Emmis Communications Corp. (EMMS, Financial) filed Quarterly Report for the period ended 2009-05-31.
Emmis Communications Corporation is a diversified media company with radio broadcasting and magazine publishing operations and pending approval from the FCC television broadcasting operations. Emmis is an owner and operator of radio stations in the nation's largest markets. Its international division operates Slager Radio in Hungary. Emmis Publishing holdings include Indianapolis Monthly Atlanta Cincinnati and Texas Monthly magazines. Emmis also owns Revenue Development Systems a broadcast sales consulting company. (Press Release) Emmis Communications Corp. has a market cap of $8.7 million; its shares were traded at around $0.27 with a P/E ratio of 0.8.
No customer represents more than 10% of our consolidated net revenues. Our top ten categories for radio represent approximately 60% of the total advertising net revenues. Although the automotive industry, representing approximately 9% of our radio net revenues, is the largest category for our radio division for the three-month period ended May 31, 2009, our radio net revenues for this category are down 38% versus the same period of the prior year.
On April 3, 2009, Emmis entered into an LMA and a Put and Call Agreement for KMVN-FM in Los Angeles with a subsidiary of Grupo Radio Centro, S.A.B. de C.V (GRC), a Mexican broadcasting company. The LMA for KMVN-FM started on April 15, 2009 and will continue for up to 7 years, for $7 million a year plus reimbursement of certain expenses. Under the LMA, Emmis continues to own and operate the station, with GRC providing Emmis with programming to be broadcast. The performance of Emmis other Los Angeles radio station, KPWR-FM, trailed the performance of the overall market. For the three-month period ended May 31, 2009, KPWR-FMs gross revenues were down 40.2% whereas the independent accounting firm Miller, Kaplan, Arase & Co. (Miller Kaplan) reported that the Los Angeles market total gross revenues were down 27.9% versus the same period of the prior year.
Our radio cluster in New York trailed the performance of the overall New York radio market during the three months ended May 31, 2009. For the three months ended May 31, 2009, our New York radio stations gross revenues were down 34.3%, whereas the independent accounting firm Miller Kaplan reported that New York radio market total gross revenues were down 23.7% versus the same period of the prior year.
Radio net revenues decreased principally as a result of a precipitous decline of advertising spending in our domestic and international radio markets due to the global economic slowdown. We typically monitor the performance of our domestic stations against the aggregate performance of the markets in which we operate based on reports for the periods prepared by the independent accounting firm Miller Kaplan. Miller Kaplan reports are generally prepared on a gross revenues basis and exclude revenues from barter arrangements. For the three-month period ended May 31, 2009, revenues of our domestic radio stations excluding KMVN, which is operating under an LMA as discussed earlier, as reported to Miller Kaplan were down 28.0%, whereas Miller Kaplan reported that revenues of our domestic radio markets were down 23.8%. The Companys national representation firm guaranteed a minimum amount of national sales for the year ended February 28, 2009. For the three-month period ended May 31, 2008, a $1.3 million reduction of national agency commissions was recorded related to the national representation firms guarantee. No such guarantee exists subsequent to February 28, 2009. Market weakness and our stations weaknesses have led us to discount our rates charged to advertisers. For the three-month period ended May 31, 2009, our average unit rate for our domestic radio stations was down 34% and our number of units sold was down 1%.
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Emmis Communications Corporation is a diversified media company with radio broadcasting and magazine publishing operations and pending approval from the FCC television broadcasting operations. Emmis is an owner and operator of radio stations in the nation's largest markets. Its international division operates Slager Radio in Hungary. Emmis Publishing holdings include Indianapolis Monthly Atlanta Cincinnati and Texas Monthly magazines. Emmis also owns Revenue Development Systems a broadcast sales consulting company. (Press Release) Emmis Communications Corp. has a market cap of $8.7 million; its shares were traded at around $0.27 with a P/E ratio of 0.8.
Highlight of Business Operations:
As previously mentioned, we derive approximately 80% of our net revenues from advertising sales. Our radio stations derive a higher percentage of their advertising revenues from local sales than our publishing entities. In the three-month period ended May 31, 2009, local sales, excluding political revenues, represented approximately 86% and 75% of our advertising revenues for our radio and publishing divisions, respectively. In the three-month period ended May 31, 2008, local sales, excluding political revenues, represented approximately 84% and 62% of our advertising revenues for our radio and publishing divisions, respectively. Our net revenues decreased principally as a result of a precipitous decline of advertising spending due to the global economic slowdown. Local sales have been slightly more resilient than national sales during the global economic slowdown. For the three months ended May 31, 2009 as compared to the same period of the prior year, local sales are down approximately 27.4%, while national sales are down approximately 47.2%.No customer represents more than 10% of our consolidated net revenues. Our top ten categories for radio represent approximately 60% of the total advertising net revenues. Although the automotive industry, representing approximately 9% of our radio net revenues, is the largest category for our radio division for the three-month period ended May 31, 2009, our radio net revenues for this category are down 38% versus the same period of the prior year.
On April 3, 2009, Emmis entered into an LMA and a Put and Call Agreement for KMVN-FM in Los Angeles with a subsidiary of Grupo Radio Centro, S.A.B. de C.V (GRC), a Mexican broadcasting company. The LMA for KMVN-FM started on April 15, 2009 and will continue for up to 7 years, for $7 million a year plus reimbursement of certain expenses. Under the LMA, Emmis continues to own and operate the station, with GRC providing Emmis with programming to be broadcast. The performance of Emmis other Los Angeles radio station, KPWR-FM, trailed the performance of the overall market. For the three-month period ended May 31, 2009, KPWR-FMs gross revenues were down 40.2% whereas the independent accounting firm Miller, Kaplan, Arase & Co. (Miller Kaplan) reported that the Los Angeles market total gross revenues were down 27.9% versus the same period of the prior year.
Our radio cluster in New York trailed the performance of the overall New York radio market during the three months ended May 31, 2009. For the three months ended May 31, 2009, our New York radio stations gross revenues were down 34.3%, whereas the independent accounting firm Miller Kaplan reported that New York radio market total gross revenues were down 23.7% versus the same period of the prior year.
Radio net revenues decreased principally as a result of a precipitous decline of advertising spending in our domestic and international radio markets due to the global economic slowdown. We typically monitor the performance of our domestic stations against the aggregate performance of the markets in which we operate based on reports for the periods prepared by the independent accounting firm Miller Kaplan. Miller Kaplan reports are generally prepared on a gross revenues basis and exclude revenues from barter arrangements. For the three-month period ended May 31, 2009, revenues of our domestic radio stations excluding KMVN, which is operating under an LMA as discussed earlier, as reported to Miller Kaplan were down 28.0%, whereas Miller Kaplan reported that revenues of our domestic radio markets were down 23.8%. The Companys national representation firm guaranteed a minimum amount of national sales for the year ended February 28, 2009. For the three-month period ended May 31, 2008, a $1.3 million reduction of national agency commissions was recorded related to the national representation firms guarantee. No such guarantee exists subsequent to February 28, 2009. Market weakness and our stations weaknesses have led us to discount our rates charged to advertisers. For the three-month period ended May 31, 2009, our average unit rate for our domestic radio stations was down 34% and our number of units sold was down 1%.
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