Q1 2026 Urban One Inc Earnings Call
Operator 2: Ladies and gentlemen, thank you for standing by, and welcome to the Urban One 2026 Q1 Earnings Call. As a reminder, this conference is being recorded. We will begin this call with the following safe harbor statement. During this conference call, Urban One will be sharing with you certain projections or other forward-looking statements regarding future events or its future performance. Urban One cautions you that certain factors, including risks and uncertainties referred to in the 10-Ks, 10-Qs, and other reports it periodically files with the Securities and Exchange Commission, could cause the company's actual results to differ materially from those indicated by its projections or forward-looking statements. This call will present information as of 14 May 2026. Please note that Urban One disclaims any duty to update any forward-looking statements made in the presentation.
Operator: Ladies and gentlemen, thank you for standing by, and welcome to the Urban One 2026 Q1 Earnings Call. As a reminder, this conference is being recorded. We will begin this call with the following safe harbor statement. During this conference call, Urban One will be sharing with you certain projections or other forward-looking statements regarding future events or its future performance.
Speaker #1: We will begin this call with the following safe-harbor statement: During this conference call, URBAN ONE will be sharing with you certain projections or other forward-looking statements regarding future events or its future performance.
Speaker #1: URBAN ONE cautions you that certain factors, including risks and uncertainties referred to in the 10-Ks, 10-Qs, and other reports, it periodically files with the Securities and Exchange Commission, could cause the company's actual results to differ materially from those indicated by its projections or forward-looking statements.
Operator: Urban One cautions you that certain factors, including risks and uncertainties referred to in the 10-Ks, 10-Qs, and other reports it periodically files with the Securities and Exchange Commission, could cause the company's actual results to differ materially from those indicated by its projections or forward-looking statements. This call will present information as of 14 May 2026. Please note that Urban One disclaims any duty to update any forward-looking statements made in the presentation.
Speaker #1: This call will present information as of May 14, 2026. Please note that URBAN ONE disclaims any duty to update any forward-looking statements made in the presentation.
Speaker #1: In this call, URBAN ONE may also discuss some non-GAAP financial measures in talking about its performance. These measures will be reconciled to GAAP either during the course of this call or in the company's press release, which can be found on its website, at www.urbanone.com.
Operator 2: In this call, Urban One may also discuss some non-GAAP financial measures in talking about its performance. These measures will be reconciled to GAAP either during the course of this call or in the company's press release, which can be found on its website at www.urbanone.com. A replay of the conference call will be available from 2:00 PM Eastern Daylight Time, 14 May 2026, until 11:59 PM Eastern Daylight Time, 21 May 2026. Callers may access the replay by calling 1-800-770-2030. International callers may dial direct 1-609-800-9909. The replay access code is 3438559. Access to live audio and a replay of the conference will also be available on Urban One's corporate website at www.urbanone.com.
Operator: In this call, Urban One may also discuss some non-GAAP financial measures in talking about its performance. These measures will be reconciled to GAAP either during the course of this call or in the company's press release, which can be found on its website at www.urbanone.com. A replay of the conference call will be available from 2:00 PM Eastern Daylight Time, 14 May 2026, until 11:59 PM Eastern Daylight Time, 21 May 2026.
Speaker #1: A replay of the conference call will be available from 2:00 PM Eastern Daylight Time, May 14, 2026, until 11:59 PM Eastern Daylight Time, May 21, 2026.
Speaker #1: Callers may access the replay by calling 1-800-770-2030. International callers may dial direct 1-609-800-9909. The replay access code is 3438559. Access to live audio and to replay of the conference will also be available on URBAN ONE's corporate website, at www.urbanone.com.
Operator: Callers may access the replay by calling 1-800-770-2030. International callers may dial direct 1-609-800-9909. The replay access code is 3438559. Access to live audio and a replay of the conference will also be available on Urban One's corporate website at www.urbanone.com. The replay will be made available on the website for seven days after the call.
Speaker #1: The replay will be made available on the website for 7 days after the call. No other recordings or copies of this call are authorized or may be relied upon.
Operator 2: The replay will be made available on the website for seven days after the call. No other recordings or copies of this call are authorized or may be relied upon. I will now turn the call over to Alfred C. Liggins, Chief Executive Officer of Urban One, who is joined by Peter Thompson, Chief Financial Officer. Mr. Liggins, please go ahead.
Operator: No other recordings or copies of this call are authorized or may be relied upon. I will now turn the call over to Alfred C. Liggins, Chief Executive Officer of Urban One, who is joined by Peter Thompson, Chief Financial Officer. Mr. Liggins, please go ahead.
Speaker #1: I will now turn the call over to Alfred C. Liggins, Chief Executive Officer of URBAN ONE, who is joined by Peter Thompson, Chief Financial Officer. Mr. Liggins, please go ahead.
Speaker #2: Thank you very much, Operator. And welcome to our first quarter results conference call. Also joining Peter and I are Jody Drewer, the Chief Financial Officer, at TV1, and Chris Simpson, who is our General Counsel.
Alfred C. Liggins: Thank you very much, operator, welcome to our first quarter results conference call. Also joining Peter and I are Jody Drewer, the Chief Financial Officer at TV One, and C. Kristopher Simpson, who is our General Counsel. Press release came out this morning. I think that, you know, we had, you know, warned, inferred, you know, other people have also, you know, reported already. You know, first quarter was a very tough quarter. We were budgeted to be down, but things, the marketplace was softer than anticipated due to continued declines in the traditional ad marketplace. Peter will give you more specifics and details on the numbers in a moment.
Alfred Liggins: Thank you very much, operator, welcome to our first quarter results conference call. Also joining Peter and I are Jody Drewer, the Chief Financial Officer at TV One, and C. Kristopher Simpson, who is our General Counsel. Press release came out this morning. I think that, you know, we had, you know, warned, inferred, you know, other people have also, you know, reported already. You know, first quarter was a very tough quarter.
Speaker #2: Press release came out this morning. I think that we had warned and heard other people have also reported already, but first quarter was very tough quarter.
Speaker #2: We were budgeted to be down, but things, the marketplace was softer than anticipated due to continued declines in the traditional ad marketplace. Peter, I'll give you more specifics and details on the numbers in a moment.
Alfred Liggins: We were budgeted to be down, but things, the marketplace was softer than anticipated due to continued declines in the traditional ad marketplace. Peter will give you more specifics and details on the numbers in a moment. With the slow start to the year, we've been focused on balance sheet management and debt reduction and de-leveraging opportunities. Since the beginning of the year, we spent approximately $25 million to reduce our debt balance by another $60 million or so approximately, just to over $300 million of gross debt.
Speaker #2: But been focused on balance sheet management and debt reduction and de-leveraging opportunities. Since the beginning of the year, we spent approximately $25 million to reduce our debt balance by another $60 million or so approximately, just to over $300 million of gross debt.
Alfred C. Liggins: With the slow start to the year, we've been focused on balance sheet management and debt reduction and de-leveraging opportunities. Since the beginning of the year, we spent approximately $25 million to reduce our debt balance by another $60 million or so approximately, just to over $300 million of gross debt. We've also announced some de-levering and accretive M&A with the acquisition of Service Broadcasting in Dallas, Texas, two radio stations there in the marketplace for an in-market consolidation opportunity for an announced purchase price of just about $22 million. Net of dispositions of one station in Dallas and two stations in Charlotte. By the way, those dispositions don't contribute any cash flow currently.
Speaker #2: We've also announced some de-leveraging and accretive M&A with the acquisition of Service Broadcasting in Dallas' Dallas, Texas, two radio stations there, and the marketplace for an in-market consolidation opportunity.
Alfred Liggins: We've also announced some de-levering and accretive M&A with the acquisition of Service Broadcasting in Dallas, Texas, two radio stations there in the marketplace for an in-market consolidation opportunity for an announced purchase price of just about $22 million. Net of dispositions of one station in Dallas and two stations in Charlotte. By the way, those dispositions don't contribute any cash flow currently.
