Saga Communications Inc. (SGA, Financial) filed Quarterly Report for the period ended 2010-03-31.
Saga Communications Inc. has a market cap of $106.7 million; its shares were traded at around $25.05 with a P/E ratio of 13.5 and P/S ratio of 0.8. SGA is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Station operating expense was $22,560,000 for the three months ended March 31, 2010, compared with $23,940,000 for the three months ended March 31, 2009, a decrease of $1,380,000 or 6%. In response to the significant downturn in the economy late in 2008 we made significant expense reductions late in the first quarter of 2009. The effects of these reductions were not realized until the second quarter of 2009. As a result of these reductions the decrease in station operating expense is primarily attributable to a decrease in salaries, severance costs and ratings services of $500,000, $230,000 and $225,000, respectively. Additionally, depreciation expense was approximately $362,000 higher in the first quarter of 2009, primarily as a result of a change in the estimated useful life of television analog equipment, which was fully depreciated in 2009.
Operating income for the three months ended March 31, 2010 was $3,545,000 compared to $117,000 for the three months ended March 31, 2009, an increase of approximately $3,428,000. The increase was a direct result of the improvement in net operating revenue and reduction in station operating expense, described in detail above, and an $185,000 or 9% decrease in corporate general and administrative charges. The decrease in corporate general and administrative charges was attributable to overall expense reductions.
We generated net income of approximately $3,317,000 ($.78 per share on a fully diluted basis) during the three months ended March 31, 2010, compared to a net loss of $362,000 (-$.09 per share on a fully diluted basis) for the three months ended March 31, 2009, an increase of approximately $3,679,000. The increase was the result of an increase in operating income of $3,428,000 and an increase in other income of $3,592,000 offset by increases in interest expense and income tax expense of $746,000 and $2,595,000, respectively. In the current quarter, we had non-recurring income of $3,561,000 resulting from an agreement to downgrade an FCC license at one of our stations. The increase in interest expense was attributable to an average increase in market interest rates of approximately 2.3% and an increase in deferred financing costs incurred in connection with our credit amendments in 2009 and 2010. We expect interest expense to increase in the second quarter as a result of the amendment to our debt agreement on February 11, 2010. The increase in income tax expense was directly attributable to operating performance.
For the three months ended March 31, 2010, net operating revenue of the radio segment was $24,144,000 compared with $22,697,000 for the three months ended March 31, 2009, which represents an increase of $1,447,000 or 6%. Gross national revenue and gross local revenue increased approximately $401,000 and $978,000, respectively. Gross political revenue increased approximately $177,000 in the current quarter as compared to the prior year period. The increase in both gross local and gross national revenue was primarily the result of the gradual recovery of the U.S. economy and advertising spending in general. The increase in gross political revenue was primarily attributable to political advertising on our networks.
Station operating expense for the radio segment was $19,223,000 for the three months ended March 31, 2010, compared with $20,317,000 for the three months ended March 31, 2009, a decline of approximately $1,094,000 or 5%. Salaries and related expenses in the first quarter of 2010 decreased approximately $450,000 from the same quarter of 2009, primarily as a result of salary and work force reductions during 2009 in response to the difficult economic conditions. Severance costs and sales surveys expense decreased approximately $210,000 and $225,000, respectively, in the current year quarter.
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Saga Communications Inc. has a market cap of $106.7 million; its shares were traded at around $25.05 with a P/E ratio of 13.5 and P/S ratio of 0.8. SGA is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
For the three months ended March 31, 2010, consolidated net operating revenue was $27,987,000 compared with $26,124,000 for the three months ended March 31, 2009, an increase of approximately $1,863,000 or 7%. Gross national revenue and gross local revenue increased approximately $640,000 and $1,177,000, respectively. Gross political revenue increased approximately $203,000. The increase in both gross local and gross national revenue was primarily the result of the gradual recovery of the U.S. economy and advertising spending in general. The increase in gross political revenue was primarily attributable to political advertising on our networks.Station operating expense was $22,560,000 for the three months ended March 31, 2010, compared with $23,940,000 for the three months ended March 31, 2009, a decrease of $1,380,000 or 6%. In response to the significant downturn in the economy late in 2008 we made significant expense reductions late in the first quarter of 2009. The effects of these reductions were not realized until the second quarter of 2009. As a result of these reductions the decrease in station operating expense is primarily attributable to a decrease in salaries, severance costs and ratings services of $500,000, $230,000 and $225,000, respectively. Additionally, depreciation expense was approximately $362,000 higher in the first quarter of 2009, primarily as a result of a change in the estimated useful life of television analog equipment, which was fully depreciated in 2009.
Operating income for the three months ended March 31, 2010 was $3,545,000 compared to $117,000 for the three months ended March 31, 2009, an increase of approximately $3,428,000. The increase was a direct result of the improvement in net operating revenue and reduction in station operating expense, described in detail above, and an $185,000 or 9% decrease in corporate general and administrative charges. The decrease in corporate general and administrative charges was attributable to overall expense reductions.
We generated net income of approximately $3,317,000 ($.78 per share on a fully diluted basis) during the three months ended March 31, 2010, compared to a net loss of $362,000 (-$.09 per share on a fully diluted basis) for the three months ended March 31, 2009, an increase of approximately $3,679,000. The increase was the result of an increase in operating income of $3,428,000 and an increase in other income of $3,592,000 offset by increases in interest expense and income tax expense of $746,000 and $2,595,000, respectively. In the current quarter, we had non-recurring income of $3,561,000 resulting from an agreement to downgrade an FCC license at one of our stations. The increase in interest expense was attributable to an average increase in market interest rates of approximately 2.3% and an increase in deferred financing costs incurred in connection with our credit amendments in 2009 and 2010. We expect interest expense to increase in the second quarter as a result of the amendment to our debt agreement on February 11, 2010. The increase in income tax expense was directly attributable to operating performance.
For the three months ended March 31, 2010, net operating revenue of the radio segment was $24,144,000 compared with $22,697,000 for the three months ended March 31, 2009, which represents an increase of $1,447,000 or 6%. Gross national revenue and gross local revenue increased approximately $401,000 and $978,000, respectively. Gross political revenue increased approximately $177,000 in the current quarter as compared to the prior year period. The increase in both gross local and gross national revenue was primarily the result of the gradual recovery of the U.S. economy and advertising spending in general. The increase in gross political revenue was primarily attributable to political advertising on our networks.
Station operating expense for the radio segment was $19,223,000 for the three months ended March 31, 2010, compared with $20,317,000 for the three months ended March 31, 2009, a decline of approximately $1,094,000 or 5%. Salaries and related expenses in the first quarter of 2010 decreased approximately $450,000 from the same quarter of 2009, primarily as a result of salary and work force reductions during 2009 in response to the difficult economic conditions. Severance costs and sales surveys expense decreased approximately $210,000 and $225,000, respectively, in the current year quarter.
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