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Entravision Communications Corporation Reports Fourth Quarter And Full Year 2018 Results

- Announces Quarterly Cash Dividend of $0.05 Per Share -

SANTA MONICA, Calif., May 7, 2019 /PRNewswire/ -- Entravision Communications Corporation (EVC) today reported financial results for the three- and twelve-month periods ended December 31, 2018.

Historical results, which are attached, are in thousands of U.S. dollars (except share and per share data). This press release contains certain non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measure most directly comparable to each of these non-GAAP financial measures, and a table reconciling each of these non-GAAP financial measures to its most directly comparable GAAP financial measure, are included beginning on page 12. Unaudited financial highlights are as follows:

 



Three Months Ended



Twelve Months Ended




December 31,



December 31,




2018



2017



% Change



2018



2017



% Change


Net revenue:

























Revenue from advertising and
retransmission consent


$

80,906



$

73,460




10

%


$

294,839



$

272,091




8

%

Revenue from spectrum usage rights



1,167




-



*




2,976




263,943




(99)

%



$

82,073



$

73,460




12

%


$

297,815



$

536,034




(44)

%


























Cost of revenue - television (spectrum
usage rights) (1)



-




209



*




-




12,340



*


Cost of revenue - digital media (1)



9,847




12,090




(19)

%



45,096




32,998




37

%

Operating expenses (2)



44,568




45,118




(1)

%



176,777




168,399




5

%

Corporate expenses (3)



7,711




8,242




(6)

%



26,865




27,937




(4)

%

Foreign currency (gain) loss



1,085




57




1804

%



1,616




350




362

%


























Consolidated adjusted EBITDA (4)



20,936




10,891




92

%



54,038




50,608




7

%


























Free cash flow (5)


$

12,237



$

5,855




109

%


$

25,001



$

287,088




(91)

%


























Net income


$

6,913



$

12,740




(46)

%


$

12,161



$

175,698




(93)

%


























Net income per share, basic


$

0.08



$

0.14




(43)

%


$

0.14



$

1.95




(93)

%

Net income per share, diluted


$

0.08



$

0.14




(43)

%


$

0.13



$

1.91




(93)

%


























Weighted average common shares
outstanding, basic



88,357,076




89,980,200








89,115,997




90,272,257






Weighted average common shares
outstanding, diluted



89,598,683




91,613,199








90,328,583




91,891,957







(1)      Cost of revenue – digital media consists primarily of the costs of online media acquired from third-party publishers. Media cost is classified as cost of revenue in the period in which the corresponding revenue is
          recognized. Cost of revenue – television (spectrum usage rights) consists primarily of the carrying value of spectrum usage rights surrendered in the Federal Communications Commission ("FCC") auction for
          broadcast spectrum.

(2)      For purposes of presentation in this table, the operating expenses line item includes direct operating and selling, general and administrative expenses. Included in operating expenses are $0.3 million and $0.4
          million of non-cash stock-based compensation for the three-month periods ended December 31, 2018 and 2017, respectively, and $0.7 million and $1.2 million of non-cash stock-based compensation for the twelve
          month periods ended December 31, 2018 and 2017, respectively. Also for purposes of presentation in this table, the operating expenses line item does not include corporate expenses, foreign currency (gain) loss,
          depreciation and amortization, impairment charge, gain (loss) on sale of assets, gain (loss) on debt extinguishment, other income (loss) and change in fair value of contingent consideration.

(3)      Corporate expenses include $1.8 million and $2.5 million of non-cash stock-based compensation for the three-month periods ended December 31, 2018 and 2017, respectively, and $5.1 million and $4.9 million of
          non-cash stock-based compensation for the twelve-month periods ended December 31, 2018 and 2017, respectively.

(4)      Consolidated adjusted EBITDA means net income (loss) plus gain (loss) on sale of assets, depreciation and amortization, non-cash impairment charge, non-cash stock-based compensation included in operating
          and corporate expenses, net interest expense, other income (loss), non-recurring cash expenses, gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income (loss) of nonconsolidated
          affiliate, non-cash losses, syndication programming amortization less syndication programming payments, revenue from FCC spectrum incentive auction less related expenses, expenses associated with
          investments, acquisitions and dispositions and certain pro-forma cost savings. We use the term consolidated adjusted EBITDA because that measure is defined in the agreement governing our current credit facility
          ("the 2017 Credit Facility") and does not include gain (loss) on sale of assets, depreciation and amortization, non-cash impairment charge, non-cash stock-based compensation, net interest expense, other income
          (loss), non-recurring cash expenses, gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income (loss) of nonconsolidated affiliate, non-cash losses, syndication programming
          amortization less syndication programming payments, revenue from FCC spectrum incentive auction less related expenses, expenses associated with investments, acquisitions and dispositions and certain pro
          forma cost savings.

