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Saga Communications Inc.$43.95$.30.69%

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 Saga Communications, Inc. Reports 2nd Quarter 2017 Results
   Thursday, August 03, 2017 9:00:00 AM ET

Saga Communications, Inc. (NYSE American: SGA) today reported earnings for the three and six months ended June 30, 2017. Continuing operations include the Company’s radio stations. The Company’s television stations are classified as held for sale and are being reported as discontinued operations due to the pending sale which is expected to close during the third quarter of 2017.

The Company announced net revenue of $30.3 million from continuing operations for the quarter ended June 30, 2017 compared to $30.9 million for the same period last year. Station operating expense decreased to $21.4 million for the quarter compared to $21.8 million last year and station operating income was $5.9 million for the quarter compared to $6.4 million last year.

The Company’s net revenue included in discontinued operations for the quarter ended June 30, 2017 was $5.7 million compared to $5.6 million for the same period last year. Station operating expense and station operating income included in discontinued operations were flat for the comparable periods at $3.6 million and $2.0 million respectively.

Net income for the quarter ended June 30, 2017 was $4.5 million ($0.77 per fully diluted share) as compared to $4.8 million ($0.81 per fully diluted share) for the same period last year.

The Company’s net revenue of $56.4 million from continuing operations for the six months ended June 30, 2017 compared to $58.3 million for the same period last year. Station operating expense decreased to $42.8 million for the six month period compared to $43.0 million last year and station operating income was $7.9 million for the six months compared to $10.0 million last year. Gross political revenue from continuing operations were $289 thousand for the six month period this year compared to $1.4 million last year.

The Company’s net revenue included in discontinued operations for the six months ended June 30, 2017 was flat with the same period last year at $10.9 million. Station operating expense for the six month period was $7.4 million compared to $7.1 million last year and station operating income was $3.6 million this year compared to $3.7 million last year.

Net income for the six months ended June 30, 2017 was $6.5 million ($1.10 per fully diluted share) as compared to $7.8 million ($1.33 per fully diluted share) for the same period last year.

Capital expenditures were $2.0 million in the second quarter compared to $1.5 million for the same period last year. The Company expects to spend approximately $5.0 million to $5.5 million for capital expenditures during 2017.

The Company entered into agreements on May 9, 2017 to sell it’s television stations for approximately $66.6 million and to purchase radio stations in Charleston and Hilton Head, SC for approximately $23.0 million. Both the sale and purchase are expected to occur during the third quarter. The Company plans on utilizing an Internal Revenue Code Section 1031 like-kind exchange for some of the specific assets being sold and acquired. This will allow the Company to defer taxes on a portion of the gain from the sale. The amount of the deferral will not be fully known until both the sale and purchase are closed and certain tax documents finalized.

The Company expects to use both it’s existing cash on hand and the net cash remaining after the sale of the television stations and the purchase of the Charleston and Hilton Head radio stations for continued station acquisitions, debt reduction and other corporate purposes.

Saga’s 2017 Second Quarter call will be on Thursday, August 3, 2017 at 11:00 a.m. EDT. The dial-in number for the call is (612) 288-0329. A transcript of the call will be posted to the Company’s website as soon as it is available after the call.

The Company requests that all parties that have a question that they would like to submit to the Company to please email the inquiry by 10:00 a.m. EDT on August 3, 2017 to SagaIR@sagacom.com. The Company will discuss, during the limited period of the conference call, those inquiries it deems of general relevance and interest. Only inquiries made in compliance with the foregoing will be discussed during the call.

The attached Selected Supplemental Financial Data tables disclose "actual", "same station", and "discontinued operations" information as well as the Company’s trailing 12 month consolidated EBITDA. The "actual" amounts reflect our historical financial results and include the results of operations for stations that we did not own for the entire comparable period. The "same station" amounts reflect only the results of operations for stations that we owned for the entire comparable period.