Speaker #2: For an announced purchase price of just about $22 million but net of dispositions of one station in Dallas, and two stations in Charlotte, we will spend approximately and by the way, those dispositions don't contribute any cash flow currently.
Alfred C. Liggins: We'll invest approximately $11 million and pick up about $5 million in pro forma EBITDA. With that, you know, we are also giving out, as I said in the last conference call, we're gonna wait 'til after we got through Q1 to look at what we wanted to do about updating guidance for 2026. With that, we're actually updating the 2026 guide to approximately $60 million of EBITDA. We expect year-end leverage to be below 5 times by year-end with these acquisitions and dispositions. Another bright spot in this is with these numbers, we'll generate about $40 million of free cash flow this year. Peter is gonna have more details on that in his comments.
Speaker #2: We'll invest approximately $11 million and pick up about $5 million in pro forma EBITDA. And with that, we are also giving out a new—as I said in the last conference call, we're going to wait till after we got through first quarter to look at what we wanted to do about updating guidance for 2026.
Alfred Liggins: We'll invest approximately $11 million and pick up about $5 million in pro forma EBITDA. With that, you know, we are also giving out, as I said in the last conference call, we're gonna wait 'til after we got through Q1 to look at what we wanted to do about updating guidance for 2026. With that, we're actually updating the 2026 guide to approximately $60 million of EBITDA. We expect year-end leverage to be below 5 times by year-end with these acquisitions and dispositions.
Speaker #2: So with that, we're actually updating the 2026 guide to approximately $60 million of EBITDA. And we expect year-end leverage to be below five times by year-end with these acquisitions and dispositions.
Speaker #2: Another bright spot on this is with these numbers, we'll generate about $40 million of free cash flow this year. Peter, is going to have more details on that in his comments so I'm going to let Peter go into the details and then we can open it up for Q&A and answer any more detailed questions about the business.
Alfred Liggins: Another bright spot in this is with these numbers, we'll generate about $40 million of free cash flow this year. Peter is gonna have more details on that in his comments. I'm gonna let Peter, you know, go into the details, and then we can, you know, open it up for Q&A and answer any more detailed questions about the business.
Alfred C. Liggins: I'm gonna let Peter, you know, go into the details, and then we can, you know, open it up for Q&A and answer any more detailed questions about the business.
Speaker #3: Thank you, Alfred. So consolidating that revenue for the quarter was approximately $77.7 million down by 15.8% year over year. Net revenue for the broad radio broadcasting segment was $30.5 million which was a decrease of 6.4% year over year.
Peter Thompson: Thank you, Alfred. Consolidated net revenue for the quarter was approximately $77.7 million, down by 15.8% year over year. Net revenue for the broad radio broadcasting segment was $30.5 million, which was a decrease of 6.4% year over year. Excluding political revenue, the net revenue for radio was down 8.7% year over year. According to Miller Kaplan, our local ad sales were down 5.5% against a market that was down 7.1%. National ad sales were down 8.2% against a market that was down 6.7%. Our largest ad category was services, which was up 14.5%, primarily due to legal services.
Peter Thompson: Thank you, Alfred. Consolidated net revenue for the quarter was approximately $77.7 million, down by 15.8% year over year. Net revenue for the broad radio broadcasting segment was $30.5 million, which was a decrease of 6.4% year over year. Excluding political revenue, the net revenue for radio was down 8.7% year over year. According to Miller Kaplan, our local ad sales were down 5.5% against a market that was down 7.1%. National ad sales were down 8.2% against a market that was down 6.7%. Our largest ad category was services, which was up 14.5%, primarily due to legal services.
Speaker #3: Excluding political revenue, then net revenue for radio was down 8.7% year over year. And according to Miller Kaplan, our local ad sales were down 5.5% against a market that was down 7.1%.
Speaker #3: And national ad sales were down 8.2% against a market that was down 6.7%. Our largest ad category was services which was up 14.5%, primarily due to legal services.
Speaker #3: And the government and public category was up 23.6% due to political spending. But all of the other major categories were down. Net revenue for the Reach Media segment was $4.9 million, down 17% from the prior year.
Peter Thompson: The government and public category was up 23.6% due to political spending. All the other major categories were down. Net revenue for the Reach Media segment was $4.9 million, down 17% from the prior year. Adjusted EBITDA was a loss of half a million for the quarter. This decrease was primarily driven by a decrease in the network marketplace revenue and key client attrition. Net revenues for the digital segment were down 33.5% in Q1 at $6.8 million. Decrease was driven by the decrease in national direct revenue streams as a result of a reduction of DEI-focused spending, ad budgets being pushed to Q2 and H2, and a general pullback in advertiser spending due to macroeconomic concerns.
Peter Thompson: The government and public category was up 23.6% due to political spending. All the other major categories were down. Net revenue for the Reach Media segment was $4.9 million, down 17% from the prior year. Adjusted EBITDA was a loss of half a million for the quarter. This decrease was primarily driven by a decrease in the network marketplace revenue and key client attrition. Net revenues for the digital segment were down 33.5% in Q1 at $6.8 million.
Speaker #3: And adjusted EBITDA was a loss of half a million for the quarter. And this decrease was primarily driven by a decrease in the network marketplace revenue and key client attrition.
Speaker #3: Net revenues for the digital segment were down 33.5% in the first quarter at $6.8 million. The decrease was driven by the decline in national direct revenue streams as a result of a reduction in DEI-focused spending.
Peter Thompson: Decrease was driven by the decrease in national direct revenue streams as a result of a reduction of DEI-focused spending, ad budgets being pushed to Q2 and H2, and a general pullback in advertiser spending due to macroeconomic concerns. Local digital revenue was up 10.9% for the quarter as we continue to focus on expanding and improving our local digital sales. We recognized approximately $36 million of revenue from our cable television segment during the quarter, decrease of 18.5%.
Speaker #3: Ad budgets being pushed to second quarter and second half, and a general pullback in advertiser spending due to macroeconomic concerns. Local digital revenue was up 10.9% for the quarter.
Peter Thompson: Local digital revenue was up 10.9% for the quarter as we continue to focus on expanding and improving our local digital sales. We recognized approximately $36 million of revenue from our cable television segment during the quarter, decrease of 18.5%. Cable television advertising revenue was down 24.9%. Prime delivery declined 24% year over year for persons 25-54. The integration of Nielsen data gave a boost to linear inventory. This, along with a weak scatter market, led to more commercial units being allocated to direct response, which has a lower average unit rate. Cable television affiliate revenue was down by 9.8%, driven by a decrease in subscribers as linear cable continues to decline when that was partially offset by an increase in subscriber rates.
Speaker #3: As we continue to focus on expanding and improving our local digital sales, we recognize approximately $36 million of revenue from our cable television segment during the quarter.
Speaker #3: Decrease of 18.5%. Cable television advertising revenue was down 24.9%. Prime delivery declined 24% year over year for persons 25, 54. The integration of Nielsen dash data gave a boost to linear inventory and this along with a weak scatter market led to more commercial units being allocated to direct response which has a lower average unit rate.
Peter Thompson: Cable television advertising revenue was down 24.9%. Prime delivery declined 24% year over year for persons 25-54. The integration of Nielsen data gave a boost to linear inventory. This, along with a weak scatter market, led to more commercial units being allocated to direct response, which has a lower average unit rate. Cable television affiliate revenue was down by 9.8%, driven by a decrease in subscribers as linear cable continues to decline when that was partially offset by an increase in subscriber rates.
Speaker #3: Cable television affiliate revenue was down by 9.8% driven by a decrease in subscribers. As linear cable continues to decline, when that was partially offset by an increase in subscriber rates.
Speaker #3: Cable subscribers for TV1 as measured by Nielsen finished the first quarter at 29.1 million compared to 30.2 million at the end of Q4. Decline is a result of the combination of churn and a conversion of virtual MVPDs that has been sold as connected television and therefore pulled out of the Nielsen numbers.
