Arbitron, Inc. (ARB)
Q4 2008 Earnings Call
February 17, 2009 10:00 am ET
Thomas Mocarsky – Vice President of Press & Investor Relations
Michael P. Skarzynski – President, Chief Executive Officer & Director
Sean R. Creamer – Chief Financial Officer & Executive Vice President Finance and Planning
Alexia Quadrani – JP Morgan
Previous Statements by ARB
» Arbitron Inc. Business Update Call Transcript
» Arbitron Inc. Q3 2008 Earnings Call Transcript
» Arbitron Inc. Q2 2008 Earnings Call Transcript
Welcome to Arbitron’s fourth quarter and yearend 2008 conference call. I’m Tom Mocarsky and I will be your moderator for today’s call. Today I have the pleasure of introducing Michael Skarzynski, President and Chief Executive Officer and Sean Creamer, Chief Financial Officer. In today’s call Michael and Sean will review Arbitron’s activities, accomplishments and financial results for the fourth quarter and yearend 2008. They will also make some comments about our expectations for 2009.
After the presentation we will be happy to take your questions. But, before we begin today’s presentation I do want to note that this morning’s discussion includes forward-looking statements. These forward-looking statements are within the meaning of the Private Securities Litigation Reform Act of 1995.
These statements are based on our current expectations about future events. Arbitron derived these expectations from the information that is currently available to us. Actual results might differ materially from the results projected in our forward-looking statements which involve known and unknown risks.
For a discussion of the factors that could cause our actual results to differ materially from our forward looking statements, please refer to Arbitron’s 10K for the period ended December 31, 2007, our quarterly report on Form 10Q for the period ended September 30, 2008 and elsewhere and within any subsequent periodic current reports filed by us with the Security & Exchange Commission. A copy of all these documents are on file with the SEC.
At this time I want to turn the call over to Michael Skarzynski.
Michael P. Skarzynski
This is my first opportunity to address Arbitron’s shareholders in an earnings call since joining the company as President and CEO on January 12th. It is my great honor and pleasure to serve as the new president and CEO of Arbitron. I am absolutely thrilled and excited to lead our company at this exciting time.
I want to start by thanking Steve Morris for his significant contributions during his 16 year tenure as the leader of Arbitron. As you know Steve continues to serve as Chairman of the Board. On behalf of the customers, employees, partners and shareholders I would like to extend to Steve our deepest gratitude, respect and appreciation for all that he has done for Arbitron. Thank you very much Steve.
In my comments today I will cover four topics: number one, Arbitron’s accomplishments for the fourth quarter and for the full year 2008; number two, opportunities and challenges that I see for the company in 2009 and beyond; number three, reasons that I joined Arbitron; and number four, some comments on the road map for Arbitron’s future growth.
Let me begin with a high level recap of the fourth quarter and the full year 2008. Thanks to the restart of our portable people meter or PPM commercialization program, our revenue increased by 16.8% in the fourth quarter and by 9% for the full year 2008. Full year revenue for 2008 was $368.8 million. The 9% increase for the year hit the mid range of the company’s revenue guidance of 8% to 10%.
At the bottom line the company’s earnings per share or EPS for the fourth quarter was $0.13 per fully diluted share. For the full year, EPS was $1.36 which fell slightly below the mid range of the company’s revised 2008 guidance of $1.30 to $1.44. My colleague Sean Creamer will review the financials for the fourth quarter and full year 2008 in detail during his remarks.
Let me turn now to a review of the company’s marketplace accomplishments for 2008. We restarted the commercialization of the PPM service in 2008 after a nine month delay. In 2008 Arbitron brought electronic measurement to radio in 12 new markets including the largest three cities in the United States: New York, Los Angeles; and Chicago as well as San Francisco, Dallas, Atlanta, Detroit and Washington DC. By yearend Arbitron had lit up a total of 14 PPM markets.
Radio ad revenue for these 14 markets represents nearly 50% of all the radio ad revenue in the top markets where we plan to commercialize the PPM service. We are very proud of this significant accomplishment and important milestone.
Arbitron announced on January 9, 2009 that the company had received accreditation by the Media Rating Council for the average quarter hour PPM radio rating service in Riverside San Bernardino. MRC accreditation for Riverside San Bernardino which is the company’s second PPM market to earn MRC accreditation demonstrates that our PPM commercialization program can deliver MRC accreditable audience estimates.
Arbitron worked very hard in 2008 to strengthen the quality and value of our diary based radio rating services. We announced a number of diary market improvement initiatives designed to add cell phone only households in to our diary market samples, improve the representation of 18 to 34 year olds and accelerate work on electronic and online alternatives to the paper and pencil diary.