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Entravision Communications Corporation Reports Second Quarter 2022 Results

08/03/2022

SANTA MONICA, Calif.--(BUSINESS WIRE)-- Entravision Communications Corporation (NYSE: EVC), a leading global advertising solutions, media and technology company, today announced financial results for the three- and six-month periods ended June 30, 2022.

Second Quarter 2022 Highlights

  • Record second quarter revenue
  • Net revenue up 24% over the prior-year quarter
  • Net income attributable to common stockholders up 8% over the prior-year quarter
  • Consolidated adjusted EBITDA up 26% over the prior-year quarter
  • Operating cash flow down 54% over the prior-year quarter
  • Free cash flow up 15% over the prior-year quarter
  • Quarterly cash dividend of $0.025 per share
  • Repurchased $4.1 million in shares during the second quarter

“The second quarter marked yet another impressive performance for Entravision, with net revenues totaling $221.7 million, up 24% versus the prior year quarter. On a year to date basis, revenues increased even more significantly and were up 28% as compared to the first half of 2021,” said Walter Ulloa, Chairman and Chief Executive Officer. “Strength during the quarter was largely driven by the growth of our digital segment, where revenues improved 34% year-over-year. Our audio segment also contributed to the quarterly revenue increase. Of particular note, political ad spend was very strong during the second quarter, positioning us well in political advertising revenue for the remainder of the year, and further highlights the growing importance of the Hispanic voter in both local and national elections.”

Mr. Ulloa continued, “Entravision is well positioned for continued growth. Our strong balance sheet and exceptional global team of industry-leading digital media and sales professionals provide us with the key components to succeed. At the same time, our continued focus on expense management will help drive our EBITDA, free cash flow and ability to provide consistent returns to shareholders.”

Quarterly Cash Dividend

The Company announced today that its Board of Directors approved a quarterly cash dividend to shareholders of $0.025 per share on the Company's Class A, Class B and Class U common stock, in an aggregate amount of approximately $2.1 million. The quarterly dividend will be payable on September 30, 2022 to shareholders of record as of the close of business on September 15, 2022, and the common stock will trade ex-dividend on September 14, 2022. The Company currently anticipates that future cash dividends will be paid on a quarterly basis; however, any decision to pay future cash dividends will be subject to approval by the Board.

Share Repurchase Program

During the second quarter the Company repurchased $4.1 million of its Class A common stock. As of the end of the second quarter 2022, the Company repurchased a total of $11.3 million shares of its Class A common stock under its $20 million share repurchase program.

Investment in Jack of Digital

The Company has finalized its strategic stake in Jack of Digital, a digital marketing services company that serves as the exclusive advertising sales partner of TikTok in Pakistan. With this investment, the Company enhances its presence in South Asia.

Non-GAAP Financial Measures

This press release contains certain non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measure most directly comparable to each of these non-GAAP financial measures, and a table reconciling each of these non-GAAP financial measures to its most directly comparable GAAP financial measure is included beginning on page 10.

Unaudited Financial Highlights (In thousands, except share and per share data)

 

Three-Month Period

 

 

Six-Month Period

 

 

Ended June 30,

 

 

Ended June 30,

 

 

2022

 

 

2021

 

 

% Change

 

 

2022

 

 

2021

 

 

% Change

 

Net revenue

$

221,695

 

 

$

178,410

 

 

 

24

%

 

$

418,867

 

 

$

327,290

 

 

 

28

%

Cost of revenue - digital (1)

 

144,965

 

 

 

109,030

 

 

 

33

%

 

 

274,856

 

 

 

193,786

 

 

 

42

%

Operating expenses (2)

 

47,371

 

 

 

41,442

 

 

 

14

%

 

 

91,233

 

 

 

81,856

 

 

 

11

%

Corporate expenses (3)

 

8,520

 

 

 

7,345

 

 

 

16

%

 

 

17,244

 

 

 

14,503

 

 

 

19

%

Foreign currency (gain) loss

 

993

 

 

 

(309

)

 

*

 

 

 

146

 

 

 

277

 

 

 

(47

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated adjusted EBITDA (4)

 

22,481

 

 

 

17,787

 

 

 

26

%

 

 

40,594

 

 

 

31,982

 

 

 

27

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Free cash flow (5)

$

14,256

 

 

$

12,420

 

 

 

15

%

 

$

28,583

 

 

$

25,449

 

 

 

12

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$

8,467

 

 

$

10,476

 

 

 

(19

)%

 

$

10,354

 

 

$

17,478

 

 

 

(41

)%

Net (income) loss attributable to redeemable noncontrolling interest

$

-

 

 

$

(2,612

)

 

 

(100

)%

 

$

-

 

 

$

(4,185

)

 

 

(100

)%

Net income (loss) attributable to common stockholders

$

8,467

 

 

$

7,864

 