Peter Thompson: Cable subscribers for TV One, as measured by Nielsen, finished the first quarter at 29.1 million, compared to 30.2 million at the end of Q4. Decline is a result of the combination of churn and a conversion of virtual MVPDs that has been sold as connected television and therefore pulled out of the Nielsen numbers. Cleo TV had 28.6 million Nielsen subscribers. Operating expenses excluding depreciation and amortization, stock-based compensation, and impairment of goodwill and intangible assets was approximately $73.5 million, compared to approximately $80.7 million for the comparable period in 2025. Decrease was mainly driven by sales and marketing expense decreases in the operating segments.
Peter Thompson: Cable subscribers for TV One, as measured by Nielsen, finished the first quarter at 29.1 million, compared to 30.2 million at the end of Q4. Decline is a result of the combination of churn and a conversion of virtual MVPDs that has been sold as connected television and therefore pulled out of the Nielsen numbers. Cleo TV had 28.6 million Nielsen subscribers.
Speaker #3: Clio TV had 28.6 million Nielsen subscribers. Operating expenses excluding depreciation and amortization stock-based compensation and impairment of goodwill and intangible assets was approximately 73.5 million dollars.
Peter Thompson: Operating expenses excluding depreciation and amortization, stock-based compensation, and impairment of goodwill and intangible assets was approximately $73.5 million, compared to approximately $80.7 million for the comparable period in 2025. Decrease was mainly driven by sales and marketing expense decreases in the operating segments.
Speaker #3: Compared to approximately $80.7 million for the comparable period in 2025. The decrease was mainly driven by sales and marketing expense decreases in the operating segments.
Speaker #3: Radio expenses were down 3.8% or 1.1 million dollars. Driven primarily by lower costs associated with revenue, lower facility and rental costs, lower national rep fees, and lower bank charges.
Peter Thompson: Radio expenses were down 3.8% or $1.1 million, driven primarily by lower costs associated with revenue, lower facility and rental costs, lower national rep fees, and lower bank charges. Reach operating expenses were down by 16.2% or $1.1 million, primarily due to lower bad debt reserve, lower bank charges, and lower revenue-related expenses. Operating expenses in the digital segment were down 19.7%, driven by a decrease in traffic acquisition costs, commissions, headcount-related savings, and third-party ad serving costs. Operating expenses in the cable television segment were down 9.8%, which was driven by lower marketing expense, lower programming content amortization, and research costs. Operating expenses at corporate were down approximately 6.1%, driven by lower professional service fees and payroll-related costs.
Peter Thompson: Radio expenses were down 3.8% or $1.1 million, driven primarily by lower costs associated with revenue, lower facility and rental costs, lower national rep fees, and lower bank charges. Reach operating expenses were down by 16.2% or $1.1 million, primarily due to lower bad debt reserve, lower bank charges, and lower revenue-related expenses.
Speaker #3: Reach operating expenses were down by 16.2%, or $1.1 million, primarily due to lower bad debt reserve, lower bank charges, and lower revenue-related expenses. Operating expenses in the Digital segment were down 19.7%, driven by decreases in traffic acquisition costs, commissions, headcount-related savings, and third-party ad serving costs.
Peter Thompson: Operating expenses in the digital segment were down 19.7%, driven by a decrease in traffic acquisition costs, commissions, headcount-related savings, and third-party ad serving costs. Operating expenses in the cable television segment were down 9.8%, which was driven by lower marketing expense, lower programming content amortization, and research costs. Operating expenses at corporate were down approximately 6.1%, driven by lower professional service fees and payroll-related costs.
Speaker #3: Operating expenses in cable television segment were down 9.8% which was driven by lower marketing expense, lower programming content amortization, and research costs. Operating expenses at corporate were down approximately 6.1% driven by lower professional service fees and payroll-related costs.
Speaker #3: Consolidated adjusted EBITDA was 4.7 million dollars for the first quarter down 63.8%. Consolidated broadcast and digital operating income was approximately 14.9 million a decrease of 35.4%.
Peter Thompson: Consolidated adjusted EBITDA was $4.7 million for Q1, down 63.8%. Consolidated broadcast and digital operating income was approximately $14.9 million, a decrease of 35.4%. Interest expense was down to approximately $4.4 million, down from $10.9 million last year. Company made cash interest payments of approximately $700,000 in the quarter on the outstanding 2028 notes. Semiannual cash interest payments for the 2030 and 2031 notes were made on 1 April, for 102 days of accrued interest from the transaction date of 18 December 2025, and the next payment on those notes is now due 1 October, for the full 180 days of accrued interest.
Peter Thompson: Consolidated adjusted EBITDA was $4.7 million for Q1, down 63.8%. Consolidated broadcast and digital operating income was approximately $14.9 million, a decrease of 35.4%. Interest expense was down to approximately $4.4 million, down from $10.9 million last year. Company made cash interest payments of approximately $700,000 in the quarter on the outstanding 2028 notes.
Speaker #3: Interest expense was down to approximately 4.4 million dollars down from 10.9 million dollars last year. Company-made cash interest payments of approximately 700,000 dollars in the quarter on the outstanding 2028 notes.
Peter Thompson: Semiannual cash interest payments for the 2030 and 2031 notes were made on 1 April, for 102 days of accrued interest from the transaction date of 18 December 2025, and the next payment on those notes is now due 1 October, for the full 180 days of accrued interest.
Speaker #3: Semi-annual cash interest payments for the 2030 and 2031 notes were made on April 1st for 102 days of accrued interest from the transaction date of December 18th, 2025.
Speaker #3: And the next payment on those notes is now due October 1st, for the full 180 days of accrued interest. During the first quarter, the company repurchased 43 million dollars of its sorry, 4.3 million dollars of its 2028 notes at an average price of 51% of par for a 2.1 million dollar gain.
Peter Thompson: During Q1, the company repurchased $4.3 million of its 2028 notes at an average price of 51% of par for a $2.1 million gain, and approximately $32.4 million of its 2031 secondly notes at a weighted average price of approximately 40.7% of par. The discounted debt repurchases in Q1 reduced the outstanding long-term debt balance to $326.7 million as of 31 March 2026. The company repurchased an additional $23.5 million of its 2031 notes in Q2 at 42% of par.
Peter Thompson: During Q1, the company repurchased $4.3 million of its 2028 notes at an average price of 51% of par for a $2.1 million gain, and approximately $32.4 million of its 2031 secondly notes at a weighted average price of approximately 40.7% of par. The discounted debt repurchases in Q1 reduced the outstanding long-term debt balance to $326.7 million as of 31 March 2026. The company repurchased an additional $23.5 million of its 2031 notes in Q2 at 42% of par.
Speaker #3: And approximately $32.4 million of its 2031 senior notes at a weighted average price of approximately 40.7% of par. The discounted debt repurchases in the first quarter reduced the outstanding long-term debt balance to $326.7 million as of March 31, 2026.
Speaker #3: The company repurchased an additional $23.5 million of its 2031 notes in Q2 at 42% of par. And so, as Alfred said, year to date, that's a total reduction in long-term debt of $60.2 million.
Peter Thompson: As Alfred said, year to date, there's a total reduction in long-term debt of $60.2 million, which will give us an annual interest saving of $4.6 million. Under the troubled debt restructuring accounting, the long-term debt on the balance sheet includes a premium which amortizes over the remaining term. On the ABL, we drew $10 million in Q4 and repaid that in Q1. On March 31, we drew another $10 million for the 6-month maturity, which was outstanding as of March 31, 2026. We drew a further $10 million in Q2 2026 to help us do the long-term debt repurchase.
Peter Thompson: As Alfred said, year to date, there's a total reduction in long-term debt of $60.2 million, which will give us an annual interest saving of $4.6 million. Under the troubled debt restructuring accounting, the long-term debt on the balance sheet includes a premium which amortizes over the remaining term. On the ABL, we drew $10 million in Q4 and repaid that in Q1. On March 31, we drew another $10 million for the 6-month maturity, which was outstanding as of March 31, 2026. We drew a further $10 million in Q2 2026 to help us do the long-term debt repurchase.
Speaker #3: Which will give us an annual interest saving of 4.6 million dollars. Under the troubled debt restructuring accounting, the long-term debt on the balance sheet includes a premium which amortizes over the remaining term.