Saga utilizes certain financial measures that are not calculated in accordance with generally accepted accounting principles (GAAP) to assess its financial performance. Such non-GAAP measures include same station financial information, free cash flow, trailing 12 month consolidated EBITDA, and consolidated net leverage ratio. These non-GAAP measures are generally recognized by the broadcasting industry as measures of performance and are used by Saga to assess its financial performance including, but not limited to, evaluating individual station and market-level performance, evaluating overall operations, as a primary measure for incentive based compensation of executives and other members of management and as a measure of financial position. Saga’s management believes these non-GAAP measures are used by analysts who report on the industry and by investors to provide meaningful comparisons between broadcasting groups, as well as an indicator of their market value. These measures are not measures of liquidity or of performance in accordance with GAAP, and should be viewed as a supplement to and not as a substitute for the results of operations presented on a GAAP basis including net operating revenue, operating income, and net income. Reconciliations for all of the non-GAAP financial measures to the most directly comparable GAAP measure are attached in the Selected Consolidated and Supplemental Financial Data tables.

This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as "believes," "expects," "anticipates," "guidance" and similar expressions are intended to identify forward-looking statements. Key risks, including risks associated with Saga’s ability to effectively integrate the stations it acquires and the impact of federal regulation on Saga’s business, are described in the reports Saga periodically files with the U.S. Securities and Exchange Commission, including Item 1A of our Annual Report on Form 10-K. Readers should note that these statements may be impacted by several factors, including national and local economic changes and changes in the radio and television broadcast industry in general, as well as Saga’s actual performance. Results may vary from those stated herein and Saga undertakes no obligation to update the information contained here.

Saga is a broadcasting company whose business is devoted to acquiring, developing and operating broadcast properties. Saga owns or operates broadcast properties in 26 markets, including 68 FM and 32 AM radio stations, 4 television stations and 5 low-power television stations. For additional information, contact us at (313) 886-7070 or visit our website at www.sagacom.com.

Saga Communications, Inc. Selected Consolidated Financial Data For The Three and Six Months Ended June 30, 2017 and 2016 (amounts in 000’s except per share data) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Operating Results Net operating revenue $ 30,261 $ 30,866 $ 56,416 $ 58,330 Station operating expense 21,426 21,842 42,766 42,982 Corporate general and administrative 2,880 2,620 5,743 5,337 Other operating expense 79 8 58 5 Operating income 5,876 6,396 7,849 10,006 Interest expense 229 182 437 361 Income from continuing operations, before tax 5,647 6,214 7,412 9,645 Income tax expense 2,272 2,569 2,990 3,987 Income from continuing operations, net of tax 3,375 3,645 4,422 5,658 Income from discontinued operations, net of tax 1,159 1,166 2,050 2,177 Net income $ 4,534 $ 4,811 $ 6,472 $ 7,835 Basic Earnings per share: From continuing operations $ 0.57 $ 0.62 $ 0.75 $ 0.97 From discontinued operations 0.20 0.20 $ 0.35 $ 0.37 Basic earnings per share $ 0.77 $ 0.82 $ 1.10 $ 1.34 Diluted Earnings per share: From continuing operations $ 0.57 $ 0.61 $ 0.75 $ 0.96 From discontinued operations 0.20 0.20 $ 0.35 $ 0.37 Diluted earnings per share $ 0.77 $ 0.81 $ 1.10 $ 1.33 Weighted average common shares 5,803 5,754 5,796 5,752 Weighted average common and common equivalent shares 5,806 5,763 5,804 5,761 Free Cash Flow Net income $ 4,534 $ 4,811 $ 6,472 $ 7,835 Plus: Depreciation and amortization: Station 1,372 1,406 2,730 2,752 Corporate 72 69 143 138 Discontinued operations 129 332 445 653 Deferred tax provision 1,255 915 1,680 1,490 Non-cash compensation 574 530 1,132 1,058 Other operating expense from continuing operations 79 8 58 5 Other operating expense from discontinued operations - - 31 3 Less: Capital expenditures from continuing operations (1,974) (1,064) (3,315) (1,969) Capital expenditures from discontinued operations (12) (476) (110) (581) Free cash flow $ 6,029 $ 6,531 $ 9,266 $ 11,384 June 30, 2017 2016 Balance Sheet Data Working capital $ 56,574 $ 27,713 Net fixed assets $ 49,865 $ 50,038 Net intangible assets and other assets $ 102,658 $ 118,518 Total assets $ 226,878 $ 212,907 Long-term debt including $1,078 and $1,078 of current liabilities classified as discontinued operations, respectivley $ 36,365 $ 36,365 Stockholders’ equity $ 139,319 $ 129,036

