Q3 2022 Townsquare Media Inc Earnings Call
Good morning, and welcome to town Square Media's third quarter 2022 conference call.
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With that I would like to introduce the first speaker for today's call Claire <unk> Executive Vice President.
Thank you operator, and good morning to everyone. Thank you for joining us today for task last third classroom choppy with me on the call today are our CEO and Stuart Rosenstein, our CFO and executive Vice.
Please note that during this call we may make statements provide information other than historical information, including statements relating to the company's future expectations plans and prospects.
These statements are considered forward looking statements under the safe Harbor provision.
The Securities Litigation Reform Act 1995, and are subject to risks and uncertainties that could cause actual results to differ materially from these days.
These statements reflect the company's beliefs based on current conditions, but are subject to certain risks and uncertainties, including those that are detailed in the company's annual report on Form 10-K, and 10-K a R E S.
C C.
You May also discuss certain non-GAAP financial measures, including adjusted EBITDA adjusted net income and adjusted operating income she may affect gross profit my remarks.
non-GAAP financial measures should be used in conjunction with all the information contained in the quarterly yearend.
Babble on our website I'd also encourage all participants to go to our corporate website and download our investor presentation Telegraphing some of those by starting our discussion this morning.
At this time I'd like to turn the call over to Kelvin.
Thank you Claire and thank you all for joining US. This morning without question. We all continue to live in unprecedented times from the persistence of COVID-19, and the war in Eastern Europe to continued macroeconomic uncertainty headwinds and resulting challenges to media companies. However, because of our differentiated and unique position as a digital.
First the local media company focused exclusively on local markets outside of the top 50 cities.
House Square achieved our Q3 guidance and set an all time Q3 revenue and Q3 profit record and in turn drove strong cash flow growth in the third quarter.
And we expect that our strategy will enable us to continue to deliver positive results in the coming quarters simply put.
Our business model allows us to weather economic downturns, when they do occur better than most.
Approximately 50% of our revenue and 50% of our profits now come from digital solutions, which historically performed better during an economic downturn than broadcast advertising.
Approximately 40% of that digital revenue is recurring digital subscription revenue not tied to advertising trends.
Even during the worst of Covid town square interacted delivered revenue and profit growth. Additionally, because we are not in the large top 50 markets. The majority over 90% of our advertising revenue is local advertising, which historically is less volatile than national advertising, particularly during an economic downturn.
For example, <unk>.
Additional broadcast advertising revenue continued to be extremely weak in the third quarter with revenue down in the mid teens compared to prior year.
That decline doesn't hurt us as much as others because national advertising now only accounts for approximately 5% of our total revenue.
Overall.
We believe that we are very well positioned to perform during a downturn or a recession no matter the duration and severity of belief, which is supported by our 'twenty 'twenty performance during the worst of Covid as well as our rebound to record profits in 2021.
To demonstrate that point, even in the current environment of macroeconomic uncertainty the town square team continues to consistently deliver strong record setting topline and bottom line results across all business segments.
I'm, especially pleased to share our third quarter results with you. This morning.
To start our net revenue overall was up a very strong plus eight 4% to approximately $121 million ends up plus 7.5% ex political.
And our adjusted EBITDA increased a strong plus 6% to approximately $31 million.
There are two really important takeaways here that I want to share with you one third quarter revenue and EBITDA were both well above 2019 levels and to both net revenue and adjusted EBITDA represented our highest Q3 revenue and highest Q3 adjusted EBITDA, That's how square has ever achieved.
Town square achieves these results because as I noted before we have transformed into a highly differentiated digital first local media company focused on communities outside the top 50 markets.
As I highlighted on slide 11 over 50% of our revenue is digital 2.5 times the industry average and our digital business continues to deliver strong growth up 17% in Q3 over prior year.
The only area of disappointment in Q3.
Which continued into Q4 is our political advertising results.
Unlike prior political cycles, our market footprint did not line up well this year with key political races.
We do not own radio station markets were the most contested races are being held in 2022 like Georgia, Pennsylvania, Nevada, Ohio, and Wisconsin, and therefore had not seen the typical political spend that we've received in prior years and that we expected this year.
