Cumulus Media Reports Operating Results for 2022

Cumulus Media Inc.

Total Revenue of $953.5 Million, Up 4% Year-Over-Year
Digital Revenue of More Than $142 Million, Up 12% Year-Over-Year
Net Income of $16.2 Million, Down 6% Year-Over-Year
Adjusted EBITDA of $166.0 Million, Up 23% Year-Over-Year

ATLANTA, Feb. 23, 2023 (GLOBE NEWSWIRE) -- Cumulus Media Inc. (NASDAQ: CMLS) (the “Company,” "Cumulus Media," “we,” “us,” or “our”) today announced operating results for the three months and year ended December 31, 2022.

Mary G. Berner, President and Chief Executive Officer of Cumulus Media, said, "Despite considerable economic turbulence, we delivered fourth quarter financial performance in the upper half of our guidance range, continuing a multi-year period of significant accomplishments. Operating through a series of difficult macroeconomic environments, including the pandemic, we successfully executed a strategic plan under which we developed and drove new areas of growth, right-sized the balance sheet, improved the Company’s operating leverage and returned capital to shareholders. As a result, we have delivered consistent revenue growth, built several digital businesses to a $150+ million revenue run-rate, reduced our net leverage to its lowest level in more than a decade, and boosted our liquidity to give ourselves optionality regarding capital allocation.”

Berner added, “Looking ahead to 2023, we continue to face substantial economic headwinds. However, our battle-tested skill in performing during challenging times, as well as our very strong financial position, gives us substantial confidence in our ability to not only weather this depressed ad environment but take full advantage of opportunities that may arise over the coming quarters.”

2022 Key Highlights:

• Increased total revenue by 4% year-over-year to $953.5 million

• Increased digital revenue by 12% year-over-year, to more than $142 million (~15% of revenue)

  • Grew local digital marketing services 16% year-over-year with successful launch of Boost suite of digital presence products contributing to growth

  • Grew Cumulus Podcast Network revenue 11% year-over-year, driven by year-over- year download increase of 26% (from approximately 1.2 billion to 1.5 billion)

  • Increased streaming revenue by 12% year-over-year, driven by enhanced monetization across multiple ad channels and expansion of NFL representation to include streaming rights for first time ever

• Delivered net income of $16.2 million, a decrease of 6% with margin reduction of approximately 20 basis points

  • Recorded a non-cash, pre-tax FCC license impairment charge of $15.5 million in 2022

  • Recorded a gain on early extinguishment of debt of $20.0 million in 2021

• Increased Adjusted EBITDA⁽¹⁾ by 23% year-over-year, to $166.0 million

  • Finished 2022 with full year fixed costs approximately $90 million below 2019 baseline

  • Increased Adjusted EBITDA margin⁽¹⁾ year-over-year by approximately 270 basis points

  • Generated $78.5 mm of cash from operations

• Completed $31.8 million of share repurchases for 2.5 million shares (representing 12.1% of weighted average diluted common shares outstanding as of 12/31/21)

  • Completed $25.0 million tender offer for 1.7 million shares

  • Repurchased additional $6.8 million of shares in open market (approximately 817,000 shares)

  • Retained $18.2 million of availability at year-end under previously announced $50 million share repurchase authorization

• Reduced gross debt by $86.5 million, achieving the lowest net leverage levels in more than a decade – best among peers

  • Retired $74.0 million of debt (both term loan and senior notes) through open market repurchases at an average price of 93.9% of par

  • Reported total debt of $719.4 million, cash of $107.4 million and net debt⁽¹⁾ of $611.9 million at 12/31/22

  • Reduced net leverage⁽¹⁾ from 4.7x at 12/31/21 to 3.7x at 12/31/22

Operating Summary (dollars in thousands, except percentages and per share data):

For the three months ended December 31, 2022, the Company reported net revenue of $251.3 million, a decrease of 0.4% from the three months ended December 31, 2021, net loss of $0.1 million and Adjusted EBITDA of $42.7 million.

For the year ended December 31, 2022, the Company reported net revenue of $953.5 million, an increase of 4.0% from the year ended December 31, 2021, net income of $16.2 million and Adjusted EBITDA of $166.0 million.

