form8-kaugust082014.htm

 
 
 


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: August 5, 2014 (Date of earliest event reported)

Commission File No.: 0-25969

RADIO ONE, INC.
(Exact name of registrant as specified in its charter)
     
Delaware
(State or other jurisdiction of
incorporation or organization)
 
52-1166660
(I.R.S. Employer Identification No.)

1010 Wayne Avenue
14th Floor
Silver Spring, Maryland 20910
(Address of principal executive offices)

(301) 429-3200
Registrant’s telephone number, including area code


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:

o
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
     
o
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
     
o
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
     
o
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 
 
 
 
 
 
 
 
 
 
 
 


 
 

 




ITEM 2.02.                      Results of Operations and Financial Condition.

The Company also issued a press release setting forth the results for its quarter ended June 30, 2014.  A copy of the press release is attached as Exhibit 99.1.


ITEM 9.01.                      Financial Statements and Exhibits.

(c) Exhibits
     
Exhibit Number
 
Description
     
99.1
 
 
 
 
Press release dated August 5, 2014: Radio One, Inc. Reports Second Quarter Results.

 




SIGNATURE

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 thereunto duly authorized.
           
     
RADIO ONE, INC.
   
     
 
/s/ Peter D. Thompson
   
 
August 8, 2014
 
Peter D. Thompson
   
     
Chief Financial Officer and Principal Accounting Officer
 
   
 
 
 
 

 

 
 

 

pressreleaseaugust052014.htm
NEWS RELEASE
August 5, 2014                                 Contact: Peter D. Thompson, EVP and CFO
FOR IMMEDIATE RELEASE                           (301) 429-4638
Washington, DC


RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS


Washington, DC: - Radio One, Inc. (NASDAQ: ROIAK and ROIA) today reported its results for the quarter ended June 30, 2014.  Net revenue was approximately $108.4 million, a decrease of 9.4% from the same period in 2013, resulting primarily from a timing difference of Reach Media’s annual cruise event.  Station operating income1 was approximately $41.0 million, a decrease of 10.0% from the same period in 2013. The Company reported operating income of approximately $22.4 million for the three months ended June 30, 2014, compared to operating income of $18.3 million for the same period in 2013. Net loss was approximately $10.8 million or $0.23 per share compared to $14.2 million or $0.29 per share, for the same period in 2013.

Alfred C. Liggins, III, Radio One’s CEO and President stated, “Our radio division experienced a combination of general market-softness and specific competitive issues. In the markets in which we operate, advertising revenues were down by 3.8% for the quarter compared to our core radio performance of –4.1%.  Part of that decline resulted from the impact of a new competitor in Houston, which has adversely impacted our ratings in that market. Excluding Houston, we outperformed our markets by approximately 210 bps. Third quarter radio revenue pacings are currently negative mid to high single digits, and, while we expect some lift from political advertising, I anticipate that Q3 radio revenues will be down low to mid-single digits. Cable TV revenues were relatively flat for the quarter, and we remain focused on the successful renewal of our carriage agreements.”




 
 
 
 

 
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PAGE 2 -- RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS

 
RESULTS OF OPERATIONS
 
                       
                         
   
Three Months Ended June 30,
   
Six Months Ended June 30,
 
 
 
2014
   
2013
   
2014
   
2013
 
         
(as adjusted)2
         
(as adjusted)2
 
STATEMENT OF OPERATIONS
 
(unaudited)
   
(unaudited)
 
   
(in thousands, except share data)
   
(in thousands, except share data)
 
