Townsquare Announces Second Quarter Results

PURCHASE, N.Y., Aug. 10, 2020 /PRNewswire/ — Townsquare Media, Inc. (NYSE: TSQ) («Townsquare,» the «Company,» «we,» «us,» or «our») announced today…

PURCHASE, N.Y., Aug. 10, 2020 /PRNewswire/ — Townsquare Media, Inc. (NYSE: TSQ) («Townsquare,» the «Company,» «we,» «us,» or «our») announced today selected results for the second quarter ended June 30, 2020.

«As expected, our second quarter financial results were significantly impacted by the COVID-19 pandemic, with net revenue and Adjusted EBITDA declining 34.5% and 93.1%, respectively, as compared to the prior year.  However, we experienced sequential improvement in our Advertising net revenue throughout the quarter, which together with our Live Events net revenue has experienced the brunt of the negative business impact.  By the end of the second quarter, Advertising net revenue had materially improved, from -42.1% in April to -29.6% in June, and continued to show improvement through July and early August.  In addition, in Q2 2020 our digital revenue exceeded 48% of our total net revenue, powered by our digital solutions, which have proven more resilient than our broadcast solutions during the pandemic, and in particular Townsquare Interactive, which is our digital marketing solutions subscription business,» commented Bill Wilson, Chief Executive Officer of Townsquare.  «Despite the material decline in second quarter revenue, we generated positive Adjusted EBITDA and cash flow from operations in the second quarter, due in part to our cost reduction efforts as well as the strong cash generation of many of our assets.    In total, we enacted approximately $1.7 million of monthly fixed cost savings during the second quarter, in addition to the reduction of variable costs related to the decline in revenue, which led to total direct operating expenses declining 14.8% as compared to the prior year.  In addition, we have reduced our planned capital expenditures, which declined 30% in the second quarter compared to the prior year, and our board of directors elected to cease paying our quarterly dividend moving forward.  We also repaid the entire amount outstanding on our Revolving Credit Facility, repaid $9.9 million of our Term Loans, opportunistically repurchased $4.7 million of our Unsecured Senior Notes at a significant discount, and still ended the quarter with $70.0 million of cash on hand.»

Mr. Wilson added, «Townsquare Interactive’s growth continued in the second quarter, with net revenue increasing 10.5%, at an  Adjusted Operating Income margin in excess of 30%, and approximately 900 net subscriber additions, marking the 9th consecutive quarter of 850 (or more) net subscriber additions.  During this pandemic, the Townsquare Interactive team became a tremendous resource for their local clients by strengthening their online presence and capabilities and powering their online communication strategy.  We believe, and our thesis has always been, that Townsquare Interactive is a recession-resistant subscription business and will continue to grow its revenue and subscriber base throughout the year. We remain confident that Townsquare Interactive (as well as Townsquare Ignite, our digital programmatic advertising solution) will each generate $100 million of annual net revenue in two to four years.»

Mr. Wilson concluded, «One of the things we take great pride in is that even with all of the challenges and unknowns during this pandemic, we have not had to alter our core strategy.  Instead, the pandemic placed a spotlight on the need to double down on executing our existing long term strategy.  We believe that our Local First strategy, together with our talented team and diversified and differentiated product offering, ensures that Townsquare will emerge from this crisis well positioned for the future, and will return to our market leading performance as soon as this crisis abates. Although a very tough Q2, we believe our revenue, profit and cash flow results will be among the best in the radio as well as in the local media industry, which is directly tied to the team’s efforts and perseverance during this pandemic, as well as our large percentage of digital revenue and a strong and growing digital marketing subscription business.»

Second Quarter Highlights*

  • As compared to the second quarter of 2019:
    • Net revenue decreased 34.5%, and 35.0% excluding political revenue
    • Net loss increased $36.8 million to a net loss of $26.8 million
    • Adjusted EBITDA decreased 93.1% to $2.1 million
    • Townsquare Interactive net revenue increased 10.5%
    • Advertising net revenue decreased 37.5% and 38.2% excluding political revenue
    • Live Events net revenue decreased 99.5%
  • Diluted loss per share from continuing operations was $1.46, and Adjusted Net Loss per share was $0.40
  • Repaid $50.0 million of our Revolving Credit Facility, representing 100.0% of the amount drawn
  • Repurchased $4.7 million of our 2023 Unsecured Senior Notes at a market price below par, plus accrued interest
  • Repaid $9.9 million of our Term Loans due 2022
  • Townsquare Interactive added approximately 900 net subscribers, ending the quarter with approximately 20,750 subscribers

Year to Date Highlights*

  • As compared to the six months June 30, 2019:
    • Pro forma net revenue decreased 18.7%
    • Pro forma net loss increased $91.4 million to a net loss of $86.4 million
    • Pro forma Adjusted EBITDA decreased 64.1% to $17.6 million
    • Net revenue decreased 19.0% and 19.8% excluding political revenue
    • Net loss increased $91.8 million to a net loss of $86.4 million
    • Adjusted EBITDA decreased 64.4%
    • Townsquare Interactive net revenue increased 13.3%
    • Advertising net revenue decreased 20.6% and 21.5% excluding political revenue
    • Live Events net revenue decreased 79.1%
    • Pro forma Live Events net revenue decreased 77.6%

*See below for discussion of non-GAAP measures. As used in this release, the term «pro forma» means pro forma for the divestiture of our Arizona Bridal Shows business (consisting of two expositions) on March 18, 2019, giving effect to such divestitures as if they had occurred on January 1, 2019.

