U.S. Markets close in 5 hrs 20 mins

Edited Transcript of SALM earnings conference call or presentation 12-Nov-19 9:00pm GMT

Q3 2019 Salem Media Group Inc Earnings Call

CAMARILLO Dec 2, 2019 (Thomson StreetEvents) -- Edited Transcript of Salem Media Group Inc earnings conference call or presentation Tuesday, November 12, 2019 at 9:00:00pm GMT

TEXT version of Transcript

================================================================================

Corporate Participants

================================================================================

* David A. R. Evans

Salem Media Group, Inc. - President of New Media

* David P. Santrella

Salem Media Group, Inc. - President of Broadcast Media

* Edward G. Atsinger

Salem Media Group, Inc. - CEO & Director

* Evan D. Masyr

Salem Media Group, Inc. - Executive VP & CFO

================================================================================

Conference Call Participants

================================================================================

* Jeff Menapace

* Lisa Springer

Singular Research, LLC - Research Analyst

* Michael A. Kupinski

NOBLE Capital Markets, Inc., Research Division - Director of Research and Senior Media & Entertainment Analyst

* Steve Bassett

Calamos Investments LLC - Senior Credit Analyst

================================================================================

Presentation

--------------------------------------------------------------------------------

Operator [1]

--------------------------------------------------------------------------------

Greetings and welcome to Salem Media Group's Third Quarter 2019 Earnings Call. (Operator Instructions) As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Evan Masyr, CFO. Please go ahead.

--------------------------------------------------------------------------------

Evan D. Masyr, Salem Media Group, Inc. - Executive VP & CFO [2]

--------------------------------------------------------------------------------

Thank you, and thank you all for joining us today for Salem Media Group's third quarter 2019 earnings call. As a reminder, if you get disconnected at any time, you can dial back in or listen from our website at www.salemmedia.com.

With me today are Edward Atsinger, Chief Executive Officer; and David Evans, President of Interactive and Publishing. David Santrella, President of Broadcast Media, is out of town but on the call as well. We'll begin in just a moment with our prepared remarks. And once we are done, the conference call operator will come back on the line to instruct you on how to submit questions.

Please be advised that statements made on this call that relate to future plans, events, financial results, prospects or performance are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on currently available information. Actual results may differ materially from those anticipated, and reported results should not be considered an indication of future performance. We do not intend and undertake no obligation to update our forward-looking statements, including forecasts of future performance, the potential for growth of existing markets, the opening of new markets or the potential growth from future acquisitions.

This conference call also contains non-GAAP financial measures within the meaning of Regulation G, specifically station operating income or SOI, EBITDA, adjusted EBITDA and adjusted free cash flow. In conformity with Regulation G, information required to accompany the disclosure of non-GAAP financial measures is available on the Investor Relations portion of the company's website at www.salemmedia.com.

I will now turn the call over to Edward Atsinger. Ed?

--------------------------------------------------------------------------------

Edward G. Atsinger, Salem Media Group, Inc. - CEO & Director [3]

--------------------------------------------------------------------------------

Thank you, Evan, and thanks to all of you for taking the time to join us for this quarterly update. I'll begin my prepared remarks with an overview of the third quarter financial performance and then proceed to update you on recent M&A activity, and we'll conclude with a brief comment on our quarterly cash distribution. At that point, I'll turn the call back to Evan who will provide a more detailed explanation and information on third quarter and also provide guidance for the last quarter of the year.

With that said, for the third quarter of 2019, our revenue was a bit better than the guidance we provided on our last earnings call. The pacing at that time suggested a decline in revenue of between 4% and 6%. However, we were able to finish the quarter a little better than predicted with a decline of only 2.2%. Recurring operating expenses were down 0.1%, which was within the guidance we provided. For the quarter, adjusted EBITDA was down 13%.

Let me break down those numbers by division in terms of revenue and expenses. For the quarter, Broadcast revenue declined 2.3% or $1.1 million. A meaningful amount of this decline was due to the fact that we sold radio stations in the Miami and in the Omaha markets. When considered on a same-station basis, Broadcast revenue was down 1.4% or $650,000.

In addition to the impact of revenue from the stations that were sold, our Broadcast revenue was also impacted by the absence of political revenue in this nonelection year. In the third quarter of last year, this division had $1.2 million of political revenue, but only $200,000 of political revenue in the third quarter of this year, a decline of $1 million. Adjusting for the impact of the radio station sales and the reduction in political revenue, Broadcast revenue actually increased 0.7% or $350,000.

