Colorado Media Newsroom
February 29th, 2024, 07:39 AM
From Radio Insight:
https://radioinsight.com/wp-content/images/2023/02/iheartmedia-200x200.jpgiHeartMedia, Inc. (Nasdaq: IHRT) today reported financial results for the quarter and year ended December 31, 2023.
Financial Highlights: 1
Q4 2023 Consolidated Results
Q4 Revenue of $1,067 million, down 5.2%; slightly better than the guidance range of down high-single digits
Excluding Q4 Political Revenue, Q4 Revenue flat
GAAP Operating income of $80 million vs. $173 million in Q4 2022
Consolidated Adjusted EBITDA of $208 million, within previously disclosed guidance range of $205 million to $215 million, compared to $316 million in Q4 2022
Cash Flows from operating activities of $154 million
Free Cash Flow of $142 million, Free Cash Flow including net proceeds from real estate sales was $145 million
Q4 2023 Digital Audio Group Results
Digital Audio Group Revenue of $318 million up 6%
Podcast Revenue of $132 million up 17%
Digital Revenue excluding Podcast of $186 million down 1%
Segment Adjusted EBITDA of $117 million up 17%
Digital Audio Group Adjusted EBITDA margin of 36.7%
Q4 2023 Multiplatform Group Results
Multiplatform Group Revenue of $684 million down 7%
Excluding Multiplatform Group Q4 Political Revenue, Multiplatform Group Q4 Revenue down 3%
Segment Adjusted EBITDA of $142 million down 39%
Multiplatform Group Adjusted EBITDA margin of 20.7%
Continued Proactive Capital Structure Improvement
Cash balance and total available liquidity2 of $346 million and $772 million, respectively, as of December 31, 2023
Repurchased $15 million in principal balance of 8.375% Senior Unsecured Notes (at a discount to par) for $10 million in cash; expected to generate approximately $1 million of annualized interest savings
As of December 31, 2023, since Q2 2022 combined Notes repurchases of $534 million at a discount to par for $447 million cash; in aggregate expected to generate approximately $45 million of annualized interest savings
Cumulative reduction of the outstanding principal balance of these Notes from $1.45 billion as of March 31, 2022 to approximately $0.9 billion as of December 31, 2023
Received cash proceeds of $101 million from sale of equity interest in BMI in February 2024
Guidance
Q1 Consolidated Revenue expected to be flat to down 2%
Q1 Consolidated Adjusted EBITDA3 expected to be $100 million to $110 million, up from $93 million in prior year
Remain committed to long term target of approximately 4x Net Debt to Adjusted EBITDA (“net leverage”)3
Full Year 2023 Highlights 4
Revenue of $3,751 million, down 4%; excluding Full Year 2023 Political Revenue, Revenue down 2%
Multiplatform Group Revenue down 6%
Excluding Multiplatform Group Political Revenue, Multiplatform Group Revenue down 4%
Digital Audio Group Revenue up 5%
Podcast Revenue up 14%
Digital Revenue excluding Podcast flat
GAAP Operating loss of $797 million decreased from GAAP Operating income of $57 million in the year ended December 31, 2022, as a result of the $965 million of non-cash impairment charges recorded in Q2 2023, primarily related to our goodwill and indefinite-lived intangible assets balances. Full Year 2022 GAAP Operating income included $311 million of non-cash impairment charges, primarily related to our indefinite-lived intangible asset balance.
Consolidated Adjusted EBITDA of $697 million, down from $950 million in the year ended December 31, 2022
Generated Cash Flows from operating activities of $213 million
Free Cash Flow of $110 million, Free Cash Flow including net proceeds from real estate sales was $118 million
Received cash proceeds of $45 million from a sale leaseback of radio broadcast towers in Q3 2023
Statement from Senior Management
“We?re pleased to report that our fourth quarter results were in line with our previously provided Adjusted EBITDA and Revenue guidance ranges.? said Bob Pittman, iHeartMedia?s Chairman and CEO. ?This quarter the Digital Audio Group achieved the highest Adjusted EBITDA and margin in its history, illustrating the success of this high growth business. We view 2024 as a recovery year in which the company returns to growth mode — we expect to see our Multiplatform Group performance improve quarter by quarter throughout the year, and we expect our Digital Audio Group, including our industry leading podcast business, to continue to grow and reinforce its leadership position in the segment.?