                         
NET REVENUE
  $ 108,414     $ 119,602     $ 219,486     $ 218,714  
OPERATING EXPENSES
                               
Programming and technical, excluding stock-based compensation
    33,920       32,952       69,192       63,473  
Selling, general and administrative, excluding stock-based compensation
    33,445       41,020       74,058       73,744  
Corporate selling, general and administrative, excluding stock-based compensation
    9,398       7,975       19,439       17,423  
Stock-based compensation
    65       47       110       90  
Depreciation and amortization
    9,236       9,478       18,506       19,029  
Impairment of long-lived assets
    -       9,800       -       11,170  
Total operating expenses
    86,064       101,272       181,305       184,929  
             Operating income
    22,350       18,330       38,181       33,785  
INTEREST INCOME
    81       102       134       142  
INTEREST EXPENSE
    19,255       22,315       41,118       44,474  
LOSS ON RETIREMENT OF DEBT
    -       -       5,679       -  
OTHER (INCOME) EXPENSE, net
    (21 )     (30 )     45       (70 )
Income (loss) before provision for income taxes, noncontrolling interest in income of subsidiaries and income from discontinued operations
    3,197       (3,853 )     (8,527 )     (10,477 )
PROVISION FOR INCOME TAXES
    8,605       4,702       17,183       11,383  
Net loss from continuing operations
    (5,408 )     (8,555 )     (25,710 )     (21,860 )
INCOME FROM DISCONTINUED OPERATIONS, net of tax
    -       3       -       893  
CONSOLIDATED NET LOSS
    (5,408 )     (8,552 )     (25,710 )     (20,967 )
NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
    5,408       5,662       10,289       11,353  
CONSOLIDATED NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS
  $ (10,816 )   $ (14,214 )   $ (35,999 )   $ (32,320 )
                                 
AMOUNTS ATTRIBUTABLE TO COMMON STOCKHOLDERS
                               
NET LOSS FROM CONTINUING OPERATIONS
  $ (10,816 )   $ (14,217 )   $ (35,999 )   $ (33,213 )
INCOME FROM DISCONTINUED OPERATIONS, net of tax
    -       3       -       893  
CONSOLIDATED NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS
  $ (10,816 )   $ (14,214 )   $ (35,999 )   $ (32,320 )
                                 
Weighted average shares outstanding - basic3
    47,465,653       48,737,941       47,453,414       49,299,953  
Weighted average shares outstanding - diluted4
    47,465,653       48,737,941       47,453,414       49,299,953  



 





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PAGE 3 -- RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS
 
   
Three Months Ended June 30,
   
Six Months Ended June 30,
 
   
2014
   
2013
   
2014
   
2013
 
          (as adjusted)2    
 
   
(as adjusted)2
 
PER SHARE DATA - basic and diluted:
 
(unaudited)
   
(unaudited)
 
   
(in thousands, except per share data)
   
(in thousands, except per share data)
 
                         
    Net loss from continuing operations (basic)
  $ (0.23 )   $ (0.29 )   $ (0.76 )   $ (0.67 )
    Income from discontinued operations, net of tax (basic)
    0.00       0.00       0.00       0.02  
    Consolidated net loss attributable to common stockholders
    (basic)
  $ (0.23 )   $ (0.29 )   $ (0.76 )   $ (0.66 ) *
                                 
    Net loss from continuing operations (diluted)
  $ (0.23 )   $ (0.29 )   $ (0.76 )   $ (0.67 )
    Income from discontinued operations, net of tax (diluted)
    0.00       0.00       0.00       0.02  
    Consolidated net loss attributable to common stockholders
    (diluted)
  $ (0.23 )   $ (0.29 )   $ (0.76 )   $ (0.66 ) *
                                 
SELECTED OTHER DATA
                               
    Station operating income 1
  $ 41,049     $ 45,630     $ 76,236     $ 81,497  
    Station operating income margin (% of net revenue)
    37.9 %     38.2 %     34.7 %     37.3 %
                                 
Station operating income reconciliation:
                               
                                 
    Consolidated net loss attributable to common stockholders
  $ (10,816 )   $ (14,214 )   $ (35,999 )   $ (32,320 )
   
    Add back non-station operating income items included in consolidated net loss:
                 
        Interest income
    (81 )     (102 )     (134 )     (142 )
        Interest expense
    19,255       22,315       41,118       44,474  
        Provision for income taxes
    8,605       4,702       17,183       11,383  
        Corporate selling, general and administrative expenses
    9,398       7,975       19,439       17,423  
        Stock-based compensation
    65       47       110       90  
        Loss on retirement of debt
    -       -       5,679       -  
        Other (income) expense, net
    (21 )     (30 )     45       (70 )
        Depreciation and amortization
    9,236       9,478       18,506       19,029  
        Noncontrolling interest in income of subsidiaries
    5,408       5,662       10,289       11,353  
        Impairment of long-lived assets
    -       9,800       -       11,170  
        Income from discontinued operations, net of tax
    -       (3 )     -       (893 )
        Station operating income
  $ 41,049     $ 45,630     $ 76,236     $ 81,497  
                                 
