Religious specialist Salem Communications used its radio platform and related assets to outperform the radio industry as a whole in terms of net revenue growth. However, increased operating expenses meant decreased operating income.
Net revenue gained a very respectable 4.1% to $56.7M, compared to radio as a whole which has been reporting flat revenue results. It also reported a 16.7% gain in internet revenue, and celebrated the acquisition of Sermonspice.com in August.
Salem also highlighted its new station in the Tampa market, which it is using for Spanish-language Christian programming, and its new leverage ratio of 4.97, marking the first time since Y2K that it has been at less than 5.
The increase in net income, however, swam against a tide of increased expense to the tune of 6.7%; operating income fell 8.7% to $8.5M and EBIDA fell 3.5% to $12.1M.
Net income was up, however, experiencing a 126.8% gain to $3.4M.
Broadcast accounted for a 2.5% gain and most of the company’s income with a result of $45.9M. On a same station basis the numbers were very similar, up 2.1% to $45.7M. Station operating income fell 2.1% to $15.3M.
Salem noted the following transaction that closed during the quarter, as well as a number of transactions that remain pending.
Closed:
* On August 30, 2012, we acquired SermonSpice.com for $3.0 million;
* On August 31, 2012, we completed the acquisition of radio station WLCC-AM, Tampa, Florida, for $1.2 million; and
* On October 2, 2012, we acquired Godvine.com for $4.2 million.
Pending:
* On August 30, 2012, we entered into an agreement to acquire radio station WMUU-FM, Greenville, South Carolina for $6.0 million;
* On October 19, 2012, we entered into an agreement to purchase radio station WJKR-FM in Columbus, Ohio for $4.0 million; and
* On November 6, 2012, we gave notice to redeem $4.0 million of our 9 5/8% Notes at a price equal to 103% of the face value on December 12, 2012.
