Item 2. Management’s Discussion and Analysis
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements
This report contains forward-looking statements that are based on management’s beliefs, assumptions, current expectations, estimates and projections about the radio broadcasting industry, the economy, and the Company. Words such as “anticipates,” “believes,” “expects,” “intends,” “is likely,” “plans,” “projects,” and variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions (“Future Factors”) that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what may be expressed or forecasted in such forward-looking statements. We undertake no obligation to update, amend, or clarify forward-looking statements, whether as a result of new information, future events (whether anticipated or unanticipated), or otherwise.
Future Factors include, among others, adverse changes in interest rates and interest rate relationships; our financial leverage and debt service requirements; dependence on key personnel; dependence on key stations; U.S. national and local economic conditions or an economic recession; market volatility; demand for our services; the degree of competition by traditional and non-traditional competitors; our ability to successfully integrate acquired stations; regulatory requirements; governmental and regulatory policy changes; changes in tax laws; the impact of technological advances; risks associated with cyber-attacks on our computer systems and those of our vendors; the outcomes of contingencies; trends in audience behavior; damage to our reputation resulting from adverse publicity, regulatory actions, litigation, operational failures, the failure to meet client or listener expectations and other facts; changes in local real estate values; natural disasters; terrorist attacks; the war in Ukraine, the effects of widespread outbreak of illness or disease, inflation; increased energy costs; and risk factors described in our annual report on Form 10-K for the year ended December 31, 2022 or in this Report. These are representative of the Future Factors that could cause a difference between an ultimate actual outcome and a forward-looking statement.
Introduction
The following discussion should be read in conjunction with the unaudited condensed consolidated financial statements and accompanying notes thereto of Saga Communications, Inc. and its subsidiaries contained elsewhere herein and the audited financial statements and Management’s Discussion and Analysis contained in our annual report on Form 10-K for the year ended December 31, 2022. The following discussion is presented on a consolidated basis.
Critical Accounting Policies and Estimates
Our consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (GAAP), which require us to make estimates, judgments and assumptions that affect the reported amounts of certain assets, liabilities, revenues, expenses and related disclosures and contingencies. We evaluate estimates used in preparation of our financial statements on a continual basis. There have been no significant changes to our critical accounting policies that are described in Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies” in our annual report on Form 10-K for the year ended December 31, 2022.
We use certain financial measures that are not calculated in accordance with generally accepted accounting principles in the United States of America (GAAP) to assess our financial performance. For example, we evaluate the performance of our markets based on “station operating income” (operating income plus corporate general and administrative expenses, depreciation and amortization, other operating (income) expenses, and impairment of intangible assets). Station operating income is generally recognized by the broadcasting industry as a measure of performance, is used by analysts who report on the performance of the broadcasting industry and serves as an indicator of the market value of a group of stations. In addition, we use it to evaluate individual stations, market-level performance, overall operations and as a primary measure for incentive based compensation of executives and other members of management. Station operating income is not necessarily indicative of amounts that may be available to us for debt service requirements, other commitments, reinvestment or other discretionary uses. Station operating income is not a measure of liquidity or of performance in accordance with GAAP, and should be viewed as a supplement to, and not a substitute for our results of operations presented on a GAAP basis.
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Financial Condition and Results of Operations
General
We are a broadcast company primarily engaged in acquiring, developing and operating broadcast properties. We actively seek and explore opportunities for expansion through the acquisition of additional broadcast properties. We review acquisition opportunities on an ongoing basis. For additional information with respect to acquisitions, see “Liquidity and Capital Resources” below. We own or operate broadcast properties in 27 markets, including 79 FM and 33 AM radio stations and 80 metro signals.
We anticipate our corporate general and administrative expense to decrease from 2022 significantly because of approximately $3.8 million in expenses incurred related to the passing of our CEO, Edward Christian and payments required as a result of his death. This reduction will be offset, however, by an increase in directors’ fees of $312,000 and by investments we anticipate making in corporate personnel, and sales and training initiatives.
Radio Stations
Our radio stations’ primary source of revenue is from the sale of advertising for broadcast on our stations. Depending on the format of a particular radio station, there are a predetermined number of advertisements available to be broadcast each hour.
