Entravision Communications Corporation Reports Fourth Quarter and Full Year 2022 Results

Entravision Communications Corporation (NYSE: EVC), a leading global advertising solutions, media and technology company, today announced financial results for the three- and twelve-month periods ended December 31, 2022.

Fourth Quarter and Full Year 2022 Highlights

  • Record fourth quarter and annual revenue
  • Record fourth quarter and annual consolidated adjusted EBITDA
  • Record political advertising revenue compared to prior election cycles, including presidential
  • Net loss attributable to common stockholders of $1.6 million in the fourth quarter compared to net income attributable to common stockholders of $3.9 million in the prior-year quarter
  • Net income attributable to common stockholders for the full year down 38% compared to the prior-year
  • Consolidated adjusted EBITDA up 11% and 17% compared to the prior-year quarter and full year, respectively
  • Operating cash flow down 93% and up 21% compared to the prior-year quarter and full year, respectively
  • Free cash flow down 37% and 20% compared to the prior-year quarter and full year, respectively
  • Quarterly cash dividend increase to $0.05 per share

“We are pleased with our 2022 performance, which marks a record year for Entravision for revenue and consolidated adjusted EBITDA,” said Entravision Interim Chief Executive Officer and Chief Financial Officer, Chris Young. “Our results demonstrate the resiliency and strength of our business through challenging macro conditions, and the successful execution of our strategic plan to create a leading global advertising solutions, media and technology company. We have enhanced our digital segment organically, as well as through strategic partnerships, geographic expansion and accretive acquisitions to bolster our suite of digital services in the large and growing advertising industry. Our complementary non-digital businesses, while a smaller percentage of our revenue portfolio, continue to be an important contributor to our growth. We will continue to leverage our tools, reach, technology and world-class team to meet our clients’ evolving needs and deliver enhanced shareholder value."

Paul Zevnik, Interim Chair and co-founder said, “The Entravision team mourns the sudden and tragic loss of our late CEO, founder and dear friend, Walter Ulloa. Walter passed unexpectedly on the last day of the most successful year in the company's history. Since we founded Entravision in 1996, we have developed a clear vision to build a leading global advertising solutions, media and technology company serving diverse demographics with diverse media. Through Walter’s leadership and with the support of a strong leadership team and dedicated entrepreneurs across each of Entravision’s business platforms, we have achieved tremendous growth and transformed the Company’s geographical breadth and media portfolio. Most importantly, we created a company that is a great place to work with a focus on engagement, trust, open communications, community service and involvement, and long-lasting relationships with our key partners. I miss our friend dearly, and the Board is committed to working with management to advance Walter’s vision and execute on our roadmap to deliver enhanced value for our stakeholders and partners."

Quarterly Cash Dividend

As previously announced, the Company's Board of Directors approved a quarterly cash dividend to shareholders of $0.05 per share on the Company's Class A and Class U common stock, in an aggregate amount of approximately $4.4 million. This is double the Company's previous quarterly dividend of $0.025 in 2022 and returns the dividend to its pre-pandemic level. The quarterly dividend will be payable on March 31, 2023 to shareholders of record as of the close of business on March 16, 2023, and the common stock will trade ex-dividend on March 15, 2023. 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.

Non-GAAP Financial Measures

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 is included beginning on page 10.

Unaudited Financial Highlights (In thousands, except share and per share data)

 

Three Months Ended

Twelve Months Ended

 

December 31,

December 31,

 

2022

2021

% Change

2022

2021

% Change

Net revenue

$

296,328

 

$

233,894

27

%

$

956,209

 

$

760,192

 

26

%

Cost of revenue - digital (1)

 

191,965

 

 

148,399

29

%

 

623,916

 

 

466,517

 

34

%

Operating expenses (2)

 

57,249

 

 

48,065

19

%

 

197,776

 

 

173,034

 

14

%

Corporate expenses (3)

 

22,635

 

 

11,237

101

%

 

49,404

 

 

32,993

 

50

%

Foreign currency (gain) loss

 

860

 

 

54

1493

%

 

2,972

 

 

508

 

485

%

 

 

 

 

 

 

 

Consolidated adjusted EBITDA (4)

 

36,524

 

 

32,856

11

%

 

103,090

 

 

88,033

 

17

%

 

 

 

 

 

 

 

Free cash flow (5)

$

19,299

 

$

30,875

(37

)%

$

63,325

 

$

78,706

 

(20

)%

 

 

 

 

 

 

 

