Regent net drops but beats peers


In an environment where radio’s Q3 revenue is expected to suffer losses in the high teens, radio group operator Regent Communications is relatively pleased to hold its losses in net broadcasting revenue to 13.9%, to $21.8M. The company suffered a net loss of $400K, or $0.01 per share, during the quarter.

“During the third quarter we continued to execute our strategic plan to expand our presence among advertisers and audiences across our local market footprint, while aggressively controlling our costs,” said President and CEO Bill Stakelin. “Our revenue results reflect the weak advertising market nationwide, offset in part by our consistent ability to outperform the overall radio industry and our portfolio of markets.”

Regent is operating under restriction due to a technical default on its loan agreement. It is in negotiation and is particularly concerned with getting access to its revolver credit before 2010.

Given that, Stakelin had some positive things to say. He noted that most radio companies were expected to show losses in the high teens, so he wasn’t too disappointed with -13.9%. The company expects that Q4 losses will be less severe; they may be higher in October, but should drop to single digit in November and December.

He said visibility is extremely poor and buys come in very late and the rate card has suffered serious shrinkage not only because radio is slashing rates, but because all media are. “It’s hard as hell to have price integrity in a market like this,” Stakelin commented, noting that everybody is “diving for dollars.”

Because of the poor visibility, nobody at Regent wanted to go too deeply into predictions for 2010, but Stakelin said that over a cool beverage in the evening, modest single-digit growth v. 2009’s easy comps seems like a possible result. But until he can touch it, feel it, taste it and smell it, he’s not going to go on the record and predict it.

RBR-TVBR observation: As we noted back in April, banks do not want to become radio operators. The fact that Regent is still controlling Regent is testament to that reality. We wish the company success in getting its covenants in order so that it can focus all its attention on getting healthy in the coming months.