(5)      Free cash flow is defined as consolidated adjusted EBITDA less cash paid for income taxes, net interest expense, capital expenditures and non-recurring cash expenses plus dividend income, FCC reimbursement
          for broadcast television repack and revenue from FCC auction for broadcast spectrum less related cash expenses. Net interest expense is defined as interest expense, less non-cash interest expense relating to
          amortization of debt finance costs, and less interest income.

Commenting on the Company's earnings results, Walter F. Ulloa, Chairman and Chief Executive Officer, said, "During the fourth quarter, we achieved growth in advertising revenue, driven by an increase in our television segment. We also improved our free cash flow over the fourth quarter of 2017. We continue to maintain a solid balance sheet and return capital to our shareholders through our share repurchase program and dividend. Looking ahead, we remain well positioned to build on our success in further attracting Latino and other audiences worldwide, as we execute our multiplatform strategy to the benefit of our shareholders."

Quarterly Cash Dividend

The Company announced today that its Board of Directors has approved a quarterly cash dividend to shareholders of $0.05 per share of the Company's Class A, Class B and Class U common stock, in an aggregate amount of approximately $4.3 million. The quarterly dividend will be payable on June 28, 2019 to shareholders of record as of the close of business on June 14, 2019, and the common stock will trade ex-dividend on June 13, 2019. As previously announced, the Company currently anticipates that future cash dividends will be paid on a quarterly basis; however, any decision to pay future cash dividends will be subject to approval by the Board.

Form 10-K Filed Today

The Company today filed its Annual Report on Form 10-K for the fiscal year ended December 31, 2018 (its "Form 10-K") with the Securities and Exchange Commission (the "SEC").

As previously disclosed by the Company, on April 3, 2019 the Company received a notice from the New York Stock Exchange (the "NYSE") that the Company was not in compliance with the NYSE's continued listing requirements under the timely filing criteria established in Section 802.01E of the NYSE Listed Company Manual (the "NYSE Rules"), because the Company did not timely file its Form 10-K with the SEC on or prior to the due date thereof or by the extended filing due date provided by Rule 12b-25.  Such notices are routinely issued by the NYSE when there are late filings with the SEC.  The NYSE informed the Company that, under the NYSE Rules, the Company had six months from April 2, 2019 to file its Form 10-K with the SEC. With today's filing of the Form 10-K with the SEC, the Company believes it has regained compliance with the NYSE Rules with respect to the Company's filing of its Form 10-K.

Expects to File Form 12b-25 for Extension of Filing Deadline for Form 10-Q for First Quarter

The Company announced today that it expects to file a notification of late filing on Form 12b-25 with the SEC, which provides an automatic 5-day extension of the filing deadline for its Quarterly Report on Form 10-Q for the first quarter ended March 31, 2019 (the "2019 First Quarter Form 10-Q"), to May 15, 2019. Due to the Company's delay in filing the Form 10-K, the Company experienced delays in the preparation of its financial statements for the first quarter ended March 31, 2019 and the filing of the 2019 First Quarter Form 10-Q. The Company expects to file the 2019 First Quarter Form 10-Q and announce the timing of a conference call to discuss its financial results for the first quarter ended March 31, 2019 as soon as practicable.

