IBJNews

Debt maneuvers help Emmis turn quarterly profit

Back to TopCommentsE-mailPrintBookmark and Share

Emmis Communications Corp. reported a quarterly profit today after buying back a big chunk of its own debt on the cheap, but the outlook for the company remains grim. The radio broadcaster and magazine publisher saw revenue plunge 27 percent.

Indianapolis-based Emmis turned a profit of $7.5 million, or 20 cents per share, for the fiscal first quarter ended May 31, compared to a loss of $1 million, or 3 cents per share, a year earlier.

Revenue, however, dropped from $85.4 million to $62.4 million. And the company suffered an operating loss of nearly $6 million compared to a gain of $13.9 million in the same period last year.

Radio revenue fell from $63.6 million to $46.2 million and publishing revenue dropped from $20 million to $16.6 million.

Emmis realized $31.9 million in gains by purchasing $78 million of its own debt for about $45 million through a series of one-time Dutch auction tenders. The company said it would not be able to pursue further tenders under its credit agreement.

“We continue to fight against the impact of a remarkably difficult economy,” CEO Jeff Smulyan said in a public letter to employees. “While I believe we have seen the bottom of this downturn, what no one can say is how long it will take to climb out of the trough. Therefore, we continue to do what’s necessary to survive and prepare for better times.

“The good news is that our strategy is working. By focusing on debt reduction, maintaining compliance with our banking agreements and reducing expenses, Emmis is protecting itself from the financial failure that threatens so many others these days.”

Emmis also announced that it sold its unprofitable Belgium radio operations during the quarter to Belgium company Alfacam Group NV for about $139. The operation lost $682,000 last year and $561,000 in the first quarter.

Emmis has experienced tough times in recent years. The company lost $283.9 million, or $7.81 per share, in its fiscal year ended Feb. 28, and $10.3 million, or 74 cents per share, the previous fiscal year.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
ADVERTISEMENT