 

 

8

%

 

$

10,354

 

 

$

13,293

 

 

 

(22

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share attributable to common stockholders, basic

$

0.10

 

 

$

0.09

 

 

 

11

%

 

$

0.12

 

 

$

0.16

 

 

 

(25

)%

Net income (loss) per share attributable to common stockholders, diluted

$

0.10

 

 

$

0.09

 

 

 

11

%

 

$

0.12

 

 

$

0.15

 

 

 

(20

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding, basic

 

84,959,130

 

 

 

85,188,182

 

 

 

 

 

 

85,735,916

 

 

 

85,115,310

 

 

 

 

Weighted average common shares outstanding, diluted

 

86,985,817

 

 

 

87,777,039

 

 

 

 

 

 

87,803,178

 

 

 

87,382,215

 

 

 

 

(1)

 

Consists primarily of the costs of online media acquired from third-party publishers. Media cost is classified as cost of revenue in the period in which the corresponding revenue is recognized.

(2) 

 

Operating expenses include direct operating and selling, general and administrative expenses. Included in operating expenses are $0.9 million and $0.3 million of non-cash stock-based compensation for the three-month periods ended June 30, 2022 and 2021, respectively, and $1.9 million and $0.6 million of non-cash stock-based compensation for the six-month periods ended June 30, 2022 and 2021, respectively.

(3)

 

Corporate expenses include $1.7 million and $0.8 million of non-cash stock-based compensation for the three-month periods ended June 30, 2022 and 2021, respectively, and $3.3 million and $1.6 million of non-cash stock-based compensation for the six-month periods ended June 30, 2022 and 2021, respectively.

(4) 

 

Consolidated adjusted EBITDA means net income (loss) plus gain (loss) on sale of assets, depreciation and amortization, non-cash impairment charge, non-cash stock-based compensation included in operating and corporate expenses, net interest expense, other operating gain (loss), gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income (loss) of nonconsolidated affiliate, non-cash losses, syndication programming amortization less syndication programming payments, revenue from the Federal Communications Commission, or FCC, spectrum incentive auction less related expenses, expenses associated with investments, EBITDA attributable to redeemable noncontrolling interest, acquisitions and dispositions and certain pro-forma cost savings. We use the term consolidated adjusted EBITDA because that measure is defined in the agreement governing our current credit facility (“the 2017 Credit Facility”) and does not include gain (loss) on sale of assets, depreciation and amortization, non-cash impairment charge, non-cash stock-based compensation, net interest expense, other income (loss), gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income (loss) of nonconsolidated affiliate, non-cash losses, syndication programming amortization less syndication programming payments, revenue from FCC spectrum incentive auction less related expenses, expenses associated with investments, EBITDA attributable to redeemable noncontrolling interest, acquisitions and dispositions and certain pro-forma cost savings.

(5)

 

Free cash flow is defined as consolidated adjusted EBITDA less cash paid for income taxes, net interest expense, capital expenditures and non-recurring cash expenses plus dividend income, and other operating gain (loss). Net interest expense is defined as interest expense, less non-cash interest expense relating to amortization of debt finance costs, and less interest income.

Unaudited Financial Results (In thousands)

 

 

Three-Month Period

 

 

 

Ended June 30,

 

 

 

2022

 

 

2021

 

 

% Change

 

Net revenue

 

$

221,695

 

 

$

178,410

 

 

 

24

%

Cost of revenue - digital (1)

 

 

144,965

 

 

 

109,030

 

 

 

33

%

Operating expenses (1)

 

 

47,371

 

 

 

41,442

 

 

 

14

%

Corporate expenses (1)

 

 

8,520

 

 

 

7,345

 

 

 

16

%

Depreciation and amortization

 

 

6,263

 

 

 

5,074

 

 

 

23

%

Change in fair value of contingent consideration

 

 

976

 

 

 

-

 

 

*

 

Impairment charge

 

 

-

 

 

 

112

 

 

 

(100

)%

Foreign currency (gain) loss

 

 

993

 

 

 

(309

)

 

*

 

Other operating (gain) loss

 

 

(834

)

 

 

(523

)

 

 

59

%

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

 

13,441

 

 

 

16,239

 

 

 

(17

)%

Interest expense, net

 

 

(1,612

)

 

 

(1,773

)

 

 

(9

)%

Dividend income

 

 

11

 

 

 

2

 

 

 

450

%

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

 

11,840

 

 

 

14,468

 

 

 

(18

)%

Income tax benefit (expense)

 

 

(3,373

)

 

 

(3,992

)

 

 

(16

)%

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

 

8,467

 

 

 

10,476

 

 

 

(19

)%

Net (income) loss attributable to redeemable noncontrolling interest

 

 

-

 

 

 

(2,612

)

 

 

(100

)%

Net income (loss) attributable to common stockholders

 

$

8,467

 

 

$

7,864

 

 

 

8

%

(1) Cost of revenue, operating expenses and corporate expenses are defined on page 2.