Most advertising contracts are short-term and generally run for a few weeks only. The majority of our revenue is generated from local advertising, which is sold primarily by each radio market’s sales staff. For the six months ended June 30, 2023 and 2022, approximately 89% and 90%, respectively, of our radio stations’ gross revenue was from local advertising. To generate national advertising sales, we engage independent advertising sales representative firms that specialize in national sales for each of our broadcast markets.
Our revenue varies throughout the year. Advertising expenditures, our primary source of revenue, generally have been lowest during the winter months, which include the first quarter of each year. Furthermore, we expect political revenue in 2023 to decrease from 2022 levels as a result of less elections at the national, state and local levels.
Our net operating revenue, station operating expense and operating income varies from market to market based upon each market’s rank or size which is based upon population and the available radio advertising revenue in that particular market.
The broadcasting industry and advertising in general, is influenced by the state of the overall economy, including unemployment rates, inflation, energy prices and consumer interest rates. Our stations primarily broadcast in small to midsize markets. Historically, such markets have been more stable than major metropolitan markets during downturns in advertising spending, but may not experience increases in such spending as significant as those in major metropolitan markets in periods of economic improvement.
Our financial results are dependent on a number of factors, the most significant of which is our ability to generate advertising revenue through rates charged to advertisers. The rates a station is able to charge are, in large part, based on a station’s ability to attract audiences in the demographic groups targeted by its advertisers. In a number of our markets, this is measured by periodic reports generated by independent national rating services. In the remainder of our markets it is measured by the results advertisers obtain through the actual running of an advertising schedule. Advertisers measure these results based on increased demand for their goods or services and/or actual revenues generated from such demand. Various factors affect the rate a station can charge, including the general strength of the local and national economies, population growth, ability to provide popular programming, local market competition, target marketing capability of radio compared to other advertising media, and signal strength.
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When we acquire and/or begin to operate a station or group of stations we generally increase programming and advertising and promotion expenses to increase our share of our target demographic audience. Our strategy sometimes requires levels of spending commensurate with the revenue levels we plan on achieving in two to five years. During periods of economic downturns, or when the level of advertising spending is flat or down across the industry, this strategy may result in the appearance that our cost of operations is increasing at a faster rate than our growth in revenues, until such time as we achieve our targeted levels of revenue for the acquired station or group of stations.
The number of advertisements that can be broadcast without jeopardizing listening levels (and the resulting ratings) is limited in part by the format of a particular radio station. Our stations strive to maximize revenue by constantly managing the number of commercials available for sale and adjusting prices based upon local market conditions and ratings. While there may be shifts from time to time in the number of advertisements broadcast during a particular time of day, the total number of advertisements broadcast on a particular station generally does not vary significantly from year to year. Any change in our revenue, with the exception of those instances where stations are acquired or sold, is generally the result of inventory sell-out ratios and pricing adjustments, which are made to ensure that the station efficiently utilizes available inventory.
Our radio stations employ a variety of programming formats. We periodically perform market research, including music evaluations, focus groups and strategic vulnerability studies. Because reaching a large and demographically attractive audience is crucial to a station’s financial success, we endeavor to develop strong listener loyalty. Our stations also employ audience promotions to further develop and secure a loyal following. We believe that the diversification of formats on our radio stations helps to insulate us from the effects of changes in musical tastes of the public on any particular format.
The primary operating expenses involved in owning and operating radio stations are employee salaries, sales commissions, programming expenses, depreciation, and advertising and promotion expenses.
The radio broadcasting industry is subject to rapid technological change, evolving industry standards and the emergence of new media technologies and services. These new technologies and media are gaining advertising share against radio and other traditional media.
We are continuing to expand our digital initiative to provide a seamless experience across multiple platforms. Our goal is to allow our listeners to connect with our brands on demand, wherever, however and whenever they choose. We continue to create and expand opportunities through targeted digital advertising, online community news, entertainment and events and an array of digital services that include online promotions, mobile messaging, and email marketing.
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During the six months ended June 30, 2023 and 2022 and the years ended December 31, 2022 and 2021, our Columbus, Ohio; Des Moines, Iowa; Milwaukee, Wisconsin; Norfolk, Virginia; and Portland, Maine markets, when combined, represented approximately 37%, 38%, 38% and 39%, respectively, of our consolidated net operating revenue. An adverse change in any of these radio markets or our relative market position in those markets could have a significant impact on our operating results as a whole.
