Beasley Media Group, ahead of Monday’s Opening Bell on Wall Street, said its net revenue went up in the second quarter. However, operating income was flat, as net income for the radio industry pure-play went down.
For Q2, net revenue improved to $61.6 million to $65.7 million.
Operating income was flat at $10.7 million.
Station Operating Income was up to $17.9 million, to $16.7 million.
However, net income fell to $4.3 million (15 cents per diluted share) from $4.9 million (18 cents).
The $4 year-over-year increase in net revenue reflects improvements at Beasley’s Philadelphia station group — and, mainly, the addition of dollars from the September 2018 acquisition of WXTU-FM 92.5, along with more revenue from Beasley’s Boston stations.
That said, operating income, net income and net income per diluted share were impacted by a $4.4 million charge “due to the change in fair value of contingent consideration in the six months ended June 30, 2018” and a $3.5 million gain on dispositions in the six months ended June 30, 2019, Beasley said.
And, the net income dip was attributed to a $700,000 increase in Q2 ’19 interest expense reflecting additional borrowings related to the WXTU purchase, and a higher overall cost of borrowings.
Speaking ahead of a 10am earnings call for Wall Street analysts and investors, Beasley CEO Caroline Beasley said, “The strategic and financial benefits of our initiatives to further expand and diversify Beasley’s broadcast and digital platform are evident in our second quarter financial results and further highlights the progress we are making to reinforce and grow Beasley’s leadership position across all audio platforms in our markets.”
She took note of Beasley’s “record” Q2 net revenue. But, at the same time, Caroline Beasley revealed that Free Cash Flow shrank to $5.5 million from $8.4 million — due to higher capital expenses related to the ongoing build-out of Beasley’s Philadelphia studios and increases in taxes, corporate overhead and interest expense.
What will Q3 look like for Beasley?
“We remain committed to our strategic priorities of improving top- and bottom-line performance, reducing debt and leverage, and returning capital to shareholders through our quarterly cash dividend,” Caroline Beasley said. “With enhanced opportunities to monetize our strong core programming and local brands, we remain confident in the radio industry and in Beasley’s growth prospects going forward.”
She also looks forward to “realizing the strategic benefits of the WDMK-FM and WDMK-HD2 translators” in Detroit.