Net revenue in the second quarter of 2022 totaled $221.7 million, up 24% from $178.4 million in the prior-year period. Of the overall increase, approximately $44.2 million was attributable to our digital segment and was primarily due to advertising revenue growth from our digital commercial partnerships business and our acquisitions of MediaDonuts and 365 Digital during the third and fourth quarters of 2021, respectively, both of which did not contribute to net revenue in the comparable period. In addition, of the overall increase, approximately $0.8 million was attributable to our audio segment primarily due to increases in local advertising revenue and political advertising revenue, partially offset by a decrease in national advertising revenue. The overall increase was partially offset by a decrease of approximately $1.7 million attributable to our television segment, primarily due to decreases in local and national advertising revenue, and a decrease in retransmission consent revenue. These decreases were mainly attributed to the expiration of our Univision and UniMás network affiliation agreements in Orlando, Tampa and Washington, D.C. on December 31, 2021. The decrease in our television segment was partially offset by increases in political advertising revenue and spectrum usage rights revenue.

Cost of revenue in the second quarter of 2022 totaled $145.0 million, up 33% from $109.0 million in the prior-year period. The increase was primarily due to increased cost of revenue related to advertising revenue growth from our digital commercial partnerships business, and our acquisitions of MediaDonuts and 365 Digital during the third and fourth quarters of 2021, respectively, both of which did not incur cost of revenue for us in the comparable period.

Operating expenses in the second quarter of 2022 totaled $47.4 million, up 14% from $41.4 million in the prior-year period. Of the overall increase, approximately $5.2 million was attributable to our digital segment and was primarily due to an increase in expenses associated with the increase in digital advertising revenue, an increase in salary expense and our acquisitions of MediaDonuts and 365 Digital during the third and fourth quarters of 2021, respectively, both of which did not incur operating expenses for us in the comparable period. In addition, of the overall increase in operating expenses, approximately $0.2 million was attributable to our television segment primarily due to an increase in salaries and bad debt expense, partially offset by a decrease in expenses associated with the decrease in local and national advertising revenue. Additionally, of the overall increase in operating expenses, approximately $0.5 million was attributable to our audio segment primarily due to an increase in expenses associated with the increase in advertising revenue.

Corporate expenses in the second quarter of 2022 totaled $8.5 million, up 16% from $7.3 million in the prior-year period. The increase was primarily due to increases in non-cash stock-based compensation and salaries.

Unaudited Financial Results (In thousands)

 

 

Six-Month Period

 

 

 

Ended June 30,

 

 

 

2022

 

 

2021

 

 

% Change

 

Net revenue

 

$

418,867

 

 

$

327,290

 

 

 

28

%

Cost of revenue - digital (1)

 

 

274,856

 

 

 

193,786

 

 

 

42

%

Operating expenses (1)

 

 

91,233

 

 

 

81,856

 

 

 

11

%

Corporate expenses (1)

 

 

17,244

 

 

 

14,503

 

 

 

19

%

Depreciation and amortization

 

 

12,658

 

 

 

10,258

 

 

 

23

%

Change in fair value of contingent consideration

 

 

6,076

 

 

 

-

 

 

*

 

Impairment charge

 

 

-

 

 

 

1,438

 

 

 

(100

)%

Foreign currency (gain) loss

 

 

146

 

 

 

277

 

 

 

(47

)%

Other operating (gain) loss

 

 

(953

)

 

 

(2,436

)

 

 

(61

)%

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

 

17,607

 

 

 

27,608

 

 

 

(36

)%

Interest expense, net

 

 

(3,042

)

 

 

(3,350

)

 

 

(9

)%

Dividend income

 

 

14

 

 

 

4

 

 

 

250

%

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

 

14,579

 

 

 

24,262

 

 

 

(40

)%

Income tax benefit (expense)

 

 

(4,225

)

 

 

(6,784

)

 

 

(38

)%

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

 

10,354

 

 

 

17,478

 

 

 

(41

)%

Net (income) loss attributable to redeemable noncontrolling interest

 

 

-

 

 

 

(4,185

)

 

 

(100

)%

Net income (loss) attributable to common stockholders

 

$

10,354

 

 

$

13,293

 

 

 

(22

)%

(1) Cost of revenue, operating expenses and corporate expenses are defined on page 2.