 

 Financial Results

Three-Month Period Ended December 31, 2018 Compared to Three-Month Period Ended December 31, 2017

(Unaudited)







Three Months Ended




December 31,




2018



2017



% Change


Net, revenue from advertising and retransmission consent


$

80,906



$

73,460




10

%

Revenue from spectrum usage rights



1,167




-



*


Total net revenue



82,073




73,460




12

%














Cost of revenue - television (spectrum usage rights) (1)



-




209



*


Cost of revenue - digital media (1)



9,847




12,090




(19)

%

Operating expenses (1)



44,568




45,118




(1)

%

Corporate expenses (1)



7,711




8,242




(6)

%

Depreciation and amortization



4,221




3,951




7

%

Change in fair value of contingent consideration



(2,275)




-



*


Foreign currency (gain) loss



1,085




57




1804

%

Other operating (gain) loss



(565)




(262)




116

%














Operating income



17,481




4,055




331

%

Interest expense, net



(3,261)




(5,326)




(39)

%

Dividend income



473




-



*


Gain (loss) on debt extinguishment



(550)




(3,306)




(83)

%

Impairment loss on investment



(1,320)




-



*















Income before income taxes



12,823




(4,577)



*


Income tax (expense) benefit



(4,713)




17,452



*















Net income (loss) before equity in net income (loss) of nonconsolidated
affiliates



8,110




12,875




(37)

%

Equity in net income (loss) of nonconsolidated affiliates



(1,197)




(135)




787

%

Net income


$

6,913



$

12,740




(46)

%














(1)      Cost of revenue, operating expenses and corporate expenses are defined on page 1.

Net revenue from advertising and retransmission consent increased to $80.9 million for the three-month period ended December 31, 2018 from $73.5 million for the three-month period ended December 31, 2017, an increase of $7.4 million. Of the overall increase, approximately $8.3 million was attributable to our television segment and was primarily due to an increase in political advertising revenue, which was not material in 2017, and an increase in retransmission consent revenue. This overall increase was partially offset by a decrease of approximately $0.6 million and $0.3 million that was attributable to our digital and radio segments, respectively.

Net revenue from spectrum usage rights was $1.2 million for the three-month period ended December 31, 2018. There was no revenue from spectrum usage rights for the three-month period ended December 31, 2017.

Cost of revenue in our digital media segment decreased to $9.8 million for the three-month period ended December 31, 2018 from $12.1 million for the three-month period ended December 31, 2017, a decrease of $2.3 million. The decrease was primarily due to the decrease in revenue.

Operating expenses decreased to $44.6 million for the three-month period ended December 31, 2018 from $45.1 million for the three-month period ended December 31, 2017, a decrease of $0.5 million. Of the overall decrease, approximately $2.0 million was attributable to our radio segment and was primarily due to a decrease in expenses associated with the decrease in revenue and a decrease in salary expense. The overall decrease was partially offset by an increase of approximately $1.0 million that was attributable to our digital segment and was primarily due to the acquisition of Smadex in the second quarter of 2018, which did not contribute to direct operating expenses in 2017. Additionally, the overall decrease was partially offset by an increase of approximately $0.5 million that was attributable to our television segment and was primarily due to an increase in expenses associated with the increase in revenue.

Corporate expenses decreased to $7.7 million for the three-month period December 31, 2018 from $8.2 million for the three-month period ended December 31, 2017, a decrease of $0.5 million, primarily due to a decrease in non-cash stock-based compensation expense.

Our historical revenues have primarily been denominated in U.S. dollars, and the majority of our current revenues continue to be, and are expected to remain, denominated in U.S. dollars. However, our operating expenses are generally denominated in the currencies of the countries in which our operations are located, and we have operations in countries other than the U.S., primarily related to the Headway business. As a result, we have operating expense, attributable to foreign currency loss, that is primarily related to the operations related to the Headway business. Foreign currency loss increased to $1.1 million for the three-month period December 31, 2018 from $0.1 million for the three-month period December 31, 2017, an increase of $1.0 million, which was primarily due to currency fluctuations that affected our digital segment operations located outside the U.S., primarily related to the Headway business.

We recognized an impairment charge of $1.3 million for the three-month period December 31, 2018, related to a decrease in value of a cost method investment.