On a same-station basis and excluding political revenue, total spot revenue, including local and national, was down 1%. The network component of the Broadcast division, however, performed well, with revenue up 9% when political revenue is factored out. We've been pleased with the success achieved by our network talent, especially pleased with the growth of Sebastian Gorka's America First program, which we only launched in January of 2019.

Local digital revenue continues to perform well largely due to our investment in Salem Surround. In the third quarter, total digital revenue was up $1.5 million or 68.3% to $3.7 million. Additionally, the growth in profitability of Salem Surround has been consistent with our expectations. Broadcast expenses increased only 0.4% despite the increased digital revenue, which has a higher cost structure. We're continually looking for ways to be more efficient and contain the growth in expenses.

In our national digital division, both page views and programmatic revenue were up. Direct advertising revenue, however, was down due to the continued level of competition for revenue from Google and Facebook. This led to revenue declining 12% or $1.2 million in the third quarter of 2019. We were able to cut expenses by 9.2% to offset at least part of the revenue decline.

Finally, our Publishing division posted strong third quarter results with revenue increasing 15.3% or by almost $1 million. The growth came entirely from Regnery, our traditional book publisher, as a result of a strong book publishing schedule in the quarter. In particular, we had strong book sales from Carrie Severino and Mollie Hemingway's Justice on Trial: The Kavanaugh Confirmation and the Future of the Supreme Court and also from Michelle Malkin's Open Borders Inc.: Who's Funding America's Destruction? And finally, Greg Laurie's Johnny Cash: The Redemption of an American Icon. All those books have done well in the quarter.

We should also add that we have a solid lineup of books scheduled to be released in the fourth quarter. Included in the lineup are Sebastian Gorka's The War for America's Soul: Donald Trump, the Left's Assault on America, and How We Take Back our Country. And then Charlotte and Karen Pence's Marlon Bundo's Best Christmas Ever and finally, David Limbaugh's Guilty By Reason of Insanity: Why The Democrats Must Not Win.

Expenses in the Publishing division were up 4.9% due to the cost of sales related to the revenue growth. For the quarter, the Publishing division generated a profit of almost $800,000 compared to only $100,000 in Q3 of last year.

Let's take a look at the M&A activity. We had quite a bit to report. On September 18, we sold WORL-AM in Orlando for $900,000. Additionally, on September 26, we sold 4 radio stations, WLCC-AM, WWMI-AM in Tampa; and WOCN-AM, formerly WKTA-AM (sic) [WTKA-AM], and WZAB-AM in Miami for $8.2 million. Despite the fact that the stations closed in September, I might add the proceeds were held in escrow until FCC finality was issued. Accordingly, we did not receive proceeds until October 23, but that deal is now completed.

Also, on September 27, we finalized the swap of KKOL-AM in Seattle for KPAM-AM in Portland. We currently have 2 sales pending. We're selling 9 radio stations for $8.7 million. The stations to be sold are WAFS-AM in Atlanta; WWDJ-AM in Boston; WHKZ-AM in Cleveland; KEXB-AM, formerly KTNO-AM, in Dallas; KDTM-AM in Denver; KTEK-AM in Houston; KRDY-AM in San Antonio; KXFM-AM in St. Louis; and WSDZ-AM in St. Louis. We're expecting this transaction to close and fund later this week or early next week, and we intend to use all of the proceeds to pay down debt.

On October 31, we also entered into a transaction to sell the FCC license and transmitter site equipment associated with WBZW-AM in Apopka, Florida, a suburb of Orlando, for $185,000. Salem is retaining the 10-acre transmitter site. We expect to close on this transaction in the first half of 2020.

We also had 2 small website acquisitions. On July 10, we acquired selected items from the digital content library from Steel House Productions, Inc. (sic) [Steel House Productions] for $100,000 in cash. And on July 25, we bought journeyboxmedia.com for $500,000.

Finally, with regard to our cash distribution, we paid $1.7 million of quarterly, call it, dividends or $0.065 per share on September 30, 2019. At $0.26 per share, annual news represents a very attractive 16.4% dividend yield based upon the current stock price. And of course, it's not a dividend, it's a cash distribution on return of capital.

And with that, I'll turn the call back to you, Evan, for additional details on the quarter's performance and to provide guidance for Q4.