Net revenue for the six-month period of 2022 totaled $418.9 million, up 28% from $327.3 million in the prior-year period. Of the overall increase, approximately $96.4 million was attributable to our digital segment and was primarily due to advertising revenue growth from our digital commercial partnerships business and our acquisitions of MediaDonuts and 365 Digital during the third and fourth quarters of 2021, respectively, both of which did not contribute to net revenue in the comparable period. In addition, of the overall increase, approximately $2.1 million was attributable to our audio segment primarily due to increases in local advertising revenue and political advertising revenue, partially offset by a decrease in national advertising revenue. The overall increase was partially offset by a decrease of approximately $6.9 million attributable to our television segment, primarily due to decreases in local and national advertising revenue, and a decrease in retransmission consent revenue. These decreases were mainly attributed to the expiration of our Univision and UniMás network affiliation agreements in Orlando, Tampa and Washington, D.C. on December 31, 2021. Additionally, the decrease in our television segment was attributed to a decrease in revenue from spectrum usage rights, partially offset by an increase political advertising revenue.

Cost of revenue for the six-month period of 2022 totaled $274.9 million, up 42% from $193.8 million in the prior-year period. The increase was primarily due to increased cost of revenue related to advertising revenue growth from our digital commercial partnerships business, and our acquisitions of MediaDonuts and 365 Digital during the third and fourth quarters of 2021, respectively, both of which did not incur cost of revenue for us in the comparable period.

Operating expenses for the six-month period of 2022 totaled $91.2 million, up 11% from $81.9 million in the prior-year period. Of the overall increase, approximately $9.6 million was attributable to our digital segment and was primarily due to an increase in expenses associated with the increase in digital advertising revenue, an increase in salary expense and our acquisitions of MediaDonuts and 365 Digital during the third and fourth quarters of 2021, respectively, both of which did not incur operating expenses for us in the comparable period. Additionally, of the overall increase in operating expenses, approximately $0.2 million was attributable to our audio segment primarily due to an increase in expenses associated with the increase in advertising revenue. The overall increase in operating expenses was partially offset by a decrease of approximately $0.4 million that was attributable to our television segment primarily due to a decrease in expenses associated with the decrease in local and national advertising revenue, partially offset by an increase in salaries and bad debt expense.

Corporate expenses for the six-month period of 2022 totaled $17.2 million, up 19% from $14.5 million in the prior-year period. The increase was primarily due to increases in non-cash stock-based compensation and salaries.

Balance Sheet and Related Metrics

Cash and marketable securities as of June 30, 2022 totaled approximately $184.2 million. Total debt under the Company’s credit agreement was $210.8 million. Net of $75 million of cash and marketable securities, total leverage as defined in the Company’s credit agreement was 1.4 times as of June 30, 2022. Net of total cash and marketable securities, total leverage was 0.3 times.

Unaudited Segment Results (In thousands)

 

 

Three-Month Period

 

 

Six-Month Period

 

 

 

Ended June 30,

 

 

Ended June 30,

 

 

 

2022

 

 

2021

 

 

%
Change

 

 

2022

 

 

2021

 

 

%
Change

 

Net Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Digital

 

$

174,378

 

 

$

130,223

 

 

 

34

%

 

$

328,089

 

 

$

231,705

 

 

 

42

%

Television

 

 

32,373

 

 

 

34,057

 

 

 

(5

)%

 

 

63,240

 

 

 

70,148

 

 

 

(10

)%

Audio

 

 

14,944

 

 

 

14,130

 

 

 

6

%

 

 

27,538

 

 

 

25,437

 

 

 

8

%

Total

 

$

221,695

 

 

$

178,410

 

 

 

24

%

 

$

418,867

 

 

$

327,290

 

 

 

28

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Revenue - digital (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Digital

 

$

144,965

 

 

$

109,030

 

 

 

33

%

 

$

274,856

 

 

$

193,786

 

 

 

42

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Digital

 

 

17,262

 

 

 

12,027

 

 

 

44

%

 

 

32,497

 

 

 

22,877

 

 

 

42

%

Television

 

 

19,726

 

 

 

19,516

 

 

 

1

%

 

 

38,966

 

 

 

39,400

 

 

 

(1

)%

Audio

 

 

10,383

 

 

 

9,899

 

 

 

5

%

 

 

19,770

 

 

 

19,579

 

 

 

1

%

Total

 

$

47,371

 

 

$

41,442

 

 

 

14

%

 

$

91,233

 

 

$

81,856

 

 

 

11

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate Expenses (1)

 

$

8,520

 

 

$

7,345

 

 

 

16

%

 

$

17,244

 

 

$

14,503

 

 

 

19

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated adjusted EBITDA (1)

 

$

22,481

 

 

$

17,787

 

 

 

26

%

 

$

40,594

 

 

$

31,982

 

 

 

27

%

(1) Cost of revenue, operating expenses, corporate expenses, and consolidated adjusted EBITDA are defined on page 2.

Notice of Conference Call

Entravision Communications Corporation will hold a conference call to discuss its second quarter 2022 results on Wednesday, August 3, 2022 at 5 p.m. Eastern Time. To access the conference call, please dial (877) 407-9716 (U.S.) or (201) 493-6779 (Int’l) ten minutes prior to the start time and reference Conference ID number 13730294. The call will also be available via live webcast on the investor relations portion of the Company's website located at www.entravision.com.

