BOCA RATON, FLA. — On January 30, Salem Media Group shares finished the day with a closing price of $1.36.
It marked the lowest price for the company’s stock since July 2009, and a 52% decline from where Salem shares were at the end of January 2019.
Today’s trading session is another gloomy one for Salem, which will see company representatives pitching itself to investors later this month at Noble Capital Markets’ Sixteenth Annual Institutional Investor Conference in Hollywood, Fla.
On light volume of 17,923 shares, Salem as of 3:07pm Eastern was at $1.37.
That’s where SALM ended the trading session on Thursday.
It only further cements Salem’s last six months on Wall Street as its worst in a decade. The last time SALM hit the $2 mark was August 5, 2019. A $1.78 finish in early September 2019 was its highest point over the last 180 days.
For Simply Wall St., the Wall Street financial blog, Salem is “weighed down by its debt load.”
But, there could be other concerns regarding Salem’s operation. The company’s Q3 results were supposed to arrive November 6, 2019, but were postponed at the last minute “to accommodate the additional time required by the company and its independent auditors to finalize the analysis of valuation allowances for deferred taxes.”
The financial results then came on November 12 — with a thud. Net broadcast revenue and digital media revenue each declined year-over-year. Broadcast operating expenses inched upward. Operating income swung to a loss. On a consolidated basis, total revenue fell by 2.2% to $64.1 million, from $65.5 million. At the same time, total operating expenses soared by 32.7%, to $78.6 million from $59.3 million.
However, when excluding gains or losses on the disposition of assets, stock-based compensation expense, changes in the estimated fair value of contingent earn-out consideration, impairments, Salem’s depreciation expense and amortization expense was statistically flat, moving to $55.1 million, from $55.2 million.
Then, there is the operating loss of $14.5 million, swinging from net income of $6.3 million in Q3 2018.
Factor in a $17.5 million loss on the disposition of assets, plus a $1.9 million impairment charge “of indefinite-lived long-term assets other than goodwill,” and Salem’s Q3 is a bleak one, with the media company focused on conservative Talk radio programming and Christian-themed audio and print media registering a net loss of $20 million (75 cents per share).
Impairments were recorded in its Louisville; Philadelphia; Portland, Ore.; and San Francisco markets.
Salem’s Q4 2019 are expected to arrive between March 9 and March 15. In November, it projected Q4 ’19 total revenue to decrease between 4% and 6% from Q4 2018’s total revenue of $67.2 million.
Excluding the impact of political revenue and recent acquisitions and dispositions, the company is projecting total revenue to be between flat and a decrease of 2%.
Salem is also projecting operating expenses before gains or losses on disposition of assets, stock-based compensation expense, changes in the estimated fair value of contingent earn-out consideration, impairments, depreciation expense and amortization expense to be between an increase of 1% and a decrease of 2% compared to the fourth quarter of 2018 non-GAAP operating expenses of $55.6 million.
With that as a backdrop, Salem will present at NobleCon 16 on Feb. 17 at 4pm Eastern. This year’s event is shifting from the W Fort Lauderdale Beach to the trendy new Seminole Hard Rock Hotel & Casino, home of the Guitar Hotel.
A high-definition, video webcast of the presentation will be available the following day on the Salem website.
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