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Saga Communications, Inc. Reports 3rd Quarter 2012 Results

3rd Quarter Net Income Increase 17.2%

GROSSE POINTE FARMS, Mich., Nov. 6, 2012 /PRNewswire/ -- Saga Communications, Inc. (NYSE MKT: SGA) today reported Net income for the quarter ended September 30, 2012 increased 17.2% to $4.3 million ($1.02 per fully diluted share compared to $0.87 per fully diluted share for the same period last year).  Free cash flow increased 2.2% to $6.1 million.  For the three month period net operating revenue increased 1.2% from the comparable period in 2011 to $32.4 million with operating income from continuing operations of $8.1 million compared to $7.1 million for the same period last year.  For the same period, station operating expense decreased 2.4% to $22.4 million (station operating expense includes depreciation and amortization attributable to the stations). 

For the nine month period free cash flow increased 8.7% to $16.8 million compared to $15.5 million for the same period in 2011. The Company's net operating revenue increased 1.8% to $94.7 million while station operating expense decreased 2.0% compared to the same period last year to $66.7 million (station operating expense includes depreciation and amortization attributable to the stations).  Operating income from continuing operations increased 16.4% to $22.2 million compared to $19.1 million and net income for the period was $12.2 million ($2.86 per fully diluted share compared to $2.01 per fully diluted share for the same period last year).

Capital expenditures in the third quarter of 2012 were $1.4 million compared to $1.6 million for the same period last year.  For the nine month period capital expenditures were $3.9 million compared to $4.1 million for the same period last year.  The Company currently expects to spend approximately $5.0 - $5.5 million for capital expenditures during 2012. 

Saga Communications utilizes certain financial measures that are not calculated in accordance with generally accepted accounting principles (GAAP) to assess its financial performance.  Such non-GAAP measures include free cash flow, trailing 12 month consolidated EBITDA, and leverage ratio. These non-GAAP measures are generally recognized by the broadcasting industry as measures of performance and are used by Saga to assess its financial performance including but not limited to evaluating individual station and market-level performance, evaluating overall operations, as a primary measure for incentive based compensation of executives and other members of management and as a measure of financial position.  Saga's management believes these non-GAAP measures are used by analysts who report on the industry and by investors to provide meaningful comparisons between broadcasting groups, as well as an indicator of their market value.  These measures are not measures of liquidity or of performance in accordance with GAAP, and should be viewed as a supplement to and not as a substitute for the results of operations presented on a GAAP basis including net operating revenue, operating income, and net income. Reconciliations for all of the non-GAAP financial measures to the most directly comparable GAAP measure are attached in the Selected Supplemental Financial Data table.

Saga Communications, Inc. is a broadcasting company whose business is devoted to acquiring, developing and operating broadcast properties.  The Company owns or operates broadcast properties in 26 markets, including 61 FM and 30 AM radio stations, 3 state radio networks, 2 farm radio networks, 5 television stations and 4 low-power television stations.  For additional information, contact us at (313) 886-7070 or visit our website at www.sagacommunications.com.

Saga's 3rd Quarter 2012 conference call will be on Tuesday, November 6, 2012 at 2:00 p.m. EST.  The dial-in number for all calls is (612) 288-0329.  A transcript of the call will be posted to the Company's web site after the call.

The Company requests that all parties that have a question that they would like to submit to the Company to please email the inquiry by 1:00 p.m. EST on November 6, 2012 to [email protected]. The Company will discuss, during the limited period of the conference call, those inquiries it deems of general relevance and interest. Only inquiries made in compliance with the foregoing will be discussed during the call.

This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.  Words such as "believes," "expects," "anticipates," "guidance" and similar expressions are intended to identify forward-looking statements.  Key risks, including risks associated with Saga's ability to effectively integrate the stations it acquires and the impact of federal regulation on Saga's business, are described in the reports Saga Communications, Inc. periodically files with the U.S. Securities and Exchange Commission, including Item 1A of our Annual Report on Form 10-K.  Readers should note that these statements may be impacted by several factors, including national and local economic changes and changes in the radio and television broadcast industry in general, as well as Saga's actual performance.  Results may vary from those stated herein and Saga undertakes no obligation to update the information contained here.

 

Saga Communications, Inc.

Selected Consolidated Financial Data

For The Three and Nine Months Ended

September 30, 2012 and 2011

(amounts in 000's except per share data)

(Unaudited)











 Three Months Ended  

 Nine Months Ended  




 September 30, 

 September 30, 




2012

2011

2012

2011

Operating Results






Net operating revenue


$32,409

$32,027

$94,718

$93,039

Station operating expense


22,379

22,939

66,698

68,089

Corporate general and administrative


1,910

1,965

5,799

5,854

Operating income from continuing operations


8,120

7,123

22,221

19,096

Interest expense


381

646

1,367

2,837

Write-off debt issuance costs


-

-

-

1,326

Other (income) expense, net


145

27

135

(5)

Income from continuing operations before income tax


7,594

6,450

20,719

14,938

Income tax expense


3,227

2,473

8,450

5,930

Income from continuing operations, net of income taxes


4,367

3,977

12,269

9,008

Loss from discontinued operations, net of income taxes


(39)

(283)

(104)

