Salem Communications’ Q1 revenue increased 12.1% to $62.3 million from $55.6 million. Total operating expenses increased 16.2% to $57.0 million from $49.0 million. Operating income decreased 19.0% to $5.3 million from $6.6 million. Net income increased to $0.4 million, or $0.02 net income per diluted share, from a net loss of $18.6 million, or $0.75 net loss per share, in the prior year.
Net broadcast revenue increased 5.4% to $45.6 million from $43.2 million. Station operating income increased 5.2% to $14.4 million from $13.7 million. Same station net broadcast revenue increased 5.2% to $45.4 million from $43.2 million. Same station SOI increased 5.2% to $14.5 million from $13.8 million and
same station SOI margin remained consistent at 31.8%.
Internet and e-commerce revenue increased 32.9% to $12.9 million from $9.7 million. Internet and e-commerce operating income increased 7.6% to $3.1 million from $2.9 million.
Publishing revenue increased 44.4% to $3.8 million from $2.7 million; and publishing operating loss increased to $0.6 million from $0.4 million.
On 2/7, Salem completed the acquisition of radio stations KDIS-FM, Little Rock, Arkansas and KRDY-AM, San Antonio, Texas for $2.0 million in cash.
On 1/20 they acquired the businesses of Eagle Publishing, including Regnery Publishing, HumanEvents.com, Redstate.com, Eagle Financial Publications and Eagle Wellness, for $8.5 million of which $3.5 million in cash was paid at closing, $2.5 million is payable in January 2015 and $2.5 million is payable in January 2016. Up to an additional $8.5 million of contingent earn-out consideration can be paid over the next three years based on the achievement of certain revenue benchmarks established for calendar years 2014, 2015 and 2016.
For Q2, the company is projecting total revenue to increase 13% to 15% over the Q2 2013 total revenue of $60.1 million. The company is also projecting operating expenses before gains or losses on the sale or disposal of assets, impairments, change in estimated fair value of contingent earn-out consideration and stock-based compensation expense to increase 16% to 19% as compared to the second quarter of 2013 operating expenses of $49.7 million. Without the acquisition of Eagle, they would be projecting revenue to increase 5% to 7% and expenses to be up from 6% to 9%.