Net revenues were down 16% to $60.7 million in Q1 for Radio One and station operating income declined 43% to $49 million. But while radio struggled, TV One turned positive compared to a year ago.
“On top of Q1 seasonally being the smallest of the year, the continuing poor economic climate continued to weaken the demand for advertising in general. Our radio revenue performance mirrored that of the markets we operate in, down 24%. Our radio automobile business dropped by 57% compared to last year, and, we experienced declines in both inventory pricing and sellout rates. We continued with our cost cutting initiatives, and leveraged new and alternative revenue sources fueled by the radio industry’s growth in digital and online dollars. Though business continues to book extremely late, pacings indicate Q2 revenues will experience declines similar to those in Q1. We will proactively continue to focus on radio share growth, internet sales, further cost cuts and our balance sheet,” said CEO Alfred Liggins in a company release. Radio One no longer does quarterly conference calls, but only an annual one.
Radio One provided some details about its radio business: “Net revenue decreased to approximately $60.7 million for the quarter ended March 31, 2009, from approximately $72.5 million for the same period in 2008, a decrease of 16.3%. Excluding net revenues of approximately $3.3 million for Community Connect Inc. (“CCI”), the social online networking company we acquired in April 2008, net revenue declined 20.8%. The prolonged economic downturn continued to weaken the demand for advertising in general, and was the primary driver for the radio markets in which we operate declining 24.2% for the quarter. We experienced net revenue declines in all but two of our markets, with considerable declines in our larger markets, including Atlanta, Baltimore, Houston and Washington, DC. While Reach Media’s net revenue performance was flat for the quarter, we continued to experience growth in net revenues associated with our syndicated programs and internet advertising separate from that generated by CCI. Net revenue is reported net of agency and outside sales representative commissions of approximately $5.5 million and $7.9 million for the quarters ended March 31, 2009 and 2008, respectively.”
But the bright spot was TV One. “Equity in income of affiliated company was approximately $1.2 million for the quarter ended March 31, 2009, compared to equity in loss of affiliated company of approximately $2.8 million for the same period in 2008. The amounts are attributable to our share of income or losses generated by TV One, LLC (“TV One”) for the quarters ended March 31, 2009 and 2008, respectively,” the company reported.