--------------------------------------------------------------------------------

Evan D. Masyr, Salem Media Group, Inc. - Executive VP & CFO [4]

--------------------------------------------------------------------------------

Thank you, Ed. And before I get started reviewing the numbers, allow me to address the delay in our earnings release. Because we had a 3-year cumulative pretax loss, in large part, due to the sale of some stations, we were required to perform a detailed analysis on the necessity of additional valuation allowances against our deferred tax assets. This resulted in $5.4 million in valuation allowances being recorded during the third quarter.

Now turning back to results. For the third quarter, total revenue decreased 2.2% to $64.1 million. Operating expenses on a recurring basis decreased 0.1% to $55.1 million, which resulted in a 13.0% decrease in adjusted EBITDA to $9.0 million. Net Broadcast revenue decreased 2.3% to $47.7 million, and Broadcast operating expenses increased 0.4% to $37.3 million, resulting in station operating income of $10.4 million or a decline of 11.0%. On a same-station basis, net Broadcast revenue decreased 1.4% to $46.5 million, and SOI decreased 11.4% to $10.6 million. These same-station results include Broadcast revenue from 104 of our 109 radio stations in our network operations and represents about 98% of our net Broadcast revenue.

I'll briefly review revenue performance of our strategic formats. 38 of our radio stations are programmed in our foundational Christian teaching and talk format. These stations contributed 40% of total Broadcast revenue and decreased 6.6% for the quarter driven, in large part, by a reduction in event revenue due to timing and a 2.3% decrease in national block programming revenue. Our 33 news talk stations had a decrease of 10.9% in revenue for the quarter. Some of this decrease was due to the lack of political revenue. Overall, these stations contributed 18% of total Broadcast revenue. Revenue from our 12 temporary Christian music stations contributed 19% of total Broadcast revenue and decreased 5.3% for the quarter. Our network revenue with political factored in decreased 4.9% for the quarter and represents 10% of total Broadcast revenue. Revenue from our national Digital Media business decreased 12.0% to $9.1 million and represents 14% of our total revenue.

Our Publishing revenue increased 15.3% to $7.3 million and represents 11% of our total revenue. As of September 30, 2019, we had $231.9 million outstanding on our bonds and $18.1 million outstanding under the revolver. Our leverage ratio was 6.57. And for the fourth quarter of 2019, we're projecting total revenue to decrease between 4% and 6% from fourth quarter 2018 total revenue of $67.2 million. Excluding the impact of political revenue and recent acquisitions and dispositions, we are projecting total revenue to be between flat and a decrease of 2%.

We're also projecting operating expenses before gains or losses on disposition of assets, stock-based compensation expense, changes in the estimated fair value of contingent earn-out consideration, impairments, depreciation expense and amortization expense to be between an increase of 1% and a decrease of 2% compared to the fourth quarter of 2018 non-GAAP operating expenses of $55.6 million.

And this now concludes our prepared remarks, and we'd like to answer any questions you may have, so I will turn the call back over to the operator. And Brock, can you take it from here?

================================================================================

Questions and Answers

--------------------------------------------------------------------------------

Operator [1]

--------------------------------------------------------------------------------

(Operator Instructions) Our first question today is from Michael Kupinski of NOBLE Capital Markets.

--------------------------------------------------------------------------------

Michael A. Kupinski, NOBLE Capital Markets, Inc., Research Division - Director of Research and Senior Media & Entertainment Analyst [2]

--------------------------------------------------------------------------------

I was wondering, first, if you can just talk a little bit about the fact that you have all these planned station sales, it looks like you're going to be closing here shortly. And given the prospective free cash flow in Q4, where will debt leverage be by year-end? And what are your goals looking to maybe 2020?

--------------------------------------------------------------------------------

Evan D. Masyr, Salem Media Group, Inc. - Executive VP & CFO [3]

--------------------------------------------------------------------------------

Yes. So with respect to leverage in our plans, first of all, as Ed mentioned, we should be getting an additional $8.7 million here in the next week or so. We're going to use that, along with the proceeds that we already had, to really focus on paying down our debt. Leverage will still be -- given the guidance that we gave, we'll still probably be north of 6 at the end of Q4, but our goal is to continue to get that leverage down as low as possible.

--------------------------------------------------------------------------------

Michael A. Kupinski, NOBLE Capital Markets, Inc., Research Division - Director of Research and Senior Media & Entertainment Analyst [4]

--------------------------------------------------------------------------------

And at this point, there's no plan on cutting the dividend to be more aggressive on debt paydown, that sort of thing, at this point.

