NYSE false 0001067837 0001067837 2023-11-09 2023-11-09

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 9, 2023

 

 

AUDACY, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Pennsylvania   001-14461   23-1701044

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

2400 Market Street, 4th Floor

Philadelphia, Pennsylvania

  19103
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code: (610) 660-5610

(Former name or former address, if changed since last report.)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange

on which registered

Class A Common Stock, par value $.01 per share   AUD   New York Stock Exchange *

*    On October 30, 2023, the NYSE filed a Form 25 relating to the delisting from the NYSE of our Class A common stock. The delisting is expected to become effective 10 days after the filing of the Form 25.

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 


Item 2.02.

Results of Operations and Financial Conditions

On November 9, 2023, Audacy, Inc. (the “Company”) issued a press release (the “Press Release”) announcing third quarter 2023 results. A copy of the Press Release is attached as Exhibit 99.1 to this Current Report on Form 8-K.

The information in Item 2.02 of this Current Report on Form 8-K and Exhibit 99.1 attached hereto shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed to be incorporated by reference in any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

 

Item 9.01.

Exhibits

 

  (d)

Exhibits

 

Exhibit
No.

  

Title

99.1*      Audacy, Inc.’s Press Release, issued November 9, 2023
104       Cover Page Interactive Data File (embedded within the XBRL file)

 

* 

Exhibit is “furnished” with this report and shall not be deemed to be “filed” herewith.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Audacy, Inc.
By:  

/s/ Andrew P. Sutor, IV

  Andrew P. Sutor, IV
  Executive Vice President

Dated: November 9, 2023

Exhibit 99.1

 

LOGO

For Immediate Release
November 9, 2023
  

Investor Contacts:

Joseph Jaffoni, Jennifer

Neuman, Norberto Aja

JCIR

(212) 835-2500

AUD@jcir.com

AUDACY REPORTS THIRD QUARTER RESULTS

Philadelphia, PA — Audacy, Inc. (OTC: AUDA) today reported financial results for the quarter ended September 30, 2023.

Third Quarter Summary

 

   

Net revenues for the quarter were $299.2 million, down 5.6% compared to $317.0 million in the third quarter of 2022

 

   

Local spot revenues were down 3%, national spot revenues were down 15% and network advertising revenues were down 5%

 

   

Digital revenues were $64.8 million, up 3% compared to the third quarter of 2022

 

   

Total operating expenses for the quarter were $580.8 million, which includes a non-cash impairment loss of $272.7 million, compared to $468.8 million in the third quarter of 2022, which included a gain on sale of $10.7 million and a non-cash impairment loss of $176.8 million

 

   

Cash operating expenses for the quarter were $276.1 million, down 2% compared to $280.6 million in the third quarter of 2022

 

   

Operating loss for the quarter was $281.7 million, compared to $151.9 million in the third quarter of 2022

 

   

Adjusted EBITDA for the quarter was $23.0 million, compared to $36.3 million in the third quarter of 2022

 

   

As of September 30, 2023, the Company’s liquidity, which includes restricted cash, was $57.5 million

David J. Field, Chairman, President and Chief Executive Officer, stated: “Audacy’s third quarter net revenues declined 5.6%, in-line with our quarterly guidance as ad market conditions have remained challenging, particularly on national business. Cash operating expenses were down 2%.

We gained revenue share in the quarter, most significantly in radio in which we have achieved accelerating share growth since the start of the year. We also delivered solid gains in radio ratings share and digital audience metrics while making important progress on our tech roadmap and meaningful expense savings to improve our current and future business model.


Fourth quarter is currently pacing down 9% on an as reported basis and down 4% on a same-station, ex-political basis. We expect Q4 total revenues to decline by high single digits and costs to decline by high single digits.