Adjusted EBITDA5
  $ 31,651     $ 37,655     $ 56,797     $ 64,074  
                                 
Adjusted EBITDA reconciliation:
                               
                                 
    Consolidated net loss attributable to common stockholders
  $ (10,816 )   $ (14,214 )   $ (35,999 )   $ (32,320 )
        Interest income
    (81 )     (102 )     (134 )     (142 )
        Interest expense
    19,255       22,315       41,118       44,474  
        Provision for income taxes
    8,605       4,702       17,183       11,383  
        Depreciation and amortization
    9,236       9,478       18,506       19,029  
        EBITDA
  $ 26,199     $ 22,179     $ 40,674     $ 42,424  
        Stock-based compensation
    65       47       110       90  
        Loss on retirement of debt
    -       -       5,679       -  
        Other (income) expense, net
    (21 )     (30 )     45       (70 )
        Noncontrolling interest in income of subsidiaries
    5,408       5,662       10,289       11,353  
        Impairment of long-lived assets
    -       9,800       -       11,170  
        Income from discontinued operations, net of tax
    -       (3 )     -       (893 )
        Adjusted EBITDA
  $ 31,651     $ 37,655     $ 56,797     $ 64,074  
                                 
 * Per share amounts do not add due to rounding.
                               
 
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PAGE 4 -- RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS

 
   
June 30, 2014
   
December 31, 2013
 
   
(unaudited)
       
   
(in thousands)
 
SELECTED BALANCE SHEET DATA:
           
Cash and cash equivalents
  $ 60,019     $ 56,676  
Intangible assets, net
    1,137,082       1,147,017  
Total assets
    1,406,276       1,414,355  
Total debt (including current portion)
    821,389       815,635  
Total liabilities
    1,144,454       1,117,381  
Total equity
    250,774       284,975  
Redeemable noncontrolling interest
    11,048       11,999  
Noncontrolling interest
    207,538       207,026  
                 
   
Current Amount Outstanding
   
Applicable Interest Rate
 
   
(in thousands)
         
SELECTED LEVERAGE DATA:
               
Senior bank term debt, net of original issue discount of approximately $3.1 million (subject to variable rates) (a)
  $ 367,389       7.50 %
9.25% senior subordinated notes due February 2020 (fixed rate)
    335,000       9.25 %
10% Senior Secured TV One Notes due March 2016 (fixed rate)
    119,000       10.00 %
 
(a)  
Subject to variable Libor plus a spread that is incorporated into the applicable interest rate set forth above.
 
 
Cautionary Note Regarding Forward-Looking Statements

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements represent management's current expectations and are based upon information available to Radio One at the time of this release. These forward-looking statements involve known and unknown risks, uncertainties and other factors, some of which are beyond Radio One's control, that may cause the actual results to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements.  Important factors that could cause actual results to differ materially are described in Radio One’s reports on Forms 10-K, 10-Q, 10-Q/A, 8-K and other filings with the Securities and Exchange Commission (the “SEC”). Radio One does not undertake any duty to update any forward-looking statements.

 
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PAGE 5 -- RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS

 
Net revenue decreased to approximately $108.4 million for the quarter ended June 30, 2014, from approximately $119.6 million for the same period in 2013, a decrease of 9.4%, resulting primarily from a timing difference of Reach Media’s annual cruise event. Net revenues from our radio broadcasting segment decreased 5.1% for the quarter ended June 30, 2014, from the same period in 2013. After adjusting for the non-occurrence of the Company’s annual Gospel Cruise event (separate from the Reach Media event described below) held during the second quarter of 2013, and not held in 2014, our core radio revenue from our stations decreased 4.1% for the quarter ended June 30, 2014, compared to the same period in 2013. We experienced net revenue growth most significantly in our Charlotte, Columbus, Dallas and Detroit markets, countered by our Atlanta, Houston, Philadelphia and Washington DC markets experiencing the most significant declines. Reach Media’s net revenues decreased 43.9% in the second quarter 2014, compared to the same period in 2013, primarily attributable to the timing of the “Tom Joyner Fantastic Voyage” which took place during the second quarter of 2013 versus being held during the first quarter of 2014. The event generated revenue of approximately $7.2 million for Reach Media during the second quarter of 2013. Adjusting for the timing difference for the “Tom Joyner Fantastic Voyage,” Reach Media’s revenue decreased 6.9% for the quarter ended June 30, 2014, compared to the same period in 2013. We recognized approximately $38.0 million of revenue from our cable television segment during the three months ended June 30, 2014, compared to approximately $37.7 million for the same period in 2013, the increase due primarily from an increase in affiliate sales. Finally, net revenues for our internet business decreased 8.2% for the three months ended June 30, 2014, compared to the same period in 2013.
 
Operating expenses, excluding depreciation and amortization, stock-based compensation and impairment of long-lived assets, decreased to approximately $76.8 million for the quarter ended June 30, 2014, down 6.3% from the approximately $81.9 million incurred for the comparable quarter in 2013. Reach Media’s event, the “Tom Joyner Fantastic Voyage,” generated expenses of approximately $6.0 million during the second quarter of 2013.

Depreciation and amortization expense decreased 2.6% to approximately $9.2 million compared to approximately $9.5 million for the quarters ended June 30, 2014 and 2013, respectively. The decrease was due to the completion of amortization for certain intangible assets and the completion of useful lives for certain assets.

Impairment of long-lived assets for the three months ended June 30, 2013, was approximately $9.8 million and related to a non-cash impairment charge recorded to reduce the carrying value of our Cincinnati, Cleveland and Philadelphia radio broadcasting licenses. There was no impairment of long-lived assets for the three months ended June 30, 2014.

Interest expense decreased to approximately $19.3 million for the quarter ended June 30, 2014, compared to approximately $22.3 million for the same period in 2013. As previously announced, on February 10, 2014, the Company closed a private offering of $335.0 million aggregate principal amount of 9.25% Senior Subordinated Notes due 2020 (the “2020 Notes”). The 2020 Notes were offered at an original issue price of 100.0% plus accrued interest from February 10, 2014. Effective March 13, 2014, the Company repurchased or otherwise redeemed all of the amounts outstanding under the 12.5%/15% Senior Subordinated Notes due 2016 (the “2016 Notes”). The primary driver of the decrease in interest expense is due to the lower interest rate associated with the 2020 Notes. The Company made cash interest payments of approximately $10.4 million for the quarter ended June 30, 2014, compared to cash interest payments of approximately $21.0 million for the quarter ended June 30, 2013. Cash interest payments associated with the 2020 Notes will begin August 15, 2014.

The provision for income taxes for the quarter ended June 30, 2014, was approximately $8.6 million compared to approximately $4.7 million for the comparable period in 2013, primarily attributable to the deferred tax liability (“DTL”) for indefinite-lived intangible assets. The increase in tax provision is due to the impairment of long-lived intangibles that reduced the DTL and related deferred tax expense for the three months ended June 30, 2013. The Company paid $311,000 and $73,000 in taxes for the quarters ended June 30, 2014 and 2013, respectively.

The decrease in noncontrolling interests in income of subsidiaries is due primarily to a net loss generated by Reach Media during the three months ended June 30, 2014, compared to net income during the 2013 period.  TV One generated greater net income during the three months ended June 30, 2014, compared to the 2013 period, which partially offset the loss generated by Reach Media.
 
 

 



 
 
 
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PAGE 6 -- RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS

 
Other pertinent financial information includes capital expenditures of approximately $1.7 million and $3.6 million for the quarters ended June 30, 2014 and 2013, respectively.  The Company received dividends from TV One in the amount of approximately $6.3 million and $4.1 million for the quarters ended June 30, 2014 and 2013, respectively. As of June 30, 2014, the Company had total debt (net of cash balances) of approximately $761.4 million. The Company’s cash and cash equivalents by segment are as follows:  Radio and Internet, approximately $33.1 million; Reach Media, approximately $3.0 million; and Cable Television, approximately $23.9 million. In addition to cash and cash equivalents, the cable television segment also has short-term investments of approximately $2.6 million and long-term investments of $806,000. During the three months ended June 30, 2013, the Company repurchased 24,419 shares of Class A common stock in the amount of $57,306 and 1,166,300 shares of Class D common stock in the amount of $2,673,723.  During the six months ended June 30, 2013, the Company repurchased 31,569 shares of Class A common stock in the amount of $68,331 and 2,118,274 shares of Class D common stock in the amount of $4,188,625.  There were no stock repurchases made during the three or six month periods ended June 30, 2014.