Net income (loss)

$

725

 

$

3,868

(81

)%

$

20,169

 

$

35,230

 

(43

)%

Net (income) loss attributable to redeemable noncontrolling interest

$

-

 

$

-

*

 

$

-

 

$

(5,938

)

(100

)%

Net (income) loss attributable to noncontrolling interest

$

(2,353

)

$

-

*

 

$

(2,050

)

$

-

 

*

 

Net income (loss) attributable to common stockholders

$

(1,628

)

$

3,868

*

 

$

18,119

 

$

29,292

 

(38

)%

 

 

 

 

 

 

 

Net income (loss) per share attributable to common stockholders, basic

$

(0.02

)

$

0.05

*

 

$

0.21

 

$

0.34

 

(38

)%

Net income (loss) per share attributable to common stockholders, diluted

$

(0.02

)

$

0.04

*

 

$

0.21

 

$

0.33

 

(36

)%

 

 

 

 

 

 

 

Weighted average common shares outstanding, basic

 

85,158,189

 

 

85,579,385

 

 

85,391,163

 

 

85,301,603

 

 

Weighted average common shares outstanding, diluted

 

85,158,189

 

 

88,556,177

 

 

87,769,762

 

 

87,910,603

 

 

(1)

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.

(2)

Operating expenses include direct operating and selling, general and administrative expenses. Included in operating expenses are $2.8 million and $2.3 million of non-cash stock-based compensation for the three-month periods ended December 31, 2022 and 2021, respectively, and $5.7 million and $3.2 million of non-cash stock-based compensation for the twelve-month periods ended December 31, 2022 and 2021, respectively.

(3)

Corporate expenses include $9.2 million and $4.0 million of non-cash stock-based compensation for the three-month periods ended December 31, 2022 and 2021, respectively, and $14.3 million and $6.4 million of non-cash stock-based compensation for the twelve-month periods ended December 31, 2022 and 2021, 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 operating gain (loss), 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 the Federal Communications Commission, or FCC, spectrum incentive auction less related expenses, expenses associated with investments, EBITDA attributable to noncontrolling and redeemable noncontrolling interest, 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), 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, EBITDA attributable to noncontrolling and redeemable noncontrolling interest, 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, and other operating gain (loss). Net interest expense is defined as interest expense, less non-cash interest expense relating to amortization of debt finance costs, and less interest income.

Unaudited Financial Results (In thousands)

 

Three Months Ended

 

December 31,

 

2022

2021

% Change

Net revenue

$

296,328

 

$

233,894

 

27

%

Cost of revenue - digital (1)

 

191,965

 

 

148,399

 

29

%

Operating expenses (1)

 

57,249

 

 

48,065

 

19

%

Corporate expenses (1)

 

22,635

 

 

11,237

 

101

%

Depreciation and amortization

 

6,485

 

 

6,261

 

4

%

Change in fair value of contingent consideration

 

7,400

 

 

8,224

 

(10

)%

Impairment charge

 

1,600

 

 

1,419

 

13

%

Foreign currency (gain) loss

 

860

 

 

54

 

1493

%

Other operating (gain) loss

 

1,393

 

 

(2,131

)

*

 

 

 

 

 

Operating income (loss)

 

6,741

 

 

12,366

 

(45

)%

Interest expense, net

 

(2,703

)

 

(1,723

)

57

%

Dividend income

 

 

 

2

 

(100

)%

Realized gain (loss) on marketable securities

 

(59

)

 

 

*

 

 

 

 

 

Income before income taxes

 

3,979

 

 

10,645

 

(63

)%

Income tax (expense) benefit

 

(3,254

)

 

(6,777

)

(52

)%

 

 

 

 

Net income (loss)

 

725

 

 

3,868

 

(81

)%

Net (income) loss attributable to noncontrolling interest

 

(2,353

)

 

 

*

 

Net income (loss) attributable to common stockholders

$

(1,628

)

$

3,868

 

*

 

(1)

Cost of revenue, operating expenses and corporate expenses are defined on page 2.