About Entravision Communications Corporation

Entravision is a leading global advertising, media and ad-tech solutions company connecting brands to consumers by representing top platforms and publishers. Our dynamic portfolio includes digital, television and audio offerings. Digital, our largest revenue segment, is comprised of four business units: our digital sales representation business; Smadex, our programmatic ad purchasing platform; our branding and mobile performance solutions business; and our digital audio business. Through our digital sales representation business, we connect global media companies such as Meta, Twitter, TikTok and Spotify with advertisers in primarily emerging growth markets worldwide. Smadex is our mobile-first demand side platform, enabling advertisers to execute performance campaigns using machine learning. We also offer a branding and mobile performance solutions business, which provides managed services to advertisers looking to connect with global consumers, primarily on mobile devices, and our digital audio business provides digital audio advertising solutions for advertisers in the Americas. In addition to digital, Entravision has 49 television stations and is the largest affiliate group of the Univision and UniMás television networks. Entravision also manages 45 primarily Spanish-language radio stations that feature nationally recognized, Emmy award-winning talent. Shares of Entravision Class A Common Stock trade on the NYSE under ticker: EVC. Learn more about our offerings at entravision.com or connect with us on LinkedIn and Facebook.

Forward-Looking Statements

This press release contains certain forward-looking statements. These forward-looking statements, which are included in accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, may involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results and performance in future periods to be materially different from any future results or performance suggested by the forward-looking statements in this press release. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that actual results will not differ materially from these expectations, and the Company disclaims any duty to update any forward-looking statements made by the Company. From time to time, these risks, uncertainties and other factors are discussed in the Company’s filings with the Securities and Exchange Commission.

Entravision Communications Corporation

Consolidated Statements of Operations

(In thousands, except share and per share data)

(Unaudited)

 

 

 

Three-Month Period

 

 

Six-Month Period

 

 

 

Ended June 30,

 

 

Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Net revenue

 

$

221,695

 

 

$

178,410

 

 

$

418,867

 

 

$

327,290

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue - digital

 

 

144,965

 

 

 

109,030

 

 

 

274,856

 

 

 

193,786

 

Direct operating expenses

 

 

29,596

 

 

 

28,336

 

 

 

57,419

 

 

 

54,897

 

Selling, general and administrative expenses

 

 

17,775

 

 

 

13,106

 

 

 

33,814

 

 

 

26,959

 

Corporate expenses

 

 

8,520

 

 

 

7,345

 

 

 

17,244

 

 

 

14,503

 

Depreciation and amortization

 

 

6,263

 

 

 

5,074

 

 

 

12,658

 

 

 

10,258

 

Change in fair value of contingent consideration

 

 

976

 

 

 

-

 

 

 

6,076

 

 

 

-

 

Impairment charge

 

 

-

 

 

 

112

 

 

 

-

 

 

 

1,438

 

Foreign currency (gain) loss

 

 

993

 

 

 

(309

)

 

 

146

 

 

 

277

 

Other operating (gain) loss

 

 

(834

)

 

 

(523

)

 

 

(953

)

 

 

(2,436

)

 

 

 

208,254

 

 

 

162,171

 

 

 

401,260

 

 

 

299,682

 

Operating income (loss)

 

 

13,441

 

 

 

16,239

 

 

 

17,607

 

 

 

27,608

 

Interest expense

 

 

(2,334

)

 

 

(1,856

)

 

 

(4,170

)

 

 

(3,573

)

Interest income

 

 

722

 

 

 

83

 

 

 

1,128

 

 

 

223

 

Dividend income

 

 

11

 

 

 

2

 

 

 

14

 

 

 

4

 

Income (loss) before income taxes

 

 

11,840

 

 

 

14,468

 

 

 

14,579

 

 

 

24,262

 

Income tax benefit (expense)

 

 

(3,373

)

 

 

(3,992

)

 

 

(4,225

)

 

 

(6,784

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

 

8,467

 

 

 

10,476

 

 

 

10,354

 

 

 

17,478

 

Net (income) loss attributable to redeemable noncontrolling interest

 

 

-

 

 

 

(2,612

)

 

 

-

 

 

 

(4,185

)

Net income (loss) attributable to common stockholders

 

$

8,467

 

 

$

7,864

 

 

$

10,354

 

 

$

13,293

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share attributable to common stockholders, basic

 

$

0.10

 

 

$

0.09

 

 

$

0.12

 

 

$

0.16

 

Net income (loss) per share attributable to common stockholders, diluted

 

$

0.10

 

 

$

0.09

 

 

$

0.12

 

 

$

0.15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends declared per common share, basic and diluted

 

$

0.03

 

