Income was up nicely for Beasley Broadcast Group during the second quarter of 2013, resulting in high-single digit gains for both the quarter and year-to-date. However, it also spent a good deal on its latest station addition in Vegas, contributing to a red-ink spill on parts of the balance sheet.
Net revenues were up 8.3% for the quarter to $26.9M, feeding into a 7.4% first half gain to $51.7M.
However, station operating income decreased slightly during the quarter to $10.1M a loss of 0.7%. YTD, it’s up 1.4% to $18.2M.
The biggest hit came on the net income front, which came home Q2 at $2.4M, a drop of 38.9%.
Beasley blamed the red ink primarily on two things. One was the fact that during Q2 2012, the company received an $800K benefit related to the radio industry’s settlement with BMI which reduced its operating expenses; and a $2.1M increase in operating expenses laid at the doorstep of KOAS-FM Las Vegas, including increases in sales, programming and streaming costs.
Other figures in the debt and interest columns had a deleterious effect on the bottom line.
Chairman/CEO George Beasley was generally upbeat about the results. He stated, “Beasley Broadcast Group generated its fourth consecutive period of top line growth as second quarter net revenue rose 8.3% and same station net revenue increased 4.2%. The increase in second quarter revenue reflects strong national and digital revenue growth which contributed to strength in several market clusters including Philadelphia, Las Vegas, Ft. Myers and Augusta. Overall, for our five markets that report to Miller Kaplan – which represent approximately 75% of our total second quarter revenue – Beasley station clusters grew revenue by 8.4% while the total revenue for all reporting radio stations in these markets declined by 2.4% for the quarter. We attribute our out-performance to our organization-wide focus on strong core programming and targeted localism, both of which are contributing to the Company’s ratings strength in its markets.”
Beasley concluded, “Notwithstanding the solid revenue growth, comparisons of our other financial metrics with the year-ago period are clouded due to the operating expense credit in last year’s second quarter, and certain charges in the 2013 second quarter including a loss on the early extinguishment of debt and a prepayment fee incurred in connection with the refinancing of our second lien debt. In addition, recent initiatives in the areas of sales, programming and the further expansion of our digital offerings are expected to drive long-term revenue growth, but are resulting in higher operating expenses on a short-term basis.”