Segment Reporting

We have three reportable operating segments, Advertising, which includes broadcast and digital advertising products and solutions, Townsquare Interactive, our digital marketing solutions business and Live Events, which is comprised of the Company’s live events, including concerts, expositions and other experiential events.

Quarter Ended June 30, 2020 Compared to the Quarter Ended June 30, 2019

Net Revenue

Net revenue for the quarter ended June 30, 2020 decreased $39.0 million, or 34.5%, to $74.1 million, as compared to $113.1 million in the same period last year. Advertising net revenue decreased $34.3 million, or 37.5%, to $57.1 million, Townsquare Interactive net revenue increased $1.6 million, or 10.5%, to $16.9 million, and Live Events net revenue decreased $6.3 million, or 99.5%, to $0.03 million, each as compared to the same period last year. Excluding political revenue, net revenue decreased $39.4 million, or 35.0%, to $73.2 million, and Advertising net revenue decreased $34.7 million, or 38.2%, to $56.3 million.

Adjusted EBITDA

Adjusted EBITDA for the quarter ended June 30, 2020 decreased $28.1 million, or 93.1% to $2.1 million, as compared to $30.1 million in the same period last year. Adjusted EBITDA (Excluding Political) decreased $28.4 million, or 95.5%, to $1.3 million, as compared to $29.7 million in the same period last year.

Net Loss

Net loss for the quarter ended June 30, 2020 increased $36.8 million to a net loss of $26.8 million, as compared to net income of $9.9 million in the same period last year. Net loss from continuing operations increased $36.7 million to a net loss of $26.8 million, as compared to net income from continuing operations of $9.9 million in the same period last year.

Six Months Ended June 30, 2020 Compared to the Six Months Ended June 30, 2019

Net Revenue

Net revenue for the six months ended June 30, 2020 decreased $39.3 million, or 19.0%, to $167.5 million, as compared to $206.8 million in the same period last year. Advertising net revenue decreased $34.1 million, or 20.6%, to $131.7 million, Townsquare Interactive net revenue increased $3.9 million, or 13.3%, to $33.4 million, and Live Events net revenue decreased $9.1 million, or 79.1%, to $2.4 million, each as compared to the same period last year. Excluding political revenue, net revenue decreased $40.7 million, or 19.8%, to $165.3 million, and Advertising net revenue decreased $35.5 million, or 21.5%, to $129.5 million.

Pro forma net revenue for the six months ended June 30, 2020 decreased $38.6 million, or 18.7%, to $167.5 million, as compared to $206.0 million in the same period last year. Pro forma Advertising net revenue decreased $34.1 million, or 20.6%, to $131.7 million, pro forma Townsquare Interactive net revenue increased $3.9 million, or 13.3%, to $33.4 million, and pro forma Live Events net revenue decreased $8.3 million, or 77.6% to $2.4 million, each as compared to the same period last year. Excluding political revenue, pro forma net revenue decreased $40.0 million, or 19.5%, to $165.3 million, and pro forma Advertising net revenue decreased $35.5 million, or 21.5%, to $129.5 million.

Adjusted EBITDA

Adjusted EBITDA for the six months ended June 30, 2020 decreased $31.7 million, or 64.4% to $17.6 million, as compared to $49.3 million in the same period last year. Adjusted EBITDA (Excluding Political) decreased $32.9 million, or 67.7%, to $15.7 million, as compared to $48.6 million in the same period last year.

Pro forma Adjusted EBITDA for the six months ended June 30, 2020 decreased $31.4 million, or 64.1%, to $17.6 million, as compared to $49.0 million in the same period last year. Pro forma Adjusted EBITDA (Excluding Political) decreased $32.6 million, or 67.5%, to $15.7 million, as compared to $48.3 million in the same period last year.

Net Loss

Net loss for the six months ended June 30, 2020 increased $91.8 million to a net loss of $86.4 million, as compared to net income of $5.4 million in the same period last year. Net loss from continuing operations increased $98.6 million to a net loss of $86.4 million, as compared to net income from continuing operations of $12.2 million in the same period last year.

Pro forma net loss for the six months ended June 30, 2020 increased $91.4 million to a net loss of $86.4 million, as compared to net income of $5.0 million in the same period last year.

Liquidity and Capital Resources

As of June 30, 2020, we had a total of $70.0 million of cash on hand and $50.0 million of available borrowing capacity under

our revolving credit facility.  As of June 30, 2020, we had $545.8 million of outstanding indebtedness, representing 7.7x and 6.7x gross and net leverage, respectively, based on Adjusted EBITDA for the trailing twelve months ended June 30, 2020 of $70.7 million.

The table below presents a summary, as of August 7, 2020, of our outstanding common stock, and securities convertible into common stock, excluding options issued under our 2014 Omnibus Incentive Plan.

Security1


Number

Outstanding


Description

Class A common stock


14,330,220



One vote per share.

Class B common stock


3,011,634



10 votes per share.2

Class C common stock


1,636,341



No votes.2

Warrants


8,977,676



Each warrant is exercisable for one share of Class A common stock, at an exercise price of $0.0001 per share. The aggregate exercise price for all warrants currently outstanding is $898.3

Total


27,955,871





1 Each of the shares of common stock, including the shares of Class A common stock issuable upon exercise of the warrants, have equal economic rights.

2 Each share converts into one share of Class A common stock upon transfer or at the option of the holder, subject to certain conditions, including compliance with FCC rules.

3 The warrants are fully vested and exercisable for shares of Class A common stock, subject to certain conditions, including compliance with FCC rules.