The following table describes the percentage of our consolidated net operating revenue represented by each of these markets:
Percentage of Consolidated
Percentage of Consolidated
Net Operating Revenue for
Net Operating Revenue
the Six Months Ended
for the Years Ended
June 30,
December 31,
2023
2022
2022
2021
Market:
Columbus, Ohio
9
%
10
%
10
%
10
%
Des Moines, Iowa
5
%
5
%
5
%
6
%
Milwaukee, Wisconsin
12
%
12
%
12
%
11
%
Norfolk, Virginia
6
%
6
%
6
%
6
%
Portland, Maine
5
%
5
%
5
%
6
%
During the six months ended June 30, 2023 and 2022 and the years ended December 31, 2022 and 2021, the radio stations in our five largest markets, when combined, represented approximately 39%, 43%, 44% and 43%, respectively, of our consolidated station operating income. The following table describes the percentage of our consolidated station operating income represented by each of these markets:
Percentage of Consolidated
Percentage of Consolidated
Station Operating Income (*)
Station Operating Income(*)
for the Six Months Ended
for the Years Ended
June 30,
December 31,
2023
2022
2022
2021
Market:
Columbus, Ohio
10
%
13
%
13
%
12
%
Des Moines, Iowa
3
%
3
%
4
%
5
%
Milwaukee, Wisconsin
13
%
15
%
14
%
12
%
Norfolk, Virginia
9
%
7
%
7
%
7
%
Portland, Maine
4
%
5
%
6
%
7
%
*
Operating income adjusted for corporate general and administrative expenses, depreciation and amortization, other operating (income) expenses, and impairment of intangible assets.
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Three Months Ended June 30, 2023 Compared to Three Months Ended June 30, 2022
Results of Operations
The following table summarizes our results of operations for the three months ended June 30, 2023 and 2022.
Consolidated Results of Operations
Three Months Ended
June 30,
$ Increase
% Increase
2023
2022
(Decrease)
(Decrease)
(In thousands, except percentages and per share information)
Net operating revenue
$
29,175
$
29,821
$
(646)
(2.2)
%
Station operating expenses
22,407
21,786
621
2.9
%
Corporate general and administrative
2,472
2,609
(137)
(5.3)
%
Other operating (income) expense, net
—
45
(45)
N/M
Operating income
4,296
5,381
(1,085)
(20.2)
%
Interest expense
43
32
11
34.4
%
Interest income
(347)
(49)
(298)
N/M
Other income
—
—
—
N/M
Income before income tax expense
4,600
5,398
(798)
(14.8)
%
Income tax provision
Current
905
1,260
(355)
(28.2)
%
Deferred
345
315
30
9.5
%
1,250
1,575
(325)
(20.6)
%
Net income
$
3,350
$
3,823
$
(473)
(12.4)
%
Earnings per share (diluted)
$
0.55
$
0.63
$
(0.08)
(12.7)
%
N/M = Not Meaningful
For the three months ended June 30, 2023, consolidated net operating revenue was $29,175,000 compared with $29,821,000 for the three months ended June 30, 2022, a decrease of $646,000 or 2.2%. We had decreases in gross political revenue of $679,000, gross local revenue of $679,000 and gross barter revenue of $78,000, partially offset by increases in gross interactive revenue of $362,000, gross national revenue of $290,000 and gross non-spot revenue of $191,000, from the second quarter of 2022. The gross political revenue decreased due to a decrease in the number of national, state and local elections. The decrease in gross local revenues was attributable to decreases at our Charleston, South Carolina; Columbus, Ohio; Ithaca, New York; Milwaukee, Wisconsin; Portland, Maine; Springfield, Illinois markets partially offset by increases at our Bellingham, Washington and Ocala, Florida markets. The decrease in our gross barter revenue is due to minor decreases at the majority of our markets. The increase in gross interactive revenue is primarily due to an increase in our streaming revenue. The most significant increases in gross national revenue occurred in our Norfolk, Virginia and Ocala, Florida markets. The most significant increases in gross non-spot revenue occurred in our Charleston, South Carolina; Keene, New Hampshire; Milwaukee, Wisconsin and Yankton, South Dakota markets.