As Reported	Three Months Ended December 31, 2022			Three Months Ended December 31, 2021			% Change
Net revenue	$	251,270		$	252,304		(0.4)%
Net (loss) income	$	(54)		$	17,639		N/A
Adjusted EBITDA	$	42,717		$	43,241		(1.2)%
Basic (loss) income per share	$	(0.00)		$	0.86		N/A
Diluted (loss) income per share	$	(0.00)		$	0.84		N/A

As Reported	Year Ended December 31, 2022			Year Ended December 31, 2021			% Change
Net revenue	$	953,506		$	916,467		4.0	%
Net income	$	16,235		$	17,278		(6.0	)%
Adjusted EBITDA	$	165,982		$	134,857		23.1	%
Basic income per share	$	0.83		$	0.84		(1.2	)%
Diluted income per share	$	0.81		$	0.83		(2.4	)%

(1)   Adjusted EBITDA, Adjusted EBITDA margin, net debt, and net leverage are not financial measures calculated or presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Net leverage is as defined in our Senior Credit Facility. For additional information, see “Non-GAAP Financial Measures.”

Revenue Detail Summary (dollars in thousands):

As Reported	Three Months Ended December 31, 2022			Three Months Ended December 31, 2021			% Change
Broadcast radio revenue:
Spot	$	124,099		$	121,820		1.9	%
Network		63,525			71,318		(10.9	)%
Total broadcast radio revenue		187,624			193,138		(2.9	)%
Digital		37,708			35,036		7.6	%
Other		25,938			24,130		7.5	%
Net revenue	$	251,270		$	252,304		(0.4	)%

As Reported	Year Ended December 31, 2022			Year Ended December 31, 2021			% Change
Broadcast radio revenue:
Spot	$	479,834		$	457,607		4.9	%
Network		229,772			252,567		(9.0	)%
Total broadcast radio revenue		709,606			710,174		(0.1	)%
Digital		142,312			126,874		12.2	%
Other		101,588			79,419		27.9	%
Net revenue	$	953,506		$	916,467		4.0	%

Balance Sheet Summary (dollars in thousands):

			December 31, 2022			December 31, 2021
	Cash and cash equivalents		$	107,433		$	177,028
	Term loan due 2026 (2)		$	338,452		$	356,240
	6.75% Senior notes (2)		$	380,927		$	449,695

		Year Ended December 31, 2022			Year Ended December 31, 2021
	Capital expenditures	$	31,062		$	29,091
		Three Months Ended December 31, 2022			Three Months Ended December 31, 2021
	Capital expenditures	$	12,502		$	7,103

(2)   Excludes unamortized debt issuance costs.

Earnings Conference Call Details
The Company will host a conference call today at 8:30 AM ET to discuss its fourth quarter and full year 2022 operating results. NetRoadshow (NRS) is the service provider for this call. They will require email address verification (one-time only) and will provide registration confirmation. To participate in the conference call, please register in advance using the link on the Company’s investor relations website at www.cumulusmedia.com/investors. Upon completing registration, a calendar invitation will follow with call access details, including a unique PIN, and replay details.

To join by phone with operator-assisted dial-in, domestic callers should dial 833-470-1428 and international callers should dial 404-975-4839. If prompted, the participant access code is 463875. Please call five to ten minutes in advance to ensure that you are connected prior to the call.

The conference call will also be broadcast live in listen-only mode through a link on the Company’s investor relations website at www.cumulusmedia.com/investors. This link can also be used to access a recording of the call, which will be available shortly following its completion.

Please see an update to the Company’s investor presentation on the Company’s investor relations website at www.cumulusmedia.com/investors, which may be referenced on the conference call. Unless otherwise specified, information contained in the investor presentation or on our website is not incorporated into this press release or other documents we file with, or furnish to, the SEC.

Forward-Looking Statements
Certain statements in this release may constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Such statements are statements other than historical fact and relate to our intent, belief or current expectations primarily with respect to our future operating, financial, and strategic performance and our plans and objectives, including with regard to returning capital to shareholders. Any such forward-looking statements are not guarantees of future performance and involve risks, uncertainties and other factors that may cause actual results, performance or achievements to differ from those contained in or implied by the forward-looking statements as a result of various factors. Such factors include, among others, risks and uncertainties related to the implementation of our strategic operating plans, the continued uncertain financial and economic conditions, the amount and frequency of our shareholder capital returns, the rapidly changing and competitive media industry, and the economy in general. We are subject to additional risks and uncertainties described in our quarterly and annual reports filed with the Securities and Exchange Commission from time to time, including in the "Risk Factors," and "Management’s Discussion and Analysis of Financial Condition and Results of Operations" sections contained therein. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company’s control, and the unexpected occurrence or failure to occur of any such events or matters could cause our actual results, performance, financial condition or achievements to differ materially from those expressed or implied by such forward-looking statements. Cumulus Media assumes no responsibility to update any forward-looking statements, which are based upon expectations as of the date hereof, as a result of new information, future events or otherwise.

