EMMS released SEC quarterly earnings report on October 9 but no formal PR yet. Solid quarter, profitable before charges, CEO is VERY optimistic in e-mail to employees, said sales may be ABOVE 2008 levels soon.
EMMS balance sheet is also stronger than ever after $78 MM debt buyback. EMMS now has only $350 MM debt and 36 MM float.
Debt buyback: "Between April 14 and May 1, Emmis closed a series of Dutch auction tenders, repurchasing $78.5 million in face amount of its bank debt for $44.7 million in cash. The repurchased bank debt was simultaneously cancelled and forgiven."
October 9, 2009 A letter from Emmis Communications CEO Jeff Smulyan
Below is the text of an email message that Jeff Smulyan sent to Emmis employees regarding 2nd Quarter earnings:
Dear Emmis employees,
This morning, we’re reporting financial results for the second fiscal quarter, covering June, July and August. The good news is that, although the problems with the economy, turmoil in our industries and our own bumps in the road have demanded a lot of attention, we do have improvements to report.
Before I talk about our progress, though, I want to put to rest some concerns you might have.
First, there’s the issue of NASDAQ delisting. I understand that merely being put on notice is unsettling, but I am confident that we have the time and means to avoid delisting. Because the trigger for delisting is months away, we believe improvements in our business could drive our stock price up in time to prevent delisting. However, if the market does not respond to our progress as we expect, we can address the problem through other means over which we have more direct control. Emmis will remain a NASDAQ firm.
Second, today we’re filing SEC documents restating our earnings from our last fiscal year and from the first quarter of this fiscal year. Certainly, “restating our earnings” sounds ominous, but our restatement solely relates to a noncash technical tax issue that has no impact on our operations. While there might be big numbers involved and a lot of paperwork being filed, I don’t see anything to worry about.
So, that leaves the good news. For the last few months, we’ve seen sequential improvements in our domestic radio performance. While we’re still behind year-to-year, we’re making gains. In Q1, we were down 27 percent from the previous year; in Q2, we were down 22 percent – still negative, but an improvement. And we see continued improvements ahead. In fact, we think that, within a few months, we could see our first positive numbers since April of 2008.
What’s driving this trend? Improvements in all of our markets. Notably, our clusters in Chicago, St, Louis, Indianapolis and Austin outperformed their markets in Q2. New York is building steam, and with significant ratings improvements we expect both New York and LA to improve in the coming months. Specific bright spots include Indy’s WIBC, which earned another Marconi Award, and Chicago’s WLUP and New York’s WRXP, which both are showing major ratings and revenue improvements.
-- -- The past year has been the most difficult I've experienced, but I do see better times ahead. Certainly, we can't relax. We’ve got to keep fighting, innovating and surviving. But we are making gains. Not long ago, I said that together we could emerge from these difficult times ready for new opportunities. Now, thanks to your good work, I can say, together, we’re showing steady improvement toward that goal. Thank you. – Jeff --