?We continue to see signs of improvement throughout our business and the broader advertising marketplace. Our results this quarter are a strong indication that the reallocation of resources towards our high growth Digital Audio Group has been successful – through our relentless focus on efficiencies we have reduced our Multiplatform Group expenses by approximately 7% since 2019, which has in part enabled us to build a Digital business that generated $1 billion of revenue in 2023 with an Adjusted EBITDA margin of 33%,? said Rich Bressler, iHeartMedia?s President, COO and CFO. ?We expect to see a significant year over year improvement in our 2024 financial performance, supported by our ongoing efficiency efforts and what is anticipated to be record-setting political advertising year.?
Consolidated Results of Operations
Fourth Quarter 2023 Consolidated Results
Our consolidated revenue decreased $59.1 million, or 5.2%, during the three months ended December 31, 2023 compared to the same period of 2022. Digital Audio revenue increased $16.6 million, or 5.5%, driven primarily by continuing increases in demand for podcast advertising. Multiplatform revenue decreased $48.8 million, or 6.7%, primarily resulting from a decrease in broadcast advertising due to a challenging macroeconomic environment and a decline in political advertising due to 2022 being a mid-term election year, partially offset by an increase in trade and barter revenues. Audio & Media Services revenue decreased $27.0 million primarily due to a decrease in political revenue.
Consolidated direct operating expenses increased $1.9 million, or 0.4%, during the three months ended December 31, 2023 compared to the same period of 2022. The increase in direct operating expenses was primarily driven by higher broadcast content fees and higher variable content costs resulting from an increase in digital segment revenue, including profit sharing costs and production costs. The increase was partially offset by lower third party digital costs in connection with a reduction in COVID-19 related advertisers and employee compensation as a result of cost savings initiatives.
Consolidated Selling, General & Administrative (“SG&A”) expenses increased $36.3 million, or 8.5%, during the three months ended December 31, 2023 compared to the same period of 2022. The increase in Consolidated SG&A expenses was driven primarily by higher trade and barter expense and variable bonus expense, partially offset by expense reductions as a result of our cost savings initiatives.
Our consolidated GAAP Operating income was $79.8 million compared to $172.8 million in the fourth quarter of 2022, primarily resulting from the decrease in broadcast revenue due to a more challenging macroeconomic environment and a decline in political revenues compared to 2022.
Adjusted EBITDA decreased to $208.2 million compared to $315.6 million in the prior-year period.
Cash provided by operating activities was $154.1 million, compared to $213.4 million in the prior-year period primarily due to a decrease in broadcast revenue due to a challenging macroeconomic environment, a decrease in political revenue, and an increase in floating borrowing rates. Free Cash Flow was $141.9 million, compared to $165.0 million in the prior year period.
Business Segments: Results of Operations
Fourth Quarter 2023 Multiplatform Group Results
(In thousands)
Three Months Ended
December 31,
%
Year Ended
December 31,
%
2023
2022
Change
2023
2022
Change
Revenue
$
684,028
$
732,834
(6.7)%
$
2,435,368
$
2,597,190
(6.2)%
Operating expenses1
542,493
502,803
7.9%
1,881,934
1,831,491
2.8%
Segment Adjusted EBITDA
$
141,535
$
230,031
(38.5)%
$
553,434
$
765,699
(27.7)%
Segment Adjusted EBITDA margin
20.7%
31.4%
22.7%
29.5%
1 Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring Expenses.
