Third Quarter Results
Broadcasting revenue for the third quarter of 2008 was Ps. 201,892,000, representing an increase of 15.1% compared to the Ps. 175,460,000 reported in the third quarter of 2007. This increase was mainly attributable to higher advertising expenditures by the Company's clients, who purchased more airtime in the third quarter of 2008 compared to the same period of 2007. This was a result of a highly competitive environment, in which the Company sought to gain market share by offering attractive sales packages as well as increasing the size of its sales force.
The Company's broadcasting expenses (excluding depreciation, amortization and corporate, general and administrative expenses) for the third quarter of 2008 were Ps. 114,671,000, representing an increase of 11.9% compared to the Ps. 102,491,000 reported in the third quarter of 2007. This increase was primarily due to higher sales commissions paid to the Company's sales force as a result of the increase in broadcasting revenue, as well as higher expenses related to the Company's advertising and market research during the third quarter of 2008 compared to the same period of 2007.
For the third quarter of 2008, the Company reported broadcasting income (i.e., broadcasting revenue minus broadcasting expenses, excluding depreciation, amortization and corporate, general and administrative expenses) of Ps. 87,221,000, a 19.5% increase compared to the Ps. 72,969,000 reported in the third quarter of 2007. This increase in broadcasting income was mainly attributable to the increase in broadcasting revenue described above.
Depreciation and amortization expenses for the third quarter of 2008 were Ps. 8,044,000, a 1.7% decrease compared to the Ps. 8,187,000 reported in the third quarter of 2007. Depreciation and amortization expenses were lower in the third quarter of 2008 due to the Company no longer recording depreciation on certain assets whose useful lives ended after the third quarter of 2007.
The Company's corporate, general and administrative expenses were Ps. 2,700,000 in the third quarter of 2008, compared to the Ps. 2,712,000 reported in the third quarter of 2007.
The Company reported operating income of Ps. 76,477,000 in the third quarter of 2008, a 23.2% increase compared to the Ps. 62,070,000 in operating income reported in the third quarter of 2007. This increase was due to increased broadcasting revenue during the third quarter of 2008 compared to the third quarter of 2007, as described above.
During the third quarter of 2008, other expenses, net, were Ps. 14,896,000, a 28.8% increase compared to the Ps. 11,565,000 reported in the third quarter of 2007. This increase was mainly attributable to higher legal expenses during the third quarter of 2008 compared to the comparable period of 2007.
The Company's comprehensive financing cost for the third quarter of 2008 was Ps. 1,346,000, a decrease of 56.7% compared to the Ps. 3,105,000 reported in the third quarter of 2007. This decrease was mainly attributable to a change in MFRS for periods beginning in 2008, which did not require the Company to record gains and losses on net monetary position, as compared to the third quarter of 2007 when the Company reported a loss on net monetary position of Ps. 2,854,000.
For the third quarter of 2008, the Company reported income before taxes of Ps. 60,235,000, an increase of 27.1% compared to the Ps. 47,400,000 reported in the third quarter of 2007, primarily from the increase in broadcasting income during the third quarter of 2008, as described above.
The Company recorded income taxes of Ps. 17,413,000 in the third quarter of 2008, an increase of 17.5% compared to the Ps. 14,816,000 recorded in the third quarter of 2007. This increase was due to higher taxable income in the third quarter of 2008 compared to the comparable period in 2007.
As a result of the foregoing, the Company's net income for the third quarter of 2008 was Ps. 42,822,000, an increase of 31.4% compared to net income of Ps. 32,584,000 reported in the third quarter of 2007.
Nine Months Results
For the first nine months ended
The Company's broadcasting expenses (excluding depreciation, amortization and corporate, general and administrative expenses) for the first nine months of 2008 were Ps. 327,508,000, an increase of 3.6% compared to the Ps. 316,101,000 reported in the same period of 2007. This increase was primarily due to higher sales commissions to the Company's sales force, as well as higher expenses related to the Company's market research during 2008 compared to the same period of 2007.
