Paxson Communications Reports Third Quarter 1999 Results.WEST PALM BEACH, Fla.--(BUSINESS WIRE)--Nov. 22, 1999-- Pax TV Gains in Viewership view·er·ship n. The people who watch a television program or motion picture: a largely male viewership. and 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. Investment Provides Catalyst catalyst, substance that can cause a change in the rate of a chemical reaction without itself being consumed in the reaction; the changing of the reaction rate by use of a catalyst is called catalysis. for Future Growth - Company Announces Agreement to Purchase 9 Top 40 Market TV Stations Paxson Paxson may refer to:
See: American Stock Exchange :PAX), the owner and operator of the largest broadcast television station group in the nation and PAX TV, the seventh broadcast television network, today reported financial results for the quarter and nine months ending September September: see month. 30, 1999. For the quarter ending September 30, 1999, total revenues nearly doubled, rising 97.4% from the third quarter of 1998, to $58.1 million. The third quarter's operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. before depreciation, amortization, stock-based compensation, time brokerage BROKERAGE, contracts. The trade or occupation of a broker; the commissions paid to a broker for his services. and affiliation affiliation (  fil´ēā´sh fees, improved to $16.0 million, from a loss of $30.9 million one year
ago reflecting the significant increase in advertising revenues
generated during the third quarter of 1999. Net loss for the third
quarter was $129.8 million, including a $65.5 million non-cash,
beneficial conversion dividend on the issuance of $415.0 million of
convertible preferred stock Convertible Preferred StockPreferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". to NBC, partially offset by an income tax benefit of $16.1 million. This compares with a net loss of $53.0 million for the third quarter of 1998, which included an income tax benefit of $20.9 million. Commenting on the third quarter results, Paxson Chief Executive Officer, Jeff Sagansky said, "Our third quarter 1999 financial performance reflects significant improvement in revenues as PAX TV completed its first full broadcast season. Building on this first season's growth in both advertiser ad·ver·tise v. ad·ver·tised, ad·ver·tis·ing, ad·ver·tis·es v.tr. 1. To make public announcement of, especially to proclaim the qualities or advantages of (a product or business) so as to increase support and viewership, we can anticipate an even stronger performance during our second season, which commenced this fall. As our new relationship with NBC further develops, the Company is well positioned to take advantage of the numerous operating, programming and revenue generating opportunities ahead, in our second broadcasting season." Mr. Sagansky continued, "By almost every measure of ratings, the third quarter was a success. PAX TV was the only network to exhibit a growth in its target female 25-54 viewership, increasing its third quarter prime time ratings 12% over the second quarter. PAX TV's ratings in the top fifty markets steadily climbed during the quarter reaching a weighted average 1.4 rating in September as PAX TV launched its second season's weekday prime time line up. In fact, season to date, PAX TV has already achieved impressive ratings growth in the top fifty markets with particular improvements in the top 10 local markets. -0-
November '98 Season To Date
Market Sweeps Ratings (1) Ratings (1)
------ ------------------ -----------
TOP 10 Markets 0.8 1.4
Market Highlights:
New York 1.0 1.7
Chicago 1.5 2.1
Boston 0.2 1.4
Atlanta 1.4 1.9
Phoenix 1.6
Sacramento 1.2 1.8
Orlando 1.2 1.8
Nashville 1.2 1.8
Kansas City 1.9 2.5
New Orleans 1.6 2.1
Greensboro 1.8 2.5
(1) Source: Nielsen Station Index weekday primetime NSI rating