Net revenue in the fourth quarter of 2022 totaled $296.3 million, up 27% from $233.9 million in the prior-year period. Of the overall increase, approximately $52.6 million was attributable to our digital segment and was primarily due to advertising revenue growth from our digital commercial partnerships business. In addition, the increase in net revenue in our digital segment was due to our investments in variable interest entities in 2022, which did not contribute to our results of operations in the comparable prior-year period. In addition, of the overall increase, approximately $5.6 million was attributable to our television segment, primarily due to an increase in political advertising revenue, partially offset by decreases in local and national advertising revenue. These decreases were mainly attributed to the expiration of our Univision and UniMás network affiliation agreements in Orlando, Tampa and Washington, D.C. on December 31, 2021. Additionally, of the overall increase, approximately $4.2 million was attributable to our audio segment, primarily due to increases in political advertising revenue and national advertising revenue, partially offset by a decrease in local advertising revenue.

Cost of revenue in the fourth quarter of 2022 totaled $192.0 million, up 29% from $148.4 million in the prior-year period. The increase was primarily due to increased cost of revenue related to advertising revenue growth from our digital commercial partnerships business, and due to our investments in variable interest entities in 2022, which did not contribute to our results of operations in the comparable prior-year period.

Operating expenses in the fourth quarter of 2022 totaled $57.2 million, up 19% from $48.1 million in the prior-year period. Of the overall increase, approximately $7.0 million was attributable to our digital segment and was primarily due to an increase in expenses associated with the increase in digital advertising revenue, an increase in salary expense and non-cash stock-based compensation, and an increase due to our investments in variable interest entities in 2022, which did not contribute to our results of operations in the comparable prior-year period. In addition, of the overall increase in operating expenses, approximately $1.1 million was attributable to our television segment primarily due to an increase in rent expense, an increase in bad debt expense and an increase in non-cash stock-based compensation, partially offset by a decrease in expenses associated with the decrease in local and national advertising revenue. Additionally, of the overall increase in operating expenses, approximately $1.0 million was attributable to our audio segment primarily due to an increase in expenses associated with the increase in national advertising revenue and an increase in rent expense.

Corporate expenses in the fourth quarter of 2022 totaled $22.6 million, up 101% from $11.2 million in the prior-year period. The increase was primarily due to $8.1 million of severance related expense incurred upon the passing of our late Chief Executive Officer, and due to increases in non-cash stock-based compensation and an increase in salaries.

Unaudited Financial Results (In thousands)

 

Twelve Months Ended

 

December 31,

 

2022

2021

% Change

Net revenue

$

956,209

 

$

760,192

 

26

%

Cost of revenue - digital (1)

 

623,916

 

 

466,517

 

34

%

Operating expenses (1)

 

197,776

 

 

173,034

 

14

%

Corporate expenses (1)

 

49,404

 

 

32,993

 

50

%

Depreciation and amortization

 

25,697

 

 

22,420

 

15

%

Change in fair value of contingent consideration

 

14,210

 

 

8,224

 

73

%

Impairment charge

 

1,600

 

 

3,023

 

(47

)%

Foreign currency (gain) loss

 

2,972

 

 

508

 

485

%

Other operating (gain) loss

 

382

 

 

(6,998

)

*

 

 

 

 

 

Operating income (loss)

 

40,252

 

 

60,471

 

(33

)%

Interest expense, net

 

(8,012

)

 

(6,775

)

18

%

Dividend income

 

20

 

 

213

 

(91

)%

Realized gain (loss) on marketable securities

 

(532

)

 

 

*

 

 

 

 

 

Income before income taxes

 

31,728

 

 

53,909

 

(41

)%

Income tax (expense) benefit

 

(11,559

)

 

(18,679

)

(38

)%

 

 

 

 

Net income (loss)

 

20,169

 

 

35,230

 

(43

)%

Net (income) loss attributable to redeemable noncontrolling interest

 

 

 

(5,938

)

(100

)%

Net (income) loss attributable to noncontrolling interest

 

(2,050

)

 

 

*

 

Net income (loss) attributable to common stockholders

$

18,119

 

$

29,292

 

(38

)%

(1)

Cost of revenue, operating expenses and corporate expenses are defined on page 2.

Net revenue for the year ended December 31, 2022 totaled $956.2 million, up 26% from $760.2 million in the prior-year period. Of the overall increase, approximately $191.8 million was attributable to our digital segment and was primarily due to advertising revenue growth from our digital commercial partnerships business. In addition, the increase in net revenue in our digital segment was due to our investments in variable interest entities in 2022 and our acquisitions in 2021, which did not contribute to our results of operations for the full prior-year period. In addition, of the overall increase, approximately $6.4 million was attributable to our audio segment primarily due to increases in political advertising revenue and local advertising revenue, partially offset by a decrease in national advertising revenue. The overall increase was partially offset by a decrease of approximately $2.1 million attributable to our television segment, primarily due to decreases in local and national advertising revenue, a decrease in spectrum usage rights revenue, and a decrease in retransmission consent revenue. These decreases were mainly attributed to the expiration of our Univision and UniMás network affiliation agreements in Orlando, Tampa and Washington, D.C. on December 31, 2021. The decrease in our television segment revenue was partially offset by an increase in political advertising revenue.

