SOURCE: Barrington Broadcasting Group

Barrington Broadcasting Group

March 21, 2011 20:14 ET

Barrington Reports Fourth Quarter and Year-End Operating Results

HOFFMAN ESTATES, IL--(Marketwire - March 21, 2011) - Barrington Broadcasting Group LLC ("Barrington") announced today its financial results for the quarter ended December 31, 2010 and for the year ended December 31, 2010. Highlights are as follows:

  • Gross revenues for the quarter ended December 31, 2010 increased 40.0% to $45.6 million from $32.5 million for the quarter ended December 31, 2009. The increase was primarily due to an increase in political revenues of $10.6 million to $12.2 million, as well as an increase in local revenues of $0.9 million, or 4.8%, to $19.2 million and an increase in national revenues of $0.4 million, or 5.8%, to $7.6 million. Other revenues increased $1.1 million, or 20.3%, to $6.7 million for the quarter ended December 31, 2010 primarily as a result of an increase in revenues from retransmission consent agreements as well as an increase in fees received in connection with sales and support services provided in Syracuse, NY.

  • Net revenues (gross revenues less agency commissions and other direct costs) for the quarter ended December 31, 2010 increased 37.8%, or $10.5 million, to $38.3 million from $27.8 million for the quarter ended December 31, 2009.

  • Operating expenses for the quarter ended December 31, 2010, not including depreciation and amortization and an impairment of intangible assets and goodwill, increased 21.3%, or $3.8 million, to $21.6 million from $17.8 million for the quarter ended December 31, 2009. The increase was primarily due to bonuses of $1.9 million accrued during the quarter, increases in certain contractual obligations, as well as increased sales commissions.

  • Broadcast Cash Flow (as defined herein) for the quarter ended December 31, 2010 increased 68.1% to $19.0 million from $11.3 million for the quarter ended December 31, 2009.

  • Gross revenues for the year ended December 31, 2010 increased 23.8% to $143.1 million from $115.6 million for the year ended December 31, 2009. The increase was primarily due to an increase in political revenues of $15.6 million to $18.0 million, as well as an increase in local revenues of $4.0 million, or 5.7%, to $74.0 million and an increase in national revenues of $2.7 million, or 10.9%, to $27.8 million. Other revenues increased $5.2 million, or 29.0%, to $23.3 million, primarily due to an increase in revenues from retransmission consent agreements as well as an increase in fees received in connection with sales and support services provided in Syracuse, NY.

  • Net revenues (gross revenues less agency commissions and other direct costs) for the year ended December 31, 2010 increased 23.0%, or $22.7 million, to $121.7 million from $99.0 million for the year ended December 31, 2009.

  • Operating expenses for the year ended December 31, 2010, not including depreciation and amortization and an impairment of intangible assets and goodwill, increased 4.9%, or $3.7 million, to $78.8 million from $75.1 million for the year ended December 31, 2009. The increase was primarily due to bonuses of $2.6 million for the year, increases in certain contractual obligations, as well as increased sales commissions.

  • Broadcast Cash Flow for the year ended December 31, 2010 increased 60.8% to $50.0 million from $31.1 million for the year ended December 31, 2009.

Results for the three months and year ended December 31, 2010 also include results from joint sales and shared service agreements with Granite Broadcasting Corporation related to Granite's and Barrington's respective station operations in the Peoria, Illinois and Syracuse, New York markets, effective March 2, 2009.

"The strong completion of the political races in the 4th quarter, along with continued positive momentum in all major sales categories, enabled us to achieve record setting results for the quarter as well as for the year. As a Company, we continue to be focused on three key priorities: growth of our local sales strategies, development of our local digital platforms and cost management of our station-level operations. Also, we anticipate that our improved earnings profile coupled with the current favorable interest rate environment and reduced debt levels give us an opportunity to substantially increase cash flow available to further reduce leverage," said K. James Yager, Chief Executive Officer of Barrington Broadcasting.

Impairment of Intangible Assets

As required by ASC Topic 350, "Intangibles-Goodwill and Other," Barrington tested the impairment of its broadcast licenses and goodwill during the fourth quarter. The testing resulted in a non-cash impairment charge of $5.0 million for the quarter ended December 31, 2010.