Mr. Sagansky added: "During the quarter NBC made a significant cash investment in the Company, demonstrating their commitment to improving both the financial strength of Paxson and the operating performance of PAX TV and our 72 station broadcast television group. We are confident that this relationship will provide Paxson with a catalyst for creating significant shareholder value. Not only did the Company strengthen its balance sheet through NBC's initial $415 million investment, but the Company paved pave tr.v. paved, pav·ing, paves 1. To cover with a pavement. 2. To cover uniformly, as if with pavement. 3. To be or compose the pavement of. the way for NBC's additional investments by issuing warrants to the General Electric subsidiary to purchase additional Paxson stock, at prices ranging from $12.60 to $22.50 per share during the next three years." Mr. Sagansky continued: "Just as significant a catalyst for driving value for our shareholders has been NBC's commitment toward improving PAX TV's operating performance. Together, Paxson and NBC are on target to meet the aggressive timetable “Schedule” redirects here. For other uses, see Schedule (disambiguation). A timetable or schedule is an organized list or schedule, usually set out in tabular form, providing information about a series of arranged events: in particular, the time at which set for transitioning PAX TV's network sales operations into a separate unit under NBC's management, by the end of this year. As we announced earlier today, contracts are in place for NBC to represent PAX TV's network advertising sales, billing and collections as well as optimization optimization Field of applied mathematics whose principles and methods are used to solve quantitative problems in disciplines including physics, biology, engineering, and economics. of advertising inventory management, all with the goal of making PAX TV a better product for our advertisers. Additionally, we are ahead of schedule on our plans for implementing local joint sales agreements in the first two of Paxson & NBC's owned and operated television markets, Washington Washington, town, England Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. , DC and Providence Providence, city (1990 pop. 160,728), state capital and seat of Providence co., NE R.I., a port at the head of Providence Bay; founded by Roger Williams 1636, inc. as a city 1832. . Under these joint sales relationships, NBC's owned and operated station will serve as the local advertising sales representative for the PAX TV station, and may provide programming and local news. Other opportunities on which Paxson and NBC are exploring include the development of network programming as well as marketing, promotions, and network branding." Paxson Acquires Eight PAX TV Affiliates Paxson Communications announced today that it has entered into an agreement to acquire nine broadcast television stations, including eight of its current PAX TV network-affiliated television stations and a contractual right to purchase Boston Boston, town, England Boston, town (1991 pop. 26,495), E central England, on the Witham River. Boston's fame as a port dates from the 13th cent., when it was a Hanseatic port trading wool and wine. Having recovered from a decline in the 18th and 19th cent. television stations from DP Media, Inc. for a price not to exceed $135 million, excluding an additional $38 million to consummate To carry into completion; to fulfill; to accomplish. A Common-Law Marriage is consummated when the parties live in a manner intended to bring about public recognition of their relationship as Husband and Wife. the acquisition contract for the Boston television stations. The final purchase price will be determined through further negotiations and an arbitration arbitration Process of resolving a dispute or a grievance outside a court system by presenting it for decision to an impartial third party. Both sides in the dispute usually must agree in advance to the choice of arbitrator and certify that they will abide by the proceeding. These eight stations, all in the 40 largest US television markets, expand Paxson's owned and operated television station group to include stations serving 43 of the fifty largest television markets. The stations to be acquired include:
Market
Rank Market Station
---- ------ -------
6 Boston WBPX (1)
6 Boston WWDP
8 Washington, DC WPXW
21 St. Louis WPXS
25 Indianapolis WIPX
27 Hartford WHPX
29 Raleigh-Durham WRPX
31 Milwaukee WPXE
37 Grand Rapids WZPX
(1) Formerly WABU. Includes satellite stations WNBU & WZBU. DP Media,
Inc. has these current PAX TV network-affiliated stations under
contract to purchase from Boston University, which contract will
be transferred to Paxson. Upon completion of this transaction, it
is anticipated that Paxson will have to divest itself of one of
its three owned Boston television stations in order to comply
with current FCC station ownership regulations.