Revenue from our Multiplatform Group decreased $48.8 million, or 6.7% YoY, primarily due to the challenging macroeconomic environment and a decline in political advertising as 2022 was a mid-term election year, partially offset by an increase in trade and barter revenues. Broadcast revenue declined $36.1 million, or 6.9% YoY, driven by lower spot revenue and a decrease in political advertising, partially offset by an increase in trade and barter revenues. Networks declined $11.0 million, or 8.4% YoY. Revenue from Sponsorship and Events decreased by $3.6 million, or 4.8% YoY.
Operating expenses increased $39.7 million, or 7.9% YoY, driven primarily by an increase in trade and barter expenses and variable bonus expense, partially offset by lower sales commissions and reductions as a result of our cost savings initiatives.
Segment Adjusted EBITDA Margin decreased YoY to 20.7% from 31.4%.
Fourth Quarter 2023 Digital Audio Group Results
(In thousands)
Three Months Ended
December 31,
%
Year Ended
December 31,
%
2023
2022
Change
2023
2022
Change
Revenue
$
317,695
$
301,091
5.5%
$
1,069,167
$
1,021,824
4.6%
Operating expenses1
201,183
201,760
(0.3)%
720,298
712,786
1.1%
Segment Adjusted EBITDA
$
116,512
$
99,331
17.3%
$
348,869
$
309,038
12.9%
Segment Adjusted EBITDA margin
36.7%
33.0%
32.6%
30.2%
1 Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring Expenses.
Revenue from our Digital Audio Group increased $16.6 million, or 5.5% YoY, driven by Podcast revenue which increased by $18.7 million, or 16.6%, YoY, to $131.7 million, driven primarily by increased demand for podcasting from advertisers, partially offset by Digital, excluding Podcast revenue, which declined $2.1 million, or 1.1%, YoY, to $186.0 million, driven by a decrease in COVID-19 related advertisers, partially offset by an increase in demand for digital advertising.
Operating expenses decreased $0.6 million, or 0.3% YoY, primarily driven by lower third-party digital costs in connection with fewer COVID-19 related advertisers, partially offset by higher profit sharing costs resulting from higher revenue.
Segment Adjusted EBITDA Margin increased YoY to 36.7% from 33.0%.
Fourth Quarter 2023 Audio & Media Services Group Results
(In thousands)
Three Months Ended
December 31,
%
Year Ended
December 31,
%
2023
2022
Change
2023
2022
Change
Revenue
$
67,568
$
94,586
(28.6)%
$
256,702
$
304,302
(15.6)%
Operating expenses1
46,926
49,898
(6.0)%
185,241
191,407
(3.2)%
Segment Adjusted EBITDA
$
20,642
$
44,688
(53.8)%
$
71,461
$
112,895
(36.7)%
Segment Adjusted EBITDA margin
30.5%
47.3%
27.8%
37.1%
1 Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring Expenses.
Revenue from our Audio & Media Services Group decreased $27.0 million, or 28.6% YoY, primarily driven by a decrease in political revenue.
Operating expenses decreased $3.0 million, or 6.0% YoY, primarily as a result of lower variable bonus expense.
Segment Adjusted EBITDA Margin decreased YoY to 30.5% from 47.3%.
GAAP and Non-GAAP Measures: Consolidated
(In thousands)
Three Months Ended
December 31,
Year Ended
December 31,
2023
2022
2023
2022
Revenue
$
1,066,783
$
1,125,890
$
3,751,025
$
3,912,283
Operating income (loss)
$
79,780
$
172,843
$
(797,311)
$
56,860
Adjusted EBITDA1
$
208,211
$
315,645
$
696,598
$
950,289
Net income (loss)
$
13,975
$
80,663
$
(1,100,339)
$
(262,670)
Cash provided by operating activities2
$
154,104
$
213,376
$
213,062
$
420,075
Free cash flow1,2
$
141,890
$
164,974
$
110,392
$
259,106
Free cash flow including net proceeds from real estate sales1,2
$
144,789
$
165,774
$
117,920
$
291,441
_________________________________
1 See the end of this press release for reconciliations of (i) Adjusted EBITDA to Operating income (loss), (ii) Adjusted EBITDA to Net income (loss), (iii) Free Cash Flow and Free cash flow including net proceeds from real estate sales to cash provided by operating activities, (iv) revenue, excluding political advertising revenue, to revenue, and (v) Net Debt to Total Debt. See also the definitions of Adjusted EBITDA, Free Cash Flow, Free cash flow including net proceeds from real estate sales, Adjusted EBITDA margin, and Net Debt under the Supplemental Disclosure Regarding Non-GAAP Financial Information section in this release.
