RADIO ONE INC'A' : Radio One, Inc. Reports Third Quarter Results
11/03/2011| 06:21am US/Eastern
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WASHINGTON, Nov. 3, 2011 /PRNewswire via COMTEX/ --
Radio One, Inc. (NASDAQ: ROIAK and ROIA) today reported its
results for the quarter ended September 30,
2011. Giving effect to the consolidation of TV One,
net revenue was approximately $104.4 million, an
increase of 40.3% from the same period in 2010. Also giving
effect to the consolidation of TV One, station operating
income(1) was approximately $35.8 million, an
increase of 26.5% from the same period in 2010. The Company
reported operating income of approximately $13.1
million compared to operating income of approximately
$17.3 million for the same period in 2010. Net
loss was approximately $9.9 million or
$0.20 per share, compared to net income of
approximately $1.0 million or $0.02
per share for the same period in 2010.
Alfred C. Liggins, III, Radio One's CEO and
President stated, "The third quarter again highlights
the importance of consolidating TV One into our results:
radio was relatively flat, however, our TV and Internet
divisions both showed good revenue progression from prior
year, and provide a sound diversification strategy. We have
made some changes in certain radio markets designed to
improve long term performance: in Houston we are
launching News 92 FM; in Columbus, we switched
from gospel to the Jack format; in Detroit we
signed a local marketing agreement for 107.5 WGPR; and, in
Philadelphia, we moved our adult urban format to
our hip-hop signal, and vice versa. I am confident that these
strategic changes will reap rewards in the long-term."
RESULTS OF OPERATIONS
Three Months Ended September 30,
Nine Months Ended September 30,
2011
2010
2011
2010
(as adjusted)(2)
(as adjusted)(2)
STATEMENT OF OPERATIONS
(unaudited)
(unaudited)
(in thousands, except share data)
(in thousands, except share data)
NET REVENUE
$ 104,445
$ 74,430
$ 266,516
$ 208,557
OPERATING EXPENSES
Programming and technical
32,742
18,762
82,291
56,592
Selling, general and administrative, excluding
stock-based compensation
35,878
27,336
95,803
77,383
Corporate selling, general and administrative,
excluding stock-based compensation
10,442
5,488
25,214
20,537
Stock-based compensation
759
908
2,895
4,877
Depreciation and amortization
11,504
4,610
25,825
14,156
Total operating expenses
91,325
57,104
232,028
173,545
Operating Income
13,120
17,326
34,488
35,012
INTEREST INCOME
103
28
120
95
INTEREST EXPENSE
22,973
12,122
65,222
31,059
GAIN ON INVESTMENT IN AFFILIATED COMPANY
-
-
146,879
-
LOSS ON RETIREMENT OF DEBT
-
-
7,743
-
EQUITY IN INCOME OF AFFILIATED COMPANY
-
1,784
3,287
3,832
OTHER (INCOME) EXPENSE, net
(19)
50
3
2,934
(Loss) income before (benefit from) provision for
income taxes, noncontrolling interest in income of
subsidiaries and income (loss) from discontinued
operations
(9,731)
6,966
111,806
4,946
(BENEFIT FROM) PROVISION FOR INCOME TAXES
(2,325)
4,760
81,905
4,685
Net (loss) income from continuing
operations
(7,406)
2,206
29,901
261
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, net
of tax
11
(158)
(71)
(316)
CONSOLIDATED NET (LOSS) INCOME
(7,395)
2,048
29,830
(55)
NET INCOME ATTRIBUTABLE TO NONCONTROLLING
INTERESTS
2,483
1,010
5,403
1,427
CONSOLIDATED NET (LOSS) INCOME ATTRIBUTABLE TO
COMMON STOCKHOLDERS
$ (9,878)
$ 1,038
$ 24,427
$ (1,482)
AMOUNTS ATTRIBUTABLE TO COMMON
STOCKHOLDERS:
NET (LOSS) INCOME FROM CONTINUING
OPERATIONS
$ (9,889)
$ 1,196
$ 24,498
$ (1,166)
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, net
of tax
11
(158)
(71)
(316)
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON
STOCKHOLDERS
$ (9,878)
$ 1,038
$ 24,427
$ (1,482)
Weighted average shares outstanding -
basic(3)
50,270,550
52,064,108
51,072,480
51,316,498
Weighted average shares outstanding -
diluted(4)
50,270,550
54,262,885
52,943,536