Commenting on the acquisitions, Mr. Sagansky noted: "In light of the recent relaxation re·lax·a·tion n. 1. The act of relaxing or the state of being relaxed. 2. Refreshment of body or mind. 3. A loosening or slackening. 4. The lengthening of inactive muscle or muscle fibers. of ownership rules, Paxson felt that it was important to better control the direction of our PAX TV stations in the largest television markets. The Company plans to implement many of the opportunities available to it through our relationship with NBC, such as local joint sales agreements between each of these stations and the NBC O&O or network affiliated af·fil·i·ate v. af·fil·i·at·ed, af·fil·i·at·ing, af·fil·i·ates v.tr. 1. To adopt or accept as a member, subordinate associate, or branch: station in the market. In addition, now we will be able to manage the build out of each station's digital broadcast capabilities and distribution. Finally, by entering into this agreement today, we are able to gain attribution at·tri·bu·tion n. 1. The act of attributing, especially the act of establishing a particular person as the creator of a work of art. 2. to stations serving another 4.5% of the US television households by taking advantage of the current FCC (1) (Federal Communications Commission, Washington, DC, www.fcc.gov) The U.S. government agency that regulates interstate and international communications including wire, cable, radio, TV and satellite. The FCC was created under the U.S. UHF (Ultra High Frequency) The range of electromagnetic frequencies from 300 MHz to 3 GHz. In the U.S., analog television has used UHF channels 52 to 69 in the 700 MHz band. discount regulations." Results of Operations for Three Months Ended September 30, 1999 and 1998 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: revenues for the three months ended September 30, 1999, increased 97% (or $28.6 million) to $58.1 million over the same period in 1998. This increase was primarily due to the launch of PAX TV and increased distribution via television, cable systems and satellite. Expenses from operations for the three months ended September 30, 1999, increased 41% (or $31.2 million) to $107.4 million over the same period in 1998. The majority of the expense increases were incurred as a result of the launch of PAX TV and costs associated with operating new television stations. These increases primarily included program rights amortization of $16.7 million, increased selling, general and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. , such as commissions and bad debt provisions of $4.0 million, increased time brokerage and affiliation fees of $1.6 million associated with operating new television stations, increased technical costs of $0.8 million, higher depreciation and amortization of $9.4 million, primarily related to assets acquired and increased stock based compensation of $6.5 million. These increases were partially offset by lower promotion costs of $7.5 million, and other selling, general and administrative costs of $0.6 million, which were due to a reduction in employees. Interest expense for the three months ended September 30, 1999, increased to $11 million or 9% over the same period in 1998 primarily due to a greater level of senior debt throughout the period. At September 30, 1999, total long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. and senior subordinated Subordinated A claim ranked lower in priority than other claims. Common stock claims are always subordinated to debt. notes were $384 million, excluding DP Media debt of $114 million which had no effect on the Company's interest expense for the three months, compared with the balance of $353 million in the prior year. Interest income for the three months ended September 30, 1999, decreased from $4.7 million to $1.8 million or 63% over the same period in 1998 primarily due to the 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. of cash held by qualified intermediary The Qualified Intermediary (also known as an Accommodator) should be a corporation that is in the full-time business of facilitating 1031 exchanges. The role of a QI is similar to, but not identical to, the role of an escrow company. into television station assets. Because the Series B Convertible Preferred Stock, which was issued to NBC during the quarter, at a conversion price per share that was less than the closing price of the Class A Common Stock at the date of issuance, and 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 applicable accounting guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. , the Company recognized a beneficial conversion feature in connection with the issuance of the stock equal to the amount of the discount multiplied mul·ti·ply 1 v. mul·ti·plied, mul·ti·ply·ing, mul·ti·plies v.tr. 1. To increase the amount, number, or degree of. 2. Mathematics To perform multiplication on. by the number of shares into which Series B Convertible Preferred Stock is convertible. The full amount of the beneficial conversion feature, approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $65.5 million, has been reflected in the accompanying ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. statement of operations See Income statement. as a dividend during the third quarter and has been allocated to additional paid-in capital additional paid-in capital Stockholder contributions that are in excess of a stock's stated