Cost of revenue for the year ended December 31, 2022 totaled $623.9 million, up 34% from $466.5 million in the prior-year period. The increase was primarily due to increased cost of revenue related to advertising revenue growth from our digital commercial partnerships business, and due to our investments in variable interest entities in 2022 and our acquisitions in 2021, which did not contribute to our results of operations for the full prior-year period.

Operating expenses for the year ended December 31, 2022 totaled $197.8 million, up 14% from $173.0 million in the prior-year period. Of the overall increase, approximately $22.5 million was attributable to our digital segment and was primarily due to an increase in expenses associated with the increase in digital advertising revenue, an increase in salary expense and non-cash stock-based compensation, and an increase due to our investments in variable interest entities in 2022 and our acquisitions in 2021, which did not contribute to our results of operations for the full prior-year period. In addition, of the overall increase in operating expenses, approximately $0.6 million was attributable to our television segment primarily due to an increase in rent expense, an increase in bad debt expense and an increase in non-cash stock-based compensation, partially offset by a decrease in expenses associated with the decrease in local and national advertising revenue. Additionally, of the overall increase in operating expenses, approximately $1.7 million was attributable to our audio segment primarily due to an increase in expenses associated with the increase in local advertising revenue and an increase in rent expense.

Corporate expenses for the year ended December 31, 2022 totaled $49.4 million, up 50% from $33.0 million in the prior-year period. The increase was primarily due to $8.1 million of severance related expense incurred upon the passing of our late Chief Executive Officer, and due to increases in non-cash stock-based compensation and an increase in salaries.

Balance Sheet and Related Metrics

Cash and marketable securities as of December 31, 2022 totaled approximately $155.2 million. Total debt under the Company’s credit agreement was $209.3 million. Net of $75 million of cash and marketable securities, total leverage as defined in the Company’s credit agreement was 1.3 times as of December 31, 2022. Net of total cash and marketable securities, total leverage was 0.5 times.

Unaudited Segment Results (In thousands)

 

Three Months Ended

Twelve Months Ended

 

December 31,

December 31,

 

2022

2021

% Change

2022

2021

% Change

Net Revenue

 

 

 

 

 

 

Digital

$

230,137

$

177,512

30

%

$

747,103

$

555,338

35

%

Television

 

45,812

 

40,241

14

%

 

144,730

 

146,839

(1

)%

Audio

 

20,379

 

16,141

26

%

 

64,376

 

58,015

11

%

Total

$

296,328

$

233,894

27

%

$

956,209

$

760,192

26

%

 

 

 

 

 

 

 

Cost of Revenue - Digital (1)

$

191,965

$

148,399

29

%

$

623,916

$

466,517

34

%

 

 

 

 

 

 

 

Operating Expenses (1)

 

 

 

 

 

 

Digital

$

22,553

$

15,540

45

%

$

74,130

$

51,604

44

%

Television

 

22,989

 

21,849

5

%

 

81,958

 

81,397

1

%

Audio

 

11,707

 

10,676

10

%

 

41,688

 

40,033

4

%

Total

$

57,249

$

48,065

19

%

$

197,776

$

173,034

14

%

 

 

 

 

 

 

 

Corporate Expenses (1)

$

22,635

$

11,237

101

%

$

49,404

$

32,993

50

%

 

 

 

 

 

 

 

Foreign currency (gain) loss

$

860

$

54

1493

%

$

2,972

$

508

485

%

 

 

 

 

 

 

 

Consolidated adjusted EBITDA (1)

$

36,524

$

32,856

11

%

$

103,090

$

88,033

17

%

(1)

Cost of revenue, operating expenses, corporate expenses, and consolidated adjusted EBITDA are defined on page 2.

Notice of Conference Call

Entravision Communications Corporation will hold a conference call to discuss its fourth quarter and full year 2022 results on Thursday, March 9, 2023 at 5:00 p.m. Eastern Time. To access the conference call, please dial (844) 836-8739 (U.S.) or (412) 317-5440 (Int’l) ten minutes prior to the start time and reference Conference ID number 10176187. The call will also be available via live webcast on the investor relations portion of the Company's website located at www.entravision.com.