Broadcasting income (i.e., broadcasting revenue minus broadcasting expenses, excluding depreciation, amortization and corporate, general and administrative expenses) for the first nine months of 2008 was Ps. 176,255,000, an increase of 28.2% compared to the Ps. 137,482,000 reported in the same period of 2007. This increase was mainly attributable to the increase in broadcasting revenue, as described above.
Depreciation and amortization expenses for the first nine months of 2008 were Ps. 23,776,000, a decrease of 8.4% compared to the Ps. 25,967,000 reported in the same period of 2007. This decrease was due to the Company no longer recording depreciation on certain Company assets whose useful lives have ended.
The Company's corporate, general and administrative expenses for the first nine months of 2008 were Ps. 10,000,000, compared to the Ps. 9,985,000 reported in the same period of 2007.
As a result of the foregoing, the Company reported operating income of Ps. 142,479,000 for the first nine months of 2008, a 40.3% increase compared to the Ps. 101,530,000 reported in the same period of 2007.
Other expenses, net, for the first nine months of 2008 were Ps. 39,341,000, a 22.7% increase compared to the Ps. 32,063,000 reported in the same period of 2007. This increase was mainly attributable to higher legal expenses during 2008 compared to the same period of 2007.
The Company's comprehensive financing cost for the first nine months of 2008 was Ps. 5,853,000, a 13.2% increase compared to the Ps. 5,171,000 reported in the same period of 2007. This increase was mainly due to fees paid in connection with the amendment of the Company's credit facility. The increase in comprehensive financing cost was partially offset by the fact that the Company did not record a gain or loss on net monetary position due to a change in MFRS for periods beginning in 2008, as compared to a loss on net monetary position of Ps. 3,650,000 that the Company recorded during the first nine months of 2007.
For the first nine months of 2008, the Company reported income before taxes of Ps. 97,285,000, a 51.3% increase compared to the Ps. 64,296,000 reported in the same period of 2007, mainly due to the previously mentioned increase in broadcasting revenue.
The Company recorded income taxes of Ps. 28,213,000 for the first nine months of 2008, compared to Ps. 18,631,000 recorded in the same period of 2007, primarily due to higher taxable income.
As a result of the foregoing, the Company reported net income of Ps. 69,072,000 for the first nine months of 2008, an increase of 51.3% compared to net income of Ps. 45,665,000 reported for the same period of 2007.
Other Matters
On
Company Description
Grupo Radio Centro owns and/or operates 14 radio stations. Of these 14
radio stations, Grupo Radio Centro operates 11 in
Note on Forward-Looking Statements
This release may contain projections or other forward-looking statements related to Grupo Radio Centro that involve risks and uncertainties. Readers are cautioned that these statements are only predictions and may differ materially from actual or future results or events. Readers are referred to the documents filed by Grupo Radio Centro with the United States Securities and Exchange Commission, specifically the most recent filing on Form 20-F, which identifies important risk factors that could cause actual results to differ from those contained in the forward-looking statements. All forward- looking statements are based on information available to Grupo Radio Centro on the date hereof, and Grupo Radio Centro assumes no obligation to update such statements.