Conference Call

Townsquare Media, Inc. will host a conference call to discuss certain second quarter 2020 financial results on Monday, August 10, 2020 at 8:00 a.m. Eastern Time. The conference call dial-in number is 1-877-407-0784 (U.S. & Canada) or 1-201-689-8560 (International) and the confirmation code is 13707180. A live webcast of the conference call will also be available on the equity investor relations page of the Company’s website at www.townsquaremedia.com.

A replay of the conference call will be available through August 17, 2020. To access the replay, please dial 1-844-512-2921 (U.S. and Canada) or 1-412-317-6671 (International) and enter confirmation code 13707180. A web-based archive of the conference call will also be available at the above website.

About Townsquare Media, Inc.

Townsquare is a radio, digital media, entertainment and digital marketing solutions company principally focused on being the premier local advertising and marketing solutions platform in small and mid-sized markets across the U.S. Our assets include 321 radio stations and more than 330 local websites in 67 U.S. markets, a digital marketing solutions company (Townsquare Interactive) serving approximately 20,750 small to medium sized businesses, a proprietary digital programmatic advertising platform (Townsquare Ignite) and numerous local live events each year. Our brands include local media assets such as WYRK, KLAQ, K2 and NJ101.5; iconic local and regional events such as WYRK’s Taste of Country, the Boise Music Festival, the Red Dirt BBQ & Music Festival and Taste of Fort Collins; and leading tastemaker music and entertainment websites such as XXLmag.com, TasteofCountry.com and Loudwire.com. For more information, please visit www.townsquaremedia.com, www.townsquareinteractive.com, and www.townsquareignite.com.

Forward-Looking Statements

Except for the historical information contained in this press release, the matters addressed are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often discuss our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as «aim,» «anticipate,» «estimate,» «expect,» «forecast,» «outlook,» «potential,» «project,» «projection,» «plan,» «intend,» «seek,» «believe,» «may,» «could,» «would,» «will,» «should,» «can,» «can have,» «likely,» the negatives thereof and other words and terms. By nature, forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statement. Forward-looking statements are based on current expectations and assumptions and currently available data and are neither predictions nor guarantees of future events or performance. You should not place undue reliance on forward-looking statements, which speak only as of the date hereof or as of the date specified herein. Risks and uncertainties that could have a material impact on our business and financial results include, but are not limited to, general economic conditions in the United States, or in the specific markets in which we currently do business, industry conditions, legislative or regulatory requirements, the continuation or worsening of the effects from the COVID-19 pandemic, its scope, duration and impact on our business, financial results, cash flows and liquidity, as well as the impact on our clients and customers, the success of our mitigation efforts in response to the COVID-19 pandemic, our performance in any recovery from the COVID-19 pandemic, the performance of financial and credit markets, our ability to comply with the covenants and obligations under our outstanding debt, including meeting required payments of principal and interest, our ability to access debt or equity capital on attractive terms or at all, potential downgrades to our credit ratings, and certain other events, including future disease outbreaks and pandemics. See «Risk Factors» and «Forward-Looking Statements» included in our Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on June 9, 2020, and subsequent filings with the SEC, for a discussion of additional factors that could cause our actual results to differ from those expressed or implied by forward-looking statements. Townsquare Media, Inc. assumes no responsibility to update any forward-looking statement as a result of new information, future events or otherwise.

Non-GAAP Financial Measures and Definitions

In this press release, we refer to Adjusted Operating Income, Adjusted EBITDA,  Adjusted EBITDA (Excluding Political), Adjusted Net Income and Adjusted Net Income Per Share which are financial measures that have not been prepared in accordance with generally accepted accounting principles in the United States («GAAP»).

We define Adjusted Operating Income as operating income before the deduction of depreciation and amortization, stock-based compensation, corporate expenses, transaction costs, business realignment costs, impairment of goodwill, long-lived and intangible assets and net loss (gain) on sale and retirement of assets. We define Adjusted EBITDA as net income (loss) before the deduction of income taxes, interest expense, net, repurchase of debt, transaction costs, depreciation and amortization, stock-based compensation, business realignment costs, impairment of goodwill, long-lived and intangible assets, impairment of investments, net (income) loss from discontinued operations, net of income taxes, net (loss) gain on sale and retirement of assets and other expense (income) net. We define Adjusted EBITDA (Excluding Political) as Adjusted EBITDA less political net revenue, net of a fifteen percent deduction to account for estimated national representative firm fees, music licensing fees and sales commissions expense. Adjusted Net Income is defined as net income (loss) before the deduction of transaction costs, business realignment costs, impairment of intangible and long-lived assets, net loss (gain) on sale and retirement of assets, gain on repurchase of debt and insurance recoveries, net income attributable to non-controlling interest, net of income taxes, and net loss from discontinued operations, net of income taxes.  Adjusted Net Income Per Share is defined as Adjusted Net Income divided by the weighted average shares outstanding. We define Net Leverage as our total outstanding indebtedness, net of our total cash balance as of June 30, 2020, divided by our Adjusted EBITDA for the twelve months ended June 30, 2020. These measures do not represent, and should not be considered as alternatives to or superior to, financial results and measures determined or calculated in accordance with GAAP. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. You should be aware that in the future we may incur expenses or charges that are the same as or similar to some of the adjustments in the presentation, and we do not infer that our future results will be unaffected by unusual or non-recurring items. In addition, these non-GAAP measures may not be comparable to similarly-named measures reported by other companies. Where we use the term «pro forma», it refers to pro forma financial information for our disposal of our Arizona Bridal Show business, as if the sale occurred on January 1, 2019.

