With its Indianapolis radio stations soon to comprise nearly all of the broadcast facilities it operates, pending the transfer of control of WBLS-FM and WRKS-FM in New York to a newly formed entity that will see Jeff Smulyan in control, Emmis Communications is a leaner — and perhaps healthier — company designed to grow in ways that no longer involve AM or FM.
That said, the company saw radio net revenues for the first fiscal quarter of 2020 that were flat compared to last year.
For Q1 2020, radio net revenue was $26.4 million.
Pro forma for radio station divestures, Emmis’ fiscal first quarter 2020 radio revenues as reported to Miller Kaplan, which excludes barter revenues and syndication revenues, were up 3%, which matched the 3% growth in Emmis’ markets.
Subsequent to the end of fiscal Q1 2020, Emmis announced an agreement to sell its controlling interest in a partnership that owns and operates six Austin radio stations and two FM translators to Sinclair Telecable. Additionally, Emmis announced an agreement to form a new public company, Mediaco, with New York investment firm Standard General. Mediaco will purchase WBLS-FM and WQHT-FM from the company, but Emmis will continue to manage operations of the stations.
After closing these transactions, Emmis expects to have approximately $88 million of cash available for reinvestment and other corporate purposes, after settling all tax obligations, closing costs, and assuming $13 million remains outstanding under the mortgage on its corporate headquarters.
“In the past 14 years, we’ve paid off more than $1.3 billion of debt while making the conscious decision to take our entrepreneurial skills and transition Emmis into new areas of growth,” said Smulyan, in prepared remarks. “We believe that this fiscal year will reveal a new Emmis, and I couldn’t be more excited.”
Looking ahead, Emmis’ radio net revenue for its fiscal Q2 2020 are currently pacing up double digits. Smulyan said this is largely thanks to a “record-breaking” HOT 97 Summer Jam concert in New York. “Due to hard work and superior execution by our New York team, coupled with a terrific artist lineup, ticket revenue was the strongest in the 26-year history of Summer Jam,” he said. “We are also seeing a nice strengthening in advertising sales overall, which points to an outstanding quarter ahead.”
With fewer assets, consolidated net income came in at $2.52 million; net income attributable to the company is $1.67 million.
Station Operating Income (SOI) grew to $8.06 million, from $6.55 million.