or par value. For example, if a firm issues stock with a par value of $1 per share but sells the stock to investors at $10 per share, the firm's financial statements in the accompanying balance sheet. Results of Operations for Nine Months Ended September 30, 1999 and 1998 Consolidated revenues for the nine months ended September 30, 1999, increased 83% (or $76.2 million) to $167.7 million over the same period in 1998. This increase was primarily due to the launch of PAX TV and increased distribution via television, cable systems and satellite. Expenses from operations for the nine months ended September 30, 1999, increased 129% (or $207.2 million) to $368.4 million over the same period in 1998. The largest increase in expense relates to the programming rights adjustment to net realizable value Net realizable value (NRV) is a commonly used method of evaluating an asset's worth in the field of inventory accounting. NRV is part of GAAP rules that apply to valuing inventory, so as to not overstate or understate the value of inventory goods. of $70.5 million, reflecting a decrease in programming value due to lower anticipated future usage, ratings and related revenues for these programs. The majority of the remaining expense increases were incurred as a result of the launch of PAX TV and costs associated with operating new television stations. These increases primarily included program rights amortization of $59.3 million, increased selling, general and administrative costs, such as commissions and bad debt provisions of $14.6 million, and other selling, general and administrative costs of $22.1 million, which were higher primarily due to additional employees hired and regional sales offices added, increased technical costs of $2.1 million, higher depreciation and amortization of $28.4 million, primarily related to assets acquired and increased stock based compensation expense of $5.7 million. These increases were partially offset by promotion costs of $0.7 million. Interest expense for the nine months ended September 30, 1999, increased to $32.7 million or 6% over the same period in 1998 primarily due to a greater level of senior debt throughout the period. Interest income for the nine months ended September 30, 1999, decreased from $13.3 million to $4.7 million or 65% over the same period in 1998 primarily due to the reinvestment of cash held by qualified intermediary into television station assets. Gain on sale of Travel Channel and television stations reflects the Company's sale of its interest in the Travel Channel, the transfer of the Company's interest in KWOK and the sale of four television stations. Because the Series B Convertible Preferred Stock is convertible at a price per share that is less than the closing price of the Class A Common Stock at the date of issuance, the Company recognized a beneficial conversion feature in connection with the issuance of the stock equal to the amount of the discount multiplied by the number of shares into which Series B Convertible Preferred Stock is convertible. The full amount of the beneficial conversion feature, approximately $65.5 million, has been reflected in the accompanying statement of operations as a dividend during the third quarter and has been allocated to additional paid-in capital in the accompanying balance sheet. Upon the completion of pending acquisitions, construction projects, other transactions and divestitures, Paxson Communications Corporation (AMEX:PAX) will own or operate 72 broadcast television stations and have 51 additional PAX TV network affiliates carrying the Company's PAX TV network programming. A complete listing of stations and markets served can be found by visiting the company's web-site at paxtv.com. Paxson Communications Corporation owns and operates the nation's seventh and newest broadcast network. With its nationwide broadcast television and cable distribution system, in partnership with the National Broadcasting Company Noun 1. broadcasting company - a company that manages tv or radio stations company - an institution created to conduct business; "he only invests in large well-established companies"; "he started the company in his garage" (NBC, see http://www.pax.net/press), Paxson airs PAX TV, the national family entertainment network. The foundation of the network's prime-time schedule for the fall includes new original shows Hope Island, Destination Stardom star·dom n. 1. The status of a performer or entertainer acknowledged as a star. 2. Star performers considered as a group. , Chicken Soup chicken soup Chicken broth Folk medicine Jewish penicillin A fowl broth with a long tradition as a home remedy for URIs, which may be a nasal decongestant, inhibit growth of pneumococci in vitro, and stimulate immune responsiveness in WBCs Mainstream medicine A For The Soul and Twice In A Lifetime. Leading into primetime Monday Monday: see week. through Friday Friday: see Sabbath; week. Friday young Indian rescued by Crusoe and kept as servant and companion. [Br. Lit.: Robinson Crusoe] See : Servant is the all new, live show Treasures In Your Home. Other originals returning for a second season on PAX are Flipper: The New Adventures, Little Men and It's A Miracle It's a Miracle was a television show that aired on PAX-TV (now Independent Television) between September 6, 1998 and September 1, 2004.[1] Initially hosted by Richard Thomas[2], and later by Roma Downey, [3] . Additionally, the line-up line-up Noun 1. people or things assembled for a particular purpose: Christmas TV line-up 2. includes Touched By An Angel, Diagnosis Murder, Dr. Quinn, Medicine Woman Dr. Quinn, Medicine Woman is multi-Emmy Award winning western/dramatic television series in the United States, created by Beth Sullivan. It ran on CBS for six seasons, from January 1st, 1993 to May 16th, 1998. , Christy chris·ty n. Variant of christie. , The Father Dowling Dowling is a surname, and may refer to