51,316,498
Three Months Ended September 30,
Nine Months Ended September 30,
2011
2010
2011
2010
(as adjusted)(2)
(as adjusted)(2)
(unaudited)
(unaudited)
(in thousands, except per share data)
(in thousands, except per share data)
PER SHARE DATA - basic and diluted:
Net (loss) income from continuing operations
(basic)
$ (0.20)
$ 0.02
$ 0.48
$ (0.02)
Income (loss) from discontinued operations, net
of tax (basic)
0.00
(0.00)
(0.00)
(0.01)
Consolidated net (loss) income attributable to
common stockholders (basic)
$ (0.20)
$ 0.02
$ 0.48
$ (0.03)
Net (loss) income from continuing operations
(diluted)
$ (0.20)
$ 0.02
$ 0.46
$ (0.02)
Income (loss) from discontinued operations, net
of tax (diluted)
0.00
(0.00)
(0.00)
(0.01)
Consolidated net (loss) income attributable to
common stockholders (diluted)
$ (0.20)
$ 0.02
$ 0.46
$ (0.03)
SELECTED OTHER DATA
Station operating income (1)
$ 35,825
$ 28,332
$ 88,422
$ 74,582
Station operating income margin (% of net
revenue)
34.3%
38.1%
33.2%
35.8%
Station operating income reconciliation:
Consolidated net (loss) income attributable to
common stockholders
$ (9,878)
$ 1,038
$ 24,427
$ (1,482)
Add back non-station operating income items
included in consolidated net (loss) income:
Interest income
(103)
(28)
(120)
(95)
Interest expense
22,973
12,122
65,222
31,059
(Benefit from) provision for income taxes
(2,325)
4,760
81,905
4,685
Corporate selling, general and administrative
expenses
10,442
5,488
25,214
20,537
Stock-based compensation
759
908
2,895
4,877
Gain on investment in affiliated company
-
-
(146,879)
-
Loss on retirement of debt
-
-
7,743
-
Equity in income of affiliated company
-
(1,784)
(3,287)
(3,832)
Other (income) expense, net
(19)
50
3
2,934
Depreciation and amortization
11,504
4,610
25,825
14,156
Noncontrolling interest in income of
subsidiaries
2,483
1,010
5,403
1,427
(Income) loss from discontinued operations, net
of tax
(11)
158
71
316
Station operating income
$ 35,825
$ 28,332
$ 88,422
$ 74,582
Adjusted EBITDA(5)
$ 25,383
$ 22,844
$ 63,208
$ 54,045
Adjusted EBITDA reconciliation:
Consolidated net (loss) income attributable to
common stockholders
$ (9,878)
$ 1,038
$ 24,427
$ (1,482)
Interest income
(103)
(28)
(120)
(95)
Interest expense
22,973
12,122
65,222
31,059
(Benefit from) provision for income taxes
(2,325)
4,760
81,905
4,685
Depreciation and amortization
11,504
4,610
25,825
14,156
EBITDA
$ 22,171
$ 22,502
$ 197,259
$ 48,323
Stock-based compensation
759
908
2,895
4,877
Gain on investment in affiliated company
-
-
(146,879)
-
Loss on retirement of debt
-
-
7,743
-
Equity in income of affiliated company
-
(1,784)
(3,287)
(3,832)
Other (income) expense, net
(19)
50
3
2,934
Noncontrolling interest in income of
subsidiaries
2,483
1,010
5,403
1,427
(Income) loss from discontinued operations, net
of tax
(11)
158
71
316
Adjusted EBITDA
$ 25,383
$ 22,844
$ 63,208
$ 54,045
September 30, 2011
December 31, 2010
(unaudited)
(as adjusted)
(in thousands)
SELECTED BALANCE SHEET DATA:
Cash and cash equivalents
$ 33,171
$ 9,192
Intangible assets, net
1,278,256
838,945
Total assets
1,521,021
999,212
Total debt (including current portion)
803,655
642,222
Total liabilities
1,069,515
774,242
Total stockholders' equity
215,925
194,335
Redeemable noncontrolling interest
29,711
30,635
Noncontrolling interest
205,870
-
SELECTED LEVERAGE DATA:
Current Amount
Outstanding
Applicable
Interest Rate
(in thousands)
Senior bank term debt, net of original issue
discount
of approximately $7.1 million (subject to
variable
rates)(a)
$ 376,991
7.50%
12 1/2%/15% senior subordinated notes
(fixed rate)
305,917
15.00%
6 3/8% senior subordinated notes (fixed
rate)
747
6.38%
10% Senior Secured TV One Notes due
March 2016 (fixed rate)
119,000
10.00%
Note payable (fixed rate)
1,000
7.00%
(a) Subject to variable Libor Rate plus a spread
currently at 6.00% and incorporated into the applicable
interest rate set forth above.
