It was a solid second quarter for Beasley Broadcast Group, with net income and net earnings surging. The gains came even as Beasley on May 1 completed the sale of its six stations in Greenville-New Bern-Jacksonville, N.C., and today continues to fully integrate 15 former Greater Media stations into its Naples, Fla.-based operations.
Prior to today’s Opening Bell on Wall Street, Beasley reported a 100% increase in its all-important Station Operating Income, to $16.1 million. The increase in SOI reflects the operations of the Greater Media stations and comparable quarterly net revenues at Beasley’s existing stations compared to the same period in 2016, which did not include the Greater Media stations. Thus, it’s not exactly an apples-to-apples comparison.
Still, investors are likely pleased, as net revenue soared to $61 million, from $27.8 million, and net income jumped to $3.9 million (14 cents per diluted share), from $2.5 million (11 cents).
Beasley says the 119.7% year-over-year increase in net revenue during Q2 reflects the operation of former Greater Media stations in Boston, Philadelphia, Detroit and New Jersey, and was partially offset by the disposition of the Greenville-New Bern-Jacksonville cluster in addition to WFNZ-AM in Charlotte, plus the three Greater Media stations it picked up in the Queen City.
On a pro-forma basis, which essentially looks at the company today as if all transactions had been completed on Jan. 1, 2016, things don’t look so rosy for Beasley.
Pro-forma net revenue dipped 3.3%, to $60.5 million. Even so, pro-forma SOI climbed to $16.1 million, from $13.7 million. Furthermore, pro-forma station operating expenses decreased to $44.4 million, from $48.8 million — a positive sign for Beasley.
In prepared comments (a 10am conference call Monday was not accessible via phone or webcast to several reporters), Beasley CEO Caroline Beasley said, “Following our second full quarter of results including the Greater Media markets, we are beginning to realize the benefits from this transaction in terms of scale and opportunity. In the second quarter, we continued to actively manage our local radio broadcasting platform while implementing our operating disciplines at the acquired Greater Media stations and extracting valuable synergies from our enhanced scale to drive SOI margin expansion.”
She added that with the financing of the Greater Media acquisition, the company’s total outstanding debt as of June 30 was approximately $225 million, compared to $240 million on March 31. Beasley made voluntary debt repayments of $4 million in the second quarter, and applied 100% of the $11 million in net proceeds from the sale of its Greenville-New Bern-Jacksonville stations toward debt reduction, resulting in a total $15 million reduction in debt.
In addition, Beasley declared its 16th consecutive quarterly cash dividend during the quarter.
While BBGI shares were up more than 5% in the 11am hour, as of 11:22am Beasley stock was trading up 3.7%, to $10.68. At the Closing Bell, Beasley stock saw a 1.9% gain, to $10.50.
Shares hit a high of $16.55 on April 25, but remain well ahead of where they were on February 1: $7.25 a share.