 
Supplemental Financial Information:
 
For comparative purposes, the following more detailed, unaudited statements of operations for the three and six months ended June 30, 2014 and 2013 are included.  These detailed, unaudited and adjusted statements of operations include certain reclassifications associated with accounting for discontinued operations.  These reclassifications had no effect on previously reported net income or loss, or any other previously reported statements of operations, balance sheet or cash flow amounts.
 







 
 
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PAGE 7 -- RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS

 
   
Three Months Ended June 30, 2014
 
   
(in thousands, unaudited)
 
                                     
                                 
Corporate/
 
         
Radio
   
Reach
         
Cable
   
Eliminations/
 
   
Consolidated
   
Broadcasting
   
Media
   
Internet
   
Television
   
Other
 
                                     
STATEMENT OF OPERATIONS:
                                   
                                     
NET REVENUE
  $ 108,414     $ 55,773     $ 10,099     $ 5,909     $ 37,984     $ (1,351 )
OPERATING EXPENSES:
                                               
Programming and technical
    33,920       10,905       7,880       2,346       14,220       (1,431 )
Selling, general and administrative
    33,445       21,871       1,344       3,410       7,367       (547 )
Corporate selling, general and administrative
    9,398       -       1,119       -       1,822       6,457  
Stock-based compensation
    65       5       -       -       -       60  
Depreciation and amortization
    9,236       1,283       286       606       6,532       529  
Total operating expenses
    86,064       34,064       10,629       6,362       29,941       5,068  
           Operating income (loss)
    22,350       21,709       (530 )     (453 )     8,043       (6,419 )
INTEREST INCOME
    81       -       -       -       15       66  
INTEREST EXPENSE
    19,255       255       -       -       3,039       15,961  
OTHER INCOME, net
    (21 )     (2 )     -       -       -       (19 )
Income (loss) income before provision for income taxes, noncontrolling interest in income of subsidiaries and income from discontinued operations
    3,197       21,456       (530 )     (453 )     5,019       (22,295 )
PROVISION FOR INCOME TAXES
    8,605       8,596       9       -       -       -  
Net (loss) income from continuing operations
    (5,408 )     12,860       (539 )     (453 )     5,019       (22,295 )
INCOME FROM DISCONTINUED OPERATIONS, net of tax
    -       -       -       -       -       -  
CONSOLIDATED NET (LOSS) INCOME
    (5,408 )     12,860       (539 )     (453 )     5,019       (22,295 )
NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
    5,408       -       -       -       -       5,408  
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS
  $ (10,816 )   $ 12,860     $ (539 )   $ (453 )   $ 5,019     $ (27,703 )
                                                 
Adjusted EBITDA5
  $ 31,651     $ 22,997     $ (244 )   $ 153     $ 14,575     $ (5,830 )
 

 
 

 
 

 
 
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PAGE 8 -- RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS
 
 
   
Three Months Ended June 30, 2013
 
   
(in thousands, unaudited, as adjusted)2
 
                                     
                                 
Corporate/
 
         
Radio
   
Reach
         
Cable
   
Eliminations/
 
   
Consolidated
   
Broadcasting
   
Media
   
Internet
   
Television
   
Other
 
                                     
STATEMENT OF OPERATIONS:
                                   
                                     
NET REVENUE
  $ 119,602     $ 58,759     $ 18,015     $ 6,434     $ 37,729     $ (1,335 )
OPERATING EXPENSES:
                                               