 

Twelve-month Period Ended December 31, 2018 Compared to Twelve-month Period Ended December 31, 2017

(Unaudited)







Twelve Months Ended




December 31,




2018



2017



% Change


Net revenue:













Revenue from advertising and retransmission consent


$

294,839



$

272,091




8

%

Revenue from spectrum usage rights



2,976




263,943




(99)

%

Total net revenue



297,815




536,034




(44)

%














Cost of revenue - television (spectrum usage rights) (1)



-




12,340



*


Cost of revenue - digital media (1)



45,096




32,998




37

%

Operating expenses (1)



176,777




168,399




5

%

Corporate expenses (1)



26,865




27,937




(4)

%

Depreciation and amortization



16,273




16,411




(1)

%

Change in fair value of contingent consideration



(1,202)




-



*


Foreign currency (gain) loss



1,616




350




362

%

Other operating (gain) loss



(1,187)




(262)




353

%














Operating income



33,577




277,861




(88)

%

Interest expense, net



(11,770)




(15,935)




(26)

%

Dividend income



1,475




-



*


Gain (loss) on debt extinguishment



(550)




(3,306)




(83)

%

Impairment loss on investment



(1,320)




-



*















Income before income taxes



21,412




258,620




(92)

%

Income tax (expense) benefit



(7,877)




(82,612)




(90)

%














Net income (loss) before equity in net income (loss) of nonconsolidated
affiliates



13,535




176,008




(92)

%

Equity in net income (loss) of nonconsolidated affiliates



(1,374)




(310)




343

%














Net income


$

12,161



$

175,698




(93)

%














(1)      Cost of revenue, operating expenses and corporate expenses are defined on page 1.

Net revenue from advertising and retransmission consent increased to $294.8 million for the twelve-month period ended December 31, 2018 from $272.1 million for the twelve-month period ended December 31, 2017, an increase of approximately $22.7 million. Of the overall increase, $23.9 million was attributable to our digital media segment and was primarily due to the growth in the Headway business, which we acquired in the second quarter of 2017. Additionally, $1.9 million of the overall increase was attributable to our television segment and was primarily due to an increase in political advertising revenue, which was not material in 2017, and an increase in retransmission consent revenue, partially offset by decreases in national and local advertising revenue, as part of a trend for advertising to move increasingly from traditional media, such as television and radio, to new media, such as digital media. The overall increase was partially offset by a decrease in our radio segment of $3.0 million, primarily due to decreases in local and national advertising revenue, partially offset by an increase in political advertising revenue, which was not material in 2017, and an increase in revenue from the 2018 FIFA World Cup.

Net revenue from spectrum usage rights decreased to $3.0 million for the twelve-month period ended December 31, 2018 from $263.9 million for the twelve-month period ended December 31, 2017. The decrease was primarily due to revenue from the FCC auction for broadcast spectrum in the prior year, which revenue was not significant in 2018.

We did not incur cost of revenue related to revenue from spectrum usage rights in 2018. Cost of revenue related to revenue from spectrum usage rights was $12.3 million for the twelve-month period ended December 31, 2017, related to the FCC auction for broadcast spectrum.

Cost of revenue in our digital media segment increased to $45.1 million for the twelve-month period ended December 31, 2018 from $33.0 million for the twelve-month period ended December 31, 2017, an increase of $12.1 million, primarily due to the growth in the Headway business, which we acquired in the second quarter of 2017.

Operating expenses increased to $176.8 million for the twelve-month period ended December 31, 2018 from $168.4 million for the twelve-month period ended December 31, 2017, an increase of $8.4 million. Of the overall increase, approximately $9.8 million was attributable to our digital media segment and was primarily due to expenses associated with the increase in revenue, and due to the acquisitions of Headway during the second quarter of 2017, which did not contribute to direct operating expenses for the full year in 2017, and Smadex in the second quarter of 2018. Additionally, $2.6 million of the overall increase was attributable to our television segment and was primarily due to the acquisition of station KMIR-TV in the fourth quarter of 2017, which did not contribute to direct operating expenses in that year, and expenses associated with the increase in advertising revenue. The overall increase was partially offset by a decrease in expenses associated with the decrease in radio advertising revenue and a decrease in salary expenses in our television and radio segments.

Corporate expenses decreased to $26.9 million for the twelve-month period ended December 31, 2018 from $27.9 million for the twelve-month period ended December 31, 2017, a decrease of $1.0 million. The decrease was primarily due to expenses associated with the FCC auction for broadcast spectrum recorded in 2017, which expenses did not recur in 2018, and due diligence costs related to the Headway acquisition during the second quarter of 2017, partially offset by increase in salary expense, non-cash stock-based compensation expense, and due diligence costs related to the Smadex acquisition in 2018.