2 We made cash interest payments of $88.5 million in the three months ended December 31, 2023, compared to $92.5 million in the three months ended December 31, 2022.
Certain prior period amounts have been reclassified to conform to the 2023 presentation of financial information throughout the press release.
Liquidity and Financial Position
As of December 31, 2023, we had $346.4 million of cash on our balance sheet. For the twelve months ended December 31, 2023, cash provided by operating activities was $213.1 million, cash used for investing activities was $51.3 million and cash used for financing activities was $152.2 million.
Capital expenditures for the twelve months ended December 31, 2023 were $102.7 million compared to $161.0 million in the twelve months ended December 31, 2022. Capital expenditures during the twelve months ended December 31, 2023 decreased primarily due to lower spending on real estate optimization initiatives.
As of December 31, 2023, the Company had $5,215.2 million of total debt and $4,868.8 million of Net Debt. The terms of our capital structure include no material maintenance covenants, and there are no material debt maturities prior to May 2026. During the three months ended December 31, 2023, we repurchased $15.0 million in aggregate principal amount of iHeartCommunications Inc.’s 8.375% Senior Unsecured Notes due 2027, at a discount to par, for $9.8 million in cash. During the twelve months ended December 31, 2023, we repurchased $204.0 million in aggregate principal amount of iHeartCommunications Inc.’s 8.375% Senior Unsecured Notes due 2027, at a discount to par, for $147.3 million in cash.
In September 2023, we sold 122 of our broadcast tower sites for net proceeds of $45.3 million and entered into long-term operating leases for use of space on 121 of the broadcast towers and related assets.
Cash balance and total available liquidity5 were $346.4 million and $772 million, respectively, as of December 31, 2023.
Revenue Streams
The tables below present the comparison of our historical revenue streams (including political revenue) for the periods presented:
(In thousands)
Three Months Ended
December 31,
%
Year Ended
December 31,
%
2023
2022
Change
2023
2022
Change
Broadcast Radio
$
484,673
$
520,725
(6.9)%
$
1,752,166
$
1,883,324
(7.0)%
Networks
119,948
130,915
(8.4)%
466,404
503,244
(7.3)%
Sponsorship and Events
71,137
74,759
(4.8)%
191,434
188,985
1.3%
Other
8,270
6,435
28.5%
25,364
21,637
17.2%
Multiplatform Group1
684,028
732,834
(6.7)%
2,435,368
2,597,190
(6.2)%
Digital ex. Podcast
186,028
188,138
(1.1)%
661,319
663,392
(0.3)%
Podcast
131,667
112,953
16.6%
407,848
358,432
13.8%
Digital Audio Group
317,695
301,091
5.5%
1,069,167
1,021,824
4.6%
Audio & Media Services Group1
67,568
94,586
(28.6)%
256,702
304,302
(15.6)%
Eliminations
(2,508)
(2,621)
(10,212)
(11,033)
Revenue, total1
$
1,066,783
$
1,125,890
(5.2)%
$
3,751,025
$
3,912,283
(4.1)%
1 Excluding the impact of political revenue, Revenue from the Multiplatform Group and Consolidated Revenue decreased by 3.2% and 0.5% for the three months ended December 31, 2023 compared to the three months ended December 31, 2022, respectively. Excluding the impact of political revenue, Revenue from Audio & Media Services decreased by 5.2% for the three months ended December 31, 2023 compared to the three months ended December 31, 2022. See the end of this press release for a reconciliation of revenue, excluding political advertising revenue, to revenue.
more (https://radioinsight.com/headlines/265506/iheartmedia-releases-2023-year-end-earnings/)
https://radioinsight.com/wp-content/images/2023/02/iheartmedia-200x200.jpgiHeartMedia, Inc. (Nasdaq: IHRT) today reported financial results for the quarter and year ended December 31, 2023.
