Emmis Communications Corp. released second quarter earnings that Jeff Smulyan called disappointing and come at a time when the Emmis chairman/CEO is trying to take the broadcaster private.
The Indy-based multimedia group reported net revenues for the second fiscal quarter ending Aug. 31 were down 3.3% to $46 million compared to $47.6 million a year ago. And Miller Kaplan reporting, which excludes barter and syndication revenues, shows Emmis radio revenues down nearly 4% for Q2. To make the news even worse, Emmis said that drop in revenue was in markets that overall were up 1% for the quarter.
The Q2 report coincides with Smulyan’s offer of $4.10 per share for all its common stock in August. He has extended that offer twice with a new deadline of tomorrow (Friday). He said on a conference call that negotiations are ongoing. This is Smulyan’s third try to take the company private.
In addition, Emmis has announced it plans to sell its Terre Haute, Ind., cluster of radio stations and its Emmis Publishing division, except for Indianapolis Monthly magazine.
Emmis EVP/CFO/Treasurer Ryan Hornaday on the Thursday earnings call said the quarter was “a step backward for the company.” He did point to digital as being the company’s strongest line of business with revenue up a whopping 32%.
The NextRadio platform continues to make progress on multiple fronts, according to Smulyan, who called it a “landmark” quarter for the smartphone app. “NextRadio-compatible Samsung Galaxy S7, S7 Edge and Note 7 smartphones are now available across all carriers,” he said.
Cap ex spending at Emmis was $300,000 for the quarter, Hornaday says, and it expects to spend approximately $3.5 million for the full year.
The company’s third quarter so far is pacing flat to slightly ahead when compared to 2015, Smulyan said on the earnings call. “We are hopeful that we will see political advertising tailwinds strengthen as we move through October. We are also increasing marketing spending at some of our largest brands to boost ratings and give us a competitive advantage.”
Emmis owns 19 FM and four AM radio stations in the U.S.