS WIRE)--Aug. 13, 2003 Nexstar Broadcasting Group today reported financial results for Nexstar Finance, L.L.C., for the quarter ended June June: see month. 30, 2003. Reported results Net revenues in the second quarter of 2003 were $34.3 million, an increase of 18.3% over net revenues of $29.0 million in the second quarter of 2002. Broadcast cash flow for the second quarter of 2003 was $15.0 million compared to $12.4 million in the second quarter of 2002, an increase of 21.2%, and adjusted 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 for the second quarter of 2003 was $13.7 million compared to adjusted EBITDA of $11.5 million for the second quarter of 2002. For the six months ended June 30, 2003, net revenues were $61.8 million compared to $54.9 million for the same period in 2002, an increase of 12.4%. Broadcast cash flow for the first six months of 2003 was $24.0 million, an increase of 9.9% over broadcast cash flow of $21.8 million for the first six months of 2002. Adjusted EBITDA was $21.5 million and $20.0 million for the first six months of 2003 and 2002, respectively. A reconciliation of earnings as determined in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with Generally Accepted Accounting Principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting ("GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ") to broadcast cash flow and adjusted EBITDA is included in the attached exhibits. Nexstar recognized a net loss for the second quarter of 2003 of $1.0 million, compared to a net loss in the second quarter of 2002 of $4.2 million. For the first six months of 2003, Nexstar's net loss was $14.0 million compared to a net loss of $38.2 million for the first six months of 2002. The six month loss in 2002 included a transition impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charge for goodwill of $27.4 million. In the first quarter of 2003, the Company recorded a write off of $5.8 million 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 related to the refinancing Refinancing An extension and/or increase in amount of existing debt. of our senior credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities . The write off of debt financing costs is included in interest expense. Balance Sheet Debt, net of cash, on June 30, 2003 was $340.0 million, and leverage at the operating company operating company A business that engages in transactions with outsiders. was 5.6x. The debt and leverage calculations are pursuant to the Company's senior secured credit agreement. The Company's current covenant with respect to consolidated total leverage, as defined in the credit agreement, is 7.25x. Capital expenditures for the quarter ended June 30, 2003 totaled $4.1 million. Cash on hand as of June 30, 2003 totaled $97.7 million. Recent Developments On May 9, 2003 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]. announced it had reached a definitive agreement to acquire WBAK TV, the Fox affiliate serving 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, from Bahakel Communications Bahakel Communications is a communications company, owning radio and television stations in the United States. The company was founded in 1965 by Cy Bahakel when he put WCCB in Charlotte, North Carolina on the air and was controlled by Bahakel (and, in later years, his children) for $3.0 million. Mission began operating the station effective that date and entered into a Shared Services shared services, n.pl the administrative, clinical, or other service functions that are common to two or more hospitals or their health care facilities and used jointly or cooperatively by them. Agreement and Joint Sales Agreement with Nexstar's Terre Haute 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, WTWO WTWO is the NBC-affiliated television station in Terre Haute, Indiana. It operated on analog channel 2. Through a joint sales agreement (JSA), it operates the local Fox affiliate, WFXW. Its transmitter and headquarters are located in Farmersburg, Indiana. TV. The transaction is expected to close in the fourth quarter of this year. On June 13, 2003 Mission closed on its acquisition of NBC affiliates KRBC TV, Abilene Abilene (ăb`ĭlēn). 1 City (1990 pop. 6,242), seat of Dickinson co., central Kans., on the Smoky Hill River; inc. 1869. It was (1867–71) a railhead for a large cattle-raising region extending SW into Texas. , TX, and KACB KACB Keep Alachua County Beautiful (Gainesville, FL) TV, 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, from Lin Lin , Maya Ying Born 1959. American sculptor and architect whose public works include the Vietnam Veterans Memorial in Washington, D.C. (1982). Noun 1. Broadcasting. The previously announced acquisition of KARK TV (NBC), 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. TV (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. ), Dothan Dothan, in the Bible Dothan (dō`thăn) or Dothaim (dōthā`ĭm), city, central ancient Palestine, in the uplands NE of Samaria. , AL, from Morris Multimedia closed on August 1, 2003. 