Financial Highlights: 1
Q4 2023 Consolidated Results
Q4 Revenue of $1,067 million, down 5.2%; slightly better than the guidance range of down high-single digits
Excluding Q4 Political Revenue, Q4 Revenue flat
GAAP Operating income of $80 million vs. $173 million in Q4 2022
Consolidated Adjusted EBITDA of $208 million, within previously disclosed guidance range of $205 million to $215 million, compared to $316 million in Q4 2022
Cash Flows from operating activities of $154 million
Free Cash Flow of $142 million, Free Cash Flow including net proceeds from real estate sales was $145 million
Q4 2023 Digital Audio Group Results
Digital Audio Group Revenue of $318 million up 6%
Podcast Revenue of $132 million up 17%
Digital Revenue excluding Podcast of $186 million down 1%
Segment Adjusted EBITDA of $117 million up 17%
Digital Audio Group Adjusted EBITDA margin of 36.7%
Q4 2023 Multiplatform Group Results
Multiplatform Group Revenue of $684 million down 7%
Excluding Multiplatform Group Q4 Political Revenue, Multiplatform Group Q4 Revenue down 3%
Segment Adjusted EBITDA of $142 million down 39%
Multiplatform Group Adjusted EBITDA margin of 20.7%
Continued Proactive Capital Structure Improvement
Cash balance and total available liquidity2 of $346 million and $772 million, respectively, as of December 31, 2023
Repurchased $15 million in principal balance of 8.375% Senior Unsecured Notes (at a discount to par) for $10 million in cash; expected to generate approximately $1 million of annualized interest savings
As of December 31, 2023, since Q2 2022 combined Notes repurchases of $534 million at a discount to par for $447 million cash; in aggregate expected to generate approximately $45 million of annualized interest savings
Cumulative reduction of the outstanding principal balance of these Notes from $1.45 billion as of March 31, 2022 to approximately $0.9 billion as of December 31, 2023
Received cash proceeds of $101 million from sale of equity interest in BMI in February 2024
Guidance
Q1 Consolidated Revenue expected to be flat to down 2%
Q1 Consolidated Adjusted EBITDA3 expected to be $100 million to $110 million, up from $93 million in prior year
Remain committed to long term target of approximately 4x Net Debt to Adjusted EBITDA (“net leverage”)3
Full Year 2023 Highlights 4
Revenue of $3,751 million, down 4%; excluding Full Year 2023 Political Revenue, Revenue down 2%
Multiplatform Group Revenue down 6%
Excluding Multiplatform Group Political Revenue, Multiplatform Group Revenue down 4%
Digital Audio Group Revenue up 5%
Podcast Revenue up 14%
Digital Revenue excluding Podcast flat
GAAP Operating loss of $797 million decreased from GAAP Operating income of $57 million in the year ended December 31, 2022, as a result of the $965 million of non-cash impairment charges recorded in Q2 2023, primarily related to our goodwill and indefinite-lived intangible assets balances. Full Year 2022 GAAP Operating income included $311 million of non-cash impairment charges, primarily related to our indefinite-lived intangible asset balance.
Consolidated Adjusted EBITDA of $697 million, down from $950 million in the year ended December 31, 2022
Generated Cash Flows from operating activities of $213 million
Free Cash Flow of $110 million, Free Cash Flow including net proceeds from real estate sales was $118 million
Received cash proceeds of $45 million from a sale leaseback of radio broadcast towers in Q3 2023
Statement from Senior Management
“We?re pleased to report that our fourth quarter results were in line with our previously provided Adjusted EBITDA and Revenue guidance ranges.? said Bob Pittman, iHeartMedia?s Chairman and CEO. ?This quarter the Digital Audio Group achieved the highest Adjusted EBITDA and margin in its history, illustrating the success of this high growth business. We view 2024 as a recovery year in which the company returns to growth mode — we expect to see our Multiplatform Group performance improve quarter by quarter throughout the year, and we expect our Digital Audio Group, including our industry leading podcast business, to continue to grow and reinforce its leadership position in the segment.?