About Cumulus Media
Cumulus Media (NASDAQ: CMLS) is an audio-first media company delivering premium content to over a quarter billion people every month — wherever and whenever they want it. Cumulus Media engages listeners with high-quality local programming through 404 owned-and-operated radio stations across 85 markets; delivers nationally-syndicated sports, news, talk, and entertainment programming from iconic brands including the NFL, the NCAA, the Masters, CNN, the AP, the Academy of Country Music Awards, and many other world-class partners across more than 9,400 affiliated stations through Westwood One, the largest audio network in America; and inspires listeners through the Cumulus Podcast Network, its rapidly growing network of original podcasts that are smart, entertaining and thought-provoking. Cumulus Media provides advertisers with personal connections, local impact and national reach through broadcast and on-demand digital, mobile, social, and voice-activated platforms, as well as integrated digital marketing services, powerful influencers, full-service audio solutions, industry-leading research and insights, and live event experiences. Cumulus Media is the only audio media company to provide marketers with local and national advertising performance guarantees. For more information visit www.cumulusmedia.com.

Non-GAAP Financial Measures

From time to time, we utilize certain financial measures that are not prepared or calculated in accordance with GAAP to assess our financial performance and profitability. Consolidated adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA” or “EBITDA”) is the financial metric by which management and the chief operating decision maker allocate resources of the Company and analyze the performance of the Company as a whole. Management also uses this measure to determine the contribution of our core operations to the funding of our corporate resources utilized to manage our operations and the funding of our non-operating expenses including debt service and acquisitions. In addition, consolidated Adjusted EBITDA is a key metric for purposes of calculating and determining our compliance with certain covenants contained in our Refinanced Credit Agreement.

In determining Adjusted EBITDA, we exclude the following from net (loss) income: interest, taxes, depreciation, amortization, stock-based compensation expense, gain or loss on the exchange, sale, or disposal of any assets or stations or early extinguishment of debt, local marketing agreement fees, restructuring costs, expenses relating to acquisitions and divestitures, non-routine legal expenses incurred in connection with certain litigation matters, and non-cash impairments of assets, if any. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by net revenue.

Management believes that Adjusted EBITDA, with and excluding impact of political advertising, although not a measure that is calculated in accordance with GAAP, is commonly employed by the investment community as a measure for determining the market value of a media company and, along with Adjusted EBITDA margin, for comparing the operational and financial performance among media companies. Management has also observed that Adjusted EBITDA, with and excluding impact of political advertising, is routinely utilized to evaluate and negotiate the potential purchase price for media companies. Given the relevance to our overall value, management believes that investors consider these metrics to be extremely useful.

The Company presents revenue, excluding impact of political revenue. As a result of the cyclical nature of the electoral system and the seasonality of the related political revenue, management believes presenting net revenue, excluding impact of political revenue, provides useful information to investors about the Company’s revenue growth comparable from period to period.

The Company presents the non-GAAP financial measure net debt which is total debt principal, gross, less cash and cash equivalents. The Company also presents the non-GAAP financial measure net leverage, which is defined in our Senior Credit Facility as net debt divided by Adjusted EBITDA. Management believes that net leverage and net debt are important measures to monitor leverage and evaluate the balance sheet. Additionally, net leverage is required for complying with certain covenants under the Company’s credit agreements.

We refer to Adjusted EBITDA, with and excluding the impact of political advertising, Adjusted EBITDA margin, net revenue, excluding impact of political revenue, net debt and net leverage as the “Non-GAAP Financial Measures.” Non-GAAP Financial Measures should not be considered in isolation or as a substitute for net income, net revenue, operating income, cash flows from operating activities or any other measure for determining the Company’s operating performance or liquidity that is calculated in accordance with GAAP. In addition, Non-GAAP Financial Measures may be defined or calculated differently by other companies and, therefore, comparability may be limited.

For further information, please contact:
Cumulus Media Inc.
Investor Relations Department
IR@cumulus.com
404-260-6600

Supplemental Financial Data and Reconciliations

Cumulus Media Inc.
Unaudited Condensed Consolidated Statements of Operations
(Dollars in thousands)