This press release includes 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.
Forward-looking statements represent management's current
expectations and are based upon information available to
Radio One at the time of this release. These forward-looking
statements involve known and unknown risks, uncertainties and
other factors, some of which are beyond Radio One's
control, that may cause the actual results to differ
materially from any future results, performance or
achievements expressed or implied by such forward-looking
statements. Important factors that could cause actual results
to differ materially are described in Radio One's reports
on Form 10-K and other filings with the Securities and
Exchange Commission. Radio One does not undertake any duty to
update any forward-looking statements.
Net revenue increased to approximately $104.4
million for the quarter ended September 30,
2011, from approximately $74.4 million
for the same period in 2010, an increase of 40.3%. We began
to consolidate the results of TV One during the second
quarter of 2011 and recognized approximately $29.5
million of revenue from our new cable television
segment during the three months ended September 30,
2011. The radio markets that we operate in grew 1.7%
for the quarter and 2.5% year to date, led primarily by
growth in digital revenues, while national revenue and local
revenue in our radio markets were relatively flat for the
quarter. Our radio stations' net revenues increased 0.3%
with the most significant increases noted in our
Atlanta, Charlotte,
Cincinnati, Raleigh and St.
Louis clusters, while our Columbus,
Dallas, Indianapolis and
Washington D.C. markets experienced the most
significant declines. Total core radio revenue (radio
stations and syndicated programs excluding Reach Media)
improved 1.4% during the quarter. While Reach Media's
revenue declined 4.7% in the quarter, this decline was an
improvement from the decline experienced during the second
quarter of 2011. Net revenue for our internet segment
improved 11.5% for the three months ended September 30,
2011 compared to the same period in 2010.
Operating expenses, excluding depreciation and amortization
and stock-based compensation, increased to approximately
$79.1 million for the quarter ended
September 30, 2011, up 53.3% from the
approximately $51.6 million incurred for the
comparable quarter in 2010. Most of the increase is a result
of the TV One consolidation specifically related to
programming and technical operating expenses. For our cable
television segment, programming and technical expenses
include expenses associated with the technical, programming,
production, and content management. Approximately $13.7
million of our consolidated programming and technical
operating expenses were incurred by TV One, with
approximately $11.2 million of this amount
relating specifically to content amortization. Excluding the
impact of consolidating TV One results, our programming and
technical expenses would have increased by 1.6% for the
quarter compared to the same period in 2010.
Stock-based compensation decreased to $759,000
for the quarter ended September 30, 2011,
compared to $908,000 for the same period in
2010. This decrease in stock-based compensation expense is
due to one-time accelerated vesting that occurred in 2010
associated with the long-term incentive plan whereby officers
and certain key employees were granted a total of 3,250,000
shares of restricted stock in January of 2010.
Depreciation and amortization expense increased to
approximately $11.5 million compared to
approximately $4.6 million for the quarters
ended September 30, 2011 and 2010, respectively,
an increase of 150.0%. Additional depreciation and
amortization expense of approximately $7.8
million resulted from the fixed and intangible assets
recorded as part of the consolidation of TV One. This
increased expense was partially offset by the completion of
amortization for certain intangible assets and the completion
of depreciation and amortization for certain assets.
Interest expense increased to approximately $23.0
million for the quarter ended September 30,
2011, from approximately $12.1 million
for the same period in 2010, an increase of 90.1%. The
increase in interest expense was due to higher interest rates
associated with the 2011 Credit Agreement, Amended Exchange
Offer and TV One Notes, which were in effect for the three
months ended September 30, 2011 compared to the
same period in 2010. The overall effective rate of borrowing
for the three months ended September 30, 2011
increased approximately 4.0% compared to the three months
ended September 30, 2010. Approximately
$3.0 million of the increased interest expense
relates to the debt recorded as part of the consolidation of
TV One.