 

$

0.03

 

 

$

0.05

 

 

$

0.05

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding, basic

 

 

84,959,130

 

 

 

85,188,182

 

 

 

85,735,916

 

 

 

85,115,310

 

Weighted average common shares outstanding, diluted

 

 

86,985,817

 

 

 

87,777,039

 

 

 

87,803,178

 

 

 

87,382,215

 

Entravision Communications Corporation

Consolidated Balance Sheets

(In thousands; unaudited)

 

 

 

June 30,

 

 

December 31,

 

 

 

2022

 

 

2021

 

ASSETS

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

109,950

 

 

$

185,094

 

Marketable securities

 

 

74,278

 

 

 

-

 

Restricted cash

 

 

750

 

 

 

749

 

Trade receivables, net of allowance for doubtful accounts

 

 

184,872

 

 

 

201,747

 

Assets held for sale

 

 

-

 

 

 

1,963

 

Prepaid expenses and other current assets

 

 

37,029

 

 

 

18,925

 

Total current assets

 

 

406,879

 

 

 

408,478

 

Property and equipment, net

 

 

58,274

 

 

 

62,498

 

Intangible assets subject to amortization, net

 

 

58,931

 

 

 

64,034

 

Intangible assets not subject to amortization

 

 

209,053

 

 

 

209,053

 

Goodwill

 

 

73,273

 

 

 

71,708

 

Deferred income taxes

 

 

1,462

 

 

 

1,462

 

Operating leases right of use asset

 

 

24,356

 

 

 

25,582

 

Other assets

 

 

7,975

 

 

 

8,527

 

Total assets

 

$

840,203

 

 

$

851,342

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Current maturities of long-term debt

 

$

4,795

 

 

$

4,903

 

Accounts payable and accrued expenses

 

 

229,953

 

 

 

212,655

 

Operating lease liabilities

 

 

6,097

 

 

 

7,304

 

Total current liabilities

 

 

240,845

 

 

 

224,862

 

Long-term debt, less current maturities, net of unamortized debt issuance costs

 

 

206,218

 

 

 

207,416

 

Long-term operating lease liabilities

 

 

20,802

 

 

 

20,988

 

Other long-term liabilities

 

 

49,135

 

 

 

72,930

 

Deferred income taxes

 

 

67,910

 

 

 

68,220

 

Total liabilities

 

 

584,910

 

 

 

594,416

 

 

 

 

 

 

 

 

Stockholders' equity

 

 

 

 

 

 

Class A common stock

 

 

6

 

 

 

6

 

Class B common stock

 

 

2

 

 

 

2

 

Class U common stock

 

 

1

 

 

 

1

 

Additional paid-in capital

 

 

769,977

 

 

 

780,388

 

Accumulated deficit

 

 

(512,140

)

 

 

(522,494

)

Accumulated other comprehensive income (loss)

 

 

(2,553

)

 

 

(977

)

Total stockholders' equity

 

 

255,293

 

 

 

256,926

 

Total liabilities and stockholders' equity

 

$

840,203

 

 

$

851,342

 

Entravision Communications Corporation

Consolidated Statements of Cash Flows

(In thousands; unaudited)

 

 

 

Three-Month Period

 

 

Six-Month Period

 

 

 

Ended June 30,

 

 

Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

8,467

 

 

$

10,476

 

 

$

10,354

 

 

$

17,478

 

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

6,263

 

 

 

5,074

 

 

 

12,658

 

 

 

10,258

 

Impairment charge

 

 

-

 

 

 

112

 

 

 

-

 

 

 

1,438

 

Deferred income taxes

 

 

(2,854

)

 

 

712

 

 

 

(3,213

)

 

 

3,699

 

Non-cash interest

 

 

431

 

 

 

159

 

 

 

711

 

 

 

298

 

Amortization of syndication contracts

 

 

115

 

 

 

119

 

 

 

231

 

 

 

238

 

Payments on syndication contracts

 

 

(116

)

 

 

(115

)

 

 

(234

)

 

 

(239

)

Non-cash stock-based compensation

 

 

2,636

 

 

 

1,135

 

 

 

5,209

 

 

 

2,206

 

(Gain) loss on disposal of property and equipment

 

 

(487

)

 

 

-

 

 

 

(638

)

 

 

-

 

Change in fair value of contingent consideration

 

 

976

 

 

 

-

 

 

 

6,076

 

 

 

-

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

(Increase) decrease in accounts receivable

 

 

(11,792

)

 

 

(9,460

)

 

 

17,588

 

 

 

467

 

(Increase) decrease in prepaid expenses and other assets

 

 

1,153

 

 

 

1,732

 

 

 

(1,252

)

 

 

2,909

 

Increase (decrease) in accounts payable, accrued expenses and other liabilities

 

 

4,895

 

 

 

10,989

 

