On Thursday, no less than eight broadcast media companies released their third quarter 2021 results. The day concluded with concurrent conference calls for analysts and investors from Entravision Communications, and from Salem Media Group.
With Friday’s Closing Bell, Salem shares were up a strong 7.2%, with a slight after-hours giveback putting SALM at $3.82 at 4:16pm Friday. Investors were likely pleased as the company known for its conservative Talk radio stations and its Christian-themed print and audio media content surpassed analysts’ estimates with its Q3 fiscal report card.
Analysts polled by Zacks Equity Research expected Salem to post earnings per share, adjusted for non-recurring items, of $0.32 in Q3.
Salem easily surpassed that forecast, with adjusted earnings of $0.58 per share as adjusted EBITDA climbed to $10.83 million from $9.63 million.
Overall, Salem saw its total revenue climb to $65.98 million in Q3, from $60.64 million. This beat the Zacks Consensus Estimate by 6.42% and follows a trend for Salem, as it has topped consensus revenue estimates in each of the last four quarters.
Net publishing revenue improved to $5.75 million, from $5.44 million, while digital media revenue rose to $10.65 million, from $9.81 million.
With overall operational expenses down to $50.18 million from $55.89 million, Salem’s operating income in Q3 surged to $15.8 million from $4.75 million. This pushed net income to $22.09 million, from $329,000.
Looking at same-station net broadcast revenue, the dollars moved to $49.11 million, from $45.1 million. Additionally, same-station Station Operating Income climbed to $12.04 million from $11.4 million.
Salem’s 5pm Eastern conference call was just under 30 minutes. On the call, the company’s leadership shared that it is projecting Q4 revenue to be flat, or perhaps increase by 2% from Q4 2020. Ex-political, revenue will grow between 6% and 8%.
Among those asking a question to Salem’s C-Suite leadership on the call: A colleague of Michael Kupinski, of Noble Capital Markets, who asked about supply chain issues and labor issues in its local markets.
The response: Supply chain issues are impacting some local advertising, but that was countered by “really favorable advertising” from real estate, recruitment advertising and events. In the book publishing area, there is a little bit of a slowdown as there are delays in getting new books printed.
Lisa Springer at Singular Research asked about land sales, and if Salem is considering additional deals. Salem’s leadership acknowledged that it owns a lot of its broadcast tower facilities for its AM stations, and has identified some potential land sales.
Should a deal happen, Salem will be pleased. As CEO Ed Atsinger III commented, “The great thing about these transactions is like it’s found money. We don’t lose the revenue-generating asset in the process of generating all sorts of new revenue from that land sale. It works out quite well for us.”