Our historical revenues have primarily been denominated in U.S. dollars, and the majority of our current revenues continue to be, and are expected to remain, denominated in U.S. dollars. However, our operating expenses are generally denominated in the currencies of the countries in which our operations are located, and we have operations in countries other than the U.S., primarily related to the Headway business. As a result, we have operating expense, attributable to foreign currency loss, that is primarily related to the operations related to the Headway business. Foreign currency loss increased to $1.6 million for the year ended December 31, 2018 from $0.4 million for the year ended December 31, 2017, an increase of $1.2 million, which was primarily due to currency fluctuations that affected our digital segment operations located outside the U.S., primarily related to the Headway business.

We recognized an impairment charge of $1.3 million for the three-month period December 31, 2018, related to a decrease in value of a cost method investment.

 

Segment Results

The following represents selected unaudited segment information:



Three Months Ended



Twelve Months Ended




December 31,



December 31,




2018



2017



% Change



2018



2017



% Change


Net Revenue

























Revenue from advertising and retransmission
consent

























Television


$

44,361



$

36,038




23

%


$

149,935



$

148,059




1

%

Radio



16,796




17,118




(2)

%



63,922




66,934




(4)

%

Digital



19,749




20,304




(3)

%



80,982




57,098




42

%

Total


$

80,906



$

73,460




10

%


$

294,839



$

272,091




8

%


























Revenue from spectrum usage rights (television)


$

1,167



$

-



*



$

2,976



$

263,943




(99)

%


























Total Net Revenue


$

82,073



$

73,460




12

%


$

297,815



$

536,034




(44)

%


























Cost of Revenue  (1)

























Television



-




209



*




-




12,340



*


Digital



9,847




12,090




(19)

%



45,096




32,998




37

%

Total


$

9,847



$

12,299




(20)

%


$

45,096



$

45,338




(1)

%


























Operating Expenses (1)

























Television



21,725




21,214




2

%



84,298




81,730




3

%

Radio



13,975




16,021




(13)

%



59,368




63,315




(6)

%

Digital



8,868




7,883




12

%



33,111




23,354




42

%

Total


$

44,568



$

45,118




(1)

%


$

176,777



$

168,399




5

%


























Corporate Expenses (1)


$

7,711



$

8,242




(6)

%


$

26,865



$

27,937




(4)

%


























Foreign currency (gain) loss


$

1,085



$

57




1804

%


$

1,616



$

350




362

%


























Consolidated adjusted EBITDA (1)


$

20,936



$

10,891




92

%


$

54,038



$

50,608




7

%


























(1)          Cost of revenue, operating expenses, corporate expenses, and consolidated adjusted EBITDA are defined on page 1.

Entravision Communications Corporation will hold a conference call to discuss its 2018 fourth quarter results on May 7, 2019 at 5:00 p.m. Eastern Time. To access the conference call, please dial 412-317-5440 ten minutes prior to the start time. The call will be webcast live and archived for replay on the investor relations portion of the Company's web site located at www.entravision.com.

Entravision Communications Corporation is a leading global media company that, through its television and radio segments, reaches and engages U.S. Hispanics across acculturation levels and media channels. Additionally, our digital segment, whose operations are located primarily in Spain, Mexico, and Argentina and other countries in Latin America, reaches a global market. The Company's expansive portfolio encompasses integrated marketing and media solutions, comprised of television, radio, and digital properties and data analytics services. Entravision has 55 primary television stations and is the largest affiliate group of both the Univision and UniMás television networks. Entravision also owns and operates 49 primarily Spanish-language radio stations featuring nationally recognized talent, as well as the Entravision Audio Network and Entravision Solutions, a coast-to-coast national spot and network sales and marketing organization representing Entravision's owned and operated, as well as its affiliate partner, radio stations. Entravision's Pulpo digital advertising unit is the #1-ranked online advertising platform in Hispanic reach according to comScore Media Metrix®, and Entravision's digital group also includes Headway, a leading provider of mobile, programmatic, data and performance digital marketing solutions primarily in the United States, Mexico and other markets in Latin America. Entravision shares of Class A Common Stock are traded on The New York Stock Exchange under the symbol: EVC.

This press release contains certain forward-looking statements. These forward-looking statements, which are included in accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, may involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results and performance in future periods to be materially different from any future results or performance suggested by the forward-looking statements in this press release. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that actual results will not differ materially from these expectations, including the length of time that may be required for the Company to file the Form 10-Q and whether the Company files the Form 10-Q on or prior to the due date thereof or by the extended filing due date provided by Rule 12b-25, and the Company disclaims any duty to update any forward-looking statements made by the Company. From time to time, these risks, uncertainties and other factors are discussed in the Company's filings with the Securities and Exchange Commission.