As noted in our recent public filings, we remain in constructive conversations with our lenders to recapitalize the company’s balance sheet to establish a strong financial footing and position the company to capitalize effectively on our growth opportunities. Notwithstanding current challenges, Audacy has established a strong position as a scaled, leading multi-platform audio content and entertainment company distinguished by our exclusive premium content and top positions across the country’s largest markets. We salute our team for their strong work delivering solid growth against our key performance metrics and serving our listeners and customers with excellence.”

Recent Company Developments

 

   

Market share gains. The Company posted solid market share gains during the quarter as its local spot market share increased by 1.1% and network market share increased 1.6%. Overall, Audacy’s total revenue share increased 0.4%.

 

   

Strong Ratings Performance. Our radio stations continue to gain ratings share from our competitors as Audacy brands in PPM markets had their sixth consecutive quarter of year over year share growth in the key A25-54 demographic. Our gains came across many markets with 70% (24 of 34) of our PPM markets seeing ratings improvement.

 

   

Major Fall/Holiday Events Calendar. Our annual We Can Survive concert moved from LA to New York on October 14 and celebrated its 10th anniversary with performances by Maroon 5, ONEREPUBLIC, Kelly Clarkson and others. The sold-out show raised over $600,000 for the American Foundation for Suicide Prevention as part of Audacy’s I’m Listening mental health initiative. Last week, some of the biggest names in country music took the stage at the Hard Rock South Florida for Audacy’s Stars & Strings, raising funds for the Wounded Warrior Project. The Red Hot Chili Peppers will headline the wildly popular KROQ Almost Acoustic Christmas at the Forum in Los Angeles in December. In addition the Riptide Music Festival returns to the beach in Fort Lauderdale and our Alice in Winterland and Deck The Hall Ball concert tour will take place in eight of our markets.

 

   

Industry Leading Podcasts. This quarter studio launches include Say More with Dr? Sheila, the first in a three-season original comedy podcast franchise from Amy Poehler’s Paper Kite Podcasts. The show hit #1 on Apple’s comedy chart and #4 overall. Audacy had a #1 hit with parenting influencers Big Little Feelings hosted by real-life best friends and preeminent toddler/preschool experts Kristin Gallant and Deena Margolin. Audacy signed a multi-year contract extension for Glennon Doyle’s chart-topping podcast We Can Do Hard Things. As part of the new agreement, select episodes will drop early exclusively on the Audacy app.

 

   

Podcast of the Year Award. In partnership with HBO, Pineapple Street Studios won Adweek’s coveted “2023 Podcast of the Year” Award for the Succession podcast, the official companion to HBO’s iconic series in its final season, hosted by journalist Kara Swisher and featuring behind-the-scenes interviews with show’s writers, producers, directors and cast members. The show also won in Adweek’s Best TV/Streaming Podcast category, and hit #1 on Apple’s TV & Film chart.

The company will not be holding a conference call regarding the third quarter earnings release.


About Audacy

Audacy, Inc. (OTC: AUDA) is a leading multi-platform audio content and entertainment company with the country’s best collection of local music, news and sports brands, a premium podcast creator, major event producer, and digital innovator. Audacy engages 200 million consumers each month, bringing people together around content that matters to them. Learn more at www.audacyinc.com, Facebook (Audacy Corp), Twitter (@AudacyCorp), LinkedIn (@Audacy-Inc), Instagram (@lifeataudacy) and Threads (@AudacyCorp).

Certain Definitions

All references to per share data, unless stated otherwise, are presented as per diluted share. All references to shares outstanding, unless stated otherwise, are presented to exclude unvested restricted stock units. All references to net debt are outstanding debt net of cash on hand.

Core Spot Revenues consist of local spot plus national spot advertising revenues less political spot advertising revenues.

Station Expenses consist of station operating expenses excluding non-cash compensation expense.

Corporate Expenses consist of corporate general and administrative expenses excluding non-cash compensation expense.