?We continue to see signs of improvement throughout our business and the broader advertising marketplace. Our results this quarter are a strong indication that the reallocation of resources towards our high growth Digital Audio Group has been successful – through our relentless focus on efficiencies we have reduced our Multiplatform Group expenses by approximately 7% since 2019, which has in part enabled us to build a Digital business that generated $1 billion of revenue in 2023 with an Adjusted EBITDA margin of 33%,? said Rich Bressler, iHeartMedia?s President, COO and CFO. ?We expect to see a significant year over year improvement in our 2024 financial performance, supported by our ongoing efficiency efforts and what is anticipated to be record-setting political advertising year.?
Consolidated Results of Operations
Fourth Quarter 2023 Consolidated Results
Our consolidated revenue decreased $59.1 million, or 5.2%, during the three months ended December 31, 2023 compared to the same period of 2022. Digital Audio revenue increased $16.6 million, or 5.5%, driven primarily by continuing increases in demand for podcast advertising. Multiplatform revenue decreased $48.8 million, or 6.7%, primarily resulting from a decrease in broadcast advertising due to a challenging macroeconomic environment and a decline in political advertising due to 2022 being a mid-term election year, partially offset by an increase in trade and barter revenues. Audio & Media Services revenue decreased $27.0 million primarily due to a decrease in political revenue.
Consolidated direct operating expenses increased $1.9 million, or 0.4%, during the three months ended December 31, 2023 compared to the same period of 2022. The increase in direct operating expenses was primarily driven by higher broadcast content fees and higher variable content costs resulting from an increase in digital segment revenue, including profit sharing costs and production costs. The increase was partially offset by lower third party digital costs in connection with a reduction in COVID-19 related advertisers and employee compensation as a result of cost savings initiatives.
Consolidated Selling, General & Administrative (“SG&A”) expenses increased $36.3 million, or 8.5%, during the three months ended December 31, 2023 compared to the same period of 2022. The increase in Consolidated SG&A expenses was driven primarily by higher trade and barter expense and variable bonus expense, partially offset by expense reductions as a result of our cost savings initiatives.
Our consolidated GAAP Operating income was $79.8 million compared to $172.8 million in the fourth quarter of 2022, primarily resulting from the decrease in broadcast revenue due to a more challenging macroeconomic environment and a decline in political revenues compared to 2022.
Adjusted EBITDA decreased to $208.2 million compared to $315.6 million in the prior-year period.
Cash provided by operating activities was $154.1 million, compared to $213.4 million in the prior-year period primarily due to a decrease in broadcast revenue due to a challenging macroeconomic environment, a decrease in political revenue, and an increase in floating borrowing rates. Free Cash Flow was $141.9 million, compared to $165.0 million in the prior year period.
Business Segments: Results of Operations
Fourth Quarter 2023 Multiplatform Group Results
(In thousands)
Three Months Ended
December 31,
%
Year Ended
December 31,
%
2023
2022
Change
2023
2022
Change
Revenue
$
684,028
$
732,834
(6.7)%
$
2,435,368
$
2,597,190
(6.2)%
Operating expenses1
542,493
502,803
7.9%
1,881,934
1,831,491
2.8%
Segment Adjusted EBITDA
$
141,535
$
230,031
(38.5)%
$
553,434
$
765,699
(27.7)%
Segment Adjusted EBITDA margin
20.7%
31.4%
22.7%
29.5%
1 Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring Expenses.
Revenue from our Multiplatform Group decreased $48.8 million, or 6.7% YoY, primarily due to the challenging macroeconomic environment and a decline in political advertising as 2022 was a mid-term election year, partially offset by an increase in trade and barter revenues. Broadcast revenue declined $36.1 million, or 6.9% YoY, driven by lower spot revenue and a decrease in political advertising, partially offset by an increase in trade and barter revenues. Networks declined $11.0 million, or 8.4% YoY. Revenue from Sponsorship and Events decreased by $3.6 million, or 4.8% YoY.