Speaker #3: And on the ABL, we drew 10 million dollars in fourth quarter and repaid that in the first quarter. And then on March 31st, we drew another 10 million dollars with a six-month maturity which was outstanding as of March 31st, 2026.
Speaker #3: We drew a further 10 million dollars in the second quarter of 2026 to help us do the long-term debt repurchase. And so we have a current outstanding balance today of 20 million dollars on the ABL and we have incremental borrowing capacity of approximately 22 million dollars today.
Peter Thompson: We have a current outstanding balance today of $20 million on the ABL, and we have incremental borrowing capacity of approximately $22 million today. No impairment losses were recognized for the 3 months ending 31 March 2026. We recorded amortization expense of approximately $6.2 million, including $5.6 million for the radio broadcast license and TV One trade name for the 3 months ending 31 March 2026. Benefit from income taxes was approximately $1.4 million for Q1. Company paid cash income taxes net of refunds in the amount of approximately $0.1 million. Capital expenditures were approximately $3.4 million in the quarter, which included the Indianapolis studio refurbishment, which is why that's higher than you would normally expect to see.
Peter Thompson: We have a current outstanding balance today of $20 million on the ABL, and we have incremental borrowing capacity of approximately $22 million today. No impairment losses were recognized for the 3 months ending 31 March 2026. We recorded amortization expense of approximately $6.2 million, including $5.6 million for the radio broadcast license and TV One trade name for the 3 months ending 31 March 2026. Benefit from income taxes was approximately $1.4 million for Q1.
Speaker #3: No impairment losses were recognized for the three months ended March 31st, 2026. We recorded amortization expense of approximately 6.2 million dollars including 5.6 million dollars for the radio broadcast license and TV1 trade name for the three months ended March 31st, 2026.
Speaker #3: Benefit from income taxes was approximately 1.4 million dollars for the first quarter. Company paid cash income taxes net of refunds in the amount of approximately 0.1 million dollars.
Peter Thompson: Company paid cash income taxes net of refunds in the amount of approximately $0.1 million. Capital expenditures were approximately $3.4 million in the quarter, which included the Indianapolis studio refurbishment, which is why that's higher than you would normally expect to see. That will normalize over time. Net loss was approximately $3.1 million or $0.69 a share compared to a net loss of $11.7 million or $2.64 per share for Q1 2025.
Speaker #3: Capital expenditures were approximately 3.4 million dollars in the quarter which included the Indianapolis Studio refurbishment which is why that's higher than you would normally expect to see.
Speaker #3: So that will normalize over time. Net loss was approximately 3.1 million dollars or 69 cents a share compared to a net loss of 11.7 million dollars.
Peter Thompson: That will normalize over time. Net loss was approximately $3.1 million or $0.69 a share compared to a net loss of $11.7 million or $2.64 per share for Q1 2025. During the 3 months, the company did not repurchase any shares of Class A common stock, and we executed stock vest tax repurchases of 2,187 shares of Class D common stock at a price of $5.73 per share. As we previously announced, in March, company agreed to sell its WMXG and also WLNK radio broadcast licenses in Charlotte, North Carolina, to unrelated third parties for approximately $0.7 million and $4.2 million respectively. We anticipate to close on the sale by the end of Q2.
Speaker #3: Or $2.64 per share for the first quarter of 2025. During the three months, the company did not repurchase any shares of Class A common stock and we executed stock vest tax repurchases of 2,187 shares of Class D common stock at a price of $5.73 per share.
Peter Thompson: During the 3 months, the company did not repurchase any shares of Class A common stock, and we executed stock vest tax repurchases of 2,187 shares of Class D common stock at a price of $5.73 per share. As we previously announced, in March, company agreed to sell its WMXG and also WLNK radio broadcast licenses in Charlotte, North Carolina, to unrelated third parties for approximately $0.7 million and $4.2 million respectively. We anticipate to close on the sale by the end of Q2.
Speaker #3: As we previously announced in March, the company agreed to sell its WMXG and also WLNK radio broadcast licenses in Charlotte, North Carolina, to unrelated third parties for approximately $0.7 million and $4.2 million, respectively.
Speaker #3: We anticipate close on the sale by the end of Q2. In April, company entered into an agreement to acquire service broadcasting group in Dallas, Texas.
Peter Thompson: In April, company entered into an agreement to acquire Service Broadcasting Group in Dallas, Texas, including radio stations KKDA and KRNB for $22 million. At the same time, we also entered into an agreement to sell radio station KZMJ to Fuzion Dallas for $6 million. Pending FCC approval, the Dallas transactions are expected to close in Q3. The net of all of that, radio M&A is roughly $11 million of outflow, and on a pro forma basis, we think the incremental cash flows from that will be around about $5 million.
Peter Thompson: In April, company entered into an agreement to acquire Service Broadcasting Group in Dallas, Texas, including radio stations KKDA and KRNB for $22 million. At the same time, we also entered into an agreement to sell radio station KZMJ to Fuzion Dallas for $6 million. Pending FCC approval, the Dallas transactions are expected to close in Q3. The net of all of that, radio M&A is roughly $11 million of outflow, and on a pro forma basis, we think the incremental cash flows from that will be around about $5 million.
Speaker #3: Including radio stations KKDA and KRMB for $22 million. At the same time, we also entered into an agreement to sell radio station KZMJ to Fusion Dallas for $6 million.
Speaker #3: Pending FCC approval, the Dallas transactions are expected to close in Q3. So the net of all of that, radio M&A is roughly 11 million dollars of outflow.
Speaker #3: And on a pro forma basis, we think the incremental cash flows from that will be around about 5 million dollars. As of March 31st, 2026, the current contractually outstanding debt balance was approximately 336 million dollars.
Peter Thompson: As of 31 March 2026, the current contractually outstanding debt balance was approximately $336 million, and the ending unrestricted cash balance was $27.2 million, resulting in net debt of approximately $309.5 million compared to $48.5 million of LTM reported adjusted EBITDA for a total net leverage ratio of 6.39x. Cash flow from operations is expected to be around $40 million for the year, and we do anticipate repaying the $20 million ABL balance in H2 of the year. Based on the guidance that we gave, we anticipate net leverage being below 5x at year-end. With that, I'll hand it back to Alfred.
Peter Thompson: As of 31 March 2026, the current contractually outstanding debt balance was approximately $336 million, and the ending unrestricted cash balance was $27.2 million, resulting in net debt of approximately $309.5 million compared to $48.5 million of LTM reported adjusted EBITDA for a total net leverage ratio of 6.39x. Cash flow from operations is expected to be around $40 million for the year, and we do anticipate repaying the $20 million ABL balance in H2 of the year. Based on the guidance that we gave, we anticipate net leverage being below 5x at year-end. With that, I'll hand it back to Alfred.
Speaker #3: And the ending unrestricted cash balance for 27.2 million dollars. Resulting in net debt of approximately 309.5 million dollars. Compared to 48.5 million dollars of LTM reported adjusted EBITDA for a total net leverage ratio of 6.39 times.
Speaker #3: Cash flow from operations is expected to be around $40 million for the year, and we do anticipate repaying the $20 million ABL balance in the second half of the year.
Speaker #3: And based on the guidance that we gave, we anticipate net leverage being below five times a year-end. And with that, I'll hand it back.
Speaker #1: Thanks, Peter. Operator, could you please open up the lines for questions?
Alfred C. Liggins: Thanks, Peter. Operator, could you please open up the lines for questions?
Alfred Liggins: Thanks, Peter. Operator, could you please open up the lines for questions?
Speaker #3: We will now begin the question and answer session. To ask a question, press star, then the number one on your telephone keypad. Again, for questions, simply press star followed by the number one on your telephone keypad.
Operator 2: We will now begin the question-and-answer session. To ask a question, press star, then the number 1 on your telephone keypad. Again, for questions, simply press star followed by the number 1 on your telephone keypad. Our first question will come from the line of Ben Briggs with StoneX Financial. Please go ahead.