Adjusted EBITDA consists of net income (loss) available to common shareholders, adjusted to exclude: income taxes (benefit); income from discontinued operations, net of income taxes or benefit; total other income or expense; net interest expense; depreciation and amortization; time brokerage agreement fees (income); non-cash compensation expense (which is otherwise included in station operating expenses and corporate G&A expenses); refinancing expenses; impairment loss, merger and acquisition costs, restructuring and integration costs, preferred stock dividends; COVID-19 related expenses/(recoveries); non-recurring expenses/recoveries otherwise included in corporate or station expenses; change in fair value of contingent consideration; deferred compensation expense/(income); (gain) loss on early extinguishment of debt; and (gain) loss on sale or disposal.

Adjusted Free Cash Flow consists of net income (loss): (i) plus depreciation and amortization; (gain) loss on sale or disposal; non-cash compensation expense (which is otherwise included in station operating expenses and corporate general and administrative expenses); impairment loss; merger and acquisition costs; restructuring and integration costs, (gain) loss on early extinguishment of debt; COVID-19 related expenses/(recoveries); other expense/(income); non-recurring expenses/recoveries otherwise included in corporate or station expenses; change in fair value of contingent consideration; deferred compensation expense/(income); income from discontinued operations (excluding income taxes or tax benefit); amortization of deferred financing costs and debt premium included in interest expense; refinancing expenses; income taxes (benefit); Adjusted Income Taxes Paid; and Net Capital Expenditures.

Net Capital Expenditures consists of capital expenditures, including amortizable intangibles, adjusted to subtract reimbursed tenant improvement allowances.

Adjusted Income Taxes Paid consist of income tax paid, adjusted to exclude taxes paid related to the gain/loss on sale or exchange of radio station assets; and taxes paid related to the gain/loss on the sale of redundant property.

Non-GAAP Financial Measures

It is important to note that Adjusted EBITDA, Adjusted Free Cash Flow, Net Capital Expenditures and Adjusted Income Taxes Paid are not measures of performance or liquidity calculated in accordance with generally accepted accounting principles (“GAAP”). Management believes that these measures are useful as a way to evaluate the Company and the means for Management to evaluate our performance and operations. Management believes that these measures are useful to an investor in evaluating our performance because they are widely used in the broadcast industry.

 


Certain adjusted non-GAAP financial measures are presented in this release. The adjustments include, among other items as defined above, gain/loss on sale of assets, derivative instruments, and investments; non-cash compensation expense, other income, impairment loss, merger and acquisition costs, other expenses related to refinancing, and gain/loss on early extinguishment of debt and non-recurring expenses recognized for restructuring charges or similar costs, including transition and integration costs. Management believes these adjusted non-GAAP measures provide useful information to Management and investors by excluding certain income, expenses and gains and losses that may not be indicative of the Company’s core operating and financial results. Similarly, Management believes these adjusted measures are a useful performance measure because certain items included in the calculation of net income (loss) may either mask or exaggerate trends in the Company’s ongoing operating performance. Further, the reconciliations corresponding to these adjusted measures, by identifying the individual adjustments, provide a useful mechanism for investors to consider these adjusted measures with some or all of the identified adjustments.

Management uses these non-GAAP financial measures on an ongoing basis to help track and assess the Company’s financial performance. You, however, should not consider non-GAAP measures in isolation or as substitutes for net income (loss), operating income, or any other measure for determining our operating performance that is calculated in accordance with generally accepted accounting principles. These non-GAAP measures are not necessarily comparable to similarly titled measures employed by other companies. The accompanying financial tables provide reconciliations to the nearest GAAP measure of all non-GAAP measures provided in this release.

Note Regarding Forward-Looking Statements

This news announcement contains certain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements, including statements about market conditions, the Company’s revenue guidance, and the Company’s ability to capitalize on its growth opportunities, develop digital demand, enhance its balance sheet and regain compliance with the NYSE’s minimum price condition, are based upon current expectations and involve certain risks and uncertainties.. Additional information and key risks applicable to these statements are described in the Company’s reports on Forms 8-K, 10-Q and 10-K and other filings the Company makes with the Securities and Exchange Commission. All of the forward-looking statements in this press release are qualified by these cautionary statements, and actual results or developments may differ materially from those in these forward-looking statements. The Company assumes no obligation to publicly update or revise any forward-looking statements.