Programming and technical
    32,952       10,790       7,451       2,050       13,960       (1,299 )
Selling, general and administrative
    41,020       22,150       7,573       3,877       7,683       (263 )
Corporate selling, general and administrative
    7,975       -       1,075       -       1,821       5,079  
Stock-based compensation
    47       9       -       -       -       38  
Depreciation and amortization
    9,478       1,522       352       605       6,583       416  
Impairment of long-lived assets
    9,800       9,800       -       -       -       -  
Total operating expenses
    101,272       44,271       16,451       6,532       30,047       3,971  
           Operating income (loss)
    18,330       14,488       1,564       (98 )     7,682       (5,306 )
INTEREST INCOME
    102       -       -       -       17       85  
INTEREST EXPENSE
    22,315       309       -       -       3,039       18,967  
OTHER INCOME, net
    (30 )     -       -       -       -       (30 )
(Loss) income before provision for income taxes, noncontrolling interest in income of subsidiaries and income from discontinued operations
    (3,853 )     14,179       1,564       (98 )     4,660       (24,158 )
PROVISION FOR INCOME TAXES
    4,702       3,904       798       -       -       -  
Net (loss) income from continuing operations
    (8,555 )     10,275       766       (98 )     4,660       (24,158 )
INCOME FROM DISCONTINUED OPERATIONS, net of tax
    3       3       -       -       -       -  
CONSOLIDATED NET (LOSS) INCOME
    (8,552 )     10,278       766       (98 )     4,660       (24,158 )
NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
    5,662       -       -       -       -       5,662  
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS
  $ (14,214 )   $ 10,278     $ 766     $ (98 )   $ 4,660     $ (29,820 )
                                                 
Adjusted EBITDA5
  $ 37,655     $ 25,819     $ 1,916     $ 507     $ 14,265     $ (4,852 )
 
 

 
 

 
 

 
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PAGE 9 -- RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS

 
   
Six Months Ended June 30, 2014
 
   
(in thousands, unaudited)
 
                                     
                                 
Corporate/
 
         
Radio
   
Reach
         
Cable
   
Eliminations/
 
   
Consolidated
   
Broadcasting
   
Media
   
Internet
   
Television
   
Other
 
                                     
STATEMENT OF OPERATIONS:
                                   
                                     
NET REVENUE
  $ 219,486     $ 105,408     $ 26,815     $ 12,353     $ 77,678     $ (2,768 )
OPERATING EXPENSES:
                                               
Programming and technical
    69,192       21,573       15,881       4,710       29,747       (2,719 )
Selling, general and administrative
    74,058       43,132       8,674       7,336       16,104       (1,188 )
Corporate selling, general and administrative
    19,439       -       2,366       -       3,949       13,124  
Stock-based compensation
    110       10       -       -       -       100  
Depreciation and amortization
    18,506       2,591       577       1,232       13,074       1,032  
Total operating expenses
    181,305       67,306       27,498       13,278       62,874       10,349  
           Operating income (loss)
    38,181       38,102       (683 )     (925 )     14,804       (13,117 )
INTEREST INCOME
    134       -       -       -       27       107  
INTEREST EXPENSE
    41,118       605       -       -       6,078       34,435  
LOSS ON RETIREMENT OF DEBT
    5,679       -       -       -       -       5,679  
OTHER EXPENSE (INCOME), net
    45       (1 )     -       -       96       (50 )
(Loss) income before provision for income taxes, noncontrolling interest in income of subsidiaries and income (loss) from discontinued operations
    (8,527 )     37,498       (683 )     (925 )     8,657       (53,074 )
PROVISION FOR INCOME TAXES
    17,183       17,160       23       -       -       -  
Net (loss) income from continuing operations
    (25,710 )     20,338       (706 )     (925 )     8,657       (53,074 )
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, net of tax
    -       -       -       -       -       -  
CONSOLIDATED NET (LOSS) INCOME
    (25,710 )     20,338       (706 )     (925 )     8,657       (53,074 )
NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
    10,289       -       -       -       -       10,289  
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS
  $ (35,999 )   $ 20,338     $ (706 )   $ (925 )   $ 8,657     $ (63,363 )
                                                 
Adjusted EBITDA5
  $ 56,797     $ 40,703     $ (106 )   $ 307     $ 27,878     $ (11,985 )








 
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PAGE 10 -- RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS


   
Six Months Ended June 30, 2013
 
   
(in thousands, unaudited, as adjusted)2
 
                                     
                                 
Corporate/
 
         
Radio
   
Reach
         
Cable
   
Eliminations/
 
   
Consolidated
   
Broadcasting
   
Media
   
Internet
   
Television
   
Other
 
                                     
STATEMENT OF OPERATIONS:
                                   
                                     
NET REVENUE
  $ 218,714     $ 108,616     $ 27,556     $ 11,486     $ 73,721     $ (2,665 )
OPERATING EXPENSES:
                                               
Programming and technical
    63,473       21,744       14,915       3,982       25,333       (2,501 )
Selling, general and administrative
    73,744       42,864       9,317       7,498       14,667       (602 )
Corporate selling, general and administrative
    17,423       -       2,214       -       4,230       10,979  
Stock-based compensation
    90       24       -       -       -       66  
Depreciation and amortization
    19,029       3,076       640       1,314       13,217       782  
Impairment of long-lived assets
    11,170       11,170       -       -       -       -  
Total operating expenses
    184,929       78,878       27,086       12,794       57,447       8,724  
           Operating income (loss)
    33,785       29,738       470       (1,308 )     16,274       (11,389 )
INTEREST INCOME
    142       -       -       -       27       115  
INTEREST EXPENSE
    44,474       585       -       -       6,078       37,811  
OTHER INCOME,  net
    (70 )     (11 )     -       -       -       (59 )
(Loss) income before provision for income taxes, noncontrolling interest in income of subsidiaries and loss from discontinued operations
    (10,477 )     29,164       470       (1,308 )     10,223       (49,026 )
PROVISION FOR INCOME TAXES
    11,383       10,911       472       -       -       -  
Net (loss) income from continuing operations
    (21,860 )     18,253       (2 )     (1,308 )     10,223       (49,026 )
INCOME FROM DISCONTINUED OPERATIONS, net of tax
    893       893       -       -       -       -  
CONSOLIDATED NET (LOSS) INCOME
    (20,967 )     19,146       (2 )     (1,308 )     10,223       (49,026 )
NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
    11,353       -       -       -       -       11,353  
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS
  $ (32,320 )   $ 19,146     $ (2 )   $ (1,308 )   $ 10,223     $ (60,379 )
                                                 
Adjusted EBITDA5
  $ 64,074     $ 44,008     $ 1,110     $ 6     $ 29,491     $ (10,541 )




 
 

 
 
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PAGE 11 -- RADIO ONE, INC. REPORTS SECOND QUARTER RESULTS
 
Radio One, Inc. will hold a conference call to discuss its results for second fiscal quarter of 2014. This conference call is scheduled for Tuesday, August 5, 2014 at 10:00 a.m. Eastern Daylight Time. To participate on this call, U.S. callers may dial toll-free 1-800-230-1092; international callers may dial direct (+1) 612-288-0337.

A replay of the conference call will be available from 12:00 p.m. EDT August 5, 2014 until 11:59 p.m. EDT August 7, 2014. Callers may access the replay by calling 1-800-475-6701; international callers may dial direct (+1) 320-365-3844. The replay Access Code is 330905. Access to live audio and a replay of the conference call will also be available on Radio One's corporate website at http://www.radio-one.com/. The replay will be made available on the website for seven days after the call.
 
Radio One, Inc., together with its subsidiaries (http://www.radio-one.com/), is a diversified media company that primarily targets African-American and urban consumers. The Company is one of the nation's largest radio broadcasting companies, currently owning and/or operating 54 broadcast stations located in 16 urban markets in the United States. Through its controlling interest in Reach Media, Inc. (http://www.blackamericaweb.com/), the Company also operates syndicated programming including the Tom Joyner Morning Show, the Rickey Smiley Morning Show, the Yolanda Adams Morning Show, the Russ Parr Morning Show, the DL Hughley Show, Bishop T.D. Jakes' "Empowering Moments", and the Reverend Al Sharpton Show. Beyond its core radio broadcasting franchise, Radio One owns Interactive One (http://www.interactiveone.com/), an online platform serving the African-American community through social content, news, information, and entertainment. Interactive One operates a number of branded sites, including News One, UrbanDaily, HelloBeautiful and social networking websites, including BlackPlanet and MiGente. In addition, the Company owns a controlling interest in TV One, LLC (http://www.tvoneonline.com/), a cable/satellite network programming primarily to African-Americans.
 