Operator: We will now begin the question-and-answer session. To ask a question, press star, then the number 1 on your telephone keypad. Again, for questions, simply press star followed by the number 1 on your telephone keypad. Our first question will come from the line of Ben Briggs with StoneX Financial. Please go ahead.
Speaker #3: Our first question will come from the line of Ben Briggs with Stonex Financial. Please go ahead.
Speaker #4: Hey, good morning, guys. And thank you for taking the call and taking the questions. So I wanted to touch on one thing here. So first of all, congratulations on the acquisitions that you made this quarter.
Ben Briggs: Hey, good morning, guys, and thank you for taking the call and taking the questions. I wanted to touch on one thing here. First of all, congratulations on the acquisitions that you made this quarter. I know, kinda moving some chips around the board is an important strategy for you guys. Can you give us some clarity on the, on the thought process behind these? Is it more attractive formats, that you think are gonna make the difference? Or is it better geographies or combination of both? Any clarity there would be great.
Ben Briggs: Hey, good morning, guys, and thank you for taking the call and taking the questions. I wanted to touch on one thing here. First of all, congratulations on the acquisitions that you made this quarter. I know, kinda moving some chips around the board is an important strategy for you guys. Can you give us some clarity on the, on the thought process behind these? Is it more attractive formats, that you think are gonna make the difference? Or is it better geographies or combination of both? Any clarity there would be great.
Speaker #4: I know kind of moving some of the chips around the board is an important strategy for you guys. Can you give us some clarity on the thought process behind these?
Speaker #4: Is it more attractive formats that you think are going to make the difference? Or is it better geographies? Or a combination of both? Any clarity there would be great.
Alfred C. Liggins: They aren't different formats. They're similar formats, you know, in the marketplace. You know, we're really, you know, looking to expand our, our reach and our service of the African American community in Dallas, Texas. I think it's gonna help us, you know, all the way around, in terms of serving local advertisers. It's, you know, the economics, you know, of putting those clusters together and also, you know, selling off our, you know, one station, you know, are gonna create a much larger cluster that has, you know, more revenue scale. With those economies of scale, you're, you know, producing significantly more EBITDA. It makes a lot of sense.
Speaker #5: They aren't different formats. They're similar formats. In the marketplace. So we're really looking to expand our reach and our service of the African American community in Dallas, Texas.
Alfred Liggins: They aren't different formats. They're similar formats, you know, in the marketplace. You know, we're really, you know, looking to expand our, our reach and our service of the African American community in Dallas, Texas. I think it's gonna help us, you know, all the way around, in terms of serving local advertisers. It's, you know, the economics, you know, of putting those clusters together and also, you know, selling off our, you know, one station, you know, are gonna create a much larger cluster that has, you know, more revenue scale.
Speaker #5: So, I think it's going to help us all the way around in terms of serving local advertisers. The economics of putting those clusters together, and also selling off our one station, are going to create a much larger cluster that has more revenue scale.
Speaker #5: And with those economies of scale, you're producing significantly more EBITDA, so it makes a lot of sense. It's an acquisition that I've been trying to do for almost 30 years.
Alfred Liggins: With those economies of scale, you're, you know, producing significantly more EBITDA. It makes a lot of sense. It's an acquisition that I've been trying to do for almost 30 years. I think we, actually, so we went public in May of 1999. Been trying to make a deal with the owner-operator there, Mr. Hymen Childs, who's a wonderful broadcaster and has been in this business for a long time. We always stayed in touch, and we finally were able to do something. What really helps it is, again, the disposition of the one station that we have, which, I think does maybe $2 million of revenue, but really no cash flow contribution.
Alfred C. Liggins: It's an acquisition that I've been trying to do for almost 30 years. I think we, actually, so we went public in May of 1999. Been trying to make a deal with the owner-operator there, Mr. Hymen Childs, who's a wonderful broadcaster and has been in this business for a long time. We always stayed in touch, and we finally were able to do something. What really helps it is, again, the disposition of the one station that we have, which, I think does maybe $2 million of revenue, but really no cash flow contribution.
Speaker #5: I think we actually so we went public in May of '99. That's when we bought our first established station. And I've been trying to make a deal with the owner-operator.
Speaker #5: They're Mr. Hyman Childs, who's a wonderful broadcaster and has been in this business for a long time. And we will always stay in touch.
Speaker #5: And we finally were able to do something. What really helps it is, again, the disposition of the one station that we have that I think does maybe a couple million dollars of revenue, but really no cash flow contribution.
Alfred C. Liggins: You know, those two stations in Charlotte that we're selling, you know, will probably do just about $1 million of revenue this year and also contribute no cash flow. The two stations in Charlotte became saleable because we moved our news talk format off of WBT AM, and we put it on what was WLNK-FM, which is a full market signal there. Because these spoken word formats have to move to the FM band, we finally, you know, did that. You know, we moved the adult contemporary format to, you know, these stations, which, you know, 1's a Class A in Charlotte, the other one is a C3 that's just, you know, south of Charlotte.
Alfred Liggins: You know, those two stations in Charlotte that we're selling, you know, will probably do just about $1 million of revenue this year and also contribute no cash flow. The two stations in Charlotte became saleable because we moved our news talk format off of WBT AM, and we put it on what was WLNK-FM, which is a full market signal there. Because these spoken word formats have to move to the FM band, we finally, you know, did that.
Speaker #5: Those two stations in Charlotte that we're selling will probably do just about $1 million of revenue this year, and also contribute no cash flow.
Speaker #5: The two stations in Charlotte became saleable because we moved our news talk format off of WBTAM. And we put it on W what was WLNKFM, which is a full market signal there.
Speaker #5: Because these spoken word formats have to move to the FM band. So we finally did that. And then we moved the adult contemporary format to these stations, which one's a class A in Charlotte.
Alfred Liggins: You know, we moved the adult contemporary format to, you know, these stations, which, you know, 1's a Class A in Charlotte, the other one is a C3 that's just, you know, south of Charlotte. You know, we're really positioning that Charlotte cluster, you know, for the future, but there was no cash flow associated with it. It also actually frees up, you know, the land associated with the tower sites for WBT AM and also for our old WFMZ AM, which we also moved to the FM band.
Speaker #5: The other one is a C3 that's just a south of Charlotte. And so we're really positioning that Charlotte cluster for the future. But there was no cash flow associated with it.
Alfred C. Liggins: You know, we're really positioning that Charlotte cluster, you know, for the future, but there was no cash flow associated with it. It also actually frees up, you know, the land associated with the tower sites for WBT AM and also for our old WFMZ AM, which we also moved to the FM band. Something I didn't talk about is that we've got significant value in those land assets in Charlotte, and there is a process going on as we speak to monetize those parcels, you know. All in the vein of how do we, you know, look for accretive and de-levering M&A. You know, you gotta get it at the right price. It's gotta be an operational fit such that one plus one equals three in terms of profitability.
Speaker #5: It also actually frees up the land associated with the tower sites for WBT AM and also for our old WFNZ AM, which we also moved to the FM band.
Speaker #5: So something I didn't talk about is that we've got significant value in those land assets in Charlotte. And there is a process going on as we speak to monetize those parcels.
Alfred Liggins: Something I didn't talk about is that we've got significant value in those land assets in Charlotte, and there is a process going on as we speak to monetize those parcels, you know. All in the vein of how do we, you know, look for accretive and de-levering M&A. You know, you gotta get it at the right price. It's gotta be an operational fit such that one plus one equals three in terms of profitability. You know, we think what we did in, you know, Dallas and what we're doing in Charlotte, you know, are significant plays in our effort to continue to de-lever.
Speaker #5: So all in the vein of how do we look or accretive and de-levering M&A? So you got to get it at the right price.
Speaker #5: It's got to be an operational fit such that one plus one equals three in terms of profit in terms of profitability. And so we think what we did in Dallas and what we're doing in Charlotte is our significant going to be significant plays in our effort to continue to de-lever.
Alfred C. Liggins: You know, we think what we did in, you know, Dallas and what we're doing in Charlotte, you know, are significant plays in our effort to continue to de-lever.
Speaker #4: Okay. That's great color. And I appreciate the I appreciate the information. About the land that some AM towers are on. That frees up. Can you give any more clarity on the monetization process?
Ben Briggs: Okay. That's great color, and I appreciate the information about the land that some AM towers are on that frees up. Can you give any more clarity on the monetization process? Are you gonna lease? Are you gonna sell? Are you not sure yet?
Ben Briggs: Okay. That's great color, and I appreciate the information about the land that some AM towers are on that frees up. Can you give any more clarity on the monetization process? Are you gonna lease? Are you gonna sell? Are you not sure yet?
Speaker #4: Is it going to be are you going to lease? Are you going to sell? Are you not sure yet?
Speaker #5: Wait, wait. Yeah. The land is listed with JLL right now, and there's a process going on to bring in offers and to evaluate and to eventually just sell it.
Alfred C. Liggins: We, yeah, we're, you know, the land is listed with JLL right now, and there's a process going on, you know, to bring in offers and to evaluate and to, you know, eventually just sell it. Yeah.
Alfred Liggins: We, yeah, we're, you know, the land is listed with JLL right now, and there's a process going on, you know, to bring in offers and to evaluate and to, you know, eventually just sell it. Yeah.
Speaker #5: Yeah.
Speaker #4: Okay. Great. That's very helpful color. I appreciate it. Thank you, guys.
Ben Briggs: Okay, great. That's very helpful color. I appreciate it. Thank you, guys.
Ben Briggs: Okay, great. That's very helpful color. I appreciate it. Thank you, guys.
Speaker #5: Thank you.
Alfred C. Liggins: Thank you.
Alfred Liggins: Thank you.
Speaker #3: Again, for questions, press star one. And our next question will come from the line of Dennis Panula with LaPan Partners. Please go ahead.
Operator 2: Again, for questions, press star one. Our next question will come from the line of Dennis Paunula with Lupan Partners. Please go ahead.
Operator: Again, for questions, press star one. Our next question will come from the line of Dennis Pannullo with Lapan Partners. Please go ahead.
Speaker #6: Hi. Good morning, guys, and thanks for taking my questions.
Dennis Paunula: Hi. Good morning, guys. Thanks for taking my questions.
Dennis Pannullo: Hi. Good morning, guys. Thanks for taking my questions.
Speaker #7: Hey, Dennis.
Alfred C. Liggins: Hey, Dennis.
Alfred Liggins: Hey, Dennis.
Dennis Paunula: Hey. I know the Q1, you know, seasonality is the weakest quarter of the year, but man, to see TV down double digits. Did I hear Mr. Thompson right? Did you say digital, your digital broadcasting was up?
Speaker #6: Hey. I know the first quarter seasonality is the weakest quarter of the year. But man, to see TV down double digits and did I hear Mr. Thompson right?
Dennis Pannullo: Hey. I know the Q1, you know, seasonality is the weakest quarter of the year, but man, to see TV down double digits. Did I hear Mr. Thompson right? Did you say digital, your digital broadcasting was up?
Speaker #6: Did you say digital your digital broadcasting was up?
Speaker #7: Q2.
Alfred C. Liggins: Q2.
Alfred Liggins: Q2.
Speaker #5: Q2. Yeah. So I'm sorry. Yeah. So no. So look. So SuperSoft Q1. But a bunch of campaigns got pushed into Q2 in the back half.
Peter Thompson: Q2. We're.
Peter Thompson: Q2. We're.
Dennis Paunula: Oh, Q2, I'm sorry. Gotcha.
Dennis Pannullo: Oh, Q2, I'm sorry. Gotcha.
Peter Thompson: No. Look, super soft Q1, a bunch of campaigns got pushed into Q2 in the back half, Q2 and digital is actually up.
Peter Thompson: No. Look, super soft Q1, a bunch of campaigns got pushed into Q2 in the back half, Q2 and digital is actually up.
Speaker #5: So Q2 and digital is actually up. So yeah.
Speaker #6: Yeah. Because digital.
Dennis Paunula: Yeah, because.
Dennis Pannullo: Yeah, because.
Peter Thompson: Yeah, sorry. Of all of the divisions, I think the digital folks are optimistic and confident about, you know, making their numbers for the year, right? A weak Q2, but a weak Q1, but a stronger Q2.
Speaker #5: Of all of the yeah. Sorry. Of all of the divisions, I think the digital folks are optimistic and confident about making their numbers for the year, right?
Peter Thompson: Yeah, sorry. Of all of the divisions, I think the digital folks are optimistic and confident about, you know, making their numbers for the year, right? A weak Q2, but a weak Q1, but a stronger Q2.
Speaker #5: So a weak Q2. But a weak Q1, but a stronger Q2.
Speaker #6: Yeah. Because a lot of your peers are transitioning to digital. And digital sales have been pretty strong. So I'm sure that we're probably trying to head in that same direction, I would imagine.
Dennis Paunula: Because a lot of your peers are transitioning to digital, and digital sales have been pretty strong. I'm sure that we're probably trying to head in that same direction, I would imagine. Margins are better, you know, sales numbers are better.
Dennis Pannullo: Because a lot of your peers are transitioning to digital, and digital sales have been pretty strong. I'm sure that we're probably trying to head in that same direction, I would imagine. Margins are better, you know, sales numbers are better.
Speaker #6: Margins are better. Sales numbers are better. We're trying to drive that division.
Alfred C. Liggins: the margin.
Alfred Liggins: the margin.
Dennis Paunula: Are we seeing that at division?
Dennis Pannullo: Are we seeing that at division?
Alfred C. Liggins: Yes. Well, the division, you know, has grown from I mean, we created Interactive One, and for a long time it was a break-even division, you know. Then I think revenue went from, like, low 30s to, you know, we fell 75 after sort of the George Floyd DEI, and it was wildly profitable. When I say wildly, went up to, you know, call it $20 million. Now there's pressure on digital publishers, of which they are, you know. You can see, you know, BuzzFeed had its challenge, et cetera. Even with all of that, advertisers are moving, you know, more towards digital. It will still be, you know, not a $20 million profitable division, but probably $6 million, you know, of course.
Alfred Liggins: Yes. Well, the division, you know, has grown from I mean, we created Interactive One, and for a long time it was a break-even division, you know. Then I think revenue went from, like, low 30s to, you know, we fell 75 after sort of the George Floyd DEI, and it was wildly profitable. When I say wildly, went up to, you know, call it $20 million. Now there's pressure on digital publishers, of which they are, you know. You can see, you know, BuzzFeed had its challenge, et cetera.
Speaker #5: Yeah. The margin, well, the division has grown from—I mean, we created Interactive One, and for a long time, it was a breakeven division.
Speaker #5: And then I think revenue went from, like, low $30 million to $75 million after sort of the George Floyd DEI, and it was wildly profitable. When I say wildly, it went up to—call it—$20 million bucks.
Speaker #5: Now there's pressure on digital publishers, of which they are. You can see BuzzFeed had its challenge, etc. But even with all of that, advertisers are moving more towards digital.
Alfred Liggins: Even with all of that, advertisers are moving, you know, more towards digital. It will still be, you know, not a $20 million profitable division, but probably $6 million, you know, of course. A misnomer that you just, you know, mentioned is that the margins aren't better, you know, in digital. The margins are actually, you know, worse, particularly on local digital, because a lot of the campaigns that you sell, you know, require you to, A,
Speaker #5: So, it will still not be a $20 million profitable division, but probably six. Of course. But a misnomer that you just mentioned is that the margins aren't better.
Alfred C. Liggins: A misnomer that you just, you know, mentioned is that the margins aren't better, you know, in digital. The margins are actually, you know, worse, particularly on local digital, because a lot of the campaigns that you sell, you know, require you to, A, do specialized individual custom content, and B, oftentimes you need impressions that are not owned and operated impressions to build scale, and those impressions are very expensive to buy. So you have TAC, you know, which is traffic acquisition cost. You know, the radio business, local radio, you know, has been moving, you know, in that direction. You know, it is a lower margin business.
Speaker #5: In digital, the margins are actually worse, particularly on local digital because a lot of the campaigns that you sell require you to, A, do specialized individual custom content, and B, oftentimes you need impressions that are not owned and operated impressions to build scale.