About Entravision Communications Corporation

Entravision is a leading global advertising, media and ad-tech solutions company connecting brands to consumers by representing top platforms and publishers. Our dynamic portfolio includes digital, television and audio offerings. Digital, our largest revenue segment, is comprised of four business units: our digital sales representation business; Smadex, our programmatic ad purchasing platform; our branding and mobile performance solutions business; and our digital audio business. Through our digital sales representation business, we connect global media companies such as Meta, Twitter, TikTok and Spotify with advertisers in primarily emerging growth markets worldwide. Smadex is our mobile-first demand side platform, enabling advertisers to execute performance campaigns using machine learning. We also offer a branding and mobile performance solutions business, which provides managed services to advertisers looking to connect with global consumers, primarily on mobile devices, and our digital audio business provides digital audio advertising solutions for advertisers in the Americas. In addition to digital, Entravision has 49 television stations and is the largest affiliate group of the Univision and UniMás television networks. Entravision also manages 45 primarily Spanish-language radio stations that feature nationally recognized, Emmy award-winning talent. Shares of Entravision Class A Common Stock trade on the NYSE under ticker: EVC. Learn more about our offerings at entravision.com or connect with us on LinkedIn and Facebook.

Forward-Looking Statements

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, 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 Statements of Operations

(In thousands, except share and per share data)

(Unaudited)

 

 

Three-Month Period

Twelve-Month Period

 

Ended December 31,

Ended December 31,

 

2022

2021

2022

2021

Net revenue

$

296,328

 

$

233,894

 

$

956,209

 

$

760,192

 

Expenses:

 

 

 

 

Cost of revenue - digital

 

191,965

 

 

148,399

 

 

623,916

 

 

466,517

 

Direct operating expenses

 

35,106

 

 

32,969

 

 

122,611

 

 

116,449

 

Selling, general and administrative expenses

 

22,143

 

 

15,096

 

 

75,165

 

 

56,585

 

Corporate expenses

 

22,635

 

 

11,237

 

 

49,404

 

 

32,993

 

Depreciation and amortization

 

6,485

 

 

6,261

 

 

25,697

 

 

22,420

 

Change in fair value of contingent consideration

 

7,400

 

 

8,224

 

 

14,210

 

 

8,224

 

Impairment charge

 

1,600

 

 

1,419

 

 

1,600

 

 

3,023

 

Foreign currency (gain) loss

 

860

 

 

54

 

 

2,972

 

 

508

 

Other operating (gain) loss

 

1,393

 

 

(2,131

)

 

382

 

 

(6,998

)

 

 

289,587

 

 

221,528

 

 

915,957

 

 

699,721

 

Operating income (loss)

 

6,741

 

 

12,366

 

 

40,252

 

 

60,471

 

Interest expense

 

(3,651

)

 

(1,733

)

 

(10,876

)

 

(7,020

)

Interest income

 

948

 

 

10

 

 

2,864

 

 

245

 

Dividend income

 

 

 

2

 

 

20

 

 

213

 

Realized gain (loss) on marketable securities

 

(59

)

 

 

 

(532

)

 

 

Income before income taxes

 

3,979

 

 

10,645

 

 

31,728

 

 

53,909

 

Income tax (expense) benefit

 

(3,254

)

 

(6,777

)

 

(11,559

)

 

(18,679

)

Net income (loss)

 

725

 

 

3,868

 

 

20,169

 

 

35,230

 

Net (income) loss attributable to redeemable noncontrolling interest

 

 

 

 

 

 

 

(5,938

)

Net (income) loss attributable to noncontrolling interest

 

(2,353

)

 

 

 

(2,050

)

 

 

Net income (loss) attributable to common stockholders

$

(1,628

)

$

3,868

 

$

18,119

 

$

29,292

 

 

 

 

 

 

Basic and diluted earnings per share:

 

 

 

 

Net income (loss) per share attributable to common stockholders, basic

$

(0.02

)

$

0.05

 

$

0.21

 

$

0.34

 

Net income (loss) per share attributable to common stockholders, diluted

$

(0.02

)

$

0.04

 

$

0.21

 

$

0.33

 

 

 

 

 

 

Cash dividends declared per common share, basic and diluted

$

0.03

 

$

0.03

 

$

0.10

 

$

0.10

 

 

 

 

 

 

Weighted average common shares outstanding, basic

 

85,158,189

 

 