AUDACY, INC.

FINANCIAL DATA

(amounts in thousands, except per share data)

(unaudited)

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2023     2022     2023     2022  

STATEMENTS OF OPERATIONS

        

Net Revenues

   $ 299,166     $ 316,969     $ 857,314     $ 911,703  
  

 

 

   

 

 

   

 

 

   

 

 

 

Station Expenses

     255,686       259,203       754,589       743,947  

Station Expenses—Non-Cash Compensation

     303       828       1,449       2,989  

Corporate Expenses

     32,110       21,136       81,436       68,818  

Corporate Expenses—Non-Cash Compensation

     446       24       2,298       3,956  

Depreciation And Amortization

     18,310       18,345       53,327       47,455  

Other Expenses

     74       72       426       474  

Impairment Loss

     272,656       176,784       403,061       180,075  

Restructuring Charges

     1,272       4,216       12,204       6,118  

Net Gain On Sale Or Disposal

     (24     (10,665     (22,305     (13,228

Change In Fair Value of Contingent Consideration

     —         (1,098     —         (8,802
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Operating Expenses

     580,833       468,845       1,286,485       1,031,802  
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating Loss

     (281,667     (151,876     (429,171     (120,099
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Interest Expense

     36,011       28,113       102,940       76,113  

Other Income

     —         —         —         (238
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss Before Income Taxes

     (317,678     (179,989     (532,111     (195,974

Income Tax Benefit

     (83,345     (39,014     (136,075     (43,153
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Loss

   $ (234,333   $ (140,975   $ (396,036   $ (152,821
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Loss Per Share—Basic

   $ (49.64   $ (30.35   $ (84.29   $ (32.92
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Loss Per Share—Diluted

   $ (49.64   $ (30.35   $ (84.29   $ (32.92

Weighted Common Shares Outstanding—Basic*

     4,720       4,645       4,698       4,642  
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Common Shares Outstanding—Diluted*

     4,720       4,645       4,698       4,642  
  

 

 

   

 

 

   

 

 

   

 

 

 

*Stock split applied

        

SUPPLEMENTAL BREAKDOWN OF REVENUE BY TYPE

        

Spot (local and national)

   $ 185,646     $ 204,742     $ 532,069     $ 584,363  

Digital (including podcasting)

     64,792       62,685       188,373       190,024  

Network

     22,516       23,663       63,208       66,592  

Sponsorships and Events

     13,825       13,760       38,207       35,724  

Other

     12,387       12,119       35,457       35,000  
  

 

 

   

 

 

   

 

 

   

 

 

 
   $ 299,166     $ 316,969     $ 857,314     $ 911,703  
  

 

 

   

 

 

   

 

 

   

 

 

 

Political

   $ 952     $ 6,900     $ 3,062     $ 12,188  
  

 

 

   

 

 

   

 

 

   

 

 

 


     Three Months Ended
September 30,
     Nine Months Ended
September 30,
 
     2023      2022      2023      2022  

SUPPLEMENTAL BREAKDOWN OF REVENUE BY FORMAT

           

Music

   $ 145,657      $ 156,793      $ 419,095      $ 455,838  

Sports

     72,015        72,595        190,768        190,493  

News/Talk

     43,250        48,503        129,706        148,617  

Non-format specific

     38,244        39,078        117,745        116,755  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 299,166      $ 316,969      $ 857,314      $ 911,703  
  

 

 

    

 

 

    

 

 

    

 

 

 

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

           

Net Capital Expenditures

   $ 9,618      $ 25,637      $ 34,642      $ 72,541  

Adjusted Income Taxes Paid (Refunded)