Alfred Liggins: do specialized individual custom content, and B, oftentimes you need impressions that are not owned and operated impressions to build scale, and those impressions are very expensive to buy. So you have TAC, you know, which is traffic acquisition cost. You know, the radio business, local radio, you know, has been moving, you know, in that direction. You know, it is a lower margin business.
Speaker #5: And those impressions are very expensive to buy. And so you have tack, which is traffic acquisition cost. And the radio business, local radio has been moving in that direction.
Speaker #5: But it is a lower margin business. But as I and our local radio stations have been behind the curve in local digital. And we're pushing and improving in that area because I tell my guys, and ladies, that low margin is better than no margin, right?
Alfred C. Liggins: Our local radio stations have been behind the curve in local digital, and we're pushing and improving in that area because, you know, I tell my guys, you know, and ladies that low margin is better than no margin, right? You know.
Alfred Liggins: Our local radio stations have been behind the curve in local digital, and we're pushing and improving in that area because, you know, I tell my guys, you know, and ladies that low margin is better than no margin, right? You know.
Speaker #5: So.
Peter Thompson: Yeah. Dennis, to Alfred's point, on local digital revenue, I mentioned in my sort of prepared remarks, we were up 10.9% for the quarter. The marketplace was up 20%, local digital is where the growth is in radio. We're sort of trailing that curve, but we're working hard.
Peter Thompson: Yeah. Dennis, to Alfred's point, on local digital revenue, I mentioned in my sort of prepared remarks, we were up 10.9% for the quarter. The marketplace was up 20%, local digital is where the growth is in radio. We're sort of trailing that curve, but we're working hard.
Speaker #4: Yeah. And Dennis, on the local to Alfred's point, on local digital revenue, I mentioned in my sort of prepared remarks, we were up 10.9% for the quarter.
Speaker #4: The marketplace was up 20%. So local digital is where the growth is in radio. And we're sort of trailing that curve. But we're working hard to catch up.
Alfred C. Liggins: Yeah
Alfred Liggins: Yeah
Peter Thompson: to catch up.
Peter Thompson: to catch up.
Alfred C. Liggins: More scale in our markets would help us be a better local digital marketing partner for our advertisers. You know, we're, you know, we're focused on that.
Alfred Liggins: More scale in our markets would help us be a better local digital marketing partner for our advertisers. You know, we're, you know, we're focused on that.
Speaker #5: More scale in our markets help us be a better local digital marketing partner for our advertisers. So we're focused on that.
Speaker #6: And let me just take a quick second to thank you in management for working so hard. I mean, my God, that refinancing you guys did in December was awesome.
Dennis Paunula: Let me just take a quick second to thank you and management for working so hard. I mean, my God, that refinancing you guys did in December was awesome. You didn't any of the company. There was no dilution to shareholders. Unfortunately, the market didn't reward you in any way, shape, or form for that. Now with this additional debt repurchase and another $1.1 million in interest savings, plus the premium savings, it's looking like if I'm not mistaken, your quarterly interest cost on your P&L is gonna be under $3 million. Does that sound about right, Mr. Thompson?
Dennis Pannullo: Let me just take a quick second to thank you and management for working so hard. I mean, my God, that refinancing you guys did in December was awesome. You didn't any of the company. There was no dilution to shareholders. Unfortunately, the market didn't reward you in any way, shape, or form for that. Now with this additional debt repurchase and another $1.1 million in interest savings, plus the premium savings, it's looking like if I'm not mistaken, your quarterly interest cost on your P&L is gonna be under $3 million. Does that sound about right, Mr. Thompson?
Speaker #6: You didn’t have any of the company. There was no dilution to shareholders, and unfortunately, the market didn’t reward you in any way, shape, or form for that.
Speaker #6: And now with this additional debt repurchase and another $1.1 million in interest savings, plus the premium savings, it's looking like if I'm mistaken, your quarterly interest cost on your P&L is going to be under $3 million.
Speaker #6: Does that sound about right, Mr. Thompson?
Peter Thompson: Yeah. Look, that's the weirdness of having to amortize the premium, and it reduces the effective interest rate. I think the way to think about the interest burden going forward is the cash interest expense pro forma.
Peter Thompson: Yeah. Look, that's the weirdness of having to amortize the premium, and it reduces the effective interest rate. I think the way to think about the interest burden going forward is the cash interest expense pro forma.
Speaker #5: Yeah. It's—look, that's the weirdness of having to amortize the premium, and it reduces the effective interest rate. I think the way to think about the interest burden going forward is the cash interest expense pro forma, yeah.
Dennis Paunula: No, I know that.
Dennis Pannullo: No, I know that.
Peter Thompson: Yeah. $24.8 is the pro forma cash interest expense moving forward, which is obviously way down on where we've been historically, and to your point, helps us generate more free cash flow, right?
Peter Thompson: Yeah. $24.8 is the pro forma cash interest expense moving forward, which is obviously way down on where we've been historically, and to your point, helps us generate more free cash flow, right?
Speaker #5: So 24.8 is the pro forma cash interest expense moving forward, which is obviously way down on where we've been historically and to your point, helps us generate more free cash flow, right?
Speaker #5: Yeah. Look, you're in we're in tougher businesses, right? And so it really it's going to be a threading of the needle of how do you manage the balance sheet, get your interest burden down, get your debt down, find the places where you can create more cash flow.
Alfred C. Liggins: Yeah. Look, it's, you know, you're in tougher businesses, right? You know, so it really, it's going to be, you know, a threading of the needle of how do you manage the balance sheet, get your interest burden down, get your debt down, find the places where you can create more cash flow. Look, you gotta deal with the reality is that, you know, at least the assumptions that we make, like when we did this Dallas acquisition, our model has the Dallas market going down in spot revenue and digital going up, you know, with lower margins, but net, the market coming down, right?
Alfred Liggins: Yeah. Look, it's, you know, you're in tougher businesses, right? You know, so it really, it's going to be, you know, a threading of the needle of how do you manage the balance sheet, get your interest burden down, get your debt down, find the places where you can create more cash flow. Look, you gotta deal with the reality is that, you know, at least the assumptions that we make, like when we did this Dallas acquisition, our model has the Dallas market going down in spot revenue and digital going up, you know, with lower margins, but net, the market coming down, right?
Speaker #5: And look, you got to deal with the reality—at least the assumptions that we make, like when we did this Dallas acquisition. Our model has the Dallas market going down in spot revenue.
Speaker #5: And digital is going up with lower margins. But net-net, the market is coming down, right? And I don't have a crystal ball as to what happens to the media ecosystem in terms of technology, and who's competing, and what it means.
Alfred C. Liggins: I don't have a crystal ball as to what happens, you know, to the media ecosystem in terms of technology and who's competing and what it means, you know. I don't think anybody does. You know, you just gotta manage that debt down and stay ahead of it. That's, you know, that's what we've been doing. That's what we planned on. I mean, it's actually the fact that in February 2021, we had $825 million of debt. Five years later, we've got $303 million of debt. You know, we have less cash flow too, but, you know, but that's, you know, that's.
Alfred Liggins: I don't have a crystal ball as to what happens, you know, to the media ecosystem in terms of technology and who's competing and what it means, you know. I don't think anybody does. You know, you just gotta manage that debt down and stay ahead of it. That's, you know, that's what we've been doing. That's what we planned on. I mean, it's actually the fact that in February 2021, we had $825 million of debt. Five years later, we've got $303 million of debt. You know, we have less cash flow too, but, you know, but that's, you know, that's.
Speaker #5: And I don't think anybody does. But you just got to manage that debt down and stay ahead of it. And so that's what we've been doing.
Speaker #5: That's what we plan to do. I mean, it's actually I mean, the fact that in February of '21, we had 825 million dollars of debt.
Speaker #5: In five years later, we've got 303 million dollars of debt. Now we have less cash flow too. But that's yeah.
Speaker #6: Well, even looking at January of 2024, you had $725 million. So in just a few years, you guys took off over $400 million in debt, without diluting shareholders a single share.