Station operating expense was $22,407,000 for the three months ended June 30, 2023, compared with $21,786,000 for the three months ended June 30, 2022, an increase of $621,000 or 2.9%. The increase in operating expense was primarily a result of increases in compensation-related expense, building maintenance and repairs, commission expense, utility expenses, sales rating survey expenses, and programming rights expenses, of $433,000, $131,000, $127,000, $78,000, $62,000 and $33,000, respectively, partially offset by a decrease in healthcare costs of $270,000, from the second quarter of 2022.
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We had operating income for the three months ended June 30, 2023 of $4,296,000 compared to $5,381,000 for the three months ended June 30, 2022, a decrease of $1,085,000. The decrease was a result of the decrease in net operating revenue and increase in station operating expense, noted above, partially offset by a decrease in corporate general and administrative expenses of $137,000 and a decrease in other operating (income) expense, net of $45,000. In the second quarter of 2022, we recorded a loss on the sale of fixed assets of $45,000 compared to no gain or loss on the sale of fixed assets in the second quarter of 2023 in other operating (income) expense, net. The decrease in corporate general and administrative expenses was primarily comprised of a decrease of $300,000 in compensation-related expense partially offset by an increase of $66,000 in directors’ fees and $90,000 in other consulting fees.
We generated net income of $3,350,000 ($0.55 per share on a fully diluted basis) during the three months ended June 30, 2023, compared to $3,823,000 ($0.63 per share on a fully diluted basis) for the three months ended June 30, 2022, a decrease of $473,000. The decrease in net income is primarily due to the decrease in operating income, described above, an increase in interest expense of $11,000 partially offset by an increase in interest income of $298,000 and a decrease in income tax expense of $325,000. The increase in interest expense is due to an increase in interest rates and amortization of bank fees. The increase in interest income is related to higher rates of return on money market accounts reflected as cash equivalents and from our short-term investment accounts which began in May 2022. The decrease in our income tax expense is due to the decrease in income before income tax.
Six Months Ended June 30, 2023 Compared to Six Months Ended June 30, 2022
Results of Operations
The following table summarizes our results of operations for the six months ended June 30, 2023 and 2022.
Six Months Ended
June 30,
$ Increase
% Increase
2023
2022
(Decrease)
(Decrease)
(In thousands, except percentages and per share information)
Net operating revenue
$
54,479
$
54,788
$
(309)
(0.6)
%
Station operating expenses
44,110
42,354
1,756
4.1
%
Corporate general and administrative
5,088
5,303
(215)
(4.1)
%
Other operating (income) expense, net
80
40
40
N/M
Operating income
5,201
7,091
(1,890)
(26.7)
%
Interest expense
86
64
22
34.4
%
Interest income
(636)
(53)
(583)
N/M
Other income
(119)
(2)
(117)
N/M
Income before income tax expense
5,870
7,082
(1,212)
(17.1)
%
Income tax provision
Current
1,185
1,660
(475)
(28.6)
%
Deferred
415
395
20
5.1
%
1,600
2,055
(455)
(22.1)
%
Net income
$
4,270
$
5,027
$
(757)
(15.1)
%
Earnings per share (diluted)
$
0.70
$
0.83
$
(0.13)
(15.7)
%
N/M = Not Meaningful
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For the six months ended June 30, 2023, consolidated net operating revenue was $54,479,000 compared with $54,788,000 for the six months ended June 30, 2022, a decrease of $309,000 or 0.6%. We had decreases in gross local revenue of $956,000, and gross political revenue of $606,000, and an increase in agency commissions of $108,000 partially offset by increases in gross interactive revenue of $535,000, gross national revenue of $447,000 and gross non-spot revenue of $435,000, from 2022. The decrease in gross local revenues was attributable to decreases at our Charleston, South Carolina; Columbus, Ohio; Ithaca, New York; Milwaukee, Wisconsin; and Springfield, Illinois markets partially offset by increases at our Asheville, North Carolina; Bellingham, Washington and Charlottesville, Virginia markets. The gross political revenue decreased due to a decrease in the number of national, state and local elections. The increase in agency commissions is due to increases in both our national and local agency revenue. The increase in gross interactive revenue is primarily due to an increase in our streaming revenue. The most significant increases in gross national revenue occurred in our Charlottesville, Virginia; Des Moines, Iowa; Norfolk, Virginia and Ocala, Florida markets. The most significant increases in gross non-spot revenue occurred in our Charleston, South Carolina; Milwaukee, Wisconsin; Ocala, Florida and Yankton, South Dakota markets.