   $ 307      $ 13      $ 2,233      $ (14,779
     September 30,
2023
     December 31,
2022
               

SELECTED BALANCE SHEET DATA

           

Cash, Cash Equivalents and Restricted Cash

   $ 57,380      $ 103,344        

Senior Debt—Term B-2 Loan (Includes Current Portion)

   $ 632,415      $ 632,415        

Senior Debt—Revolver (Includes Current Portion)

   $ 219,000      $ 180,000        

Senior Secured Notes—2027

   $ 460,000      $ 460,000        

Senior Secured Notes—2029

   $ 540,000      $ 540,000        

Accounts Receivable Facility (Includes Current Portion)

   $ 75,000      $ 75,000        

Total Shareholders’ Equity

   $ 126,623      $ 520,619        

OTHER FINANCIAL DATA

 

     Three Months Ended
September 30,
     Nine Months Ended
September 30,
 
     2023      2022      2023      2022  
Reconciliation Of GAAP Net Loss To Adjusted EBITDA and To Adjusted Free Cash Flow            

Net Loss

   $ (234,333    $ (140,975    $ (396,036    $ (152,821

Income Tax Benefit

     (83,345      (39,014      (136,075      (43,153

Net Interest Expense

     36,011        28,113        102,940        76,113  

Corporate Expenses—Non-Cash Compensation

     446        24        2,298        3,956  

Station Expenses—Non-Cash Compensation

     303        828        1,449        2,989  

Depreciation And Amortization

     18,310        18,345        53,327        47,455  

Other Expenses

     72        125        341        622  

Restructuring Charges

     1,272        4,216        12,204        6,118  

COVID-19 Related Expenses

     2        127        93        480  

Non-Recurring Expenses Otherwise Included in
Corporate Expenses

     —          (470      42        1,217  

Liability Management Expenses

     12,181        —          19,152        —    

Impairment Loss

     272,656        176,784        403,061        180,075  

Contingent Consideration Accretion and
Remeasurements

     —          (1,098      —          (8,802

Deferred Compensation Expense

     (506      —          459        —    


     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2023     2022     2023     2022  

Other Income

   $ —       $ —       $ —       $ (238

Net Gain On Sale Or Disposal of Assets

     (24     (10,665     (22,305     (13,228
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

     23,045       36,340       40,949       100,783  
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Interest Expense

     (36,011     (28,113     (102,940     (76,113

Deferred Financing Costs Included In Interest Expense

     1,397       1,292       4,838       3,832  

Amortization Debt Premium Included In
Interest Expense

     (256     (256     (766     (768

Net Capital Expenditures

     (9,618     (25,637     (34,642     (72,541

Other

        

Adjusted Income Taxes (Paid) Refunded

     (307     (13     (2,233     14,779  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Free Cash Flow

   $ (21,750   $ (16,387   $ (94,794   $ (30,028
  

 

 

   

 

 

   

 

 

   

 

 

 
v3.23.3
Document and Entity Information
Nov. 09, 2023
Cover [Abstract]  
Security Exchange Name NYSE
Amendment Flag false
Entity Central Index Key 0001067837
Document Type 8-K
Document Period End Date Nov. 09, 2023
Entity Registrant Name AUDACY, INC.
Entity Incorporation State Country Code PA
Entity File Number 001-14461
Entity Tax Identification Number 23-1701044
Entity Address, Address Line One 2400 Market Street
Entity Address, Address Line Two 4th Floor
Entity Address, City or Town Philadelphia
Entity Address, State or Province PA
Entity Address, Postal Zip Code 19103
City Area Code (610)
Local Phone Number 660-5610
Written Communications false
Soliciting Material false
Pre Commencement Tender Offer false
Pre Commencement Issuer Tender Offer false
Security 12b Title Class A Common Stock, par value $.01 per share
Trading Symbol AUD
Entity Emerging Growth Company false

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