Dennis Paunula: Well, even looking at January 2024, you had $725 million. In just a few years, you guys took off what? Over $400 million in debts without.
Dennis Pannullo: Well, even looking at January 2024, you had $725 million. In just a few years, you guys took off what? Over $400 million in debts without.
Alfred C. Liggins: Yeah
Alfred Liggins: Yeah
Dennis Paunula: without diluting shareholders a single share.
Dennis Pannullo: without diluting shareholders a single share.
Alfred C. Liggins: I mean, look, you know, that's all fine and good. I appreciate that, the stock trades at an option level because, you know, what's the value, right? Like, if you value stuff that, you know we're like, hey, we're going to be below 5 times. Somebody could argue that, you know, your assets, cable and radio are worth 5 times. There's no equity value, right? Like, you know, it could certainly benchmarks whether it's AMC Networks or whether it's Versant or like, you know, have seen multiples, you know, below 5 times, right? You know, we sold drawn. That's the reason you gotta get your debt down to 3 times, right?
Speaker #5: Yeah. I mean, look, that's all fine and good. But the and I appreciate that. But the stock trades at an as basically as an option level because what's the value, right?
Alfred Liggins: I mean, look, you know, that's all fine and good. I appreciate that, the stock trades at an option level because, you know, what's the value, right? Like, if you value stuff that, you know we're like, hey, we're going to be below 5 times. Somebody could argue that, you know, your assets, cable and radio are worth 5 times. There's no equity value, right? Like, you know, it could certainly benchmarks whether it's AMC Networks or whether it's Versant or like, you know, have seen multiples, you know, below 5 times, right? You know, we sold drawn. That's the reason you gotta get your debt down to 3 times, right?
Speaker #5: Do you value stuff at we're like, "Hey, we're going to be below five times somebody could argue that your assets, cable and radio, are worth five times." So there's no equity value, right?
Speaker #5: Because certainly, benchmarks, whether it's AMC Networks or whether it's Versant or have seen multiples, below five times, right? So but we sold drawn. That's the reason you got to get your debt down to three times, right?
Alfred C. Liggins: You know, and that's, you know, like, you know, what we're, you know, what we're focusing on.
Alfred Liggins: You know, and that's, you know, like, you know, what we're, you know, what we're focusing on.
Speaker #5: And that's like what we're what we're focusing on.
Speaker #6: Well, even your free cash flow that you just mentioned, you're going to do $40 million, your current market cap is 26 million this morning.
Dennis Paunula: Well, even your free cash flow that you just mentioned, you're gonna do $40 million. Your current market cap is $26 million this morning. I mean, how many companies are trading under 1 times free cash flow? I don't know of any.
Dennis Pannullo: Well, even your free cash flow that you just mentioned, you're gonna do $40 million. Your current market cap is $26 million this morning. I mean, how many companies are trading under 1 times free cash flow? I don't know of any.
Speaker #6: I mean, how many companies are trading under one times free cash flow? I don't know any. I mean, I don't know what your peers typically trade at.
Alfred C. Liggins: Yeah.
Alfred Liggins: Yeah.
Dennis Paunula: I mean, I don't know what your peers typically trade at, but when I took a look, they typically trade at 5x to 8x free cash flow. You guys are less than 1x.
Dennis Pannullo: I mean, I don't know what your peers typically trade at, but when I took a look, they typically trade at 5x to 8x free cash flow. You guys are less than 1x.
Speaker #6: But when I took a look, they typically trade at five to eight times free cash flow. You guys are less than one.
Speaker #5: Yeah. Well, look, I think the market's got to get comfortable that our company, these companies are going to make it through the curve, right?
Alfred C. Liggins: Yeah. Well, look, I think the market's gotta get comfortable that, you know, our company, these companies are gonna make it through the curve, right? Like, you know, 'cause a number of folks have not made it, you know. Cumulus is in, you know, BK again, Spanish Broadcasting just went to BK, you know. You know, they gotta believe that you're gonna make it, and then they'll buy your argument.
Alfred Liggins: Yeah. Well, look, I think the market's gotta get comfortable that, you know, our company, these companies are gonna make it through the curve, right? Like, you know, 'cause a number of folks have not made it, you know. Cumulus is in, you know, BK again, Spanish Broadcasting just went to BK, you know. You know, they gotta believe that you're gonna make it, and then they'll buy your argument.
Speaker #5: Because a number of folks have not made it. Cumulus is in BK again, Spanish Broadcasting just went to BK. And so they got to believe that you're going to make it.
Speaker #5: And then they'll buy your argument.
Speaker #6: Well, and you don't have any liquidity issues either. And in terms of debt issues, you just pushed them out the 2030 and 2031. And you're eradicating and you're eliminating that debt at a rapid pace.
Dennis Paunula: Well, you don't have any liquidity issues either, any near-term debt issues. You just pushed them out to 2030 and 2031, you're eliminating that debt at a rapid pace. How do you not get rerated and, you know, have your stock trading at literally bankruptcy prices?
Dennis Pannullo: Well, you don't have any liquidity issues either, any near-term debt issues. You just pushed them out to 2030 and 2031, you're eliminating that debt at a rapid pace. How do you not get rerated and, you know, have your stock trading at literally bankruptcy prices?
Speaker #6: So I mean, how do you not get rerated in have your stock trading at literally bankruptcy prices?
Alfred C. Liggins: Yeah.
Alfred Liggins: Yeah.
Peter Thompson: S&P are on the call. I'm sure they're making.
Peter Thompson: S&P are on the call. I'm sure they're making.
Speaker #5: S&P are on the call. I'm sure they make it.
Alfred C. Liggins: Exactly.
Alfred Liggins: Exactly.
Speaker #7: Exactly.
Speaker #5: S&P, I hope you're making notes. Well, thank you.
Peter Thompson: S&P, I hope you're making notes.
Peter Thompson: S&P, I hope you're making notes.
Alfred C. Liggins: All right.
Alfred Liggins: All right.
Dennis Paunula: Thank you, guys. Thank you for taking my questions. I appreciate your time and your hard work. I hope you guys get rewarded share price-wise very soon.
Dennis Pannullo: Thank you, guys. Thank you for taking my questions. I appreciate your time and your hard work. I hope you guys get rewarded share price-wise very soon.
Speaker #6: Guys, thank you for taking my questions. I appreciate your time. And you hard work. And I hope that I hope you guys get rewarded share price-wise.
Speaker #6: It's very soon.
Speaker #5: So do we.
Alfred C. Liggins: Do we.
Alfred Liggins: Do we.
Speaker #1: Yeah. Thank you, Dennis.
Peter Thompson: Yeah. Thank you, Dennis.
Peter Thompson: Yeah. Thank you, Dennis.
Speaker #8: And once again, for questions, please press star one on your telephone keypad. This concludes our question and answer session. I'll hand the call back to Alfred for any closing comments.
Operator 2: Once again for questions, please press star one on your telephone keypad. This concludes our question and answer session. I'll hand the call back to Alfred for any closing comments.
Operator: Once again for questions, please press star one on your telephone keypad. This concludes our question and answer session. I'll hand the call back to Alfred for any closing comments.
Alfred C. Liggins: Operator, thank you very much. Also, thank you everybody for your support. Again, I always say this, it sound like a broken record, Peter and I, you know, pride ourselves on being accessible. If there are any follow-up questions, please feel free to reach out to us. Thank you very much.
Alfred Liggins: Operator, thank you very much. Also, thank you everybody for your support. Again, I always say this, it sound like a broken record, Peter and I, you know, pride ourselves on being accessible. If there are any follow-up questions, please feel free to reach out to us. Thank you very much.
Speaker #7: Operator, thank you very much. And also, thank you, everybody, for your support. And again, I always say this. It sounds like a broken record, but Peter and I pride ourselves on being accessible.
Speaker #7: And so if there are any follow-up questions, please feel free to reach out to us. Thank you very much.
Operator 2: This concludes our call. Thank you all for joining. You may now disconnect.
Operator: This concludes our call. Thank you all for joining. You may now disconnect.