Conference Call

As previously announced, Barrington will host a conference call to discuss its fourth quarter and annual results at 11:00 AM (ET) on Tuesday, March 22, 2011. The dial-in information for the earnings call is as follows: 1-877-941-6011. A telephonic replay of the earnings call will be available beginning on March 22, 2011 at 1:00 PM (ET) and remain available for 30 days. To access the replay, call 1-800-406-7325 (domestic callers) or 303-590-3030 (international callers) and enter access code 4416337#.

During the conference call, representatives of Barrington may discuss and answer one or more questions concerning Barrington's business and financial matters. The responses to these questions, as well as other matters discussed during the call, may contain information that has not been previously disclosed.

Annual Report

The information in this press release should be read in conjunction with the financial statements and footnotes contained in Barrington's annual report for the year ended December 31, 2010 which we expect to post on Barrington's website (www.barringtontv.com) on March 25, 2011. Barrington's results for the year ended December 31, 2010 are subject to the completion of its annual report for such period.

Non-GAAP Financial Measures

Broadcast Cash Flow, EBITDA and Adjusted EBITDA (each as defined in the attachments to this press release) are non-GAAP financial measures (i.e., they are not measures of financial performance under generally accepted accounting principles) and should not be considered in isolation from or as a substitute for consolidated statements of operations and cash flow data prepared in accordance with GAAP. Broadcast Cash Flow, EBITDA and Adjusted EBITDA, as used herein, are not necessarily comparable to similarly titled measures of other companies. For definitions of and additional information regarding Broadcast Cash Flow, EBITDA and Adjusted EBITDA and a reconciliation of such measures to the most comparable measures calculated in accordance with GAAP, please see the attachments to this press release.

Broadcast Cash Flow, EBITDA and Adjusted EBITDA are measures commonly used by financial analysts in evaluating performance of companies, including broadcast companies. Accordingly, Barrington believes that Broadcast Cash Flow, EBITDA and Adjusted EBITDA may be useful in assessing Barrington's operating performance and its ability to meet its debt service requirements. Barrington also believes that these measures allow a standardized comparison between companies in the broadcast industry, while minimizing the differences from depreciation policies, financial leverage and tax strategies.

About Barrington

Barrington was formed in 2003 to acquire and operate television stations in smaller markets across the United States. Barrington currently owns, operates, or supports the operations of twenty four network affiliated television stations. Barrington is owned and controlled by Pilot Group, with management as its partner. Pilot Group is a non-traditional private investment firm founded in 2003 by a group of operating executives who actively help its management partners achieve their goals.

Forward-Looking Statements

The statements in this press release that are not historical facts are forward-looking statements that are subject to material risks and uncertainties. Investors are cautioned that any such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties, and that actual results or developments may differ materially from those in the forward-looking statements as a result of various factors. Such factors include those risks described from time to time in Barrington's quarterly reports and annual reports which are furnished pursuant to the Indenture dated as of August 11, 2006, by and among Barrington, Barrington Broadcasting Capital Corporation, the guarantors named therein and U.S. Bank National Association, as trustee, as amended, and which are posted on Barrington's website. These factors should be considered carefully and readers are cautioned not to place undue reliance on such forward-looking statements. Barrington does not undertake to update any forward-looking statements in this press release or with respect to matters described herein.


                    Barrington Broadcasting Group LLC
                    Consolidated Financial Information
  For the Three Months and the Twelve Months Ended December 31, 2010 and
                            December 31, 2009



                              Three Months Ended      Twelve Months Ended
                            ----------------------  ----------------------
(Dollars in thousands)      12/31/2010  12/31/2009  12/31/2010  12/31/2009
                            ----------- ----------  ----------  ----------

Statement of Operations
 Data:(1)
Net revenue                 $    38,282 $   27,771  $  121,749  $   99,019
Expenses:
   Operating(2)                  19,544     16,565      72,338      69,698
   Depreciation and
    amortization                  3,349      3,581      13,111      20,862
   Impairment of intangible
    assets(3)                     4,985      9,144       4,985      10,560
   Corporate                      2,034      1,217       6,418       5,369
                            ----------- ----------  ----------  ----------
   Total operating expenses      29,912     30,507      96,852     106,489
                            ----------- ----------  ----------  ----------

