How Strong Was Entravision’s Q4?


By Adam R Jacobson

Entravision‘s multi-platform strategies seem to be paying off for the media company focused on Latino consumers.

Entravision Communications CorporationAs Chairman/CEO Walter Ulloa noted on Entravision’s Thursday afternoon Q4 and full-year 2016 conference call with financial analysts, net income soared 21%, while net revenue grew 7%. However, it was the company’s gross proceeds from the FCC’s broadcast spectrum incentive auction that may send tongues wagging.

Ulloa revealed that Entravision will receive $264 million in gross proceeds from the FCC’s reverse auction. “The anticipated proceeds reflect the FCC’s acceptance of one or more bids placed by the company during the auction to modify and/or relinquish spectrum usage rights” for some of its television stations, the company said in its earnings release.

Entravision expects to receive the first auction proceeds in the early part of Q3 2017, and the company noted that it — like all other companies relinquishing spectrum — does not expect it to result in material changes in its operations.

As the company discussed its fourth-quarter and FY16 results by segment, with growth seen across digital, television and radio, longtime COO Jeffery Liberman was presented with presidential stripes. At the same time, Entravision “made some Headway” by purchasing an Argentine provider of mobile, programmatic, data and performance providing services across the Americas. 

Breaking out the Q4 results, Entravision saw its net revenue improve to $70.3 million, from $65.4 million, in Q4 2015.

Net income improved to $7 million (8 cents per diluted share), from $5.8 million (6 cents).

The strong quarter came with a 4% increase in operating expenses, to $41.1 million, and a 14% widening of corporate expenses, to $7.9 million.

The last quarter of 2016 also saw Entravision voluntarily prepay $20 million of term loans under its senior secured term loan credit facility.


Entravision saw growth in its television, radio and digital divisions in the final quarter of 2016, with TV the key revenue driver.

Television revenue improved by 9% in Q4, to $43.4 million. Radio revenue jumped by 4%, to $20.2 million. Digital revenue was up 6%, to $6.7 million.

Entravision did not break out retransmission fees. However, it was noted during the call that it saw $30 million in such fees in FY2016, with $7.8 million in retrans fees on average seen per quarter.

Additionally, the company declined to disclose what percentage of its revenue was political, only noting that political dollars did positively impact its radio and TV sectors, with the latter segment seeing political as a “primary” catalyst for the 9% year-over-year improvement in Q4.

For analysts on Entravision’s earnings call, the topic of the day was the spectrum auction revenue, with one analyst asking Ulloa why the company opted to keep its significant proceeds secretive. He explained that proceeds are still forthcoming, among other reasons that point to the company’s preference to keep a low profile regarding its take.

James Dix, a Senior Analyst at Wedbush Securities and one of just three Wall Streeters on the call, also asked about the auction results.

Said Ulloa, “We are pleased with the results. It is certainly not what anyone anticipated but we are pleased nevertheless.”

The goal for Entravision, he noted, was to pay down debt so that the company’s leverage was between 2x and 3x. Some of the auction proceeds will be used to accomplish that need.

Dix also inquired about channel sharing, as the Commission on Thursday announced that it will consider a Report and Order that would authorize it outside the context of the incentive auction at its March Open Meeting.

Ulloa remained coy on the subject, telling Dix that Entravision is “talking to different parties.” He expects that something might happen in Q2 or Q3. He also hinted that some like-in-kind exchanges may be considered. “We have nothing definitive to announce today,” he said.

Consolidated adjusted EBITDA was $20.6 million in Q4, up from $18.8 million in the year-ago period.

Meanwhile, in response to another analyst’s query on pacings, Entravision expects its radio and TV division to be down by mid-single digit percetages in Q1 2017.

Looking at the full year, the company reported net revenue of $258.5 million, a rise from $254.1 million, while net income slipped to $20.4 million (22 cents per diluted share), from $25.6 million (28 cents).

Free cash flow decreased to $45.2 million, from $49.7 million, for the year.

Meanwhile, radio and TV revenue were flat in 2016, compared to 2015 — despite an undisclosed bump from political dollars.

The strong Q4 results came as Entravision COO Liberman became President/COO. He continues to lead the management and operation of all of Entravision’s radio, television and digital media properties, and reports directly to Ulloa. Liberman joined Entravision in 2000 following the company’s acquisition of the former Latin Communications Group. He took the COO role in 2012.

At the same time, Entravision has agreed to purchase Buenos Aires-based Headway, a provider of mobile, programmatic, data and performance digital marketing solutions in the U.S., Mexico and Latin America. Headway has 152 employees in 18 offices across the Americas.  Following the closing of the transaction, Martin Kogan will continue to lead the company as CEO, with Agustin Echavarría Coll retaining his role as Chief Revenue Officer.

A purchase price was not disclosed. The deal will also Entravision’s Pulpo Media digital subsidiary to merge its data with Headway’s DataXpand DMP.

“We expect this transaction will help us fulfill our goal of doubling Entravision’s digital revenue to more than 20% of our total revenue,” Ulloa said. The transaction, which will be funded from Entravision’s cash on hand, is expected to close in early Q2.



  • Univision    $376 million
  • FOX Television Stations     $350 million (approx.)
  • Sinclair Broadcast Group   $313 million (approx.)
  • Entravision  $264 million
  • Tribune Media                      $190 million (approx.)
  • Gray Television                     $90,824,000