We use Adjusted Operating Income to evaluate the operating performance of our business segments. We use Adjusted EBITDA and Adjusted EBITDA (Excluding Political) to facilitate company-to-company operating performance comparisons by backing out potential differences caused by variations in capital structures (affecting interest expense), taxation and the age and book depreciation of facilities and equipment (affecting relative depreciation expense), which may vary for different companies for reasons unrelated to operating performance, and to facilitate year over year comparisons, by backing out the impact of political revenue which varies depending on the election cycle and may be unrelated to operating performance. We use Adjusted Net Income and Adjusted Net Income Per Share to assess total company operating performance on a consistent basis. We use Net Leverage to measure the Company’s ability to handle its debt burden. We believe that these measures, when considered together with our GAAP financial results, provide management and investors with a more complete understanding of our business operating results, including underlying trends, by excluding the effects of transaction costs, net (loss) gain on sale and retirement of assets, business realignment costs, certain impairments, and net income (loss) from discontinued operations. Further, while discretionary bonuses for members of management are not determined with reference to specific targets, our board of directors may consider Adjusted Operating Income, Adjusted EBITDA, Adjusted EBITDA (Excluding Political), Adjusted Net Income, Adjusted Net Income Per Share and Net Leverage when determining discretionary bonuses.

Investor Relations

Claire Yenicay

(203) 900-5555

investors@townsquaremedia.com

TOWNSQUARE MEDIA, INC.

CONSOLIDATED BALANCE SHEETS

(in Thousands, Except Share and Per Share Data)

(unaudited)



June 30,

 2020


December 31,

 2019

ASSETS




Current assets:




Cash and cash equivalents

$

70,015



$

84,667


Accounts receivable, net of allowance of $3,632 and $2,604, respectively

46,988



67,463


Prepaid expenses and other current assets

9,374



9,241


Total current assets

126,377



161,371


Property and equipment, net

114,040



114,142


Intangible assets, net

280,504



388,029


Goodwill

157,947



157,947


Investments

10,975



8,275


Operating lease right-of-use assets

48,693



49,503


Restricted cash

494



494


Other assets

1,226



638


Total assets

$

740,256



$

880,399


LIABILITIES AND STOCKHOLDERS’ EQUITY




Current liabilities:




Accounts payable

$

16,799



$

14,790


Current portion of long-term debt



9,929


Deferred revenue

9,195



8,086


Accrued compensation and benefits

8,234



10,714


Accrued expenses and other current liabilities

10,071



15,358


Operating lease liabilities, current

7,685



7,690


Financing lease liabilities, current

47



17


Accrued interest

4,473



4,558


Liabilities of discontinued operations

248



423


Total current liabilities

56,752



71,565


Long-term debt, less current portion (net of deferred finance costs of $3,088 and $3,840, respectively)

542,709



546,711


Deferred tax liability

613



34,347


Operating lease liability, net of current portion

44,246



44,957


Financing lease liabilities, net of current portion

106



31


Other long-term liabilities

1,826



352


Total liabilities

646,252



697,963


Stockholders’ equity:




Class A common stock, par value $0.01 per share; 300,000,000 shares authorized; 14,330,220 and 14,314,092 shares issued and outstanding, respectively

143



143


Class B common stock, par value $0.01 per share; 50,000,000 shares authorized; 3,011,634 shares issued and outstanding

30



30


Class C common stock, par value $0.01 per share; 50,000,000 shares authorized; 1,636,341 shares issued and outstanding

17



17


    Total common stock

190



190


    Additional paid-in capital

368,770



367,540


    Accumulated deficit

(277,464)



(188,034)


    Non-controlling interest

2,508



2,740


Total stockholders’ equity

94,004



182,436


Total liabilities and stockholders’ equity

$

740,256



$

880,399


 

TOWNSQUARE MEDIA, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in Thousands, Except Per Share Data)

(unaudited)



Three Months Ended

 June 30,


Six Months Ended

 June 30,


2020


2019


2020

2019








Net revenue

$

74,055



$

113,088



$

167,488


$

206,770


Operating costs and expenses:







Direct operating expenses

64,408



75,590



135,958


144,358


Depreciation and amortization

4,761



6,947



10,045


12,993


Corporate expenses

7,570



7,370



13,960


13,107


Stock-based compensation

657



660



1,181


1,536


Transaction costs

1,213



128



2,240


276


Business realignment costs

456





2,167


165


Impairment of intangible and long-lived assets

28,655



231



107,715


231


Net gain on sale and retirement of assets

(10)



(21)



(12)


(2)


    Total operating costs and expenses

107,710



90,905



273,254


172,664


    Operating (loss) income

(33,655)



22,183



(105,766)


34,106


Other expense:







Interest expense, net

7,892



8,526



16,021


17,121


Gain on repurchase of debt

(1,159)





(1,159)



Other (income) expense, net

(961)



37



(734)


70


    (Loss) income from continuing operations before income taxes

(39,427)



13,620



(119,894)


16,915


(Benefit) provision for income taxes

(12,605)



3,769



(33,495)


4,680


Net (loss) income from continuing operations

(26,822)



9,851



(86,399)


12,235


Net income (loss) from discontinued operations, net of income taxes



84




(6,878)


Net (loss) income

$

(26,822)



$

9,935



$

(86,399)


$

5,357


Net (loss) income attributable to:







     Controlling interests

$

(27,178)



$

9,442



$

(87,332)


$

4,417


     Non-controlling interests

$

356



$

493



$

933


$

940


Basic (loss) income per share:







