David Field says Audacy may be facing market headwinds but that its fundamentals are strong.
The company on Friday reported an increase of net revenues in the second quarter of 5% compared to the same period a year earlier, but it said its performance has been hampered by “declining macroeconomic conditions and ad market headwinds.”
Among other plans it said it is working on “meaningful cost-reductions” and the possible sale of “non-strategic assets.”
Net revenues for the quarter were $319.4 million, up 5%. Core spot revenues were flat compared to last year, while digital revenue was up 19%.
Field, the chairman, president and CEO, said the company is navigating “turbulent current market conditions,” but he cited reasons for optimism: “an enhanced national sales organization, expanded podcast and streaming audio networks, and during the second half of this year, the rollout of a new, reimagined digital platform and ad tech capabilities that will enable us to unlock pools of ad demand and supply that we can’t effectively monetize today.”
The company’s common stock has not met the $1 minimum per share price for continued listing on the New York Stock Exchange. Audacy said it intends to regain compliance and “is considering all available options” to do so. For now it remains listed.
Field said Audacy had made a “transformational development over the past couple of years” that has helped its competitive position. He said Audacy’s digital business has grown from 10% to 22% of revenues since 2019 and that podcast downloads are up 40% from a year ago.
[Related: “Audacy, CBS Sports Partner in Podcasts”]
According to a transcript on Seeking Alpha, Field told financial analysts: “The twin punches of the pandemic and now the economic slowdown over the past two plus years have definitely adversely impacted our business. But it’s essential to distinguish between the adverse impact of the pandemic and slowdown on our business and Audacy’s fundamental strength and earnings potential going forward.”
Still, Field foretold more cost-cutting. “We are working to enact substantial sustainable savings through a number of measures to improve margins and profitability across the business. We believe we will be able to deliver meaningful cost reductions without hindering our strategic priorities and growth plans.”
He said Audacy is exploring selling “non-strategic assets,” including the pending sale of land in Houston.
But he said the acquisition of AmperWave in late 2021 gives Audacy an important upgrade in advertising technology, “which we have bolstered through additional staff investments and an aggressive product roadmap with important deliverables over the next several months that will materially reduce our reliance on third parties.”
And Audacy is in the process of enhancing its app and website, “the first phase of a roadmap that will see additional features, interactivity and content.”
As an example of the improvements, Field said: “If you’re a New Yorker, the Audacy app will provide you with essentially what you can get on the other leading platforms, plus the best in local sports and news with WFAN, the Yankees, Mets and Giants Games, 1010 WINS and WCS, plus a suite of new unique features to listen to radio as you never have before, such as new interactive chapter functionality, a first full live radio, so that listeners can scroll through to easily find and play topical content on demand from across our owned and partner broadcasts.”