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, Nexstar Broadcasting Group President and Chief Executive Officer said, "I am proud of the resiliency The ability to recover from a failure. The term may be applied to hardware, software or data. shown by our sales and management teams in the second quarter while facing an uncertain advertising environment not yet fully recovered from the war in Iraq Iraq or Irak (both: ēräk`, ĭrăk`), officially Republic of Iraq, republic (2005 est. pop. 26,075,000), 167,924 sq mi (434,924 sq km), SW Asia. . On a pro-forma same station basis, our "core" local and national revenue held flat to the prior year. Political revenues were $1.3 million in the second quarter of 2003 compared to $2.1 million in the same period of 2002. Our total net revenue on a same station pro-forma basis finished at $34.4 million in the second quarter of 2003, down 1.7% as compared to the $35.0 million in the second quarter of 2002. I am particularly pleased that our concerted effort to contain costs allowed us to deliver a same station operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: increase for the quarter. Station 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. finished 3% under second quarter of 2002, excluding program payments which were down 9.3% on a same station basis for the quarter. This produced a station operating margin of 43.6% for the second quarter of 2003, versus 42.2% for the same period last year." Second Quarter Conference Call Senior management of Nexstar will hold a conference call to discuss second quarter results on Wednesday Wednesday: see week. , August 13, 2003 at 3 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. . The dial in number is (800) 915-4836. No additional access code is needed. A replay will be available through August 15, 2003 by dialing 800-428-6051 and entering passcode 300793. 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 This release contains both historical and 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. . All statements, other than statements of historical fact, are or may be deemed to be, "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, such as our management's expectations of future business prospects or financial results. Such forward-looking statements involve a number of risks and uncertainties, including, among other factors, general economic conditions, demand for advertising, the situation in Iraq or other geopolitical ge·o·pol·i·tics n. (used with a sing. verb) 1. The study of the relationship among politics and geography, demography, and economics, especially with respect to the foreign policy of a nation. 2. a. events, competition for audience and programming, government regulations and new technologies, and should be considered in light of these and other risk factors described in Nexstar's filings with the Securities and Exchange Commission. Such factors may cause actual results to differ materially from the forward-looking statements. Nexstar undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, unless otherwise required by law. About Nexstar Broadcasting Nexstar owns or provides services to 25 television stations (including a pending acquisition) serving markets covering approximately 3.5% of all U.S. television households. Nexstar has certain local service agreements including Shared Services Agreements, Time Brokerage Agreements, Joint Operating Agreements Any contract, agreement, Joint Venture, or other arrangement entered into by two or more businesses in which the operations and the physical facilities of a failing business are merged, although each business retains its status as a separate entity in terms of profits and and Joint Sales Agreements with other stations. The following is a list of the company's owned stations, as well as those with which it has local service agreements:
Station
Call Channel
DMA Market Letters # Affiliation Status
--- ------ ------- ------- ----------- -------
53 Wilkes-Barre/ WBRE-TV 28 NBC Owned
Scranton, PA WYOU-TV 22 CBS SSA
56 Little Rock, AR KARK-TV 4 NBC Owned
77 Rochester, NY WROC-TV 8 CBS Owned
81 Shreveport, LA/ KTAL-TV 6 NBC Owned
Texarkana, TX
82 Champaign/ WCIA-TV 3 CBS Owned
Springfield/ WCFN-TV 49 UPN Owned
Decatur, IL
117 Peoria/ WMBD-TV 31 CBS Owned
Bloomington, IL WYZZ-TV 43 FOX JOA
137 Beaumont/ KBTV 4 NBC Owned
Port Arthur, TX
142 Wichita Falls, KFDX-TV 3 NBC Owned
TX/Lawton, OK KJTL-TV 18 FOX JSA
KJBO-LP 35 UPN JSA
143 Erie, PA WJET-TV 24 ABC Owned
WFXP-TV 66 FOX TBA
145 Joplin, MO/ KSNF-TV 16 NBC Owned
Pittsburg, KS KODE-TV 12 ABC SSA
146 Terre Haute, IN WTWO-TV 2 NBC Owned
WBAK-TV 38 FOX Acq.