    Continuing operations attributable to common shares

$

(1.46)



$

0.34



$

(4.73)


0.41


    Continuing operations attributable to participating shares

$



$

0.34



$

0.08


0.41


    Discontinued operations attributable to common shares

$



$



$


(0.25)


    Discontinued operations attributable to participating shares

$



$



$


(0.25)


Diluted (loss) income per share:







    Continuing operations

$

(1.46)



$

0.34



$

(4.73)


$

0.41


    Discontinued operations

$



$



$


$

(0.25)


Weighted average shares outstanding:







     Basic attributable to common shares

18,616



18,512



18,599


18,495


     Basic attributable to participating shares

8,978



8,978



8,978


8,978


     Diluted

27,594



27,490



27,577


27,473


Cash dividend declared per share

$



$

0.075



$

0.075


$

0.150


 

 TOWNSQUARE MEDIA, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in Thousands)

(unaudited)



Six Months Ended

 June 30,


2020


2019

Cash flows from operating activities:




Net income (loss)

$

(86,399)



$

5,357


Loss from discontinued operations



(6,878)


(Loss) income from continuing operations

(86,399)



12,235


Adjustments to reconcile (loss) income from continuing operations to net cash flows from operating activities:




   Depreciation and amortization

10,045



12,993


   Amortization of deferred financing costs

759



639


   Net deferred taxes and other

(33,734)



4,680


   Provision for doubtful accounts

2,246



963


   Stock-based compensation expense

1,181



1,536


   Gain on repurchase of notes

(1,159)




   Gain on insurance recoveries

(1,065)




   Trade activity, net

(4,352)



(5,506)


   Write-off of deferred financing cost

79



7


   Impairment of intangible and long-lived assets

107,715



231


   Net (gain) loss on sale of assets

(12)



(2)


Changes in assets and liabilities, net of acquisitions:




   Accounts receivable

17,993



(4,021)


   Prepaid expenses and other assets

3,020



(1,154)


   Accounts payable

420



(1,860)


   Accrued expenses

(831)



(13,714)


   Accrued interest

(85)



84


   Other long-term liabilities

(3,969)



(244)


Net cash provided by operating activities – continuing operations

11,852



6,867


Net cash (used in) provided by operating activities – discontinued operations

(175)



(3,464)


Net cash provided by operating activities

11,677



3,403






Cash flows from investing activities:




   Purchase of property and equipment

(8,343)



(8,928)


   Purchase of investment

(400)




   Proceeds from insurance recoveries

1,172




   Payments for acquisitions, net of cash acquired



(6)


   Proceeds from sale of assets

102



171


Net cash used in investing activities – continuing operations

(7,469)



(8,763)


Net cash provided by investing activities – discontinued operations



11,093


Net cash used in investing activities

(7,469)



2,330






Cash flows from financing activities:




   Repayment of term loans

(9,951)




   Borrowings under the revolving credit facility

50,000




   Repayment of borrowings under the revolving credit facility

(50,000)




   Dividend payments

(4,201)



(4,141)


   Repurchase of notes

(3,573)




   Proceeds from stock options exercised

49




   Sale of noncontrolling interest



1,500


   Cash distribution to noncontrolling interests

(1,164)



(1,300)


   Deferred financing cost



(421)


   Repayments of capitalized obligations

(20)



(3)


Net cash provided by (used in) financing activities

(18,860)



(4,365)






  Cash and cash equivalents and restricted cash:




        Net increase (decrease) in cash and cash equivalents and restricted cash

(14,652)



1,368


        Beginning of period

85,161



61,396


        End of period

$

70,509



$

62,764



 

TOWNSQUARE MEDIA, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(in Thousands)

(unaudited)



Six Months Ended

 June 30,


2020


2019

Supplemental Disclosure of Cash Flow Information:




   Cash payments:




Interest

$

15,746



$

16,928


Income taxes

444



570






Supplemental Disclosure of Non-cash Activities:




Dividends declared, but not paid during the period

$

22



$

2,124


Investments acquired in exchange for advertising

2,300



2,000


Accrued capital expenditures

810



504






Supplemental Disclosure of Cash Flow Information relating to Leases:




Cash paid for amounts included in the measurement of lease liabilities:




Operating cash flows from operating leases

$

5,412



$

6,082


Right-of-use assets obtained in exchange for lease obligations:




Operating leases

$

3,193



$

3,622






Reconciliation of cash, cash equivalents and restricted cash




Cash and cash equivalents

$

70,015



$

61,884


Restricted cash

494



880



$

70,509



$

62,764


 

TOWNSQUARE MEDIA, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS BY SEGMENT

(in Thousands, Except Per Share Data)

(unaudited)



Three Months Ended

 June 30,




Six Months Ended

 June 30,




2020


2019


% Change


2020


2019


% Change

Advertising net revenue

$

57,137



$

91,483



(37.5)

%


$

131,672



$

165,799



(20.6)

%

Townsquare Interactive net revenue

16,886



15,288



10.5

%


33,413



29,495



13.3

%

Live Events net revenue

32



6,317



(99.5)

%


2,403



11,476



(79.1)

%

Net revenue

74,055



113,088



(34.5)

%


167,488



206,770



(19.0)

%

Advertising direct operating expenses

52,572



60,621



(13.3)

%


110,292



115,649



(4.6)

%

Townsquare Interactive direct operating expenses

11,742



10,274



14.3

%


23,720



20,101



18.0

%

Live Events direct operating expenses

94



4,695



(98.0)

%


1,946



8,608



(77.4)

%

Direct operating expenses

64,408



75,590



(14.8)