saga of the Cartwright family. [TV: Terrace, I, 111–112] See : Wild West , Eight Is Enough and Life Goes On, as well as original specials and theatrical and made-for-television movies. This press release contains "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. ," within the meaning of federal securities laws, that involve risks and uncertainties. All statements herein, other than those consisting solely of historical facts, that address activities, events or developments that the Company expects or anticipates will or may occur in the future, including such things as business strategy, measures to implement strategy, competitive strengths, goals, references to future success and other events may be forward-looking statements. Statements herein are based on certain assumptions and analysis made by the Company in light of its experience and its perception of historical trends, current conditions and potential future developments, as well as other factors it believes are appropriate in the 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 . However, whether actual results, events and developments will conform with the Company's expectations is subject to a number of risks and uncertainties and important factors that could cause actual results, events and developments to differ materially from those referenced in, contemplated by or underlying any forward-looking statements herein, including, among others, the continued development and viability of the Company's television operations, the Company's ability to manage its growth, the Company's high level of indebtedness INDEBTEDNESS. The state, of being in debt, without regard to the ability or inability of the party to pay the same. See 1 Story, Eq. 343; 2 Hill. Ab. 421. 2. , restrictions imposed on the Company by the terms of its indebtedness and preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. , the impact of government regulations, industry and economic conditions, competition, changes in 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. , industry and economic conditions and other factors, many of which are beyond the control of the Company. Consequently, all forward-looking statements made herein are qualified by these cautionary statements and there can be no assurance that the actual results, events or developments referenced herein will occur or be realized.
PAXSON COMMUNICATIONS CORPORATION
Consolidated Balance Sheets (In thousands except share data)
September 30, December 31,
1999 1998
(Unaudited)
Assets
Current assets:
Cash and cash
equivalents $ 416,083 $ 49,440
Restricted cash and
short-term investments 19,091 18,096
Accounts receivable, less
allowance for doubtful
accounts of $4,342 and $3,953,
respectively 28,952 21,391
Program rights 66,433 81,867
Prepaid expenses and
other current assets 4,443 2,947
Total current assets 535,002 173,741
Property and equipment, ne 191,085 178,975
Intangible assets, net 914,582 827,973
Investments in broadcast
properties 40,938 74,683
Program rights, net 164,866 214,331
Investment in cable network - 42,531
Other assets, net 39,560 30,552
Total assets $ 1,886,033 $ 1,542,786
Liabilities, Redeemable Securities and Common Stockholders' Equity
Current liabilities:
Accounts payable and
accrued liabilities $ 17,021 $ 25,738
Accrued interest 16,395 8,391
Obligations for cable
distribution rights 34,439 50,914
Obligation for satellite
distribution 2,625 -
Obligations for program rights 95,057 84,820
Income taxes payable 2,022 1,542
Current portion of long-term debt 397 529
Total current liabilities 167,956 171,934
Deferred income taxes - 58,109
Obligations for cable
distribution rights,
net of current portion 5,329 15,400
Obligation for satellite
distribution, net of
current portion 12,375 -
Obligations for program
rights, net of current portion 124,808 154,800
Long-term debt 154,521 145,164
DP Media long-term debt 114,000 -
Senior subordinated notes, net 228,591 228,305
Mandatorily redeemable
preferred stock 884,063 521,401
Class A common stock, $0.001
par value; one vote per share;
150,000,000 shares authorized,
53,654,889 & 52,608,765 shares
issued and outstanding 54 53
Class B common stock, $0.001
par value; ten votes per share;
35,000,000 shares authorized
and 8,311,639 shares issued
and outstanding 8 8
Class A common stock warrants
and Class B common stock call option 101,582 1,582
Stock subscription notes receivable (1,799) (2,813)
Additional paid-in capital 401,318 318,935
Deferred option plan compensation (15,788) (16,728)
Accumulated deficit....... (290,985) (53,364)
Commitments and contingencies - -
Total liabilities, mandatorily
redeemable preferred stock and
common stockholders' equity $ 1,886,033 $ 1,542,786
The Notes to Consolidated Financial Statements as found in the
Company's Form 10-Q for the three and nine months ended September 30,
1998 and 1999 are an integral part of the consolidated financial
statements.