 

Entravision Communications Corporation

Consolidated Balance Sheets

(In thousands; unaudited)










December 31,



December 31,




2018



2017


ASSETS









Current assets









Cash and cash equivalents


$

46,733



$

39,560


Marketable securities



132,424




-


Restricted Cash



732




222,294


Trade receivables, net of allowance for doubtful accounts



79,308




84,348


Assets held for sale



1,179




-


Prepaid expenses and other current assets



10,672




6,260


Total current assets



271,048




352,462


Property and equipment, net



64,939




60,337


Intangible assets subject to amortization, net



22,598




26,758


Intangible assets not subject to amortization



254,598




251,163


Goodwill



74,292




70,729


Other assets



2,934




4,690


Total assets


$

690,409



$

766,139




















LIABILITIES AND STOCKHOLDERS' EQUITY









Current liabilities









Current maturities of long-term debt


$

3,000



$

3,000


Accounts payable and accrued expenses



51,034




61,847


Total current liabilities



54,034




64,847


Long-term debt, less current maturities, net of unamortized debt issuance costs



240,541




292,489


Other long-term liabilities



16,418




19,889


Deferred income taxes



46,684




40,639


Total liabilities



357,677




417,864











Stockholders' equity









Class A common stock



6




7


Class B common stock



2




2


Class U common stock



1




1


Additional paid-in capital



862,299




888,650


Accumulated deficit



(528,164)




(540,325)


Accumulated other comprehensive income (loss)



(1,412)




(60)


Total stockholders' equity



332,732




348,275


Total liabilities and stockholders' equity


$

690,409



$

766,139


 

 

Entravision Communications Corporation

Consolidated Statements of Operations

(In thousands, except share and per share data)

(Unaudited)










Three-Month Period



Twelve-Month Period




Ended December 31,



Ended December 31,




2018



2017



2018



2017


Net revenue

















Revenue from advertising and retransmission consent


$

80,906



$

73,460



$

294,839



$

272,091


Revenue from spectrum usage rights



1,167




-




2,976




263,943





82,073




73,460




297,815




536,034


Expenses:

















Cost of revenue - television (spectrum usage rights)



-




209




-




12,340


Cost of revenue - digital media



9,847




12,090




45,096




32,998


Direct operating expenses



31,398




32,045




125,242




119,283


Selling, general and administrative expenses



13,170




13,073




51,535




49,116


Corporate expenses



7,711




8,242




26,865




27,937


Depreciation and amortization



4,221




3,951




16,273




16,411


Change in fair value of contingent consideration



(2,275)




-




(1,202)




-


Foreign currency (gain) loss



1,085




57




1,616




350


Other operating (gain) loss



(565)




(262)




(1,187)




(262)





64,592




69,405




264,238




258,173


Operating income



17,481




4,055




33,577




277,861


Interest expense



(4,349)




(5,625)




(15,743)




(16,709)


Interest income



1,088




299




3,973




774


Dividend income



473




-




1,475




-


Gain (loss) on debt extinguishment



(550)




(3,306)




(550)




(3,306)


Impairment loss on investment



(1,320)




-




(1,320)




-


Income before income taxes



12,823




(4,577)




21,412




258,620


Income tax (expense) benefit



(4,713)




17,452




(7,877)




(82,612)



















Income (loss) before equity in net income (loss) of nonconsolidated
affiliate



8,110




12,875




13,535




176,008


Equity in net income (loss) of nonconsolidated affiliate



(1,197)




(135)




(1,374)




(310)


Net income


$

6,913



$

12,740



$

12,161



$

175,698



















Basic and diluted earnings per share:

















Net income per share, basic


$

0.08



$

0.14



$

0.14



$

1.95


Net income per share, diluted


$

0.08



$

0.14



$

0.13



$

1.91



















Cash dividends declared per common share, basic


$

0.05



$

0.05



$

0.20



$

0.16


Cash dividends declared per common share, diluted


$

0.05



$

0.05



$

0.20



$

0.16



















Weighted average common shares outstanding, basic



88,357,076




89,980,200




89,115,997




90,272,257


Weighted average common shares outstanding, diluted



89,598,683




91,613,199




90,328,583




91,891,957


 