Income (loss) from
 operations                       8,370     (2,736)     24,897      (7,470)
Total net interest expense        4,619      5,367      21,063      22,791
Non-operating income(4)               -       (541)     (1,124)    (57,504)
                            ----------- ----------  ----------  ----------
Income (loss) before income
 taxes                            3,751     (7,562)      4,958      27,243
Income tax expense
 (benefit)(5)                       115         (2)        496         510
                            ----------- ----------  ----------  ----------
Net income (loss)           $     3,636 $   (7,560) $    4,462  $   26,733
                            =========== ==========  ==========  ==========


Other Financial Data:
EBITDA(6)                   $    16,704 $   10,530  $   44,117  $   81,456
Adjusted EBITDA(7)               16,978     10,064      43,711      26,350
Broadcast Cash Flow(8)           18,962     11,277      50,021      31,115

Balance Sheet Data:
Cash and cash equivalents   $    12,473
                            ===========
Total long-term debt,
 including current
 portions(9)                $   197,386
                            ===========

(1) Statement of operations data is based on Barrington's historical consolidated financial results for the three months and twelve months ended December 31, 2010 and 2009, and includes the results from joint sales and shared services agreements entered into with Granite Broadcasting Corporation ("Granite") beginning March 2, 2009.

(2) Includes selling, technical, programming (including amortization of program broadcast rights) and general and administrative expenses. Also includes the net operating expenses in connection with Barrington's investment in joint ventures.

(3) Barrington tested the impairment of its FCC broadcast licenses and goodwill during the quarters ended June 30, 2009 and December 31, 2009 resulting in annual non-cash impairment charges of $10,560 on the FCC broadcast licenses at three of its stations. For the three and the twelve months ended December 31, 2010, Barrington recorded a non-cash impairment charge of $4,985 on the FCC broadcast license at one of its television stations.

(4) For the twelve months ended December 31, 2010, consists of gain of $1,124 on the exchange of assets with Nextel. For the twelve months ended December 31, 2009, consists of a gain of $55,081 on the extinguishment of debt related to the repurchase of a portion of our 10-1/2% Senior Subordinated Notes due 2014 (the "Notes"). For the three and twelve months ended December 31, 2009, consists of gain of $541 and $2,423, respectively, on the exchange of assets with Nextel.

(5) Since Barrington is a limited liability company, federal taxes are passed through to its members and as such no provision has been made for federal income taxes. Income tax expense includes various state tax liabilities.

(6) EBITDA is defined as net income (loss) before income taxes, interest expense, depreciation and amortization. EBITDA is a measure commonly used by financial analysts in evaluating operating performance of companies. Accordingly, management believes that EBITDA may be useful in assessing Barrington's operating performance and Barrington's ability to meet its debt service requirements. A reconciliation of EBITDA to net income (loss) is provided below.

                              Three Months Ended      Twelve Months Ended
                            ----------------------  ----------------------
(Dollars in thousands)      12/31/2010  12/31/2009  12/31/2010  12/31/2009
                            ----------  ----------  ----------  ----------

Reconciliation of EBITDA:

Net income (loss)           $    3,636  $   (7,560) $    4,462  $   26,733
Total net interest expense       4,619       5,367      21,063      22,791
Income tax expense(a)              115          (2)        496         510
Depreciation and
 amortization                    3,349       3,581      13,111      20,862
Impairment of intangible
 assets                          4,985       9,144       4,985      10,560
                            ----------  ----------  ----------  ----------
EBITDA                      $   16,704  $   10,530  $   44,117  $   81,456
                            ==========  ==========  ==========  ==========

(a) Since Barrington is a limited liability company, federal taxes are passed through to its members and as such no provision has been made for federal income taxes. Income tax expense includes various state tax liabilities.

(7) Adjusted EBITDA is defined as EBITDA before amortization of program and broadcast rights and network revenues, other non-cash charges, gains or losses on dispositions of assets and other non-recurring items and after program broadcast rights payments and payments from networks. Certain financial covenants in Barrington's credit facility contain ratios based on Adjusted EBITDA and the restricted payment and debt incurrence covenants in the indenture governing Barrington's senior subordinated notes are based on Adjusted EBITDA. In addition, management believes that Adjusted EBITDA may be useful in assessing Barrington's operating performance and Barrington's ability to meet its debt service requirements because Adjusted EBITDA, as opposed to EBITDA, more accurately reflects Barrington's operating performance as it takes into account industry specific adjustments such as amortization of program broadcast rights, program broadcast rights payments, amortization of network revenues, cash payments from networks, as well as gains and losses on dispositions of assets and other non-recurring items. A reconciliation of Adjusted EBITDA to EBITDA is provided below.