%


135,958



144,358



(5.8)

%

Depreciation and amortization

4,761



6,947



(31.5)

%


10,045



12,993



(22.7)

%

Corporate expenses

7,570



7,370



2.7

%


13,960



13,107



6.5

%

Stock-based compensation

657



660



(0.5)

%


1,181



1,536



(23.1)

%

Transaction costs

1,213



128



**


2,240



276



**

Business realignment costs

456





**


2,167



165



**

Impairment of intangible and long-lived assets

28,655



231



**


107,715



231



**

Net gain on sale and retirement of assets

(10)



(21)



(52.4)

%


(12)



(2)



**

    Total operating costs and expenses

107,710



90,905



18.5

%


273,254



172,664



58.3

%

    Operating (loss) income

(33,655)



22,183



**


(105,766)



34,106



**

Other expense:












Interest expense, net

7,892



8,526



(7.4)

%


16,021



17,121



(6.4)

%

Gain on repurchase of debt

(1,159)





**


(1,159)





**

Other (income) expense, net

(961)



37



**


(734)



70



**

    (Loss) income from continuing operations before income taxes

(39,427)



13,620



**


(119,894)



16,915



**

(Benefit) provision for income taxes

(12,605)



3,769



**


(33,495)



4,680



**

Net (loss) income from continuing operations

(26,822)



9,851



**


(86,399)



12,235



**

Net income (loss) from discontinued operations, net of income taxes



84



**




(6,878)



**

Net (loss) income

$

(26,822)



$

9,935



**


$

(86,399)



$

5,357



**


** not meaningful

The following table presents net revenue and Adjusted Operating Income by segment, for the three and six months ended June 30, 2020, and 2019, respectively (in thousands):


Actual


Three Months Ended

June 30,


Six Months Ended

 June 30,


2020


2019


2020


2019

Advertising net revenue

$

57,137



$

91,483



$

131,672



$

165,799


Townsquare Interactive net revenue

16,886



15,288



33,413



29,495


Live Events net revenue

32



6,317



2,403



11,476


Net revenue

$

74,055



$

113,088



$

167,488



$

206,770


Advertising Adjusted Operating Income

4,565



30,862



21,380



50,150


Townsquare Interactive Adjusted Operating Income

5,144



5,014



9,693



9,394


Live Events Adjusted Operating Income

(62)



1,622



457



2,868


Adjusted Operating Income

$

9,647



$

37,498



$

31,530



$

62,412


The following table presents on a pro forma basis, net revenue and Adjusted Operating Income by segment for the three and six months ended June 30, 2020, and 2019, respectively (in thousands):


Pro Forma


Three Months Ended

June 30,


Six Months Ended

 June 30,


2020


2019


2020


2019

Advertising net revenue

$

57,137



$

91,483



$

131,672



$

165,799


Townsquare Interactive net revenue

16,886



15,288



33,413



29,495


Live Events net revenue

32



6,317



2,403



10,750


Net revenue

$

74,055



$

113,088



$

167,488



$

206,044


Advertising Adjusted Operating Income

4,565



30,862



21,380



50,150


Townsquare Interactive Adjusted Operating Income

5,144



5,014



9,693



9,394


Live Events Adjusted Operating Income

(62)



1,622



457



2,514


Adjusted Operating Income

$

9,647



$

37,498



$

31,530



$

62,058


The following table reconciles Net revenue to Net revenue, excluding political revenue on a GAAP basis by segment for the three and six months ended June 30, 2020 and 2019, respectively (in thousands):


Actual


Three Months Ended

June 30,




Six Months Ended

 June 30,




2020


2019


%Change


2020


2019


%Change

Advertising net revenue

$

57,137



$

91,483



(37.5)

%


$

131,672



$

165,799



(20.6)

%

Townsquare Interactive net revenue

16,886



15,288



10.5

%


33,413



29,495



13.3

%

Live Events net revenue

32



6,317



(99.5)

%


2,403



11,476



(79.1)

%

Net revenue

$

74,055



$

113,088



(34.5)

%


$

167,488



$

206,770



(19.0)

%













Advertising political revenue

$

886



$

506



75.1

%


$

2,213



$

804



175.2

%

Townsquare Interactive political revenue





%






%

Live Events political revenue





%






%

Political revenue

$

886



$

506



75.1

%


$

2,213



$

804



175.2

%













Advertising net revenue (ex. political)

$

56,251



$

90,977



(38.2)

%


$

129,459



$

164,995



(21.5)

%

Townsquare Interactive net revenue (ex. political)

16,886



15,288



10.5

%


33,413



29,495



13.3

%

Live Events net revenue (ex. political)

32



6,317



(99.5)

%


2,403



11,476



(79.1)

%

Net revenue (ex. political)

$

73,169



$

112,582



(35.0)

%


$

165,275



$

205,966



(19.8)

%

The following table reconciles Net revenue to Net revenue, excluding political revenue on a pro forma basis by segment for the three and six months ended June 30, 2020 and 2019, respectively (in thousands):


Pro Forma


Three Months Ended

June 30,




Six Months Ended

 June 30,




2020


2019


%Change


2020


2019


%Change

Advertising net revenue

$

57,137



$

91,483



(37.5)

%


$

131,672



$

165,799



(20.6)

%

Townsquare Interactive net revenue

16,886



15,288



10.5

%


33,413



29,495



13.3

%

Live Events net revenue

32



6,317



(99.5)

%


2,403



10,750



(77.6)

%

Net revenue

$

74,055



$

113,088



(34.5)