Equity in income of affiliated company decreased to
$0 for the quarter ended September 30,
2011, compared to approximately $1.8
million for the same period in 2010, a decrease of
100.0%. Equity in income of affiliated company primarily
reflects our estimated equity in the net income of TV One.
The decrease to equity in income of affiliated company for
the three months ended September 30, 2011 was
due to the consolidation of TV One during the prior quarter.
Previously, the Company's share of the net income was
driven by TV One's current capital structure and the
Company's percentage ownership of the equity securities
of TV One.
The benefit from income taxes for the quarter ended
September 30, 2011 was approximately $2.3
million compared to a provision for income taxes of
approximately $4.8 million for the quarter ended
September 30, 2010. Substantially all of the
decrease in income taxes relates to the deferred tax
liability for TV One. The consolidated effective tax rate for
the three months ended September 30, 2011 and
2010 was 23.9% and 68.3%, respectively.
Income (loss) from discontinued operations, net of tax,
includes the results of operations for our sold radio
stations and Giant Magazine, which ceased publication in
December 2009. The income from discontinued
operations, net of tax, for the three months ended
September 30, 2011 resulted from the remaining
Boston radio station entering into an LMA in
June 2011. The loss from discontinued
operations, net of tax, for the quarter ended September
30, 2010 of $158,000 resulted primarily
from legal and litigation expenses incurred as a result of
ongoing legal activity related to certain previously sold
stations. The income (loss) from discontinued operations, net
of tax, includes no tax provision for the three months ended
September 30, 2011 and 2010.
The increase in noncontrolling interests in income of
subsidiaries is due primarily to the impact of consolidating
TV One results for the three months ended September 30,
2011. This amount is partially offset by lower net
income generated by Reach Media for the three months ended
September 30, 2011 compared to the same period
in 2010.
Other pertinent financial information includes capital
expenditures of approximately $1.8 million and
$1.5 million for the quarters ended
September 30, 2011 and 2010, respectively. In
addition, as of September 30, 2011, Radio One
had total debt (net of cash balances) of approximately
$770.5 million.
Supplemental Financial Information:
For comparative purposes, the following more detailed and
unaudited statements of operations for the three and nine
months ended September 30, 2011 and 2010 are
included. These detailed, unaudited and adjusted statements
of operations include certain reclassifications associated
with accounting for discontinued operations. These
reclassifications had no effect on previously reported net
income or loss, or any other previously reported statements
of operations, balance sheet or cash flow amounts.
Three Months Ended September 30, 2011
(in thousands, unaudited)
Corporate/
Reach
Cable
Eliminations/
Consolidated
Radio One
Media
Internet
Television
Other
STATEMENT OF OPERATIONS:
NET REVENUE
$
104,445
$
58,733
$
13,427
$
4,884
$
29,545
$
(2,144)
OPERATING EXPENSES:
Programming and technical
32,742
13,659
5,309
2,008
13,684
(1,918)
Selling, general and administrative
35,878
21,325
3,929
3,054
8,239
(669)
Corporate selling, general and
administrative
10,442
-
1,252
-
1,380
7,810
Stock-based compensation
759
133
-
24
-
602
Depreciation and amortization
11,504
1,657
988
838
7,779
242
Total operating expenses
91,325
36,774
11,478
5,924
31,082
6,067
Operating income (loss)
13,120
21,959
1,949
(1,040)
(1,537)
(8,211)
INTEREST INCOME
103
-
3
-
100
-
INTEREST EXPENSE
22,973
-
18
-
3,039
19,916
OTHER (INCOME) EXPENSE, net
(19)
(19)
-
-
-
-