IR Contacts In Mexico: Pedro Beltran / Alfredo Azpeitia Grupo Radio Centro, S.A.B. de C.V. Tel: (5255) 5728-4800 Ext. 7018 aazpeitia@grc.com.mx In NY: Maria Barona / Peter Majeski i-advize Corporate Communications, Inc. Tel: (212) 406-3690 grc@i-advize.com.mx GRUPO RADIO CENTRO, S.A.B. DE C.V. CONSOLIDATED UNAUDITED BALANCE SHEETS as of September 30, 2008 and 2007 (1)
(figures in thousands of Mexican pesos ("Ps.") and U.S. dollars ("U.S.$") (2)
September 30, 2008 2007 U.S. $(2) Ps. Ps. ASSETS Current assets: Cash and temporary investments 9,747 105,185 62,380 Accounts receivable: Broadcasting, net 16,931 182,716 189,950 Other 744 8,029 5,547 17,675 190,745 195,497 Prepaid expenses 1,589 17,154 18,929 Total current assets 29,011 313,084 276,806 Property and equipment, net 42,820 462,108 468,474 Deferred charges, net 486 5,249 6,161 Excess of cost over book value of net assets of subsidiaries, net 76,804 828,863 828,864 Other assets 308 3,325 3,331 Total assets 149,429 1,612,629 1,583,636 LIABILITIES Current: Advances from customers 6,847 73,895 81,816 Suppliers and other accounts payable 6,697 72,276 55,035 Taxes payable 2,249 24,267 23,101 Total current liabilities 15,793 170,438 159,952 Long-Term: Reserve for labor liabilities 5,687 61,377 56,259 Deferred taxes 446 4,813 6,286 Total liabilities 21,926 236,628 222,497 SHAREHOLDERS' EQUITY Capital stock 104,746 1,130,409 1,130,409 Cumulative earnings 18,630 201,050 186,211 Reserve for repurchase of shares 4,062 43,840 43,840 Minority interest 65 702 679 Total shareholders' equity 127,503 1,376,001 1,361,139 Total liabilities and shareholders' equity 149,429 1,612,629 1,583,636 (1) Amounts for the third quarter 2007 are expressed in Mexican pesos with purchasing power as of December 31, 2007.
As a result of a change in MFRS for periods beginning in 2008, we have
not prepared 2008 amounts using inflation accounting or re-expressed 2007
amounts as of
GRUPO RADIO CENTRO, S.A.B. DE C.V. CONSOLIDATED UNAUDITED STATEMENTS OF INCOME for the three-month and nine-month periods ended September 30, 2008 and 2007 (1) (figures in thousands of Mexican pesos ("Ps.") and U.S. dollars ("U.S.$")(2),
except per Share and per ADS amounts) 3rd Quarter Accumulated 9 months 2008 2007 2008 2007 U.S.$(2) Ps. Ps. U.S.$(1) Ps. Ps. Broadcasting revenue (3) 18,708 201,892 175,460 46,680 503,763 453,583 Broadcasting expenses, excluding depreciation, amortization and corporate, general and administrative expenses 10,626 114,671 102,491 30,348 327,508 316,101 Broadcasting income 8,082 87,221 72,969 16,332 176,255 137,482 Depreciation and amortization 745 8,044 8,187 2,203 23,776 25,967 Corporate, general and administrative expenses 250 2,700 2,712 927 10,000 9,985 Operating income 7,087 76,477 62,070 13,202 142,479 101,530 Other expenses, net (1,380) (14,896) (11,565) (3,645) (39,341) (32,063) Comprehensive financing cost: Interest expense (128) (1,382) (613) (565) (6,100) (2,012) Interest income (3) (5) (53) 356 24 262 484 (Loss) Gain on foreign currency exchange, net 8 89 6 (1) (15) 7 (Loss) Gain on net monetary position (4) 0 0 (2,854) 0 0 (3,650) (125) (1,346) (3,105) (542) (5,853) (5,171) Income before income taxes 5,582 60,235 47,400 9,015 97,285 64,296 Income taxes 1,614 17,413 14,816 2,614 28,213 18,631 Net income 3,968 42,822 32,584 6,401 69,072 45,665 Net income applicable to: Majority interest 3,967 42,812 32,583 6,399 69,047 45,655 Minority interest 1 10 1 2 25 10 3,968 42,822 32,584 6,401 69,072 45,665 Net income per Series A Share (5) 0.065 0.7035 0.5362 Net income per ADS (5) 0.587 6.3315 4.8258 Weighted average common shares outstanding (000's) (5) 162,725 162,704
(1) Amounts for the third quarter 2007 are expressed in Mexican pesos with
purchasing power as of
As a result of a change in MFRS for periods beginning in 2008, we have
not prepared 2008 amounts using inflation accounting or re-expressed 2007
amounts as of
SOURCE Grupo Radio Centro, S.A.B. de C.V.