%


$

167,488



$

206,044



(18.7)

%













Advertising political revenue

$

886



$

506



75.1

%


$

2,213



$

804



175.2

%

Townsquare Interactive political revenue





%






%

Live Events political revenue





%






%

Political revenue

$

886



$

506



75.1

%


$

2,213



$

804



175.2

%













Advertising net revenue (ex. political)

$

56,251



$

90,977



(38.2)

%


$

129,459



$

164,995



(21.5)

%

Townsquare Interactive net revenue (ex. political)

16,886



15,288



10.5

%


33,413



29,495



13.3

%

Live Events net revenue (ex. political)

32



6,317



(99.5)

%


2,403



10,750



(77.6)

%

Net revenue (ex. political)

$

73,169



$

112,582



(35.0)

%


$

165,275



$

205,240



(19.5)

%

The following table reconciles on a GAAP basis net (loss) income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Net Income for the three and six months ended June 30, 2020, and 2019, respectively (in thousands, except per share data):


Three Months Ended

 June 30,


Six Months Ended

 June 30,


2020


2019


2020


2019

Net (loss) income

$

(26,822)



$

9,935



$

(86,399)



$

5,357


Net income (loss) from discontinued operations, net of income taxes



84





(6,878)


Net income from continuing operations

(26,822)



9,851



(86,399)



12,235


  (Benefit) provision for income taxes

(12,605)



3,769



(33,495)



4,680


Net income from continuing operations before income taxes

(39,427)



13,620



(119,894)



16,915


Transaction costs

1,213



128



2,240



276


Business realignment costs

456





2,167



165


Impairment of intangible and long-lived assets

28,655



231



107,715



231


Net gain on sale and retirement of assets

(10)



(21)



(12)



(2)


Gain on repurchase of debt

(1,159)





(1,159)




Gain on insurance recoveries

(1,065)





(1,065)




Net income attributable to non-controlling interest, net of income taxes

356



493



933



940


Adjusted net income before income taxes

(10,981)



14,451



(9,075)



18,525


   (Benefit) provision for income taxes

(3,511)



3,999



(2,536)



5,126


Adjusted Net (Loss) Income

$

(7,470)



$

10,452



$

(6,539)



$

13,399










Adjusted Net Income Per Share:








   Basic

$

(0.40)



$

0.56



$

(0.35)



$

0.72


   Diluted

$

(0.40)



$

0.38



$

(0.35)



$

0.49










Weighted average shares outstanding:








     Basic

18,616



18,512



18,599



18,495


     Diluted

27,594



27,490



27,577



27,473


The following table reconciles on a GAAP basis net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA and Adjusted EBITDA Less Interest, Capex and Taxes for the three and six months ended June 30, 2020, and 2019, respectively (dollars in thousands):


Actual


Three Months Ended

June 30,


Six Months Ended

 June 30,


2020


2019


2020


2019

Net (loss) income from continuing operations

$

(26,822)



$

9,851



$

(86,399)



$

12,235


Net income (loss) from discontinued operations, net of income taxes



84





(6,878)


Net (loss) income

(26,822)



9,935



(86,399)



5,357


  (Benefit) provision for income taxes

(12,605)



3,769



(33,495)



4,680


  Interest expense, net

7,892



8,526



16,021



17,121


Gain on repurchase of debt

(1,159)





(1,159)




Depreciation and amortization

4,761



6,947



10,045



12,993


Stock-based compensation

657



660



1,181



1,536


Transaction costs

1,213



128



2,240



276


Business realignment costs

456





2,167



165


Impairment of intangible and long-lived assets

28,655



231



107,715



231


  Net (income) loss from discontinued operations, net of income taxes



(84)





6,878


  Other (a)

(971)



16



(746)



68


Adjusted EBITDA

$

2,077



$

30,128



$

17,570



$

49,305


Political Adjusted EBITDA

$

(753)



$

(430)



$

(1,881)



$

(684)


Adjusted EBITDA (Excluding Political)

$

1,324



$

29,698



$

15,689



$

48,621


Political Adjusted EBITDA

753



430



1,881



684


Net cash paid for interest

(12,309)



(13,039)



(15,746)



(16,928)


Capital expenditures

(2,717)



(3,895)



(8,343)



(8,928)


Cash paid for taxes

(444)



(502)



(444)



(570)


Adjusted EBITDA Less Interest, Capex and Taxes

$

(13,393)



$

12,692



$

(6,963)



$

22,879




(a)

Other includes net gain on sales and retirements of assets and other (income) expense, net.

The following table reconciles on a pro forma basis net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to pro forma net (loss) income, pro forma Adjusted EBITDA, pro forma Adjusted EBITDA (Excluding Political) and pro forma Adjusted EBITDA Less Interest, Capex and Taxes for the three and six months ended June 30, 2020, and 2019, respectively (dollars in thousands):


Pro forma


Three Months Ended

June 30,


Six Months Ended

 June 30,


2020


2019


2020


2019

Net (loss) income from continuing operations

$

(26,822)



$

9,851



$

(86,399)



$

12,235


Net income (loss) from discontinued operations, net of income taxes



84





(6,878)


Net (loss) income

$

(26,822)



$

9,935



$

(86,399)



$

5,357


   Net income from divestiture







354


Pro forma net (loss) income

$

(26,822)



$

9,935



$

(86,399)



$

5,003


  Provision for income taxes

(12,605)



3,769



(33,495)



4,680


  Interest expense, net

7,892



8,526



16,021



17,121


Gain on repurchase of debt

(1,159)





(1,159)