(Loss) income before (benefit from) provision for
income taxes, noncontrolling interest in income of
subsidiaries and income from discontinued
operations
(9,731)
21,978
1,934
(1,040)
(4,476)
(28,127)
(BENEFIT FROM) PROVISION FOR INCOME TAXES
(2,325)
(2,833)
508
-
-
-
Net (loss) income from continuing
operations
(7,406)
24,811
1,426
(1,040)
(4,476)
(28,127)
INCOME FROM DISCONTINUED OPERATIONS, net of
tax
11
11
-
-
-
-
CONSOLIDATED NET (LOSS) INCOME
(7,395)
24,822
1,426
(1,040)
(4,476)
(28,127)
NET INCOME ATTRIBUTABLE TO NONCONTROLLING
INTERESTS
2,483
-
-
-
-
2,483
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON
STOCKHOLDERS
$
(9,878)
$
24,822
$
1,426
$
(1,040)
$
(4,476)
$
(30,610)
Three Months Ended September 30, 2010
(in thousands, unaudited, as adjusted(2))
Corporate/
Reach
Eliminations/
Consolidated
Radio One
Media
Internet
Other
STATEMENT OF OPERATIONS:
NET REVENUE
$
74,430
$
57,906
$
14,092
$
4,382
$
(1,950)
OPERATING EXPENSES:
Programming and technical
18,762
12,958
5,072
2,376
(1,644)
Selling, general and administrative
27,336
20,644
4,164
3,263
(735)
Corporate selling, general and
administrative
5,488
-
1,318
-
4,170
Stock-based compensation
908
127
-
24
757
Depreciation and amortization
4,610
2,027
1,089
1,222
272
Total operating expenses
57,104
35,756
11,643
6,885
2,820
Operating income (loss)
17,326
22,150
2,449
(2,503)
(4,770)
INTEREST INCOME
28
-
16
-
12
INTEREST EXPENSE
12,122
-
18
-
12,104
EQUITY IN INCOME OF AFFILIATED COMPANY
1,784
-
-
-
1,784
OTHER EXPENSE (INCOME), net
50
-
-
48
2
Income (loss) before provision for income taxes,
noncontrolling interest in income of subsidiaries and
(loss) income from discontinued operations
6,966
22,150
2,447
(2,551)
(15,080)
PROVISION FOR INCOME TAXES
4,760
3,860
900
-
-
Net income (loss) from continuing
operations
2,206
18,290
1,547
(2,551)
(15,080)
(LOSS) INCOME FROM DISCONTINUED OPERATIONS, net
of tax
(158)
(177)
-
19
-
CONSOLIDATED NET INCOME (LOSS)
2,048
18,113
1,547
(2,532)
(15,080)
NET INCOME ATTRIBUTABLE TO NONCONTROLLING
INTERESTS
1,010
-
-
-
1,010
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON
STOCKHOLDERS
$
1,038
$
18,113
$
1,547
$
(2,532)
$
(16,090)
Nine Months Ended September 30, 2011
(in thousands, unaudited)
Corporate/
Reach
Cable
Eliminations/
Consolidated
Radio One
Media
Internet
Television
Other
STATEMENT OF OPERATIONS:
NET REVENUE
$
266,516
$
167,152
$
37,928
$
12,705
$
54,711
$
(5,980)
OPERATING EXPENSES:
Programming and technical
82,291
39,764
15,919
6,692
25,455
(5,539)
Selling, general and administrative
95,803
63,101
12,228
8,209
14,053
(1,788)
Corporate selling, general and
administrative
25,214
-
4,598
-
1,297
19,319
Stock-based compensation
2,895
452
-
82
-
2,361
Depreciation and amortization
25,825
5,091
2,961
2,875
14,208
690
Total operating expenses
232,028
108,408
35,706
17,858
55,013
15,043
Operating income (loss)
34,488
58,744
2,222
(5,153)
(302)
(21,023)
INTEREST INCOME
120
-
12
-
105
3
INTEREST EXPENSE
65,222
-
46
-
6,187
58,989
GAIN ON INVESTMENT IN AFFILIATED COMPANY
146,879
-
-
-
-
146,879
LOSS ON RETIREMENT OF DEBT
7,743
-
-
-
-
7,743
EQUITY IN INCOME OF AFFILIATED COMPANY
3,287
-
-
-
-
3,287
OTHER EXPENSE (INCOME), net
3
(6)
-
-
9
Income (loss) before provision for income taxes,
noncontrolling interest in income of subsidiaries and
(loss) income from discontinued operations
111,806
58,750
2,188
(5,153)
(6,384)
62,405
PROVISION FOR INCOME TAXES
81,905
81,319
586
-
-
-
Net income (loss) from continuing
operations
29,901
(22,569)
1,602
(5,153)
(6,384)
62,405
(LOSS) INCOME FROM DISCONTINUED OPERATIONS, net
of tax
(71)
(72)
-
1
-
CONSOLIDATED NET INCOME (LOSS)
29,830
(22,641)
1,602
(5,152)
(6,384)
62,405
NONCONTROLLING INTEREST IN INCOME OF
SUBSIDIARIES
5,403
-
-
-
-
5,403
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON
STOCKHOLDERS
$
24,427
$
(22,641)
$
1,602
$
(5,152)
$
(6,384)
$
57,002
