BBGI

Beasley Broadcast Group, Inc. (BBGI)

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Beasley Broadcast Group Inc. (BBGI)

Q4 2007 Earnings Call

February 14, 2008 11:00 am ET

Executives

Bruce Beasley - President and COO

Caroline Beasley - CFO

Analysts

Tracy Young - Bear Stearns

Lee Westerfield - BMO Capital

Victor Miller - Bear Stearns

Presentation

Operator

Good morning my name is Brae and I will be your conference operator today. At this time I would like to welcome everyone to the Beasley Broadcast Group 2007 fourth quarter results conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question-and-answer period. (Operator Instructions)

It is now my pleasure to turn the floor over to your host, Chief Financial Officer, Caroline Beasley. Ma'am, you may begin your conference.

Caroline Beasley

Thank you Brae. Good morning and welcome to the Beasley Broadcast Group fourth quarter conference call. Before beginning, I would like to emphasize that this call will contain forward-looking statements about our future performance and results of operations that involve risks and uncertainties that are described in the risk factors section of our most recent Form 10-K.

This call will also contain a discussion of certain non-GAAP financial measures within the meaning of Item 10 of Reg S-K. A reconciliation of these non-GAAP measures with their most directly comparable financial measures, calculated and presented in accordance with GAAP can be found on the company's website.

I would also remind listeners this call is being webcast live over the Internet and that a replay of the call will be available on our corporate website, BBGI.com, for five days after the call ends. Investors can also find a copy of today's press release on the investors or pressroom section of the site.

As always we will keep our remarks focused this morning on the fourth quarter, our guidance and operations outlook and then open the floor to Q&A. Bruce Beasley, our President and COO is with me this morning.

Before the quarter, our revenues increased 0.4%. Actual fourth quarter net revenue, SOI and other metrics reported include $1.4 million in revenue from the Miami Dolphins, which the company didn’t have in last years fourth quarter. BBGI exceeded its fourth quarter guidance for a net revenue decline of 2% as we generated better than projected cluster revenue in Philadelphia, Augusta and Coastal Carolina.

According to Miller Kaplan total Philadelphia market revenue declined 4.1% in the fourth quarter while our cluster revenues fell 1.4%. So we out performed our market in Philadelphia. Our stations also out performed the market in Miami. In total, market revenue increased 4.5%. Our clusters total revenues increased 10.9%. These figures include the revenue contributions related to the Miami Dolphins broadcast, which were partially offset by the 200,000 impact of not renewing the Florida Panthers at WQAM.

During the quarter, the Las Vegas market declined 5% while our cluster revenue dropped 6.2%, our Las Vegas cluster remains in transition following programming and changes at KKLV and KFRH. And Bruce will discuss the recent management change in the market in just a moment.

The Fort Myers market continues to be challenged with quarterly market revenues of 11.8% behind last year and our cluster revenues declining 17.9%. This under performance is partly due to an NTR concert that generated approximately 400,000 in the fourth quarter ‘06 and was not held in fourth quarter of ’07.

In seven of our 11 markets that report to Miller Kaplan our clusters outperformed our market on a total revenue basis as total revenue decline of approximately 2%, while the BBGI stations were basically flat. This numbers again do include the positive revenue contributions of the Miami Dolphins and the negative impact of not having the Florida Panthers, and Fort Myers, NTR event in Q4 '07 that we did have in Q4 '06.

We had another solid quarter with our interacted initiatives as revenue accounted for 3.4% of the companies total fourth quarter revenue representing an increase of 94% over fourth quarter of '06. And in our fourth quarter we again surpassed the $1 million mark in quarterly interactive revenue, and we generated net margins in excess of 60% on this revenue. For the full year interactive revenue accounted for 3.1% of total revenue, which represents a 121% increase over 2006.

On a same-station basis for fourth quarter, net revenue declined 3.8% and this compares to our guidance for same-station revenue decline at 6%. And just to remind everyone again, same-store revenue does not include the $1.4 million in revenue from the Dolphins, but does include the $600,000 negative impact of not having to put Myers, NTR concert, and the Florida Panthers in fourth quarter of '07.

Station operating expenses increased 6.3% and this increase was related to the Miami Dolphins contract. Without these expenses same-station expenses decline 2.8%, and this primarily reflects decreases in expenses related to the Fort Myers NTR event and the Florida Panthers contract.

Reflecting fourth quarter revenue levels and station operating expenses, SOI declined 11.9% and same-station SOI declined 5.9%.

Corporate G&A excluding stock-based compensation expense was $2 million for the quarter and for the year corporate G&A was $8 million. For the year, this represents an increase of $1.2 million and this primarily relates to the continued development of our interactive support services.

Stocked-based compensation expense was around $550,000 in the fourth quarter and for the year we recorded $2.4 million.

Read the rest of this transcript for free on seekingalpha.com