Saga Communications, Inc.
Selected Supplemental Financial Data
For The Three and Six Months Ended
June 30, 2017 and 2016
(amounts in 000’s except per share data)
(Unaudited)
                                                 Three Months Ended      Six Months Ended
                                                 June 30,                June 30,
                                                 2017        2016        2017          2016
Results of Discontinued Operations
Net operating revenue                            $     5,688 $     5,572 $     10,942  $     10,853
Station operating expense                        3,643       3,578       7,355         7,123
Other operating expense                          -           -           31            3
Operating income                                 2,045       1,994       3,556         3,727
Interest expense                                 8           7           16            17
Income before income taxes                       2,037       1,987       3,540         3,710
Income tax expense                               878         821         1,490         1,533
Income from discontinued operations, net of tax  $     1,159 $     1,166 $       2,050 $       2,177

Saga Communications, Inc. Selected Supplemental Financial Data For the Three Months Ended June 30, 2017 and 2016 (amounts in 000’s except per share data) (Unaudited) Actual Same Station (1) Three Months Ended Three Months Ended June 30, June 30, 2017 2016 2017 2016 Consolidated Net operating revenue $ 30,261 $ 30,866 $ 30,155 $ 30,866 Station operating expense 21,426 21,842 21,372 21,842 Corporate general and administrative 2,880 2,620 2,880 2,620 Other operating expense 79 8 79 8 Operating income 5,876 6,396 5,824 6,396 Interest expense 229 182 Income from continuing operations, before tax 5,647 6,214 Income tax expense 2,272 2,569 Income from continuing operations, net of tax 3,375 3,645 Income from discontinued operations, net of tax 1,159 1,166 Net income $ 4,534 $ 4,811 Basic Earnings per share: From continuing operations $ 0.57 $ 0.62 From discontinued operations 0.20 0.20 Basic earnings per share $ 0.77 $ 0.82 Diluted Earnings per share: From continuing operations $ 0.57 $ 0.61 From discontinued operations 0.20 0.20 Diluted earnings per share $ 0.77 $ 0.81 Actual Same Station (1) Three Months Ended Three Months Ended June 30, June 30, 2017 2016 2017 2016 Depreciation and amortization Radio Stations $ 1,372 $ 1,406 $ 1,370 $ 1,406 Discontinued Operations 129 332 129 332 Corporate and Other 72 69 72 69 $ 1,573 $ 1,807 $ 1,571 $ 1,807 (1) Same station includes only the results of stations we owned and operated for the entire comparable period.

