That’s a question many industry observers are likely asking right now, and we are pleased to announce that Cumulus Media saw its Radio Station Group income shoot up some $522.3 million from the same period in 2015, to $134.2 million.
But, the company’s overall story wasn’t as terrific, as Cumulus swung from a consolidated net loss of $542.2 million (-$18.57 per diluted share) to consolidated net income of $46.3 million ($1.58) in Q3.
Why the disparity? Cumulus continues to struggle with its Westwood One arm, as the losses were stemmed by some $134.5 million. However, the division still saw a Q3 net loss, of $10.9 million.
Another big issue are “corporate and other expenses,” which rose a whopping 784.5%, to a loss of $76.9 million.
This is perhaps the largest culprit in Cumulus’ net revenue decline of 1.1% in Q3, to $286.1 million.
Adjusted EBITDA sank 37.9%, to $43.9 million.
“I continue to believe that the challenges this company faces are fixable … with time,” President/CEO Mary Berner said in a conference call with investors held Tuesday after market close.
Berner noted it was her one-year anniversary at Cumulus; she joined the company in October 2015, and immediately initiated a turnaround effort at a company that has become one of the broadcast industry’s most debt-troubled entities.
Employee morale and confidence in Berner’s turnaround plan was noted during the call, along with how four straight years of ratings declines were examined and addressed.
“Though our performance in the quarter was negatively impacted by headwinds which have challenged us all year, we see evidence that our work is paying off financially as we gained share this quarter for the first time in at least four years,” Berner said. “As we seek to maintain the momentum of our initial strategies, we have now also launched a focused effort to improve sales execution as the next logical step in our turnaround plan.”
Maintaining improved standing in PPM markets is a C-Suite priority, Berner added.
“Advertisers’ continued under-appreciation of [radio] has led to tough conditions,” she says, resulting in challenges in providing visibility.
Meanwhile, Cumulus’ total debt of $2.45 billion is unchanged from last year — showing that Berner has a long way to go in her turnaround plan.
This will require better net revenue at Westwood One, which saw net revenue dip by 5.5%, to $79.4 million. Cumulus will also need to see further gains at its Radio Station Group, where net revenue was statistically flat, at $206.2 million.
Cumulus shares were unchanged at $1.10 in Tuesday’s trading.