PAXSON COMMUNICATIONS CORPORATION
Consolidated Statements of Operations (In thousands except share data)
For the Three Months
Ended September 30,
1999 1998
(Unaudited)
Advertising revenues $ 58,051 $ 29,402
Expenses:
Operating 32,662 14,785
Selling, general and
administrative 41,435 45,566
Time brokerage and
affiliation fees 4,425 2,831
Stock-based compensation 9,419 2,902
Depreciation and amortization 19,488 10,098
Operating loss (49,378) (46,780)
Other income (expense):
Interest expense (10,997) (10,053)
Interest income 1,758 4,694
Other expenses, net (686) (318)
Equity in loss of
unconsolidated investment - (4,983)
Loss before income taxes (59,303) (57,440)
Income tax benefit 16,050 20,869
Net loss (43,253) (36,571)
Beneficial conversion feature
on issuance of convertible
preferred stock (65,467) -
Dividends and accretion on
redeemable preferred stock (21,039) (16,440)
Net loss attributable
to common stock .... $ (129,759) $ (53,011)
Basic and diluted loss per share:
Loss from operations $ (2.10) $ (0.87)
Net loss $ (2.10) $ (0.87)
Weighted average shares
outstanding 61,887,000 60,740,230
The Notes to Consolidated Financial Statements as found in the
Company's Form 10-Q for the three months ended September 30, 1998 and
1999 are an integral part of the consolidated financial statements.
PAXSON COMMUNICATIONS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except share and per share data)
For the Nine Months
Ended September 30,
1999 1998
Advertising revenues $ 167,684 $ 91,443
Expenses:
Operating 91,077 25,032
Selling, general and
administrative 123,249 87,228
Time brokerage and
affiliation fees 13,057 12,488
Stock-based compensation 13,712 7,989
Adjustment of programming
to net realizable value 70,499 -
Depreciation and amortization 56,844 28,456
368,438 161,193
Operating loss (200,754) (69,750)
Other income (expense):
Interest expense (32,714) (30,939)
Interest income 4,686 13,334
Other expenses, net (1,694) (818)
Gain on sale of Travel Channel
and television stations 59,453 51,603
Equity in loss of
unconsolidated investment (2,260) (8,179)
Loss before income taxes (173,283) (44,749)
Income tax benefit 57,291 16,046
Net loss (115,992) (28,703)
Beneficial conversion feature
on issuance of convertible
preferred stock (65,467) -
Dividends and accretion
on redeemable preferred stock (56,162) (32,869)
Net loss attributable
to common stock $ (237,621) $ (61,572)
Basic and diluted loss per share:
Loss from operations $ (3.87) $ (1.02)
Net loss $ (3.87) $ (1.02)
Weighted average shares outstanding 61,424,064 60,197,234
The Notes to Consolidated Financial Statements as found in the
Company's Form 10-Q for the nine months ended September 30, 1998 and
1999 are an integral part of the consolidated financial statements.