Saga Communications, Inc.
Selected Supplemental Financial Data
For the Six Months Ended
June 30, 2017 and 2016
(amounts in 000’s except per share data)
(Unaudited)
                                                     Actual                           Same Station (1)
                                                     Six Months Ended                 Six Months Ended
                                                     June 30,                         June 30,
                                                     2017            2016             2017            2016
Consolidated
Net operating revenue                                $      56,416   $      58,330    $      56,265   $      58,330
Station operating expense                            42,766          42,982           42,655          42,982
Corporate general and administrative                 5,743           5,337            5,743           5,337
Other operating expense                              58              5                58              5
Operating income                                     7,849           10,006           7,809           10,006
Interest expense                                     437             361
Income from continuing operations, before tax        7,412           9,645
Income tax expense                                   2,990           3,987
Income from continuing operations, net of tax        4,422           5,658
Income from discontinued operations, net of tax      2,050           2,177
Net income                                           $        6,472  $        7,835
Basic Earnings per share:
                        From continuing operations   $          0.75 $          0.97
                        From discontinued operations 0.35            0.37
                        Basic earnings per share     $          1.10 $          1.34
Diluted Earnings per share:
                        From continuing operations   $          0.75 $          0.96
                        From discontinued operations 0.35            0.37
                        Diluted earnings per share   $          1.10 $          1.33
                                                     Actual                           Same Station (1)
                                                     Six Months Ended                 Six Months Ended
                                                     June 30,                         June 30,
                                                     2017            2016             2017            2016
Depreciation and amortization
Radio Stations                                       $        2,730  $        2,752   $        2,728  $        2,752
Discontinued Operations                              445             653              445             653
Corporate and Other                                  143             138              143             138
                                                     $        3,318  $        3,543   $        3,316  $        3,543
(1)                     Same station includes only the results of stations we owned and operated for the entire comparable period.
Saga Communications, Inc.
Selected Supplemental Financial Data
June 30, 2017
(amounts in 000’s except ratios)
(Unaudited)
                                                                                                                    Less:                     Plus:                     Trailing
                                                                                         12 Mos Ended               6 Mos Ended               6 Mos Ended               12 Mos Ended
                                                                                         December 31,               June 30,                  June 30,                  June 30,
                                                                                         2016                       2016                      2017                      2017
Trailing 12 Month Consolidated Earnings Before Interest,
Taxes, Depreciation and Amortization ("EBITDA") (1)
Net income                                                                               $                  18,186  $                  7,835  $                  6,472  $                  16,823
Exclusions:
                             Gain (loss) on sale of assets                               1,393                      (8)                       (89)                      1,312
                             Other                                                       298                        215                       279                       362
Total exclusions                                                                         1,691                      207                       190                       1,674
Consolidated adjusted net income (1)                                                     16,495                     7,628                     6,282                     15,149
Plus:  Interest expense                                                                  776                        378                       454                       852
                             Income tax expense                                          12,500                     5,520                     4,480                     11,460
                             Depreciation & amortization expense                         7,263                      3,543                     3,318                     7,038
                             Amortization of television syndicated programming contracts 628                        312                       316                       632
                             Non-cash stock based compensation expense                   2,101                      1,058                     1,132                     2,175
Less: Cash television programming payments                                               (625)                      (312)                     (316)                     (629)
Trailing twelve month consolidated EBITDA (1)                                            $                  39,138  $                 18,127  $                 15,666  $                  36,677
Total long-term debt, including current maturities                                                                                                                      $                  36,365
Divided by trailing twelve month consolidated EBITDA (1)                                                                                                                36,677
Leverage ratio                                                                                                                                                          0.99
(1)                          As defined in the Company’s credit facility.
                   Saga Communications, Inc.
                   Selected Financial Data Non-GAAP Disclosures
                   For the Three and Six Months Ended
                   June 30, 2017 and 2016
                   (amounts in 000’s)
                   (Unaudited)
Reconciliation of Actual Information to Same Station Operating Income
                                                              Adjustment                                                                 Adjustment
                                      Actual                  For Acquisitions           Same Station            Actual                  For Acquisitions         Same Station
                                      Three Months            and Dispositions           Three Months            Three Months            and Dispositions         Three Months
                                      Ended                   Not Included in            Ended                   Ended                   Not Included in          Ended
                                      June 30,                Entire Comparable          June 30,                June 30,                Entire Comparable        June 30,
                                      2017                    Period                     2017                    2016                    Period                   2016
Consolidated
Net operating revenue                 $              30,261   $                 (106)    $              30,155   $              30,866   $                     -  $              30,866
Station operating expense             21,426                  (54)                       21,372                  21,842                  -                        21,842
Corporate general and administrative  2,880                   -                          2,880                   2,620                   -                        2,620
Other operating expense               79                      -                          79                      8                       -                        8
Operating income                      $                5,876  $                   (52)   $                5,824  $                6,396  $                     -  $                6,396
Depreciation and amortization         $                1,573  $                     (2)  $                1,571  $                1,807  $                     -  $                1,807
                                                              Adjustment                                                                 Adjustment
                                      Actual                  For Acquisitions           Same Station            Actual                  For Acquisitions         Same Station
                                      Six Months              and Dispositions           Six Months              Six Months              and Dispositions         Six Months
                                      Ended                   Not Included in            Ended                   Ended                   Not Included in          Ended
                                      June 30,                Entire Comparable          June 30,                June 30,                Entire Comparable        June 30,
                                      2017                    Period                     2017                    2016                    Period                   2016
Consolidated
Net operating revenue                 $              56,416   $                 (151)    $              56,265   $              58,330   -                        $              58,330
Station operating expense             42,766                  (111)                      42,655                  42,982                  -                        42,982
Corporate general and administrative  5,743                   -                          5,743                   5,337                   -                        5,337
Other operating (income) expense      58                      -                          58                      5                       -                        5
Operating income                      $                7,849  $                   (40)   $                7,809  $              10,006   $                     -  $              10,006
Depreciation and amortization         $                3,318  $                     (2)  $                3,316  $                3,543  $                     -  $                3,543

View original content:http://www.prnewswire.com/news-releases/saga-communications-inc-reports-2nd-quarter-2017-results-300

SOURCE Saga Communications, Inc.

https://rt.prnewswire.com/rt.gif?NewsItemId=DE57141&Transmission_Id=201708030900PR_NEWS_USPR_____DE57141&DateId=20170803



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