--------------------------------------------------------------------------------

Edward G. Atsinger, Salem Media Group, Inc. - CEO & Director [5]

--------------------------------------------------------------------------------

Our Board looks at it every quarter. We have -- our next Board meeting is in early December. And I'm sure, as it has been in every Board meeting in recent past, it will be on object that they'll -- an issue that they'll take a look at and make a decision at that time.

--------------------------------------------------------------------------------

Michael A. Kupinski, NOBLE Capital Markets, Inc., Research Division - Director of Research and Senior Media & Entertainment Analyst [6]

--------------------------------------------------------------------------------

Got you. And how does the planned station sales affect your network business? Does that have any effect at all?

--------------------------------------------------------------------------------

Edward G. Atsinger, Salem Media Group, Inc. - CEO & Director [7]

--------------------------------------------------------------------------------

No. Most of the stations that we sold were not in what we consider key mission formats. A lot of the stations were stations we picked up from Disney at very attractive prices. And so most of them were not significant in terms of network.

--------------------------------------------------------------------------------

Michael A. Kupinski, NOBLE Capital Markets, Inc., Research Division - Director of Research and Senior Media & Entertainment Analyst [8]

--------------------------------------------------------------------------------

Okay. And then can you talk -- I'm sorry.

--------------------------------------------------------------------------------

Edward G. Atsinger, Salem Media Group, Inc. - CEO & Director [9]

--------------------------------------------------------------------------------

I was just going to say, we didn't give up a lot of cash flow with them either.

--------------------------------------------------------------------------------

Michael A. Kupinski, NOBLE Capital Markets, Inc., Research Division - Director of Research and Senior Media & Entertainment Analyst [10]

--------------------------------------------------------------------------------

Got you. And then can you talk a little bit about your block programming heading into 2020, in particular, if you could just talk about maybe the health of some of the ministries? And is there a prospect that they would be able to absorb a price increase? Are you planning a price increase going into January of 2020? Can you just kind of give us some color there?

--------------------------------------------------------------------------------

David P. Santrella, Salem Media Group, Inc. - President of Broadcast Media [11]

--------------------------------------------------------------------------------

Yes, this is Dave. Hopefully, you all can hear me, and it's not too -- the ambient noise isn't too bad. We've just begun the renewal process. So far, it's going exceptionally well. We do -- I think we do go for rate increases every year because they're necessary, and we'll be doing that again this year. And so far, that process has been good. Our ministries are healthy, and we work very strategically with them. So we anticipate this being another good season there.

--------------------------------------------------------------------------------

Michael A. Kupinski, NOBLE Capital Markets, Inc., Research Division - Director of Research and Senior Media & Entertainment Analyst [12]

--------------------------------------------------------------------------------

Got you. And then just a final question. Can you add a little bit more color on the Publishing segment? Typically, I know that the book tend to do well as you kind of enter an election cycle, and it's surprising that you did so well in this quarter. I was wondering if you could just frame what happened in the quarter. Is this the time when Publishing starts to pick up? Or is it more into next year when we could expect maybe some continued follow-through on the Publishing segment?

--------------------------------------------------------------------------------

David A. R. Evans, Salem Media Group, Inc. - President of New Media [13]

--------------------------------------------------------------------------------

Well, we have had a good year with book publishing. It was a strong release schedule. Q3 was the strongest quarter of the year in terms of the books that we released. So definitely pleased with the performance this year. Political years, even-numbered years, election years tend to do a little bit better. If you look back at history, even-numbered years tend to be about 5% better than odd-numbered years, so 2020 is something to look forward to. But we do have some tougher comps from 2019. So yes, I do expect a little bit of growth from '19 to '20 but not as much as you'd expect because of the tough comps from this year.

--------------------------------------------------------------------------------

Operator [14]

--------------------------------------------------------------------------------

The next question is from Lisa Springer of Singular Research.

--------------------------------------------------------------------------------

Lisa Springer, Singular Research, LLC - Research Analyst [15]

--------------------------------------------------------------------------------

There's been a lot on the news lately about the pressure on Facebook regarding political advertising. Does that create any opportunity for you? Or are you feeling the same kind of pressure around political ads?

--------------------------------------------------------------------------------

David P. Santrella, Salem Media Group, Inc. - President of Broadcast Media [16]

--------------------------------------------------------------------------------

On the Broadcast side, I would -- David, I'll answer quickly on the Broadcast side and then give it to you. On the Broadcast side, certainly, we do think that, that provides opportunity to see increased political revenue.