PAXSON COMMUNICATIONS CORPORATION
Consolidated Statements of Cash Flows (In thousands)
For the Nine Months
Ended September 30,
1999 1998
(Unaudited)
Cash flows from
operating activities:
Net loss $ (115,992) $ (28,703)
Adjustments to reconcile net
loss to net cash used in
operating activities:
Depreciation and amortization 56,844 28,456
Stock-based compensation 13,712 7,989
Program rights amortization 66,924 7,650
Payments for cable
distribution rights (16,474) (11,435)
Program rights payments
and deposits (96,228) (37,747)
Provision for doubtful
accounts 5,119 1,777
Adjustment of programming to
net realizable value 70,499 -
Deferred income tax benefit (59,084) (19,256)
(Gain) on sale or disposal
of assets (671) 353
Equity in loss of unconsolidated
investment 2,260 8,179
Gain on sale of Travel Channel
and television stations (59,453) (51,603)
Changes in assets
and liabilities:
Decrease (increase)
in restricted cash 6,705 (3,083)
Increase in accounts receivable (8,875) (7,972)
Increase in prepaid expenses
and other current assets (1,272) (2,780)
(Increase) decrease in
other assets (7,812) 4,193
(Decrease) increase in
accounts payable and
accrued liabilities (11,160) 19,782
Increase in accrued interest 6,825 6,494
Decrease in current income
taxes payable 480 1,925
Net cash used in operating
activities (147,653) (75,781)
Cash flows from investing activities:
Acquisitions of broadcasting
properties (53,828) (568,896)
Decrease (increase) in investments
in broadcast properties 10,189 (35,692)
Collection of notes receivable
from CAP Communications, Inc 30,644 -
Decrease in deposits on
broadcast properties 3,974 30,544
Decrease in cash held by
qualified intermediary - 418,950
Purchases of property
and equipment (22,604) (61,872)
Distribution received from
unconsolidated investment - 3,163
DP Media cash balance
upon consolidation 4,310 -
Proceeds from sales of
Travel Channel and television
stations 120,727 66,619
Net cash provided by (used in)
investing activities 93,412 (147,184)
Cash flows from financing activities:
Proceeds from issuance of
exchangeable and convertible
preferred stock, net 406,500 261,500
Proceeds from issuance of
long-term debt 10,858 2,313
Repayments of long-term debt (1,633) (380)
Proceeds from exercise of
common stock options, net 4,145 833
Repayments of stock
subscription notes receivable 1,014 -
Net cash provided by
financing activities 420,884 264,266
Increase in cash and
cash equivalents 366,643 41,301
Cash and cash equivalents
at beginning of period 49,440 82,641
at end of period $ 416,083 $ 123,942
The Notes to Consolidated Financial Statements as found in the
Company's Form 10-Q for the nine months ended September 30, 1998 and
1999 are an integral part of the consolidated financial statements.
PAXSON COMMUNICATIONS CORPORATION
Consolidated Statements of Cash Flows (In thousands)
For the Nine Months
Ended September 30,
1999 1998
(Unaudited)
Supplemental disclosures of
cash flow information:
Cash paid for interest $ 22,533 $ 22,552
Cash paid for income taxes $ 1,312 $ 1,615
Non-cash operating and
financing activities:
Accretion of discount on
senior subordinated notes $ 286 $ 255
Issuance of common stock
for acquisition $ - $ 5,250
Beneficial conversion feature
on issuance of convertible
preferred stock $ 65,467 $ -
Dividends accrued on redeemable
preferred stock $ 52,570 $ 31,344
Discount accretion on
redeemable securities $ 3,593 $ 1,526
Satellite distribution $ 15,000 $ -
Sale of KWOK in exchange
for WCPX $ 30,000 $ -
The Notes to Consolidated Financial Statements as found in the
Company's Form 10-Q for the nine months ended September 30, 1998 and
1999 are an integral part of the consolidated financial statements.
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