In the third quarter political revenue of $1.6 million was well below 2018 levels by 31% and below 2020 levels by 64%.
Year to date through September political revenue of $3.5 million is nearly 20% below 18 levels and 47% below 2020 levels.
Since election day has passed we now have a fairly clear picture of Q4's political revenue and it also significantly below our initial expectations as well as 2018 and 2020 levels.
Given our performance in prior political cycles, especially 2018 and 2020 as well as the political dollars raised for this election in 2022.
We expected between 12 million and $13 million of political revenue this year.
But we now believe political are finished just around $7 million.
Stuart will provide more detail in our guidance discussion shortly but this is $5 million to $6 million decrease in political revenue is a meaningful factor in our current Q4, and therefore, our full year outlook.
Accordingly, we believe that this is not indicative of future political cycles, and we expect our 'twenty 'twenty four political revenue to return to historic levels. It is also important to note that the broadcast radio industry is seeing strength in political this year. So it is not a radio specific issue, but rather specific to our local markets and the lack of highly contested.
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More importantly, political has nothing to do with the success of our underlying solid core digital businesses.
As we have detailed in the past town squares current and future growth engine is digital.
Which as I highlighted earlier delivered strong profitable double digit revenue growth in the third quarter.
Q3, digital revenue increased plus 17% year over year in Q3 digital profit increased plus 7% year over year.
With a Q3 digital profit margin of 29%.
In total 50% of our September year to date revenue and 49% of our September year to date profit came from our digital businesses.
As outlined on slide six of our Investor presentation. Our digital revenue comes from two distinct segments town square ignite, our digital advertising solutions and town square interactive our subscription digital marketing solutions.
Third quarter digital advertising net revenue increased plus 21% year over year and third quarter digital marketing solutions net revenue increased plus 10% year over year in.
And importantly, both digital segments have a profit margin close to 30% in 2022.
And as we highlighted previously we expect that even with additional investments to fuel our digital growth engines. The margins will remain in the high Twenty's.
In total we expect and we are reaffirming that our digital revenue will grow from $225 million of digital revenue on a trailing 12 month basis as of September 30th two a minimum of $275 million of digital revenue by 2024.
Our digital businesses significantly differentiates us from other local media companies, particularly those that we compete with outside of the top 50 markets.
And it was the primary reason, we were able to recover so quickly from the Covid recession and not only returned to 2019 levels, but also quickly surpass those levels as well.
Housewares adjusted EBITDA returned to growth by the end of 'twenty 'twenty hit an all time high in 2021 and we're on track to deliver yet another record setting profit level in 2022 even with the national macroeconomic uncertainty headlines.
Although town square has transformed into a digital first local media company with digital is our growth driver, we do love our local broadcast business.
Our broadcast advertising revenue grew slightly in Q3, increasing plus 3% year over year or plus 2% excluding political.
However, as we continually note our expectation is not to grow our broadcast business, but to keep it relatively stable. We view local radio is an extremely valuable asset with significant and attractive cash flow properties.
Unparalleled consumer reach and an important and trusted local connection to our audience in communities.
And thus a key component of our multi platform diverse local media business.
We also view radio as a mature cash cow business and thus not a growth driver our growth driver has been and will continue to be digital we continue to focus on maintaining our profitable cash cow radio business investing in our differentiated and strong digital businesses to fuel continued strength.
And digital growth.
And using excess cash flow to reduce our leverage to below four times.
As Stewart will highlight we have made considerable progress on net leverage which has been one of our core priorities. This year, reaching an all time low of four five times at the end of Q3.
And we'll be even closer to four times by the year end now.
Now I'll turn the call over to Sue who will go through our strong third quarter results and provide an update on our Q4 and full year outlook for everyone taken away Stu. Thank you Bill and good morning, everyone. It's great to speak to everyone. This morning.
Before turning to our Q3 operating results, let me begin by making a note on our FCC licenses and noncash impairments as.
As I covered on previous calls given the way that these noncash impairments are determined we expect the value of our FCC licenses to continue to be written down over time.