Station operating expense was $44,110,000 for the six months ended June 30, 2023, compared with $42,354,000 for the six months ended June 30, 2022, an increase of $1,756,000 or 4.1%. The increase in operating expense was primarily a result of increases in compensation-related expense, utility expenses, sales commission expenses, building maintenance and repairs, programming rights expense, sales rating survey expenses, sales training expenses, music licensing fees and promotional expenses, of $822,000, $166,000, $161,000, $146,000, $113,000, $87,000, $48,000, $47,000 and $46,000, respectively, for the comparable period of 2022.
We had operating income for the six months ended June 30, 2023 of $5,201,000 compared to $7,091,000 for the six months ended June 30, 2022, a decrease of $1,890,000. The decrease was a result of the decrease in net operating revenue and the increase in station operating expense, as noted above, an increase in other operating (income) expense, net of $40,000 partially offset by a decrease in corporate general and administrative expenses of $215,000. In 2023, we recorded a loss on the sale of fixed assets of $80,000 compared to a loss on the sale of fixed assets of $40,000 in 2022. The decrease in corporate general and administrative expenses was primarily comprised of a decrease of $502,000 in compensation-related expense partially offset by an increase of $131,000 in directors’ fees and $195,000 in other consulting fees.
We generated net income of $4,270,000 ($0.70 per share on a fully diluted basis) during the six months ended June 30, 2023, compared to $5,027,000 ($0.83 per share on a fully diluted basis) for the six months ended June 30, 2022 ended, a decrease of $757,000. The decrease in net income is primarily due to the decrease in operating income, described above, an increase in interest expense of $22,000 partially offset by an increase in interest income of $583,000, an increase in other income of $117,000 and an increase in income tax expense of $455,000. The increase in interest expense is due to an increase in interest rates and amortization of bank fees. The increase in interest income is related to higher rates of return on money market accounts reflected as cash equivalents and from our short-term investment accounts which began in May 2022. The increase in other income is due to reimbursements from the FCC related to their spectrum auction of $115,000 described in footnote 13 (Other Income) versus the minimal other income earned in 2022. The decrease in our income tax expense is due to the decrease in income before income tax.
Liquidity and Capital Resources
Debt Arrangements and Debt Service Requirements
On December 19, 2022, we entered into a Third Amendment to our Credit Facility, (the “Third Amendment”), which extended the maturity date to December 19, 2027, reduced the lenders to JPMorgan Chase Bank, N.A., and the Huntington National Bank (the “Lenders”), established an interest rate equal to the secured overnight financing rate (“SOFR”) as administered by the SOFR Administrator (currently established as the Federal Reserve Bank of New York) as the interest base and increased the basis points.
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We have pledged substantially all of our assets (excluding our FCC licenses and certain other assets) in support of the Credit Facility and each of our subsidiaries has guaranteed the Credit Facility and has pledged substantially all of their assets (excluding their FCC licenses and certain other assets) in support of the Credit Facility.
Approximately $266,000 of debt issuance costs related to the Credit Facility were capitalized and are being amortized over the life of the Credit Facility. These debt issuance costs are included in other assets, net in the consolidated balance sheets. As a result of the Second Amendment, the Company incurred an additional $120,000 of transaction fees related to the Credit Facility that were capitalized. As a result of the Third Amendment, the Company incurred an additional $161,000 of transaction fees related to the Credit Facility that were capitalized. The cumulative transaction fees are being amortized over the remaining life of the Credit Facility.
Interest rates under the Credit Facility are payable, at our option, at alternatives equal to SOFR (5.09% at June 30, 2023), plus 1% to 2% or the base rate plus 0% to 1%. The spread over SOFR and the base rate vary from time to time, depending upon our financial leverage. Letters of credit issued under the Credit Facility will be subject to a participation fee (which is equal to the interest rate applicable to Eurocurrency Loans, as defined in the Credit Agreement) payable to each of the Lenders and a fronting fee equal to 0.25% per annum payable to the issuing bank. Under the Third Amendment, we now pay quarterly commitment fees of 0.25% per annum on the unused portion of the Credit Facility. We previously paid quarterly commitment fees of 0.2% to 0.3% per annum on the unused portion of the Revolving Credit Facility.