pending/
SSA & JSA
158 Midland/ KMID-TV 2 ABC Owned
Odessa, TX
163 Abilene/ KTAB-TV 32 CBS Owned
Sweetwater, TX KRBC-TV 9 NBC SSA
171 Dothan, AL WDHN-TV 18 ABC Owned
193 St. Joseph, MO KQTV 2 ABC Owned
196 San Angelo, TX KACB-TV 3 NBC SSA
Nexstar Finance, L.L.C.
Consolidated Statements of Operations
Three Months Six Months
Ended Ended
June 30, June 30,
----------------- -----------------
2002 2003 2002 2003
-------- -------- --------- --------
(Unaudited) (Unaudited)
(dollars in (dollars in
thousands) thousands)
Revenue (excluding trade and
barter) $33,623 $39,735 $63,622 $71,436
Less: commissions (4,633) (5,441) (8,692) (9,669)
-------- -------- ---------- --------
Net broadcast revenue
(excluding trade and barter) 28,990 34,294 54,930 61,767
Trade and barter revenue 2,531 2,461 4,914 5,617
-------- -------- ---------- --------
Total net
revenue 31,521 36,755 59,844 67,384
-------- -------- ---------- --------
Operating expenses:
Direct operating
expenses (exclusive
of depreciation and
amortization shown
separately below) 8,819 9,864 17,320 20,201
Selling, general, and
administrative
expenses (exclusive
of depreciation and
amortization
shown
separately
below) 8,467 10,354 17,001 19,541
Amortization of
broadcast rights 3,320 3,527 6,904 7,359
Amortization of
intangible assets 3,218 3,515 6,474 7,137
Depreciation 3,252 2,892 6,403 5,831
-------- -------- ---------- --------
Total
operating
expenses 27,076 30,152 54,102 60,069
-------- -------- ---------- --------
Income from operations 4,445 6,603 5,742 7,315
Interest expense, including
amortization of debt financing
costs (8,715) (8,210) (17,390) (22,177)
Interest income 25 255 58 324
Other income (expenses), net (1,263) 315 (262) 546
-------- -------- --------- --------
Loss before income taxes and
cumulative effect of change in
accounting principle (5,508) (1,037) (11,852) (13,992)
Income tax benefit (expense) 1,260 (49) 1,079 (153)
-------- -------- --------- ---------
Loss before cumulative effect
of change in accounting
principle (4,248) (1,086) (10,773) (14,145)
Cumulative effect of change in
accounting principle, net of
tax -- -- (27,419) --
Minority interest -- 105 -- 105
-------- -------- --------- ---------
Net loss $(4,248) $(981) $(38,192) $(14,040)
======== ======== ========= =========
Other comprehensive loss:
Change in market value
of derivative
instrument $955 $-- $1,920 $--
-------- -------- --------- ---------
Net loss and other
comprehensive loss $(3,293) $(981) $(36,272) $(14,040)
======== ======== ========= =========
NEXSTAR FINANCE, L.L.C.