In 2022, as a result of rising interest rates the assumptions that we use to evaluate our FCC licenses for impairment when negatively impacted as a result, we took a noncash impairment charge to our FCC licenses a $10.3 million in the third quarter. This write down of a decade old purchase price calculation has no.
Bearing on our cash position.
Operating revenue or expenses or profitability or future prospects, there and nothing more than noncash accounting charges affecting only the purchase price allocations made when we bought a radio station assets, roughly a decade or more ago.
Our third quarter noncash impairment charges led to a decrease in net income of approximately $10 $1 million in the third quarter to $2.8 million with 13 cents per diluted share as compared to $12 $9 million or 64 cents per diluted share in the third quarter of 2021.
Adjusted net income, which we believe is a much more valuable measure as it excludes one off items, such as noncash impairment charges and as detailed in the schedules to our earnings release was $8 $3 million or 47 cents per diluted share for the third quarter in 2022.
More importantly, let me now turn to our Q3 operating results. We are very pleased to report that the third quarter marked yet another strong quarter of growth at town square, leading us to deliver all time record high Q3 revenue and Q3, adjusted EBITDA and although political hasnt shaped up the way we initially expected.
We were still able to deliver growth in our digital and broadcast businesses and achieve our Q3 guidance third fortinet revenue increased eight 4% over the prior year period to a record setting $126 million within our third quarter guidance range of 120 to 127 million.
Despite the softness in political Bordeaux and national broadcast advertising.
Third quarter political revenue of $1 6 million was below Q3, 2018 political revenue by 31% excluding political in third quarter net revenue increased a strong seven 5% year over year.
Third quarter, adjusted EBITDA increased 6% year over year to a record setting $39 million, achieving the middle of our guidance range of $30 million to $32 million.
Town Square interactive subscriptions digital marketing solution segment demonstrated its consistency yet again delivering another quarter of strong net revenue profit net subscriber growth in the third quarter net revenue increased approximately 10% as compared to the prior year supported by the addition of approximately.
<unk> 850, net new subscribers.
Councillor interactive third quarter profit increased approximately 4% year over year to $6 $4 million at 20% profit margin.
Sounds fair ignite Alright, digital advertising segment was the largest driver of growth in the third quarter and year to date periods with net revenue increasing 21.3% in both periods.
Digital advertising profit increased eight 7% in Q3 operating at a 30% margin.
As Bill noted.
Although we view it as a mature cash cow business, our broadcast advertising net revenue increased three 4% in the third quarter as compared to the prior year broadcast profit margins with 33% in Q3.
Our other category, which is comprised of live events activity generated $1 $2 million of revenue and had a small loss of $238000 as compared to the prior year third quarter revenue in our other category declined $1.2 million due to the timing of certain events that were held in Q2 this year.
There were held in Q3 of last year.
In the third quarter of 2022, we generated $9 $1 million of positive cash flow from operations of $2 million year over year in the first nine months of the year, we generated positive cash flow from operations of $32 $1 million, which was a $6 million decrease from the prior year period.
Entirely due to the timing of our interest payments in 2021, we only paid $29 million of interest payments in the first nine months due to the timing of our refinancing as compared to $38 million. This year.
Prior to interest payments, we generated positive cash flow from operations of $70 million, a $4 million increase from the prior year period. We ended the third quarter was $27 million of cash and $538 million of total debt.
Based on a trailing 12 month adjusted EBITDA of $110 $9 million as of September 30th our net leverage has declined to an all time low of 4.54 times.
We'd like to remind you that any benefit or provision for income taxes included on the face of the income statement is for GAAP financial statement purposes, only we maintain significant tax attributes, including more than $100 million of federal and state NOL carryforwards and other substantial tax shields related to the tax amortization of our <unk>.
Intangible assets, we continue to believe that we will not be a material cash taxpayer until the year of approximately 2026.
Our primary capital allocation priority after internal investment to grow our digital business is to reduce net leverage to approximately four times, which we will be approaching at the end of this year.
Turning to our fourth quarter and yearend outlook, we expect fourth quarter net revenues to increase and be between $116 million and $122 million, which is 5% to 10% increase over the prior year we.
We expect fourth quarter adjusted EBITDA to be between 27, 7 million and $37 million, which is a year over year increase of 8% to 20%.
For the full year now that our updated political estimates are expected to be $5 million to $6 million lower than previously forecasted we expect that our revenue for 2022 will be between $459 million and $465 million. This represents a very strong year over year.
Growth.
10% to 11% and 9% to 10% excluding political.
We expect that 2022, adjusted EBITDA will be between $113 million and $160 million once again, representing a very strong year over year growth of 8% to 10%. Most importantly, this Q4 and full year revenue guidance will set an all time high revenue record.
As well as an all time company high EBIT directly for town square.
And with that I will now turn the call back over to Bill.
Thank you Sue and thank you to everyone who joined US. This morning, we greatly appreciate it or.
Our Q3 results and our expected Q4 performance that Stuart I walk you through in detail today.
Demonstrate the consistency and the strength of town squares transformation into a differentiated digital first local media company.
I am pleased to share a few of the many key takeaways from our performance in Q3.
One net revenue overall was up a very strong plus eight 4% and our adjusted EBITDA was up a very strong plus 6%.
Not only were both well above 2019 levels, but also both net revenue and adjusted EBITDA represent the highest Q3 revenue and the highest Q3 adjusted EBITDA that town square has ever achieved.
Two our digital growth engine in Q3 increased revenue plus 17% year over year and Q3 digital profit increased plus 7% year over year with a Q3 digital profit margin of 29%.
In total 50% of our September year to date revenue and 49% of our September year to date profit came from our digital businesses.
Three net leverage is at an all time company low of four five times on its way to approaching four times by the end of 2022.
Due to our differentiated digital businesses are focused on markets outside of the top 15, our competitive strengths are strong cash flow generation.
And with a strong focus on further deleveraging.
We believe town square is extremely well positioned for continued and future growth.
As always I'm extremely proud of our town square team, whose hard work is the backbone of our success.
Thanks again to all of them. Please do not hesitate to reach out if you have any more questions about town square.
Operator at this time, please open the line for any and all questions.
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One moment, please while we poll for questions.
Thank you and our first question is from the line of Michael Kaplinsky with Noble capital markets. Please proceed with your question.
Thank you and thanks for taking the questions and first of all congratulations on your quarter.
A nice achievement I was just wondering if you can talk a little bit about your guidance for Q4, particularly on your revenues.
You indicated that political is a little softer than expected in <unk> and that's understandable. The number of companies are having similar issues. I was just wondering if you could just talk a little bit about <unk>.
Maybe some of the individual line items and kind of give us a flavor of what you're seeing in terms of the cadence of the revenue growth in the digital businesses, particularly interactive is that revenue growth continuing at a double digit rate and then ignite on when it would imply to me that there would be some.
Is it in terms of economic sensitivity in that line item was just wondering if you're starting to see anything there in terms of you know impact for what we're seeing in the general economy.
I appreciate that Michael Good morning, it's Phil. Thank you for your commentary a few things. So in terms of Q4 I'll break it down in terms of the guidance, obviously on the investor deck and what's due just walked through are at slide 21 in terms of the revenue guide for Q4 is plus five to plus 10% and the profit EBITDA.
Guide is plus eight to plus 20th so I'd say, both and it should give us give a good sense that we're feeling quite good about Q4, and if we achieve this guidance a it'll be a record Q4 in terms of net revenue and profit and it'll be the highest net revenue and profit year for the company. So getting back to your specific question about the line items in turn.
A broadcast my expectation is a local continues to perform well.
Well, it's as we noted I think on the call. It was in the mid single digits in terms of growth and that is expected to continue in Q4. So Q4 from local looks similar to Q3 national could get a little worse as we noted on the call. It was down mid teens in Q3 and that was quite you know accelerated from <unk>.
Actual growth in Q1 slight decline in Q2 to a significant decline in Q3 as we highlighted on the call you know thankfully for us, it's less than 10% of our advertising revenue and less than 5% of our total revenue but.
But we do expect to see that weakness continue into Q4, so what that means for broadcast overall is relatively stable you know I'd say, it's similar to this quarter, where we were in essence broadcast was plus one and some change ex political I would say broadcast for Q4 is probably flat, depending where national ends up could be low.
Single digits, but probably I would guide to flat for blood gas just to be conservative for Q4, and then digital you know as we know broadcast is a mature cash business. When we have our five year plan, we're not expecting a growth in that line, we're going to continue to manage it as a mature cash cow business and align our expenses with revenue.
Wherever that May fall over the next five years and digital is our growth engine. So we continue to see a strong growth in digital you know up 17% in Q3, reaffirming our $275 million by the end of 'twenty for we expect double digit revenue growth for tsi for the year.
And then to your specific point about ignite and do we expect any slowdown or deterioration with based on what you're hearing probably from a macro uncertainty as well as probably some of the tech companies.
We're not seeing that so we expect ignite to be again in Q4 double digit growth and therefore digital be double digit growth overall.
It continues to perform quite well I think the reality for US is even our digital advertising is so locally focused and even in.
Past downturns and recessions digital advertising grew so if there is a recession. Our expectation is digital advertising continues to grow and we continue to outperform the market based on a halving our owned and operated property are on the web in terms of our websites and mobile apps, which reached 70% of the population that we.
Operate in and then combine that with our first party data and the fact that we've got a AD tech platform on the programmatic side that is highly differentiated in our markets and that were outside of the top 50 markets. We expect even in a downturn. If one were to occur ignite, which is our digital advertising to continue.
To grow quite nicely. So I think I covered all of your multi point question.
Yeah. Thank you for all that color and in terms of your interactive business I know a number of other companies are trying to move up more strongly into the digital building a presence very similarly to what you've done in the interactive side of your business was just wondering if you're starting to see a little bit of an increased competition I know that you're in small mark.
And with a limited.
Media presence, but was wondering if you are starting to see a little bit more competition in some of your markets four four in your interactive business.
We've always had competition, it's usually been either a digital agency in town a local media companies that primarily a white label third party solutions as well as self serve so for Casco Interactive we've always had competition as you know Michael that 60% roughly of our client base is actually outside of our radio footprint.
40% within but primarily we're focusing out outside the top 50 markets. So it's always been competitive I think the fact that we bring this national scale with a average price point of roughly $300 and be able to drive such a significant return on investment not only from a web presence, but as we've outlined on prior earnings calls we.
Really drive incremental customers to these businesses are for a very small price point and it's hard to do this in markets. If you don't have scale and if you don't own the whole AD sick. So I think one of the key Differentiators as you point out there's other local media companies, who see this as an opportunity.
I'd say the moat, we have around this is and we highlight this again in our investor deck is the engineering team that builds our products and the fact that we have these products are all in house allows us to serve the customers better and meet their needs. So we don't see any increased competition, but there's always been competition there and again it's.
The fact that we've got this subscription revenue business that even in the depths of Covid grew every quarter subscribers revenue and profit I think also it's highly differentiated for us. If there is a downturn. This is another differentiator for town square that we've got this digital subscription business that continues to grow quite nicely.
Mentioned in auto in your presentation I was just wondering if you could talk a little bit about what is auto in terms of the percent of total revenues for the company and the number of broadcasters have indicated that auto is kind of coming back for them was just wondering if you can kind of give us your thoughts about that category.
Yeah. So it's interesting we don't see auto coming back currently I did hear that from a couple of other people on the broadcast side auto is by far the weakest category for us and that's not only in broadcast it's actually the only category and digital advertising that is not growing so I'll speak specifically to broadcast but I think it.
Speaks to you know in our markets I don't think the supply has gotten to the smaller markets in America I did hear some of the larger companies who are in the top 25 top 50 markets note that autos back and they also noted that suppliers are back on a lot. We're not seeing that so auto for us is actually down in Q3.
Compared to 2019, 40% and that's similar to year to date, and we don't expect that to recover anytime soon which is as you just noted I think different than what you're hearing from others. So when that does come back that it'll be a nice tailwind, but we're not hoping or expect what we're hoping for it but we're not expecting that private.
Until the back half of 'twenty, three or even 24, so when we're modeling out. The next 12 months, we're not expecting auto to come back or.
Or even to grow until there's more inventory in our size markets. So definitely different I think it also speaks to the fact that you know we're the only local media company focused outside the top 50 markets. So a lot of the commentary you hear from others is quite different than what you hear from us. Thanks.
Thanks for the color and last question do you have any updates on the new office in Phoenix.
Yeah quite excited so we've got a few dozen people already hired for Phoenix, and we plan to be opening that in March the early indications of recruitment, which as we noted on prior calls was the primary reason there there's the secondary benefits in terms of time zones and servicing.
Clients out there, but the primary reason we opened the second location was actually for recruitment of talent and the work we've been doing with the local universities there as well as some are local recruiters has been beyond our initial expectations. So you know it's a year of investment as we've always said for our fee.
Nick's office for town square interactive. So we we have always guided that we will see increased growth in town square interactive as we head into 2024 because of the investment we're making in Phoenix and that offices are planned to be opened in March.
Great. Thank you.
Thank you Michael appreciate it.
The next question is from the line of Jim Goss with Barrington Research. Please proceed with your question.
Okay. Good morning.
Just following up a little bit more on the TSA issue.
Given the stability relative to the advertising side.
Is there a way to accelerate that growth any greater and the passing of our even with the Phoenix office and that doesn't really have hired already or are you pushing on a string or incurring too many costs to have that happen.
No that's exactly our plan. So as you noted, particularly with its and good morning, Jim the stability for this business vis vis advertising. If there is an advertising downturn in the macro environment. This is an area that is quite differentiated for us and as it did in 2020 in 2021 will stand out so we are investing.
Aggressively in this business and believe that that investment will generate incremental revenue as well as into incremental profit. So that investment I'd say has been modestly increasing since our last call as we ramp up Phoenix for Q3, I think Stu highlighted and it's in the investor deck that we're still operating.
You know, 29% margin, which houses going reactive as is our digital our ignite advertising business and broadcast this 30 and as I've noted on prior earnings calls that we plan to operate our digital businesses in the high 20% margins. So as we can.
Celebrate investment intelligent interactive that could get down into you know 27, and a half 28, but then you'll see that incremental lift in revenue and profit, but I don't think you'll see that just based on the cadence and the hiring plan, which is going to be a lot more aggressive once we actually have the physical space to open at the end of March so as we are.
Higher through Q2, and Q3, you may see some slight increase and acceleration of revenue in particular in say Q4 of 23, but you wont see a dramatic difference until 'twenty four in terms of revenue and profit. So we view it the same way you do Jim that this is a great business in terms of.
Stability and growth and it warrants increased investment was where particularly in these markets outside the top 50 cities have demonstrated for a decade now that.
That we can outperform others in this space.
Okay, Thanks, where political turned to that for a minute you parse out of.
The change from expectations of that roughly $5 million.
How much was attributable to the third quarter versus the fourth quarter.
Hum.
And still you could step in if it's needed I believe political was a couple of million I'd say a million and a half to $2 million below in Q3 are probably right around two and then I'd say for my expectation was actually a little bit north of six just given the strength of 'twenty and all the headlines around.
How much money had been raised and I think what you're seeing with other broadcasters and thankfully for the radio industry as well as TV, it's been a record a midterm. It just was the exact opposite for us. So I'd say two in Q3 and four plus in Q4 I'll just gut check that was Stuart is that.
Is that what you would think it's do.
Youre absolutely spot on Bill.
Thank you Stan.
Uh huh.
This sensor tends to not be a lot of displacement on radio.
Is most of that.
Like directly addressed or going into adjusted EBITDA.
Or is there are there are some.
Is it something I can stomach.
I don't know if I heard it correctly did definitely the PFS ball without damage yesterday, but that would be pretty similar to the impact on revenues since there isn't exactly placement.
I'd say, 90% of it you know the low 90% would flow right into our adjusted EBITDA, that's exactly right.
Hum.
Thank you Jim.
Broadcasters and I'm curious when did you tend to run did you sense that this is becoming evident that some of the Dallas, we're shifting out of certain of the markets, where you had oh expected glared at me so exposure.
Yeah.
When we reported.
Well, there may be a little bit of delay I apologize when we reported last time you know we were I guess a month into Q3, and we were being told just based on all the dynamics that I described in terms of the amount of money raised as well as the amount of money being spent that we were expecting Q3.
This year to be higher than Q3 of 18, and obviously you know we were 30% down versus 18% to 64% down from 20 in Q3, So it's pretty pretty dramatic and then even when when when we headed into Q4, obviously about 40 days ago, we were still being guided based on.
Our rep firm Katz, Who's a great great partner of ours that they still anticipated us to make that up they were like you know there was an expectation that we could.
See a lot more money in October .
October to make up for the shortfall of Q3, but that clearly didn't pan out.
You know it was.
As I noted on my my comments my prepared comments that we've been incredibly disappointing to us and that roughly 7 million. When we were expecting you know 12 million 13 million plus so.
Realized I would say we recognized each day of October is that went on where like you know this isn't we're not seeing a catch up and not only we are not seeing a catch up Q4 is underperforming our expectations just versus Q4 of 18 and 20.
So really didn't hit us until October that the reality set in.
Okay. Thanks for that last thing I'd ask them.
The arms.
Our sales staff.
<unk>, who manages the local and national broadcast ads also having relevant in the digital AD sales or is that entirely that.
Platform here you talked about.
Great question, Jim and I appreciate all your commentary on the call. So I think one of the Differentiators for US are a we have a world class local sales team and importantly, we've been investing in that sales team. You know we have more employees today than we did in January of 2020 prior to Covid. So you know we were quite specific that we were going to.
Protect our teams are as you probably recall even in the in the depths of Covid, where other broadcasters, we're doing significant furloughs and reps, we did not do that and it really benefited us are coming out of Covid and setting an all time record profit in 'twenty, one and what we expect to be an all time revenue and profit in 20th century.
Two and so our local sales teams are not only the best of the best but they sell all of our products. So to your to your specific question. They sell our local broadcast advertising they can sell off across the nation through our our our technology at a national perspective, and they sell all of our digital.
Advertising and they offer our clients a great web presence and ROI for town square interactive in terms of incremental traffic through search engines and things like that so we believe one of the core philosophies and recruitment vehicles and training mechanisms for our company. The fact that we can walk into a local business and in that.
<unk> provide them a full suite of solutions from top of funnel broad reach you know obviously radios number one reach medium in America, all the way down the funnel through conversions and paid search and form fills and things like that we believe and I think our our our results continue to demonstrate a re.
Really differentiate us and provide great return on investment for our clients and local businesses and I think our our core philosophy, one of our or our mission point as you know treat treat customers like you treat a friend because if you do that you have a lifetime partner so going back to your question. It's a we think it's really important.
Our salespeople are trained on and have solutions throughout the marketing ecosystem. So that includes broadcast advertising digital advertising on our owned and operated networks as well as programmatically as we've discussed on prior calls you know a big growth for us as a social from a digital perspective as <unk>.
Well as connected TV has been growing extremely nicely as cord cutting accelerates, where you know able to sell it into a medium that you know 510 years ago, We had no place to be in and it's what part of it you know part of the fastest growing local advertising ecosystem. So are our sales staff locally sells all of that.
These products and is one of the reasons that we're we're posting such strong results.
Alright, well, thanks, very much I appreciate it pretty much.
Good to hear from you Jim Thank you.
Thank you.
We've reached the end of our question and answer session I'll turn the call over to Bill Wilson for closing remarks I. Appreciate it. Thank you all for dialing in this morning. We appreciate your taking time to hear more about our progress on the transformation at town square, we look forward to updating you on our full year results.
In early March have a great day.
This will conclude today's conference you may disconnect. Your lines at this time, we thank you for your participation.