--------------------------------------------------------------------------------

David A. R. Evans, Salem Media Group, Inc. - President of New Media [17]

--------------------------------------------------------------------------------

On the digital side, Facebook is definitely scrutinizing ads very closely, anything of a political nature. Twitter has made the decision not to take any political ads. That political spend is still going to take place, and we hope to benefit from that.

--------------------------------------------------------------------------------

Lisa Springer, Singular Research, LLC - Research Analyst [18]

--------------------------------------------------------------------------------

Okay. And Dennis Prager seems to be doing fairly well with the new movie -- the new documentary that came out, No Safe Spaces. I wonder if he's got any books in the lineup. Is there any way that you're going to be leveraging any success from the movie?

--------------------------------------------------------------------------------

David A. R. Evans, Salem Media Group, Inc. - President of New Media [19]

--------------------------------------------------------------------------------

Yes. We've already -- we've published 2 books with Dennis, one this year, 2019; another one last year, 2018; his commentaries on the first 2 books of the bible, Genesis and Exodus; and then, most recently, we did publish the book of the movie, No Safe Spaces. So yes, we are participating in that and have participated in that on a book publishing level.

--------------------------------------------------------------------------------

Operator [20]

--------------------------------------------------------------------------------

The next question is from Steve Bassett of Calamos.

--------------------------------------------------------------------------------

Steve Bassett, Calamos Investments LLC - Senior Credit Analyst [21]

--------------------------------------------------------------------------------

A couple of questions. One, on the larger -- of the 2 larger of the acquisition -- or acquisitions, the asset sales that you've discussed, indicated that on -- that at pretty high multiples of EBITDA. Do you have a feel for the buyers of those assets? Are they going to reformat those stations? And is that why they were willing to pay such a high multiple of run rate EBITDA? And then, I guess, the second part of that question is, is there any -- are there any more stations that you have, that if you look into 2020, that may be relatively underperforming where you can be more aggressive in terms of looking to monetize those assets as well?

--------------------------------------------------------------------------------

Edward G. Atsinger, Salem Media Group, Inc. - CEO & Director [22]

--------------------------------------------------------------------------------

They have reformatted all of the stations. It's one large group of relevant radio, and they -- but they paid essentially stick values for the properties. They were good properties, valuable properties and they were all AM properties. So they did command a very good price, and we were pleased with it. We don't have a whole lot more. We may have a few more that could be candidates. Even though when you have 110 radio stations, you can always find a few that are probably not performing at the level you'd like them to. And if you got a very attractive offer, and they weren't a key network affiliate format, we'd consider selling them. So yes, we have a few but don't have anything that I can mention today, but when those situations develop, of course, we'll announce it to the public.

--------------------------------------------------------------------------------

Steve Bassett, Calamos Investments LLC - Senior Credit Analyst [23]

--------------------------------------------------------------------------------

Okay. And just lastly, circling back on the dividend, and I understand the fact that it's a quarterly Board decision, but could you provide maybe a little bit of color in terms of what the discussion details and at what point and at what leverage profile? And based on guidance for Q4, it looks like EBITDA for the year will be plus or minus $35 million, which gets you to around 7x leverage. At what leverage profile do you say that's just too high and we have to cut it?

--------------------------------------------------------------------------------

Evan D. Masyr, Salem Media Group, Inc. - Executive VP & CFO [24]

--------------------------------------------------------------------------------

Well, let me just give you my perspective as I sit in on the Board meetings and listen to the discussions. We, as a company, want to be in a position that when we have to refinance again in 2023 -- well, really in 2024, but sometime in '23 is likely when it will happen, that we're in a safe place to do that. So we continually model out where we think EBITDA is going to be, where debt is going to be and present that to the Board as they make their decisions. So we're really looking at where -- not where leverage is today but where it's going to be when we're looking to refinance. And if it gets to a point where we don't think we're going to be in a safe position, I assume that's when the Board would make a decision.

--------------------------------------------------------------------------------

Edward G. Atsinger, Salem Media Group, Inc. - CEO & Director [25]

--------------------------------------------------------------------------------

And I might add that one of the major factors the Board considers in every quarterly meeting but particularly at year-end meetings is what the budget looks like for next year. So when we meet in December, we will be taking a look at the proposed budget for the upcoming year. It is an election year. We'll assess the strength of it. And I think that will be a major factor in whatever decision is made.