                              Three Months Ended      Twelve Months Ended
                            ----------------------  ----------------------
(Dollars in thousands)      12/31/2010  12/31/2009  12/31/2010  12/31/2009
                            ----------  ----------  ----------  ----------

Reconciliation of Adjusted
 EBITDA:

EBITDA                      $   16,704  $   10,530  $   44,117  $   81,456
Amortization of program
 broadcast rights                1,624       1,289       5,270       4,885
Program broadcast rights
 payments                       (1,466)     (1,220)     (5,127)     (4,303)
Amortization of network
 revenues(a)                       (77)        (88)       (426)       (236)
Cash payments from networks        123          88         538         262
Other adjustments to arrive
 at Adjusted EBITDA(b)              70        (535)       (661)    (55,714)
                            ----------  ----------  ----------  ----------
Adjusted EBITDA             $   16,978  $   10,064  $   43,711  $   26,350
                            ==========  ==========  ==========  ==========

(a) Represents net amounts due from networks which are deferred and amortized over the length of the respective network affiliation agreements.

(b) For the twelve months ended December 31, 2010, consists of gain on the exchange of assets with Nextel of $1,124 and a credit of $13 received in 2010 for fees and expenses related to the amendment of our credit agreement in February 2009. For the three months and twelve months ended December 31, 2010, also consists of separation costs of $19 and $355, respectively, and non-recurring costs in respect of various joint sales and shared service agreements of $51 and $121, respectively.

For the three and twelve months ended December 31, 2009, consists of gain on the exchange of assets with Nextel of $541 and $2,423, respectively, as well as gain of $55,081 for the twelve months ended December 31, 2009 on the extinguishment of debt related to the repurchase of a portion of our notes. Also consists of separation costs of $2 and $1,186, respectively, related to workforce reductions and the Granite agreements, and $4 and $200, respectively, of legal expenses incurred related to one-time costs in respect of various joint sales and shared service agreements. For the twelve months ended December 31, 2009, also includes expense of $404 incurred in connection with the amendment of our credit agreement in February 2009.

(8) Broadcast Cash Flow is defined as Adjusted EBITDA before provision for corporate overhead costs. Broadcast Cash Flow is a measure commonly used by financial analysts in evaluating operating performance of broadcast companies. Accordingly, management believes that Broadcast Cash Flow may be useful in assessing Barrington's operating performance and Barrington's ability to meet its debt service requirements. A reconciliation of Broadcast Cash Flow to Adjusted EBITDA is presented below.

                              Three Months Ended      Twelve Months Ended
                            ----------------------- -----------------------
(Dollars in thousands)      12/31/2010  12/31/2009  12/31/2010  12/31/2009
                            ----------- ----------- ----------- -----------

Reconciliation of Broadcast
 Cash Flow:
Adjusted EBITDA             $    16,978 $    10,064 $    43,711 $    26,350
Corporate overhead costs(a)       1,984       1,213       6,310       4,765
                            ----------- ----------- ----------- -----------
Broadcast Cash Flow         $    18,962 $    11,277 $    50,021 $    31,115
                            =========== =========== =========== ===========

(a) The add back of corporate overhead costs is reduced by one-time costs incurred in connection with various joint sales and shared service agreements for 2010 and 2009, as well as fees and expenses incurred in connection with the amendment of our credit agreement in 2009.

(9) Includes (i) Barrington's guarantee of indebtedness of SagamoreHill of Carolina, LLC and SagamoreHill of Carolina Licenses, LLC, licensee of station WWMB (Barrington programs WWMB pursuant to a local marketing agreement) and (ii) Barrington's guarantee of, and other credit support with respect to, Tucker's $7 million of term loans.

Contact Information

  • For further information, contact:

    Warren Spector
    Chief Financial Officer
    Barrington Broadcasting Group LLC
    Barrington Broadcasting Capital Corporation
    Tel 847 884 1877
    Fax 847 755 3045
    Email Email Contact