 

Entravision Communications Corporation

Consolidated Statements of Cash Flows

(In thousands; unaudited)










Three-Month Period



Twelve-Month Period




Ended December 31,



Ended December 31,




2018



2017



2018



2017


Cash flows from operating activities:

















Net income


$

6,913



$

12,740



$

12,161



$

175,698


Adjustments to reconcile net income to net cash provided by operating
activities:

















Depreciation and amortization



4,221




3,951




16,273




16,411


Cost of revenue  - television (spectrum usage rights)



-




209




-




12,340


Impairment loss on investment



1,320




-




1,320




-


Deferred income taxes



2,670




(17,627)




4,612




81,766


Non-cash interest



296




2,642




1,124




3,237


Amortization of syndication contracts



125




141




651




452


Payments on syndication contracts



(127)




(145)




(643)




(445)


Equity in net (income) loss of nonconsolidated affiliate



1,197




135




1,374




310


Non-cash stock-based compensation



2,076




2,942




5,787




6,091


(Gain) loss on sale of property



-




28




-




28


(Gain) loss on debt extinguishment



550




3,306




550




3,306


Changes in assets and liabilities:

















(Increase) decrease in trade receivables, net



(2,683)




(12,376)




5,895




414


(Increase) decrease in prepaid expenses and other current assets



1,629




917




(5,581)




(913)


Increase (decrease) in accounts payable, accrued expenses and
other liabilities



(6,888)




11,203




(9,727)




2,825


Net cash provided by operating activities



11,299




8,066




33,796




301,520


Cash flows from investing activities:

















Proceeds from sale of property and equipment and intangibles



-




50




33




50


Purchases of property and equipment



(4,729)




(2,439)




(17,006)




(12,078)


Purchases of intangibles



-




-




(3,153)




(32,588)


Purchase of a businesses, net of cash acquired



-




(21,660)




(3,522)




(29,149)


Purchases of marketable securities



-




-




(159,403)




-


Proceeds from marketable securities



-




-




25,000




-


Purchases of investments



(525)




(250)




(1,495)




(2,450)


Deposits on acquisition



-




1,050




-




(190)


Net cash used in investing activities



(5,254)




(23,249)




(159,546)




(76,405)


Cash flows from financing activities:

















Proceeds from stock option exercises



172




697




249




708


Tax payments related to shares withheld for share-based compensation
plans



(29)




(798)




(2,268)




(798)


Payments on long-term debt



(50,750)




(290,750)




(53,000)




(293,563)


Dividends paid



(4,379)




(4,491)




(17,782)




(14,670)


Repurchase of Class A common stock



(6,152)




(3,552)




(13,812)




(5,330)


Payment of contingent consideration



-




(3,819)




(2,015)




(3,819)


Termination of swap agreements



-




(2,441)




-




(2,441)


Proceeds from borrowings on long-term debt



-




298,500




-




298,500


Payments of capitalized debt offering and issuance costs



-




(3,382)




-




(3,382)


Net cash used in financing activities



(61,138)




(10,036)




(88,628)




(24,795)


Effect of exchange rates on cash, cash equivalents and restricted cash



-




(3)




(11)




14


Net increase (decrease) in cash and cash equivalents



(55,093)




(25,222)




(214,389)




200,334


Cash and cash equivalents:

















Beginning



102,558




287,076




261,854




61,520


Ending


$

47,465



$

261,854



$

47,465



$

261,854


 

 

Entravision Communications Corporation

Reconciliation of Consolidated Adjusted EBITDA to Cash Flows From Operating Activities

(In thousands; unaudited)


The most directly comparable GAAP financial measure is operating cash flow. A reconciliation of this non-GAAP measure to
cash flows from operating activities for each of the periods presented is as follows:










Three-Month Period



Twelve-Month Period




Ended December 31,



Ended December 31,





2018




2017




2018




2017


Consolidated adjusted EBITDA (1)


$

20,936



$

10,891



$

54,038



$

50,608


Net revenue - FCC spectrum incentive auction



-




-




-




263,943


Expenses - FCC spectrum incentive auction



-




(209)




-




(14,443)


Interest expense



(4,349)




(5,625)