--------------------------------------------------------------------------------

Operator [26]

--------------------------------------------------------------------------------

The next question is from Anthony Petrone of Jefferies.

(Operator Instructions) Our next question is from Jeff Menapace of FTN Financial.

--------------------------------------------------------------------------------

Jeff Menapace, [27]

--------------------------------------------------------------------------------

Just a couple of quick ones for me. Did you say, Edward, that the proceeds from the Florida sale weren't on the 9/30 balance sheet?

--------------------------------------------------------------------------------

Evan D. Masyr, Salem Media Group, Inc. - Executive VP & CFO [28]

--------------------------------------------------------------------------------

That's -- this is Evan. That's correct. It was held in escrow until FCC granted finality, and we got that money on October 23.

--------------------------------------------------------------------------------

Jeff Menapace, [29]

--------------------------------------------------------------------------------

Okay. Great. And then with respect to the ABL, can you tell me what -- either what the borrowing base was at quarter end or what availability, net of the borrowing base, was at quarter end?

--------------------------------------------------------------------------------

Evan D. Masyr, Salem Media Group, Inc. - Executive VP & CFO [30]

--------------------------------------------------------------------------------

I don't have that exact number on me, but it's usually somewhere in the $25 million to $26 million range.

--------------------------------------------------------------------------------

Jeff Menapace, [31]

--------------------------------------------------------------------------------

Okay. And then are -- is availability, are there -- so you had $18.1 million of borrowings. Are there LOCs that further reduce? Or should I take or -- can I take $25 million, $26 million less $18.1 million is about $8 million of availability? Is there anything reducing availability I'm not considering?

--------------------------------------------------------------------------------

Evan D. Masyr, Salem Media Group, Inc. - Executive VP & CFO [32]

--------------------------------------------------------------------------------

I think at September 30, there was $1 million LOC, but that has since been returned back to us. So for today's purposes, you could use the $26 million minus $18 million as a proxy.

--------------------------------------------------------------------------------

Jeff Menapace, [33]

--------------------------------------------------------------------------------

About $8 million. And then you got $8 million of proceeds you just mentioned in October from the Florida sale? Okay. And then with respect -- go ahead.

--------------------------------------------------------------------------------

Evan D. Masyr, Salem Media Group, Inc. - Executive VP & CFO [34]

--------------------------------------------------------------------------------

And we have another $8.7 million coming into the next week or so.

--------------------------------------------------------------------------------

Jeff Menapace, [35]

--------------------------------------------------------------------------------

In the fourth quarter, right, yes. Great. And then with respect to -- so obviously, a lot of acquisition divestiture activity. Would you characterize these moves as opportunistic or strategic?

--------------------------------------------------------------------------------

Edward G. Atsinger, Salem Media Group, Inc. - CEO & Director [36]

--------------------------------------------------------------------------------

Well, I would say they're probably both. We're very satisfied with the price. We found a buyer that had particular goals and objectives that we were able to satisfy with a very large group of stations in the cities that they were interested in. And it's a company we've done business with before, and they're very -- they like how we do business, and they like the way the properties have been maintained. So I think it was both strategic and opportunistic for us.

--------------------------------------------------------------------------------

Jeff Menapace, [37]

--------------------------------------------------------------------------------

Okay. Great. And then what was the station count at quarter end and the mix between AM and FM?

--------------------------------------------------------------------------------

Evan D. Masyr, Salem Media Group, Inc. - Executive VP & CFO [38]

--------------------------------------------------------------------------------

We have about -- pro forma for the sales, about 100 stations. I don't remember how many FM and AM. It's probably 2/3 AM, 1/3 FM, somewhere in that neighborhood, maybe a little bit more AM.

--------------------------------------------------------------------------------

Edward G. Atsinger, Salem Media Group, Inc. - CEO & Director [39]

--------------------------------------------------------------------------------

We do also have a very large number of FM translators. Most of the AM stations we have, have translator -- companion translators.

--------------------------------------------------------------------------------

Operator [40]

--------------------------------------------------------------------------------

There are no additional questions at this time. I would like to turn the call back to Edward Atsinger for closing remarks.

--------------------------------------------------------------------------------

Edward G. Atsinger, Salem Media Group, Inc. - CEO & Director [41]

--------------------------------------------------------------------------------

Well, thank you, operator. Thanks to all of you for joining us for the call. We look forward to talking about the year-end results on our next call.

--------------------------------------------------------------------------------

Operator [42]

--------------------------------------------------------------------------------

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.