 

 

15,416

 

 

 

5,633

 

Net cash provided by operating activities

 

 

9,687

 

 

 

20,933

 

 

 

62,906

 

 

 

44,385

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from sale of property and equipment and intangibles

 

 

2,507

 

 

 

-

 

 

 

2,671

 

 

 

-

 

Purchases of property and equipment

 

 

(1,662

)

 

 

(998

)

 

 

(3,209

)

 

 

(2,836

)

Purchases of marketable securities

 

 

(1,722

)

 

 

-

 

 

 

(87,239

)

 

 

-

 

Proceeds from marketable securities

 

 

10,499

 

 

 

5,680

 

 

 

10,499

 

 

 

17,800

 

Net cash provided by (used in) investing activities

 

 

9,622

 

 

 

4,682

 

 

 

(77,278

)

 

 

14,964

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from stock option exercises

 

 

-

 

 

 

172

 

 

 

218

 

 

 

172

 

Tax payments related to shares withheld for share-based compensation plans

 

 

(10

)

 

 

(449

)

 

 

(267

)

 

 

(458

)

Payments on long-term debt

 

 

(750

)

 

 

(750

)

 

 

(1,500

)

 

 

(1,500

)

Dividends paid

 

 

(2,124

)

 

 

(2,133

)

 

 

(4,291

)

 

 

(4,259

)

Repurchase of Class A common stock

 

 

(4,138

)

 

 

-

 

 

 

(11,280

)

 

 

-

 

Payment of contingent consideration

 

 

(28,876

)

 

 

-

 

 

 

(43,606

)

 

 

-

 

Principal payments under finance lease obligation

 

 

(29

)

 

 

-

 

 

 

(39

)

 

 

-

 

Payments of capitalized debt costs

 

 

 

 

 

(604

)

 

 

-

 

 

 

(604

)

Net cash used in financing activities

 

 

(35,927

)

 

 

(3,764

)

 

 

(60,765

)

 

 

(6,649

)

Effect of exchange rates on cash, cash equivalents and restricted cash

 

 

(5

)

 

 

24

 

 

 

(6

)

 

 

-

 

Net increase (decrease) in cash, cash equivalents and restricted cash

 

 

(16,623

)

 

 

21,875

 

 

 

(75,143

)

 

 

52,700

 

Cash, cash equivalents and restricted cash:

 

 

 

 

 

 

 

 

 

 

 

 

Beginning

 

 

127,323

 

 

 

150,736

 

 

 

185,843

 

 

 

119,911

 

Ending

 

$

110,700

 

 

$

172,611

 

 

$

110,700

 

 

$

172,611

 

Entravision Communications Corporation
Reconciliation of Consolidated Adjusted EBITDA to Cash Flows From Operating Activities
(In thousands; unaudited)

The most directly comparable GAAP financial measure is operating cash flow. A reconciliation of this non-GAAP measure to cash flows from operating activities for each of the periods presented is as follows:

 

 

Three-Month Period

 

 

Six-Month Period

 

 

 

Ended June 30,

 

 

Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated adjusted EBITDA (1)

 

$

22,481

 

 

$

17,787

 

 

$

40,594

 

 

$

31,982

 

EBITDA attributable to redeemable noncontrolling interest

 

 

-

 

 

 

4,254

 

 

 

-

 

 

 

7,091

 

Interest expense

 

 

(2,334

)

 

 

(1,856

)

 

 

(4,170

)

 

 

(3,573

)

Interest income

 

 

722

 

 

 

83

 

 

 

1,128

 

 

 

223

 

Dividend income

 

 

11

 

 

 

2

 

 

 

14

 

 

 

4

 

Income tax expense

 

 

(3,373

)

 

 

(3,992

)

 

 

(4,225

)

 

 

(6,784

)

Amortization of syndication contracts

 

 

(115

)

 

 

(119

)

 

 

(231

)

 

 

(238

)

Payments on syndication contracts

 

 

116

 

 

 

115

 

 

 

234

 

 

 

239

 

Non-cash stock-based compensation included in direct operating expenses

 

 

(939

)

 

 

(334

)

 

 

(1,897

)

 

 

(650

)

Non-cash stock-based compensation included in corporate expenses

 

 

(1,697

)

 

 

(801

)

 

 

(3,312

)

 

 

(1,556

)

Depreciation and amortization

 

 

(6,263

)

 

 

(5,074

)

 

 

(12,658

)

 

 

(10,258

)

Change in fair value of contingent consideration

 

 

(976

)

 

 

-

 

 

 

(6,076

)

 

 

-

 

Impairment charge

 

 

-

 

 

 

(112

)

 

 

-

 

 

 

(1,438

)

Other operating gain (loss)

 

 

834

 

 

 

523

 

 

 

953

 

 

 

2,436

 

Net (income) loss attributable to redeemable noncontrolling interest

 