Nine Months Ended September 30, 2010
(in thousands, unaudited, as adjusted(2))
Corporate/
Reach
Eliminations/
Consolidated
Radio One
Media
Internet
Other
STATEMENT OF OPERATIONS:
NET REVENUE
$
208,557
$
169,430
$
32,523
$
12,330
$
(5,726)
OPERATING EXPENSES:
Programming and technical
56,592
39,039
15,102
7,161
(4,710)
Selling, general and administrative
77,383
61,792
7,412
10,503
(2,324)
Corporate selling, general and
administrative
20,537
-
4,833
-
15,704
Stock-based compensation
4,877
696
-
137
4,044
Depreciation and amortization
14,156
6,292
3,160
3,853
851
Total operating expenses
173,545
107,819
30,507
21,654
13,565
Operating income (loss)
35,012
61,611
2,016
(9,324)
(19,291)
INTEREST INCOME
95
-
51
-
44
INTEREST EXPENSE
31,059
-
54
-
31,005
EQUITY IN INCOME OF AFFILIATED COMPANY
3,832
-
-
-
3,832
OTHER EXPENSE (INCOME), net
2,934
(231)
-
159
3,006
Income (loss) before provision for income taxes,
noncontrolling interest in income of subsidiaries and
(loss) income from discontinued operations
4,946
61,842
2,013
(9,483)
(49,426)
PROVISION FOR INCOME TAXES
4,685
3,926
759
-
-
Net income (loss) from continuing
operations
261
57,916
1,254
(9,483)
(49,426)
(LOSS) INCOME FROM DISCONTINUED OPERATIONS, net
of tax
(316)
(575)
-
259
-
CONSOLIDATED NET (LOSS) INCOME
(55)
57,341
1,254
(9,224)
(49,426)
NONCONTROLLING INTEREST IN INCOME OF
SUBSIDIARIES
1,427
-
-
-
1,427
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON
STOCKHOLDERS
$
(1,482)
$
57,341
$
1,254
$
(9,224)
$
(50,853)
Radio One, Inc. (Nasdaq: ROIAK; ROIA) will be holding a
conference call for investors, analysts and other interested
parties to discuss its results for third fiscal quarter of
2011. The conference call is scheduled for Thursday,
November 3, 2011 at 10:00 a.m. EDT. To
participate on this call, U.S. callers may dial toll-free
1-800-230-1074; international callers may dial direct (+1)
612-234-9960.
A replay of the conference call will be available from
12:30 p.m. EDTNovember 3, 2011
until 11:59 p.m.November 5, 2011.
Callers may access the replay by calling 1-800-475-6701;
international callers may dial direct (+1) 320-365-3844. The
replay Access Code is 222011. Access to live audio and a
replay of the conference call will also be available on Radio
One's corporate website at http://www.radio-one.com/.
The replay will be made available on the website for seven
days after the call.
Radio One, Inc. (www.radio-one.com) is a
diversified media company that primarily targets
African-American and urban consumers. The Company is one of
the nation's largest radio broadcasting companies,
currently owning or operating 53 broadcast stations located
in 15 urban markets in the United States. As a
part of its core broadcasting business, Radio One operates
syndicated programming including the Russ Parr
Morning Show, the Yolanda Adams
Morning Show, the Rickey Smiley
Morning Show, CoCo Brother Live,
CoCo
Brother's "Spirit" program, Bishop T.D. Jakes'
"Empowering Moments", the Reverend Al Sharpton
Show, and the Warren Ballentine
Show. The Company also owns a controlling interest in
Reach Media, Inc. (www.blackamericaweb.com),
owner of the Tom Joyner Morning Show and other businesses
associated with Tom Joyner. Beyond its core
radio broadcasting business, Radio One owns Interactive One
(www.interactiveone.com),
an online platform serving the African-American community
through social content, news, information, and entertainment,
which operates a number of branded sites, including News One,
UrbanDaily, HelloBeautiful, Community Connect Inc. (www.communityconnect.com),
an online social networking company, which operates a number
of branded websites, including BlackPlanet, MiGente, and
Asian Avenue. In addition, the Company owns a controlling
interest in TV One, LLC (www.tvoneonline.com), a
cable/satellite network programming primarily to
African-Americans.