Depreciation and amortization

4,761



6,947



10,045



12,993


Stock-based compensation

657



660



1,181



1,536


Transaction costs

1,213



128



2,240



276


Business realignment costs

456





2,167



165


Impairment of intangible and long-lived assets

28,655



231



107,715



231


  Net (income) loss from discontinued operations, net of income taxes



(84)





6,878


  Other (a)

(971)



16



(746)



68


Pro forma Adjusted EBITDA

$

2,077



$

30,128



$

17,570



$

48,951


Political Adjusted EBITDA

(753)



(430)



(1,881)



(684)


Pro Forma Adjusted EBITDA (Excluding Political)

$

1,324



$

29,698



$

15,689



$

48,267


Political Adjusted EBITDA

753



430



1,881



684


Net cash paid for interest

(12,309)



(13,039)



(15,746)



(16,928)


Capital expenditures

(2,717)



(3,895)



(8,343)



(8,928)


Cash paid for taxes

(444)



(502)



(444)



(570)


Pro forma Adjusted EBITDA Less Interest, Capex and Taxes

$

(13,393)



$

12,692



$

(6,963)



$

22,525




(a)

Other includes net gain on sales and retirements of assets and other (income) expense, net.

The following table reconciles net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA on a quarterly basis for the twelve months ended June 30, 2020 (dollars in thousands):




Twelve

Months

Ended


September 30,

2019


December 31,

2019


March 31,

2020


June 30,

2020


June 30,

2020

Net income (loss)

$

7,268



$

(78,279)



$

(59,577)



$

(26,822)



$

(157,410)


  Provision (benefit) for income taxes

3,050



(22,293)



(20,890)



(12,605)



(52,738)


  Interest expense, net

8,525



8,215



8,129



7,892



32,761


  Gain on repurchase of debt







(1,159)



(1,159)


Depreciation and amortization

7,099



5,744



5,284



4,761



22,888


Stock-based compensation

532



524



524



657



2,237


Transaction costs

193



1,049



1,027



1,213



3,482


Business realignment costs





1,711



456



2,167


Impairment of goodwill



69,034







69,034


  Impairment loss on investment



617







617


Impairment of intangible and long-lived assets



39,434



79,060



28,655



147,149


  Net loss from discontinued

  operations, net of income taxes

1,235



38







1,273


  Other (a)

248



848



225



(971)



350


Adjusted EBITDA

$

28,150



$

24,931



$

15,493



$

2,077



$

70,651




(a)

Other includes net loss (gain) on sale and retirement of assets and other (income) expense, net.

The following tables reconcile Operating Income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Operating Income by segment for the three months ended June 30, 2020 and 2019 (in thousands):


Three Months ended June 30, 2020


Advertising


Townsquare

Interactive


Live Events


Corporate

and Other

Reconciling

Items


Total

Operating (loss) income

$

(27,840)



$

4,989



$

(194)



$

(10,610)



$

(33,655)


Depreciation and amortization

3,722



133



130



776



4,761


Corporate expenses







7,570



7,570


Stock-based compensation

28



22



2



605



657


Transaction costs







1,213



1,213


Business realignment costs







456



456


Impairment of intangible and long-lived

assets

28,655









28,655


Net gain on sale and retirement of assets







(10)



(10)


Adjusted Operating Income (Loss)

$

4,565



$

5,144



$

(62)



$



$

9,647


 


Three Months ended June 30, 2019


Advertising


Townsquare

Interactive


Live Events


Corporate

and Other

Reconciling

Items


Total

Operating income (loss)

$

27,511



$

4,866



$

1,487



$

(11,681)



$

22,183


Depreciation and amortization

3,079



125



133



3,610



6,947


Corporate expenses







7,370



7,370


Stock-based compensation

41



23



2



594



660


Transaction costs







128



128


Impairment of intangible and long-lived assets

231









231


Net gain on sale and retirement of assets







(21)



(21)


Adjusted Operating Income

$

30,862



$

5,014



$

1,622



$



$

37,498


 The following tables reconcile Operating Income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Operating Income by segment for the six months ended June 30, 2020 and 2019 (in thousands):


Six Months ended June 30, 2020


Advertising


Townsquare

Interactive


Live Events


Corporate

and Other

Reconciling

Items


Total

Operating (loss) income

$

(93,299)



$

9,380



$

188



$

(22,035)



$

(105,766)


Depreciation and amortization

6,884



267



265



2,629



10,045


Corporate expenses







13,960



13,960


Stock-based compensation

80



46



4



1,051



1,181


Transaction costs







2,240



2,240


Business realignment costs







2,167



2,167


Impairment of intangible and long-lived assets

107,715









107,715


Net gain on sale and retirement of assets







(12)



(12)


Adjusted Operating Income

$

21,380



$

9,693



$

457



$



$

31,530


 


Six Months ended June 30, 2019


Advertising


Townsquare

Interactive


Live Events


Corporate

and Other

Reconciling

Items


Total

Operating income (loss)

$

43,077



$

9,089



$

2,565



$

(20,625)



$

34,106


Depreciation and amortization

6,548



246



278



5,921



12,993


Corporate expenses







13,107



13,107


Stock-based compensation

133



59



25



1,319



1,536


Transaction costs







276



276


Business realignment costs

161







4



165


Impairment of intangible and long-lived  assets

231









231


Net gain on sale and retirement of assets







(2)



(2)


Adjusted Operating Income

$

50,150



$

9,394



$

2,868



$



$

62,412


 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/townsquare-announces-second-quarter-results-301108815.html

SOURCE Townsquare Media, Inc.