 

-

 

 

 

(2,612

)

 

 

-

 

 

 

(4,185

)

Net income (loss) attributable to common stockholders

 

 

8,467

 

 

 

7,864

 

 

 

10,354

 

 

 

13,293

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

6,263

 

 

 

5,074

 

 

 

12,658

 

 

 

10,258

 

Impairment charge

 

 

-

 

 

 

112

 

 

 

-

 

 

 

1,438

 

Deferred income taxes

 

 

(2,854

)

 

 

712

 

 

 

(3,213

)

 

 

3,699

 

Non-cash interest

 

 

431

 

 

 

159

 

 

 

711

 

 

 

298

 

Amortization of syndication contracts

 

 

115

 

 

 

119

 

 

 

231

 

 

 

238

 

Payments on syndication contracts

 

 

(116

)

 

 

(115

)

 

 

(234

)

 

 

(239

)

Non-cash stock-based compensation

 

 

2,636

 

 

 

1,135

 

 

 

5,209

 

 

 

2,206

 

(Gain) loss on disposal of property and equipment

 

 

(487

)

 

 

-

 

 

 

(638

)

 

 

-

 

Change in fair value of contingent consideration

 

 

976

 

 

 

-

 

 

 

6,076

 

 

 

-

 

Net income (loss) attributable to redeemable noncontrolling interest

 

 

-

 

 

 

2,612

 

 

 

-

 

 

 

4,185

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

(Increase) decrease in accounts receivable

 

 

(11,792

)

 

 

(9,460

)

 

 

17,588

 

 

 

467

 

(Increase) decrease in prepaid expenses and other assets

 

 

1,153

 

 

 

1,732

 

 

 

(1,252

)

 

 

2,909

 

Increase (decrease) in accounts payable, accrued expenses and other liabilities

 

 

4,895

 

 

 

10,989

 

 

 

15,416

 

 

 

5,633

 

Cash flows from operating activities

 

 

9,687

 

 

 

20,933

 

 

 

62,906

 

 

 

44,385

 

(1)

Consolidated adjusted EBITDA is defined on page 2.

Entravision Communications Corporation
Reconciliation of Free Cash Flow to Cash Flows From Operating Activities
(In thousands; unaudited)

The most directly comparable GAAP financial measure is operating cash flow. A reconciliation of this non-GAAP measure to cash flows from operating activities for each of the periods presented is as follows:

 

 

Three-Month Period

 

 

Six-Month Period

 

 

 

Ended June 30,

 

 

Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Consolidated adjusted EBITDA (1)

 

$

22,481

 

 

$

17,787

 

 

$

40,594

 

 

$

31,982

 

Net interest expense (1)

 

 

(1,181

)

 

 

(1,614

)

 

 

(2,331

)

 

 

(3,052

)

Dividend income

 

 

11

 

 

 

2

 

 

 

14

 

 

 

4

 

Cash paid for income taxes

 

 

(6,227

)

 

 

(3,280

)

 

 

(7,438

)

 

 

(3,085

)

Capital expenditures (2)

 

 

(1,662

)

 

 

(998

)

 

 

(3,209

)

 

 

(2,836

)

Other operating gain (loss)

 

 

834

 

 

 

523

 

 

 

953

 

 

 

2,436

 

Free cash flow (1)

 

 

14,256

 

 

 

12,420

 

 

 

28,583

 

 

 

25,449

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures (2)

 

 

1,662

 

 

 

998

 

 

 

3,209

 

 

 

2,836

 

EBITDA attributable to redeemable noncontrolling interest

 

 

-

 

 

 

4,254

 

 

 

-

 

 

 

7,091

 

(Gain) loss on disposal of property and equipment

 

 

(487

)

 

 

-

 

 

 

(638

)

 

 

-

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

(Increase) decrease in accounts receivable

 

 

(11,792

)

 

 

(9,460

)

 

 

17,588

 

 

 

467

 

(Increase) decrease in prepaid expenses and other assets

 

 

1,153

 

 

 

1,732

 

 

 

(1,252

)

 

 

2,909

 

Increase (decrease) in accounts payable, accrued expenses and other liabilities

 

 

4,895

 

 

 

10,989

 

 

 

15,416

 

 

 

5,633

 

Cash Flows From Operating Activities

 

$

9,687

 

 

$

20,933

 

 

$

62,906

 

 

$

44,385

 

(1)

 

Consolidated adjusted EBITDA, net interest expense, and free cash flow are defined on page 2.

(2)

 

Capital expenditures are not part of the consolidated statement of operations.

 

For more information, please contact:

Christopher T. Young
Chief Financial Officer
Entravision Communications Corporation
310-447-3870

Kimberly Esterkin
ADDO Investor Relations
310-829-5400
evc@addo.com

Source: Entravision Communications Corporation

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