		Three Months Ended								Year Ended
		December 31, 2022				December 31, 2021				December 31, 2022				December 31, 2021
Net revenue		$	251,270			$	252,304			$	953,506			$	916,467
Operating expenses:
Content costs			99,685				98,382				357,478				358,691
Selling, general & administrative expenses			98,048				100,457				383,375				376,832
Depreciation and amortization			14,983				13,749				56,386				53,545
Local marketing agreement fees			13				13				44				1,075
Corporate expenses			11,060				10,337				47,980				55,029
Stock-based compensation expense			1,517				1,404				6,229				5,191
Restructuring costs			1,399				7,657				8,218				14,604
(Gain) loss on sale of assets or stations			(452	)			3,044				(1,537	)			(17,616	)
Impairment of intangible assets			15,544				—				15,544				—
Total operating expenses			241,797				235,043				873,717				847,351
Operating income			9,473				17,261				79,789				69,116
Non-operating (expense) income:
Interest expense			(17,402	)			(16,020	)			(64,890	)			(67,847	)
Gain on early extinguishment of debt			2,620				20,000				4,496				20,000
Other income (expense), net			294				(677	)			210				(1,009	)
Total non-operating (expense) income, net			(14,488	)			3,303				(60,184	)			(48,856	)
(Loss) income before income taxes			(5,015	)			20,564				19,605				20,260
Income tax benefit (expense)			4,961				(2,925	)			(3,370	)			(2,982	)
Net (loss) income		$	(54	)		$	17,639			$	16,235			$	17,278

The following tables reconcile net (loss) income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA and Adjusted EBITDA margin for the periods presented herein (dollars in thousands):        

As Reported		Three Months Ended December 31, 2022				Three Months Ended December 31, 2021
GAAP net (loss) income		$	(54	)		$	17,639
Income tax (benefit) expense			(4,961	)			2,925
Non-operating expense, including net interest expense			17,108				16,697
Local marketing agreement fees			13				13
Depreciation and amortization			14,983				13,749
Stock-based compensation expense			1,517				1,404
(Gain) loss on sale or disposal of assets or stations			(452	)			3,044
Impairment of intangible assets			15,544				—
Restructuring costs			1,399				7,657
Non-routine legal expenses			21				41
Gain on early extinguishment of debt			(2,620	)			(20,000	)
Franchise taxes			219				72
Adjusted EBITDA		$	42,717			$	43,241
Net revenue		$	251,270			$	252,304
Adjusted EBITDA margin			17.0	%			17.1	%

As Reported		Year Ended December 31, 2022				Year Ended December 31, 2021
GAAP net income		$	16,235			$	17,278
Income tax expense			3,370				2,982
Non-operating expense, including net interest expense			64,680				68,856
Local marketing agreement fees			44				1,075
Depreciation and amortization			56,386				53,545
Stock-based compensation expense			6,229				5,191
Gain on sale or disposal of assets or stations			(1,537	)			(17,616	)
Impairment of intangible assets			15,544				—
Restructuring costs			8,218				14,604
Non-routine legal expenses			544				8,257
Gain on early extinguishment of debt			(4,496	)			(20,000	)
Franchise taxes			765				685
Adjusted EBITDA		$	165,982			$	134,857
Net revenue		$	953,506			$	916,467
Adjusted EBITDA margin			17.4	%			14.7	%

The following tables reconcile the as reported net revenue and as reported Adjusted EBITDA, both including and excluding the impact of political, for the periods presented herein (dollars in thousands):

		Three Months Ended December 31, 2022				Three Months Ended December 31, 2021
As reported net revenue		$	251,270			$	252,304
Political revenue			(8,298	)			(1,391	)
As reported net revenue, excluding impact of political revenue		$	242,972			$	250,913

		Three Months Ended December 31, 2022				Three Months Ended December 31, 2021
As reported Adjusted EBITDA		$	42,717			$	43,241
Political EBITDA			(7,469	)			(1,252	)
As reported Adjusted EBITDA, excluding impact of political EBITDA		$	35,248			$	41,989

		Year Ended December 31, 2022				Year Ended December 31, 2021
As reported net revenue		$	953,506			$	916,467
Political revenue			(18,425	)			(4,656	)
As reported net revenue, excluding impact of political revenue		$	935,081			$	911,811

		Year Ended December 31, 2022				Year Ended December 31, 2021
As reported Adjusted EBITDA		$	165,982			$	134,857
Political EBITDA			(16,583	)			(4,190	)
As reported Adjusted EBITDA, excluding impact of political EBITDA		$	149,399			$	130,667

The following table sets forth a reconciliation of our total debt principal, gross, cash and cash equivalents, and Adjusted EBITDA to net leverage for the periods presented herein (dollars in thousands):

		As of December 31,
			2022				2021
Total debt principal, gross		$	719,379			$	805,935
Less: Cash and cash equivalents			(107,433	)			(177,028	)
Total debt principal, net		$	611,946			$	628,907

		Year Ended December 31,
		2022			2021
Adjusted EBITDA		$	165,982		$	134,857
Net leverage		3.7x			4.7x