Operating expenses increased $39.7 million, or 7.9% YoY, driven primarily by an increase in trade and barter expenses and variable bonus expense, partially offset by lower sales commissions and reductions as a result of our cost savings initiatives.
Segment Adjusted EBITDA Margin decreased YoY to 20.7% from 31.4%.
Fourth Quarter 2023 Digital Audio Group Results
(In thousands)
Three Months Ended
December 31,
%
Year Ended
December 31,
%
2023
2022
Change
2023
2022
Change
Revenue
$
317,695
$
301,091
5.5%
$
1,069,167
$
1,021,824
4.6%
Operating expenses1
201,183
201,760
(0.3)%
720,298
712,786
1.1%
Segment Adjusted EBITDA
$
116,512
$
99,331
17.3%
$
348,869
$
309,038
12.9%
Segment Adjusted EBITDA margin
36.7%
33.0%
32.6%
30.2%
1 Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring Expenses.
Revenue from our Digital Audio Group increased $16.6 million, or 5.5% YoY, driven by Podcast revenue which increased by $18.7 million, or 16.6%, YoY, to $131.7 million, driven primarily by increased demand for podcasting from advertisers, partially offset by Digital, excluding Podcast revenue, which declined $2.1 million, or 1.1%, YoY, to $186.0 million, driven by a decrease in COVID-19 related advertisers, partially offset by an increase in demand for digital advertising.
Operating expenses decreased $0.6 million, or 0.3% YoY, primarily driven by lower third-party digital costs in connection with fewer COVID-19 related advertisers, partially offset by higher profit sharing costs resulting from higher revenue.
Segment Adjusted EBITDA Margin increased YoY to 36.7% from 33.0%.
Fourth Quarter 2023 Audio & Media Services Group Results
(In thousands)
Three Months Ended
December 31,
%
Year Ended
December 31,
%
2023
2022
Change
2023
2022
Change
Revenue
$
67,568
$
94,586
(28.6)%
$
256,702
$
304,302
(15.6)%
Operating expenses1
46,926
49,898
(6.0)%
185,241
191,407
(3.2)%
Segment Adjusted EBITDA
$
20,642
$
44,688
(53.8)%
$
71,461
$
112,895
(36.7)%
Segment Adjusted EBITDA margin
30.5%
47.3%
27.8%
37.1%
1 Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring Expenses.
Revenue from our Audio & Media Services Group decreased $27.0 million, or 28.6% YoY, primarily driven by a decrease in political revenue.
Operating expenses decreased $3.0 million, or 6.0% YoY, primarily as a result of lower variable bonus expense.
Segment Adjusted EBITDA Margin decreased YoY to 30.5% from 47.3%.
GAAP and Non-GAAP Measures: Consolidated
(In thousands)
Three Months Ended
December 31,
Year Ended
December 31,
2023
2022
2023
2022
Revenue
$
1,066,783
$
1,125,890
$
3,751,025
$
3,912,283
Operating income (loss)
$
79,780
$
172,843
$
(797,311)
$
56,860
Adjusted EBITDA1
$
208,211
$
315,645
$
696,598
$
950,289
Net income (loss)
$
13,975
$
80,663
$
(1,100,339)
$
(262,670)
Cash provided by operating activities2
$
154,104
$
213,376
$
213,062
$
420,075
Free cash flow1,2
$
141,890
$
164,974
$
110,392
$
259,106
Free cash flow including net proceeds from real estate sales1,2
$
144,789
$
165,774
$
117,920
$
291,441
_________________________________
1 See the end of this press release for reconciliations of (i) Adjusted EBITDA to Operating income (loss), (ii) Adjusted EBITDA to Net income (loss), (iii) Free Cash Flow and Free cash flow including net proceeds from real estate sales to cash provided by operating activities, (iv) revenue, excluding political advertising revenue, to revenue, and (v) Net Debt to Total Debt. See also the definitions of Adjusted EBITDA, Free Cash Flow, Free cash flow including net proceeds from real estate sales, Adjusted EBITDA margin, and Net Debt under the Supplemental Disclosure Regarding Non-GAAP Financial Information section in this release.