85,579,385

 

 

85,391,163

 

 

85,301,603

 

Weighted average common shares outstanding, diluted

 

85,158,189

 

 

88,556,177

 

 

87,769,762

 

 

87,910,603

 

Entravision Communications Corporation

Consolidated Balance Sheets

(In thousands; unaudited)

 

 

December 31,

December 31,

 

2022

2021

ASSETS

 

 

Current assets

 

 

Cash and cash equivalents

$

110,691

 

$

185,094

 

Marketable securities

 

44,528

 

 

 

Restricted Cash

 

753

 

 

749

 

Trade receivables, net of allowance for doubtful accounts

 

224,713

 

 

201,747

 

Assets held for sale

 

 

 

1,963

 

Prepaid expenses and other current assets

 

27,238

 

 

18,925

 

Total current assets

 

407,923

 

 

408,478

 

Property and equipment, net

 

61,362

 

 

62,498

 

Intangible assets subject to amortization, net

 

61,811

 

 

64,034

 

Intangible assets not subject to amortization

 

207,453

 

 

209,053

 

Goodwill

 

86,991

 

 

71,708

 

Deferred income taxes

 

2,591

 

 

1,462

 

Operating leases right of use asset

 

44,413

 

 

25,582

 

Other assets

 

8,297

 

 

8,527

 

Total assets

$

880,841

 

$

851,342

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

Current liabilities

 

 

Current maturities of long-term debt

$

5,256

 

$

4,903

 

Accounts payable and accrued expenses

 

237,415

 

 

212,655

 

Operating lease liabilities

 

5,570

 

 

7,304

 

Total current liabilities

 

248,241

 

 

224,862

 

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

 

207,292

 

 

207,416

 

Long-term operating lease liabilities

 

42,151

 

 

20,988

 

Other long-term liabilities

 

30,198

 

 

72,930

 

Deferred income taxes

 

67,590

 

 

68,220

 

Total liabilities

 

595,472

 

 

594,416

 

 

 

 

Stockholders' equity

 

 

Class A common stock

 

8

 

 

6

 

Class B common stock

 

 

 

2

 

Class U common stock

 

1

 

 

1

 

Additional paid-in capital

 

776,298

 

 

780,388

 

Accumulated deficit

 

(504,375

)

 

(522,494

)

Accumulated other comprehensive income (loss)

 

(1,510

)

 

(977

)

Total stockholders' equity

 

270,422

 

 

256,926

 

Noncontrolling interest

 

14,947

 

 

-

 

Total equity

 

285,369

 

 

256,926

 

Total liabilities and equity

$

880,841

 

$

851,342

 

Entravision Communications Corporation

Consolidated Statements of Cash Flows

(In thousands; unaudited)

 

 

Three-Month Period

Twelve-Month Period

 

Ended December 31,

Ended December 31,

 

2022

2021

2022

2021

Cash flows from operating activities:

 

 

 

 

Net income (loss)

$

725

 

$

3,868

 

$

20,169

 

$

35,230

 

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

 

 

 

 

Depreciation and amortization

 

6,485

 

 

6,261

 

 

25,697

 

 

22,420

 

Impairment charge

 

1,600

 

 

1,419

 

 

1,600

 

 

3,023

 

Deferred income taxes

 

(2,211

)

 

6,206

 

 

(5,362

)

 

14,554

 

Non-cash interest

 

238

 

 

153

 

 

1,314

 

 

604

 

Amortization of syndication contracts

 

120

 

 

118

 

 

468

 

 

475

 

Payments on syndication contracts

 

(166

)

 

(119

)

 

(470

)

 

(473

)

Non-cash stock-based compensation

 

12,039

 

 

6,295

 

 

20,034

 

 

9,595

 

(Gain) loss on marketable securities

 

59

 

 

 

 

532

 

 

 

(Gain) loss on disposal of property and equipment

 

(37

)

 

(2,007

)

 

(636

)

 

(4,629

)

Change in fair value of contingent consideration

 

7,400

 

 

8,224

 

 

14,210

 

 

8,224

 

Changes in assets and liabilities:

 

 

 

 

(Increase) decrease in trade receivables, net

 

(31,983

)

 

(33,215

)

 

(9,687

)

 

(49,109

)

(Increase) decrease in prepaid expenses and other current assets

 

2,200

 

 

4,515

 

 

2,017

 

 

6,782

 

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

 

4,306

 

 

9,755

 

 

9,031

 

 

18,557

 

Net cash provided by operating activities

 

775

 

 

11,473

 

 

78,917

 

 

65,253

 

Cash flows from investing activities:

 

 

 

 

Proceeds from sale of property and equipment and intangibles

 

37

 

 

917

 

 

2,708

 

 

10,348

 

Purchases of property and equipment

 

(3,586

)

 

(1,550

)

 

(11,468

)

 

(5,819

)

Purchase of a businesses, net of cash acquired

 

 

 

(1,413

)

 

 

 

(14,260

)

Investment in variable interest entities, net of cash consolidated

 

 

 

 

 

(5,164

)

 

 

Purchases of marketable securities

 

(13,902

)

 

 

 

(106,382

)

 

 

Proceeds from marketable securities

 

12,946

 

 

 

 

59,814

 

 

27,800

 

Purchases of investments

 

 

 

 

 

 

 

(800

)

Net cash provided by (used in) investing activities

 

(4,505

)

 

(2,046

)

 

(60,492

)

 

17,269

 

Cash flows from financing activities:

 

 

 

 

Proceeds from stock option exercises

 

1

 

 

2

 

 

219

 

 

416

 

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

 

(4,257

)

 

(4,201

)

 

(4,524

)

 

(4,729

)

Payments on long-term debt

 

(751

)

 

(750

)

 

(3,252

)

 

(3,000

)

Dividends paid

 

(2,124

)

 

(2,136

)

 

(8,539

)

 

(8,531

)

Repurchase of Class A common stock

 

 

 

 

 

(11,280

)

 

 

Payment of contingent consideration

 

 

 

 

 

(65,340

)

 

 

Principal payments under finance lease obligation

 

(33

)

 

(126

)

 

(105

)

 

(126

)

Payments of capitalized debt offering and issuance costs

 

 

 

 

 

 

 

(604

)

Net cash used in financing activities

 

(7,164

)

 

(7,211

)

 

(92,821

)

 

(16,574

)

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

 

(2

)

 

(13

)

 

(3

)

 

(16

)

Net increase (decrease) in cash, cash equivalents and restricted cash

 

(10,896

)

 

2,203

 

 

(74,399

)

 

65,932

 

Cash, cash equivalents and restricted cash:

 

 

 

 

Beginning

 

122,340

 

 

183,640

 

 

185,843

 

 

119,911

 

Ending

$

111,444

 

$

185,843

 

$

111,444

 

$

185,843

 

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,

 

2022

2021

2022

2021

Consolidated adjusted EBITDA (1)

$

36,524

 

$

32,856

 

$

103,090

 

$

88,033

 

EBITDA attributable to redeemable noncontrolling interest

 

 

 

 

 

 

 

9,127

 

EBITDA attributable to noncontrolling interest

 

3,404

 

 

 

 

3,399

 

 

 

Interest expense

 

(3,651

)

 

(1,733

)

 

(10,876

)

 

(7,020

)

Interest income

 

948

 

 

10

 

 

2,864

 

 

245

 

Income tax (expense) benefit

 

(3,254

)

 

(6,777

)

 

(11,559

)

 

(18,679

)

Amortization of syndication contracts

 

(120

)

 

(118

)

 

(468

)

 

(475

)

Payments on syndication contracts

 

166

 

 

119

 

 

470

 

 

473

 

Non-cash stock-based compensation included in direct operating

 

 

 

 

expenses

 

(2,816

)

 

(2,263

)

 

(5,694

)

 

(3,234

)

Non-cash stock-based compensation included in corporate expenses

 

(9,223

)

 

(4,032

)

 

(14,340

)

 

(6,361

)

Depreciation and amortization

 

(6,485

)

 

(6,261

)

 

(25,697

)

 

(22,420

)

Change in fair value of contingent consideration

 

(7,400

)

 

(8,224

)

 

(14,210

)

 

(8,224

)

Non-recurring severance charge

 

(4,316

)

 

(423

)

 

(4,316

)

 

(423

)

Dividend income

 

 

 

2

 

 

20

 

 

213

 

Realized gain (loss) on marketable securities

 

(59

)

 

 

 

(532

)

 

 

Other operating gain (loss)

 

(1,393

)

 

2,131

 

 

(382

)

 

6,998

 

Impairment charge

 

(1,600

)

 

(1,419

)

 

(1,600

)

 

(3,023

)

Net (income) loss attributable to redeemable noncontrolling interest

 

 

 

 

 

 

 

(5,938

)