Notes:
 
1           “Station operating income” consists of net loss before depreciation and amortization, corporate expenses, stock-based compensation, equity in income of affiliated company, income taxes, noncontrolling interest in income (loss) of subsidiaries, interest expense, impairment of long-lived assets, other (income) expense, loss (gain) on retirement of debt, (income) loss from discontinued operations, net of tax, interest income and gain on purchase of affiliated company. Station operating income is not a measure of financial performance under generally accepted accounting principles. Nevertheless station operating income is a significant basis used by our management to measure the operating performance of our stations within the various markets because station operating income provides helpful information about our results of operations apart from expenses associated with our fixed assets and long-lived intangible assets, income taxes, investments, debt financings and retirements, overhead, stock-based compensation, impairment charges, and asset sales. Our measure of station operating income may not be comparable to similarly titled measures of other companies as our definition includes the results of all four segments (Radio Broadcasting, Reach Media, Internet and Cable Television). Station operating income does not purport to represent operating income or cash flow from operating activities, as those terms are defined under generally accepted accounting principles, and should not be considered as an alternative to those measurements as an indicator of our performance. A reconciliation of net income (loss) to station operating income has been provided in this release.

2           Certain reclassifications associated with accounting for discontinued operations have been made to prior period balances to conform to the current presentation. These reclassifications had no effect on any other previously reported or consolidated net income or loss or any other statement of operations, balance sheet or cash flow amounts. Where applicable, these financial statements have been identified as “as adjusted.”

3           For the three months ended June 30, 2014 and 2013, Radio One had 47,465,653 and 48,737,941 shares of common stock outstanding on a weighted average basis (basic), respectively.  For the six months ended June 30, 2014 and 2013, Radio One had 47,453,414 and 49,299,953 shares of common stock outstanding on a weighted average basis (basic), respectively.

4           For the three months ended June 30, 2014 and 2013, Radio One had 47,465,653 and 48,737,941 shares of common stock outstanding on a weighted average basis (fully diluted), for outstanding stock options, respectively.  For the six months ended June 30, 2014 and 2013, Radio One had 47,453,414 and 49,299,953 shares of common stock outstanding on a weighted average basis (fully diluted), for outstanding stock options, respectively.

5           “Adjusted EBITDA” consists of net loss plus (1) depreciation, amortization, income taxes, interest expense, noncontrolling interest in income of subsidiaries, impairment of long-lived assets, stock-based compensation, loss on retirement of debt, loss from discontinued operations, net of tax, less (2) equity in income of affiliated company, other income, interest income, gain on retirement of debt and gain on purchase of affiliated company. Net income before interest income, interest expense, income taxes, depreciation and amortization is commonly referred to in our business as “EBITDA.” Adjusted EBITDA and EBITDA are not measures of financial performance under generally accepted accounting principles. However, we believe Adjusted EBITDA is often a useful measure of a company’s operating performance and is a significant basis used by our management to measure the operating performance of our business because Adjusted EBITDA excludes charges for depreciation, amortization and interest expense that have resulted from our acquisitions and debt financing, our taxes, impairment charges, as well as our equity in (income) loss of our affiliated company, gain on retirements of debt, and any discontinued operations. Accordingly, we believe that Adjusted EBITDA provides useful information about the operating performance of our business, apart from the expenses associated with our fixed assets and long-lived intangible assets, capital structure or the results of our affiliated company. Adjusted EBITDA is frequently used as one of the bases for comparing businesses in our industry, although our measure of Adjusted EBITDA may not be comparable to similarly titled measures of other companies as our definition includes the results of all four segments (Radio Broadcasting, Reach Media, Internet and Cable Television).  Adjusted EBITDA and EBITDA do not purport to represent operating income or cash flow from operating activities, as those terms are defined under generally accepted accounting principles, and should not be considered as alternatives to those measurements as an indicator of our performance. A reconciliation of net income (loss) to EBITDA and Adjusted EBITDA has been provided in this release.