2 We made cash interest payments of $88.5 million in the three months ended December 31, 2023, compared to $92.5 million in the three months ended December 31, 2022.
Certain prior period amounts have been reclassified to conform to the 2023 presentation of financial information throughout the press release.
Liquidity and Financial Position
As of December 31, 2023, we had $346.4 million of cash on our balance sheet. For the twelve months ended December 31, 2023, cash provided by operating activities was $213.1 million, cash used for investing activities was $51.3 million and cash used for financing activities was $152.2 million.
Capital expenditures for the twelve months ended December 31, 2023 were $102.7 million compared to $161.0 million in the twelve months ended December 31, 2022. Capital expenditures during the twelve months ended December 31, 2023 decreased primarily due to lower spending on real estate optimization initiatives.
As of December 31, 2023, the Company had $5,215.2 million of total debt and $4,868.8 million of Net Debt. The terms of our capital structure include no material maintenance covenants, and there are no material debt maturities prior to May 2026. During the three months ended December 31, 2023, we repurchased $15.0 million in aggregate principal amount of iHeartCommunications Inc.’s 8.375% Senior Unsecured Notes due 2027, at a discount to par, for $9.8 million in cash. During the twelve months ended December 31, 2023, we repurchased $204.0 million in aggregate principal amount of iHeartCommunications Inc.’s 8.375% Senior Unsecured Notes due 2027, at a discount to par, for $147.3 million in cash.
In September 2023, we sold 122 of our broadcast tower sites for net proceeds of $45.3 million and entered into long-term operating leases for use of space on 121 of the broadcast towers and related assets.
Cash balance and total available liquidity5 were $346.4 million and $772 million, respectively, as of December 31, 2023.
Revenue Streams
The tables below present the comparison of our historical revenue streams (including political revenue) for the periods presented:
(In thousands)
Three Months Ended
December 31,
%
Year Ended
December 31,
%
2023
2022
Change
2023
2022
Change
Broadcast Radio
$
484,673
$
520,725
(6.9)%
$
1,752,166
$
1,883,324
(7.0)%
Networks
119,948
130,915
(8.4)%
466,404
503,244
(7.3)%
Sponsorship and Events
71,137
74,759
(4.8)%
191,434
188,985
1.3%
Other
8,270
6,435
28.5%
25,364
21,637
17.2%
Multiplatform Group1
684,028
732,834
(6.7)%
2,435,368
2,597,190
(6.2)%
Digital ex. Podcast
186,028
188,138
(1.1)%
661,319
663,392
(0.3)%
Podcast
131,667
112,953
16.6%
407,848
358,432
13.8%
Digital Audio Group
317,695
301,091
5.5%
1,069,167
1,021,824
4.6%
Audio & Media Services Group1
67,568
94,586
(28.6)%
256,702
304,302
(15.6)%
Eliminations
(2,508)
(2,621)
(10,212)
(11,033)
Revenue, total1
$
1,066,783
$
1,125,890
(5.2)%
$
3,751,025
$
3,912,283
(4.1)%
1 Excluding the impact of political revenue, Revenue from the Multiplatform Group and Consolidated Revenue decreased by 3.2% and 0.5% for the three months ended December 31, 2023 compared to the three months ended December 31, 2022, respectively. Excluding the impact of political revenue, Revenue from Audio & Media Services decreased by 5.2% for the three months ended December 31, 2023 compared to the three months ended December 31, 2022. See the end of this press release for a reconciliation of revenue, excluding political advertising revenue, to revenue.
more (https://radioinsight.com/headlines/265506/iheartmedia-releases-2023-year-end-earnings/)