Notes:
1 "Station operating income" consists of net loss
before depreciation and amortization, corporate expenses,
stock-based compensation, equity in income of affiliated
company, income taxes, noncontrolling interest in income
(loss) of subsidiaries, interest expense, impairment of
long-lived assets, other (income) expense, loss (gain) on
retirement of debt, (income) loss from discontinued
operations, net of tax, interest income and gain on purchase
of affiliated company. Station operating income is not a
measure of financial performance under generally accepted
accounting principles. Nevertheless we believe station
operating income is often a useful measure of a broadcasting
company's operating performance and is a significant
basis used by our management to measure the operating
performance of our stations within the various markets
because station operating income provides helpful information
about our results of operations apart from expenses
associated with our fixed assets and long-lived intangible
assets, income taxes, investments, debt financings and
retirements, overhead, stock-based compensation, impairment
charges, and asset sales. Station operating income is
frequently used as one of the bases for comparing businesses
in our industry, although our measure of station operating
income may not be comparable to similarly titled measures of
other companies. Station operating income does not purport to
represent operating income or cash flow from operating
activities, as those terms are defined under generally
accepted accounting principles, and should not be considered
as an alternative to those measurements as an indicator of
our performance. A reconciliation of net loss to station
operating income has been provided in this release. Station
operating income includes results from all three of our
operating segments (radio broadcasting, internet and cable
television).
2 Certain reclassifications associated with accounting for
discontinued operations have been made to prior period
balances to conform to the current presentation. These
reclassifications had no effect on any other previously
reported or consolidated net income or loss or any other
statement of operations, balance sheet or cash flow amounts.
Where applicable, these financial statements have been
identified as "as adjusted."
3 For the three months ended September 30, 2011
and 2010, Radio One had 50,270,550 and 52,064,108 shares of
common stock outstanding on a weighted average basis (basic),
and 50,270,550 and 54,262,885 shares of common stock
outstanding on a weighted average basis (fully diluted) for
outstanding stock options, respectively.
4 For the nine months ended September 30, 2011
and 2010, Radio One had 51,072,480 and 51,316,498 shares of
common stock outstanding on a weighted average basis basic,
and 52,943,536 and 51,316,498 shares of common stock
outstanding on a weighted average basis (fully diluted) for
outstanding stock options, respectively.
5 "Adjusted EBITDA" consists of net loss plus (1)
depreciation, amortization, income taxes, interest expense,
noncontrolling interest in income of subsidiaries, impairment
of long-lived assets, stock-based compensation, loss on
retirement of debt, loss from discontinued operations, net of
tax, less (2) equity in income of affiliated company, other
income, interest income and gain on purchase of affiliated
company. Net income before interest income, interest expense,
income taxes, depreciation and amortization is commonly
referred to in our business as "EBITDA." Adjusted
EBITDA and EBITDA are not measures of financial performance
under generally accepted accounting principles. We believe
Adjusted EBITDA is often a useful measure of a company's
operating performance and is a significant basis used by our
management to measure the operating performance of our
business because Adjusted EBITDA excludes charges for
depreciation, amortization and interest expense that have
resulted from our acquisitions and debt financing, our taxes,
impairment charges, as well as our equity in (income) loss of
our affiliated company, gain on retirements of debt, and any
discontinued operations. Accordingly, we believe that
Adjusted EBITDA provides useful information about the
operating performance of our business, apart from the
expenses associated with our fixed assets and long-lived
intangible assets, capital structure or the results of our
affiliated company. Adjusted EBITDA is frequently used as one
of the bases for comparing businesses in our industry,
although our measure of Adjusted EBITDA may not be comparable
to similarly titled measures of other companies. Adjusted
EBITDA and EBITDA do not purport to represent operating
income or cash flow from operating activities, as those terms
are defined under generally accepted accounting principles,
and should not be considered as alternatives to those
measurements as an indicator of our performance. A
reconciliation of net loss to EBITDA and Adjusted EBITDA has
been provided in this release.
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