(482)

Net income


$4,328

$3,694

$12,165

$8,526

Basic earnings (loss) per share:







From continuing operations


$1.03

$0.94

$2.89

$2.13


From discontinued operations


(0.01)

(0.07)

(0.02)

(0.12)


Earnings per share


$1.02

$0.87

$2.87

$2.01

Diluted earnings (loss) per share:







From continuing operations


$1.03

$0.94

$2.89

$2.12


From discontinued operations


(0.01)

(0.07)

(0.03)

(0.11)


Earnings per share


$1.02

$0.87

$2.86

$2.01

Weighted average common shares


4,246

4,242

4,243

4,238

Weighted average common and common 







equivalent shares


4,252

4,246

4,250

4,242








Free Cash Flow






Net income 


$4,328

$3,694

$12,165

$8,526

Plus:  Depreciation and amortization:







        Station


1,642

1,724

4,898

5,048


        Corporate


57

60

170

173


        Discontinued operations


-

102

194

291

          Deferred tax provision


1,297

1,900

3,070

3,950

          Non-cash compensation


25

75

107

311

          Debt issuance cost write-off


-

-

-

1,326

          Other (income) expense, net


145

27

135

-

Less: Capital expenditures


(1,402)

(1,618)

(3,904)

(4,140)

Free cash flow


$6,092

$5,964

$16,835

$15,485








Balance Sheet Data







Working capital




$25,802

$14,748


Net fixed assets




$59,398

$61,609


Net intangible assets and other assets




$98,691

$96,675


Total assets




$197,113

$192,190


Long-term debt (including current 







   portion of $0 and $4,000, respectively)




$58,828

$76,328


Stockholders' equity




$105,168

$88,798

 

Saga Communications, Inc.

Selected Supplemental Financial Data

For the Three and Nine Months Ended

September 30, 2012 and 2011

(amounts in 000's)

(Unaudited)
















Corporate





Radio


Television


and Other


Consolidated

Three Months Ended September 30, 2012:








Net operating revenue

$27,498


$4,911


$          -


$32,409

Station operating expense

19,365


3,014


-


22,379

Corporate G&A

-


-


1,910


1,910

Operating income (loss) from continuing operations

$8,133


$1,897


$(1,910)


$8,120

Depreciation and amortization

$1,301


$341


$57


$1,699
















Corporate





Radio


Television


and Other


Consolidated

Three Months Ended September 30, 2011:








Net operating revenue

$27,885


$4,142


$          -


$32,027

Station operating expense

20,029


2,910


-


22,939

Corporate G&A

-


-


1,965


1,965

Operating income (loss) from continuing operations

$7,856


$1,232


$(1,965)


$7,123

Depreciation and amortization

$1,385


$339


$60


$1,784
















Corporate





Radio


Television


and Other


Consolidated

Nine Months Ended September 30, 2012:








Net operating revenue

$81,180


$13,538


$          -


$94,718

Station operating expense

57,641


9,057


-


66,698

Corporate G&A

-


-


5,799


5,799

Operating income (loss) from continuing operations

$23,539


$4,481


$(5,799)


$22,221

Depreciation and amortization

$3,872


$1,026


$170


$5,068
















Corporate





Radio


Television


and Other


Consolidated

Nine Months Ended September 30, 2011:








Net operating revenue

$81,002


$12,037


$          -


$93,039

Station operating expense

59,311


8,778


-


68,089

Corporate G&A

-


-


5,854


5,854

Operating income (loss) from continuing operations

$21,691


$3,259


$(5,854)


$19,096

Depreciation and amortization

$4,072


$976


$173


$5,221

 

Saga Communications, Inc.

Selected Supplemental Financial Data

September 30, 2012

(amounts in 000's except ratios)

(Unaudited)
































Less:


Plus:


Trailing



12 Mos Ended


9 Mos Ended


9 Mos Ended


12 Mos Ended



December 31,


September 30,


September 30,


September 30,



2011


2011


2012


2012

Trailing 12 Month Consolidated Earnings Before Interest,








  Taxes, Depreciation and Amortization ("EBITDA") (1)








Net income

$12,631


$8,526


$12,165


$16,270

Exclusions:









Loss on sale of assets

(643)


(109)


(132)


(666)


Loss on write off of unamortized debt issuance costs

(1,326)


(1,326)


-


-


Other

348


310


332


370

Total exclusions

(1,621)


(1,125)


200


(296)










Consolidated Adjusted Net Income (1)

14,252


9,651


11,965


16,566

Plus:

Interest expense

3,420


2,837


1,367


1,950


Income tax expense

8,430


5,930


8,380


10,880


Depreciation & amortization expense

7,486


5,512


5,262


7,236


Amortization of television syndicated programming contracts

721


543


516


694


Non-cash stock based compensation expense

383


311


107


179

Less: Cash television programming payments

(715)


(536)


(529)


(708)

Trailing twelve month consolidated EBITDA (1)

$33,977


$24,248


$27,068


$36,797










Total long-term debt, including current maturities







$58,828

Divided by trailing twelve month consolidated EBITDA (1)







36,797

Leverage ratio







1.6



















(1)

As defined in the Company's credit facility.

 

SOURCE Saga Communications, Inc.

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