UNAUDITED RECONCILIATION BETWEEN ACTUAL CONSOLIDATED STATEMENTS OF
OPERATIONS AND BROADCAST CASH FLOW, ADJUSTED EBITDA AND
PRO FORMA BROADCAST CASH FLOW
Includes the operations of KARK,WDHN,KRBC, KACB and WBAK
(dollars in thousands)
Three Months Six Months
Ended June 30, Ended June 30,
2002 2003 2002 2003
-------- -------- -------- --------
Income from operations $4,445 $6,603 $5,742 $7,315
Add:
Depreciation and
amortization of intangibles 6,470 6,407 12,877 12,968
Amortization of broadcast
rights, net of barter 1,861 1,777 3,787 3,588
Interest income 25 255 58 324
Trade and barter expense 2,466 2,304 4,813 5,600
Network compensation
payments received or
receivable 2,203 2,096 4,343 4,117
Non-recurring expenses 105 120 462 159
Less:
Trade and barter revenue 2,531 2,461 4,914 5,617
Network compensation revenue 1,660 1,703 3,257 3,334
Payments for program license
liabilities 1,916 1,737 3,936 3,648
-------- -------- -------- --------
Adjusted EBITDA 11,468 13,661 19,975 21,472
-------- -------- -------- --------
Pro forma adjustments
KARK operating results 1,340 379 2,428 379
WDHN operating results 68 50 79 50
KRBC operating results 83 -- (491) --
KACB operating results 111 -- 297 --
WBAK operating results (89) (27) (152) (106)
Add:
Depreciation and amortization
KARK 407 -- 887 --
Depreciation and amortization
WDHN 52 -- 103 --
Depreciation and amortization
KRBC -- -- 631 --
Corporate expenses KARK 234 -- 467 --
Corporate expenses WDHN 34 -- 68 --
Corporate expenses KRBC -- -- 30 --
Trade and barter expense KRBC 2 -- 49 --
Trade and barter expense WBAK 61 23 133 67
Non-recurring expense KARK 116 -- 175 --
Less:
Trade and barter revenue KRBC -- -- 51 --
Trade and barter revenue KACB -- -- 3 --
Trade and barter revenue WBAK 61 23 133 67
-------- -------- -------- --------
Net pro forma adjustments 2,358 402 4,517 323
-------- -------- -------- --------
Pro forma Adjusted EBITDA $13,826 $14,063 $24,492 $21,795
======== ======== ======== ========
Pro forma Adjusted EBITDA $13,826 $14,063 $24,492 $21,795
Corporate expenses 939 1,378 1,861 2,527
-------- -------- -------- --------
Pro forma Broadcast cash flow $14,765 $15,441 $26,353 $24,322
======== ======== ======== ========
We define adjusted EBITDA as income (loss) from operations plus depreciation and amortization (including amortization of broadcast rights), interest income, non-cash trade and 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. expenses, non-recurring expenses (including time brokerage agreement fees) and network compensation payments received or receivable, less payments for broadcast rights, non-cash trade and barter revenue and network compensation revenue. We define broadcast cash flow ("BCF BCF Billion Cubic Feet BCF Bioconcentration Factor BCF British Chess Federation BCF British Coatings Federation BCF Breast Cancer Fund BCF Bank Credit Facility BCF Bulked Continuous Filament BCF British Cycling Federation BCF Boeing Converted Freighter ") as adjusted EBITDA plus corporate expenses. Neither BCF nor adjusted EBITDA (i) is a measure of performance calculated in accordance with generally accepted accounting principles, (ii) should be considered in isolation or as a substitute for net income, income from operations or cash flow as reflected in our consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge , or (iii) is intended to represent a measure of funds available for debt service, dividends, reinvestment Reinvestment Using dividends, interest and capital gains earned in an investment or mutual fund to purchase additional shares or units, rather than receiving the distributions in cash. 1. In terms of stocks, it is the reinvestment of dividends to purchase additional shares. or discretionary uses. In addition, our definition of BCF and/or adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. We believe that the presentation of BCF and adjusted EBITDA is relevant and useful because such data is used by industry analysts to determine a market value of our television stations. Furthermore, adjusted EBITDA and broadcast cash flow are used by Nexstar's management to determine our operating performance, and (along with other data) as internal measures for setting budgets, assessing financial performance, evaluating targeted stations for acquisition and as a measurement component of incentive compensation. |
|
||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion