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In a release on August 12, the company noted net revenue for the quarter ended June 30, totaled $62.2 million, a 12.0 percent decline from the Company's record second quarter revenue of $70.6 million in the comparable period of 2008. The lower net revenue reflects the overall downturn in advertising spending due to the impact of the current economic recession as well as a $2.8 million or 77.0 percent reduction in gross political spending in a non-election year. The net revenue decline related to the economy and reduction in political spending in a non-election year more than offset a $4.1 million or 56.2 percent increase in total revenue derived from retransmission consent agreements, e-Media initiatives and management fees.
Nexstar reported income from operations for the three months ended June 30, of $9.0 million, compared with $16.2 million in the quarter ended June 30, 2008. Broadcast cash flow totaled $20.1 million in the second quarter of 2009 compared with $28.3 million for the same period in 2008. Adjusted EBITDA totaled $16.4 million for the second quarter of 2009, compared with $24.8 million in the second quarter of 2008. Free cash flow in the quarter ended June 30, was $5.0 million, compared with $11.1 million in the comparable period of 2008.
Perry A. Sook, Chairman, President and Chief Executive Officer of Nexstar Broadcasting Group, said, "Nexstar's second quarter and year-to-date results demonstrate that the Company continues to be an industry leader in revenue performance in good times and bad. Second quarter results are in-line with our operating expectations for the current environment as strong aggregate year-over-year increases in retransmission consent and e-MEDIA revenues, and the recognition of initial management fee revenue, partially mitigated the softness in spot revenue related to weak national and local economies.
"Second quarter retransmission consent revenues increased 68.1 percent to $7.9 million while e-MEDIA revenues rose 15.4 percent to $3.0 million. In addition to continuing to generate record quarterly revenue from these sources, Nexstar also realized the initial benefits of its agreement with Four Points Media Group LLC as we recorded approximately $0.5 million of management fee revenue.
"As a result of company-wide expense management measures involving regional back office consolidation and other cost reduction programs, SG&A expenses were reduced by 4.2 percent compared to the year ago period even as we added the operations of WCWJ-TV in Jacksonville, Florida and KARZ-TV in Little Rock, Arkansas.
"Our success in building new revenue streams is being complemented by select strategic, accretive and de-leveraging transactions, and the second quarter results reflected a partial quarter's operation by Nexstar of WCWJ-TV and the addition earlier in 2009 of KARZ-TV, which created the Company's 22nd duopoly market. Other de-leveraging initiatives, including the repurchase in early 2009 of approximately $29.0 million of our outstanding notes at a substantial discount to face value and the exchange of $143.6 million of our 7 percent Senior Subordinated cash interest paying notes due 2014 for $142.3 million of Nexstar Broadcasting's 7 percent Senior Subordinated Payment In Kind notes due 2014 enabled the Company to reduce total interest expense by approximately 17.6 percent and cash interest expense by approximately 52.0 percent, or $5.4 million, in the second quarter of 2009 compared to the same period last year and by over $7.4 million in the first half of 2009. In addition, at June 30, Nexstar's total debt leverage ratio was 5.6x compared to the Company's permitted total leverage covenant of 6.5x.
The Company's total net debt at June 30, was $658.5 million. As defined in the Company's credit agreement, consolidated total net debt was $491.0 at June 30. This excludes approximately $127.7 million of senior subordinated 7 percent PIK notes as well as approximately $39.8 million of senior subordinated 12 percent PIK notes and cash on hand.
As defined in the Company's credit agreement, the Company's total leverage ratio at June 30, was 5.6x compared to a total permitted leverage covenant of 6.5x.
Total interest expense in the second quarter of 2009 was $8.9 million, compared to $10.8 million for the same period in 2008. Cash interest expense for the second quarter of 2009 was $5.0 million, compared to $10.5 million for the same period in 2008.
Nexstar Broadcasting Group currently owns, operates, programs or provides sales and other services to 63 television stations in 34 markets in the states of Illinois, Indiana, Maryland, Missouri, Montana, Texas, Pennsylvania, Louisiana, Arkansas, Alabama, New York, Rhode Island, Utah and Florida.
((Comments on this story may be sent to newsdesk@closeupmedia.com))
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