• Consolidated Net Revenue: Down 6.3% year over year to approximately $110.4 million.
• Radio Broadcasting Segment Revenue: $39.7 million, a decrease of 1.1% year over year.
• Reach Media Segment Revenue: $10.2 million, down 8.2% from the prior year.
• Digital Segment Revenue: Flat at $20.4 million.
• Cable Television Segment Revenue: $40.7 million, a decrease of 13%.
• Consolidated Adjusted EBITDA: $25.4 million, down 26.7%.
• Net Loss: Approximately $31.8 million or $0.68 per share.
• Operating Expenses: Increased to approximately $87.4 million, up 3.5% from the prior year.
• Interest Expense: Decreased to approximately $11.6 million from $14 million last year.
• Cash Balance: Ending unrestricted cash was $115 million.
• Total Gross Debt: Approximately $600 million.
• Net Debt: Approximately $485 million.
• Net Leverage Ratio: 4.68 times.
• Capital Expenditures: Approximately $1.6 million for the quarter.

• Warning! GuruFocus has detected 2 Warning Sign with UONE.

Release Date: November 07, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Urban One Inc (NASDAQ:UONE) successfully repurchased $14.5 million of its outstanding bonds at 75% of their value, contributing to debt reduction.
• The company forecasts a year-end cash balance of $140 million, indicating strong liquidity management.
• Adjusted EBITDA for the reach media segment increased to $3.7 million from $3.4 million last year, showing growth in this area.
• Interest expense decreased to $11.6 million from $14 million last year, reflecting the effectiveness of the company's debt reduction strategy.
• Net loss per share improved to $0.68 from $1.20 in the previous year, indicating a reduction in overall losses.

Negative Points

• Consolidated net revenues decreased by 6.3% year over year, indicating a decline in overall business performance.
• The cable TV segment experienced a significant revenue decrease of 13%, with advertising revenue down by 13.3%.
• Operating expenses increased by 3.5% year over year, driven by higher costs in various segments including radio and digital.
• The company recorded $46.8 million in noncash impairments for broadcasting licenses and the TV One trade name, reflecting challenges in these areas.
• Net revenue for the radio broadcasting segment decreased by 1.1% year over year, with a more significant decline of 3.6% on a same-station basis.

Q & A Highlights

Q: Can you provide an overview of Urban One's financial performance for Q3 2024? A: Alfred Liggins, CEO, stated that Urban One experienced advertising headwinds in Q3, leading to a decrease in consolidated net revenues by 6.3% year over year, totaling approximately $110.4 million. The company repurchased $14.5 million of outstanding bonds and expects Q4 revenues to be flat due to robust political spending. The year-end EBITDA guidance was adjusted from $110 million to a range of $102 million to $105 million.

Q: How did the radio broadcasting segment perform in Q3 2024? A: Peter Thompson, CFO, reported that net revenue for the radio broadcasting segment was $39.7 million, a decrease of 1.1% year over year. Excluding political revenue, the segment saw a decline of 4.8% year over year. Local advertising sales were down 4.7%, while national advertising sales decreased by 6.2%.

Q: What were the results for the digital segment in Q3 2024? A: The digital segment's net revenues were flat at $20.4 million. While direct national sales were down due to decreased advertiser demand, connected TV and broadcast revenue showed growth. Adjusted EBITDA for the digital segment decreased by 13.5% to $6.4 million.

Q: Can you elaborate on the performance of the cable television segment? A: The cable television segment recognized approximately $40.7 million in revenue, a decrease of 13%. Advertising revenue was down 13.3%, with delivery erosion impacting rates by approximately $4.7 million. Cable TV affiliate revenue decreased by 12.8% due to subscriber churn, which is trending at about 11% per annum.

Q: What were the key factors affecting operating expenses in Q3 2024? A: Operating expenses increased by 3.5% to approximately $87.4 million. This was primarily due to higher expenses in the Houston radio market following an acquisition, increased third-party professional fees, and cloud-based software licenses. The digital segment saw a 2.4% increase in operating expenses due to third-party cost of sales and traffic acquisition costs.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.