Cumulus Q1 revenues down 24.1%


Results were remarkably similar for the general market radio station groups that reported Q1 results on Monday. The only one to hold a conference call was Cumulus Media, where revenues fell 24.1%. CEO Lew Dickey didn’t provide any guidance for Q2 but noted that April was down 19.5% and month-over-month results have improved sequentially in recent months.

For Q1, cash revenue was down 23.9% to $53 million and barter 28.7% to $2.3 million, for the overall decline of 24.1% to $55.4 million. Station operating expenses declined 17.3% to $42.3 million. So, station operating income (SOI) was down 40% to $13.1 million. Cumulus noted that its SOI margin declined to 23.6% from 29.8% a year ago.

Free cash flow, however, was a negative $400K, down from a positive $7.8 million in Q1 of 2008.

Dickey said the company expects to save $1 million in Q2 from mandatory five-day furloughs for each employee. All executive bonuses have been eliminated for the first half of 2009, which will save a half million. All cost-cutting efforts combined are expected to reduce Q2 expenses 22% from a year ago.

On the revenue side, Dickey said “business is booking so late that it is very difficult to give any kind of accurate guidance,” so Cumulus issued no target for the current quarter. “We can say, however, that April finished down 19.5% and we have continued to see sequential improvement – as February was down 27%, March was down 22% and now April is down 19.5%,” the CEO noted. 

As of now, Cumulus has $682 million of debt and the company has $48.5 million of cash on its balance sheet. CFO Marty Gausvik said the company was leveraged 8.14 times as defined in its credit agreement as of the end of Q1. The covenant limit was 8.5 times.

RBR/TVBR observation: With fewer and fewer Wall Street analysts covering radio companies, the quarterly conference calls are short and sweet. Not a single analyst or investor checked in for the Q&A period yesterday, so the Cumulus Media conference call was finished in under eight minutes from when Lew began speaking.