(15,743)




(16,709)


Interest income



1,088




299




3,973




774


Gain (loss) on debt extinguishment



(550)




(3,306)




(550)




(3,306)


Income tax (expense) benefit



(4,713)




17,452




(7,877)




(82,612)


Amortization of syndication contracts



(125)




(141)




(651)




(452)


Payments on syndication contracts



127




145




643




445


Non-cash stock-based compensation included in direct operating

















 expenses



(284)




(430)




(732)




(1,236)


Non-cash stock-based compensation included in corporate
expenses



(1,792)




(2,512)




(5,055)




(4,855)


Depreciation and amortization



(4,221)




(3,951)




(16,273)




(16,411)


Change in fair value of contingent consideration



2,275




-




1,202




-


Non-recurring severance charge



-




-




(782)




-


Dividend income



473




-




1,475




-


Other income (loss)



565




262




1,187




262


Impairment loss on investment



(1,320)




-




(1,320)




-


Equity in net income (loss) of nonconsolidated affiliates



(1,197)




(135)




(1,374)




(310)


Net income



6,913




12,740




12,161




175,698



















Depreciation and amortization



4,221




3,951




16,273




16,411


Cost of revenue  - television (spectrum usage rights)



-




209




-




12,340


Impairment loss on investment



1,320




-




1,320




-


Deferred income taxes



2,670




(17,627)




4,612




81,766


Amortization of debt issuance costs



296




2,642




1,124




3,237


Amortization of syndication contracts



125




141




651




452


Payments on syndication contracts



(127)




(145)




(643)




(445)


Equity in net (income) loss of nonconsolidated affiliate



1,197




135




1,374




310


Non-cash stock-based compensation



2,076




2,942




5,787




6,091


(Gain) loss on sale of property



-




28




-




28


(Gain) loss on debt extinguishment



550




3,306




550




3,306


Changes in assets and liabilities:

















(Increase) decrease in accounts receivable



(2,683)




(12,376)




5,895




414


(Increase) decrease in prepaid expenses and other assets



1,629




917




(5,581)




(913)


Increase (decrease) in accounts payable, accrued expenses and
other liabilities



(6,888)




11,203




(9,727)




2,825


Net cash provided by (used in ) operating activities


$

11,299



$

8,066



$

33,796



$

301,520



















(1)      Consolidated adjusted EBITDA is defined on page 1.

 

 

Entravision Communications Corporation

Reconciliation of Free Cash Flow to Cash Flows From Operating Activities

(In thousands; unaudited)


The most directly comparable GAAP financial measure is operating cash flow. A reconciliation of this non-GAAP measure to
cash flows from operating activities for each of the periods presented is as follows










Three-Month Period



Twelve-Month Period




Ended December 31,



Ended December 31,





2018




2017




2018




2017


Consolidated adjusted EBITDA (1)


$

20,936



$

10,891



$

54,038



$

50,608


Net, cash interest expense (1)



(2,965)




(2,685)




(10,646)




(12,698)


Dividend income



473




-




1,475




-


Cash paid for income taxes



(2,043)




(174)




(3,265)




(846)


Capital expenditures (2)



(4,729)




(2,439)




(17,006)




(12,078)


FCC reimbursement



565




262




1,187




262


Non-recurring cash severance charge



-




-




(782)




-


Net revenue - FCC spectrum incentive auction



-




-




-




263,943


Expenses - FCC spectrum incentive auction



-




-




-




(2,103)


Free cash flow (1)



12,237




5,855




25,001




287,088



















Capital expenditures (2)



4,729




2,439




17,006




12,078


Change in fair value of contingent consideration



2,275




-




1,202




-


(Gain) loss on sale of property



-




28




-




28


Changes in assets and liabilities:

















(Increase) decrease in accounts receivable



(2,683)




(12,376)




5,895




414


(Increase) decrease in prepaid expenses and other assets



1,629




917




(5,581)




(913)


Increase (decrease) in accounts payable, accrued expenses and other
liabilities



(6,888)




11,203




(9,727)




2,825


Cash Flows From Operating Activities


$

11,299



$

8,066



$

33,796



$

301,520



















(1)          Consolidated adjusted EBITDA, net interest expense, and free cash flow are defined on page 1.

(2)          Capital expenditures are not part of the consolidated statement of operations.

 

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