Surprised? We think not – and the good news is that the -14% drop in net revenue for Q4 was actually a better result than at least one analyst forecast. For the full year, Entercom held its losses to -6%. The cash numbers were $104.1M and $438.8M respectively.
Wachovia’s Marci Ryvicker had been calling for a -17% result, so the -14% was somewhat of a pleasant surprise, although she said it was still in line with general expectations. She noted that other benchmarks were in line with or slightly better than predictions.
Looking at the immediate past, January results continued along the Q4 trend, coming in at -18%, but President/CEO David Field said there is reason for some optimism in regards to the second half of the year. He noted that moves to address the company’s cost structure would benefit the bottom line throughout the year. And while the advertising business is a buyer’s market right now, he observed that compared to other media, the price/value ratio of a radio campaign is very attractive right now.
“In the face of difficult general economic conditions that are adversely impacting advertising revenues, Entercom has taken significant measures to improve our short-term performance and enhance our long-term prospects,” said Field. “We have materially reduced expenses, while at the same time increased our investment in various digital and new revenue initiatives. We also are pleased to note that in 2008, Entercom posted a three percent increase in free cash flow and reduced long-term debt by $140 million. Finally, as we look to the future, we note that the fundamentals of the radio business remain strong. At a time of unprecedented change in media usage that is severely impairing a number of other media, radio posted an all-time record number of listeners in 2008 and remains the most cost-effective major advertising medium in the nation.”