Net (income) loss attributable to noncontrolling interest

 

(2,353

)

 

 

 

(2,050

)

 

 

Net income (loss) attributable to common stockholders

 

(1,628

)

 

3,868

 

 

18,119

 

 

29,292

 

 

 

 

 

 

Depreciation and amortization

 

6,485

 

 

6,261

 

 

25,697

 

 

22,420

 

Impairment charge

 

1,600

 

 

1,419

 

 

1,600

 

 

3,023

 

Deferred income taxes

 

(2,211

)

 

6,206

 

 

(5,362

)

 

14,554

 

Amortization of debt issuance costs

 

238

 

 

153

 

 

1,314

 

 

604

 

Amortization of syndication contracts

 

120

 

 

118

 

 

468

 

 

475

 

Payments on syndication contracts

 

(166

)

 

(119

)

 

(470

)

 

(473

)

Non-cash stock-based compensation

 

12,039

 

 

6,295

 

 

20,034

 

 

9,595

 

Realized (gain) loss on marketable securities

 

59

 

 

 

 

532

 

 

 

(Gain) loss on disposal of property and equipment

 

(37

)

 

(2,007

)

 

(636

)

 

(4,629

)

Change in fair value of contingent consideration

 

7,400

 

 

8,224

 

 

14,210

 

 

8,224

 

Net (income) loss attributable to redeemable noncontrolling interest

 

 

 

 

 

 

 

5,938

 

Net income (loss) attributable to noncontrolling interest

 

2,353

 

 

 

 

2,050

 

 

 

Changes in assets and liabilities:

 

 

 

 

(Increase) decrease in accounts receivable

 

(31,983

)

 

(33,215

)

 

(9,687

)

 

(49,109

)

(Increase) decrease in prepaid expenses and other assets

 

2,200

 

 

4,515

 

 

2,017

 

 

6,782

 

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

 

4,306

 

 

9,755

 

 

9,031

 

 

18,557

 

Net cash provided by (used in ) operating activities

$

775

 

$

11,473

 

$

78,917

 

$

65,253

 

(1)

Consolidated adjusted EBITDA is defined on page 2.

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,

 

2022

2021

2022

2021

Consolidated adjusted EBITDA (1)

$

36,524

 

$

32,856

 

$

103,090

 

$

88,033

 

Net, cash interest expense (1)

 

(2,465

)

 

(1,570

)

 

(6,698

)

 

(6,171

)

Dividend income

 

 

 

2

 

 

20

 

 

213

 

Cash paid for income taxes

 

(5,465

)

 

(571

)

 

(16,921

)

 

(4,125

)

Capital expenditures (2)

 

(3,586

)

 

(1,550

)

 

(11,468

)

 

(5,819

)

Other operating gain (loss)

 

(1,393

)

 

2,131

 

 

(382

)

 

6,998

 

Non-recurring cash severance charge

 

(4,316

)

 

(423

)

 

(4,316

)

 

(423

)

Free cash flow (1)

 

19,299

 

 

30,875

 

 

63,325

 

 

78,706

 

 

 

 

 

 

Capital expenditures (2)

 

3,586

 

 

1,550

 

 

11,468

 

 

5,819

 

EBITDA attributable to redeemable noncontrolling interest

 

 

 

 

 

 

 

9,127

 

EBITDA attributable to noncontrolling interest

 

3,404

 

 

 

 

3,399

 

 

 

(Gain) loss on disposal of property and equipment

 

(37

)

 

(2,007

)

 

(636

)

 

(4,629

)

Changes in assets and liabilities:

 

 

 

 

(Increase) decrease in accounts receivable

 

(31,983

)

 

(33,215

)

 

(9,687

)

 

(49,109

)

(Increase) decrease in prepaid expenses and other assets

 

2,200

 

 

4,515

 

 

2,017

 

 

6,782

 

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

 

4,306

 

 

9,755

 

 

9,031

 

 

18,557

 

Cash Flows From Operating Activities

$

775

 

$

11,473

 

$

78,917

 

$

65,253

 

(1)

Consolidated adjusted EBITDA, net interest expense, and free cash flow are defined on page 2.

(2)

Capital expenditures are not part of the consolidated statement of operations.

 

Contacts

Christopher T. Young

Interim Chief Executive Officer,

and Chief Financial Officer and Treasurer

Entravision Communications Corporation

310-447-3870

Kimberly Esterkin

ADDO Investor Relations

310-829-5400

evc@addo.com

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