The Credit Facility contains a number of financial covenants (all of which we were in compliance with at June 30, 2023) which, among other things, require us to maintain specified financial ratios and impose certain limitations on us with respect to investments, additional indebtedness, dividends, distributions, guarantees, liens and encumbrances.
We had no debt outstanding at December 31, 2022 or June 30, 2023.
We had approximately $50 million of unused borrowing capacity under the Revolving Credit Facility at both June 30, 2023 and December 31, 2022.
Sources and Uses of Cash
During the six months ended June 30, 2023 and 2022, we had net cash flows from operating activities of $6,038,000 and $7,340,000, respectively. We believe that cash flow from operations will be sufficient to meet quarterly debt service requirements for payments of interest and principal under our Credit Facility if we borrow in the future. However, if such cash flow is not sufficient we may be required to sell additional equity securities, refinance our obligations or dispose of one or more of our properties in order to make such scheduled payments. There can be no assurance that we would be able to effect any such transactions on favorable terms, if at all.
In March 2013, our board of directors authorized an increase to our Stock Buy-Back Program (the “Buy-Back Program”) to allow us to purchase up to $75.8 million of our Class A Common Stock. From its inception in 1998 through June 30, 2023, we have repurchased 2.2 million shares of our Class A Common Stock for $57.6 million. During the three and six months ended June 30, 2023, we did not repurchase any shares related to the Buy-Back Program. We halted the directions issued for any additional buybacks under our plan in 2020. We continue to monitor economic conditions to determine if and when it makes sense to make additional buybacks under our plan.
Our capital expenditures, exclusive of acquisitions, for the six months ended June 30, 2023 were $2,637,000 (3,563,000 in 2022). We anticipate capital expenditures in 2023 to be approximately $5.0 million to $5.5 million, which we expect to finance through funds generated from operations.
On July 12, 2021, we entered into an agreement to acquire WIZZ-AM and a translator from P. & M. Radio for $61,800 of which $5,000 was paid in 2021 and the remainder was paid on April 6, 2022 when we closed on the transaction. Management attributes the goodwill recognized in the acquisition to the power of the existing brands in the Greenfield, Massachusetts market as well as synergies and growth opportunities expected through the combination with the Company’s existing stations. The translators are start-up stations and therefore, have no pro forma revenue and expenses.
On May 9, 2023, the Company’s Board of Directors declared a quarterly cash dividend of $0.25 per share on its Class A Common Stock. This dividend, totaling approximately $1,500,000 was paid on June 16, 2023 to shareholders of record on May 22, 2023.
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On March 1, 2023, the Company’s Board of Directors declared a quarterly cash dividend of $0.25 per share on its Class A Common Stock. This dividend, totaling approximately $1,500,000, was paid on April 7, 2023 to shareholders of record on March 20, 2023.
On December 7, 2022, the Company’s Board of Directors declared a quarterly cash dividend of $0.25 per share and a special cash dividend of $2.00 per share on its Class A Common Stock. This dividend, totaling approximately $13,800,000, was paid on January 13, 2023 to shareholders of record on December 21, 2022.
On September 20, 2022, the Company’s Board of Directors declared a quarterly cash dividend of $0.25 per share and a special cash dividend of $2.00 per share on its Classes A Common Stock. This dividend, totaling approximately $13,600,000, was paid on October 21, 2022 to shareholders of record on October 3, 2022.
On June 6, 2022, the Company’s Board of Directors declared a quarterly cash dividend of $0.20 per share on its Classes A and B Common Stock. This dividend, totaling approximately $1,200,000, was paid to our transfer agent on June 29, 2022. The dividend was paid by our transfer agent on July 1, 2022 to shareholders of record on June 13, 2022.
On March 1, 2022, the Company’s Board of Directors declared a quarterly cash dividend of $0.16 per share on its Classes A and B Common Stock. This dividend, totaling approximately $970,000, was paid on April 8, 2022 to shareholders of record on March 21, 2022.
We continue to actively seek and explore opportunities for expansion through the acquisitions of additional broadcast properties.
We anticipate that any future acquisitions of radio stations and dividend payments will be financed through funds generated from operations, borrowings under the Credit Agreement, additional debt or equity financing, cash on hand, or a combination thereof. However, there can be no assurances that any such financing will be available on acceptable terms, if at all.
Summary Disclosures About Contractual Obligations and Commercial Commitments
We have future cash obligations under various types of contracts, including the terms of our Credit Facility, operating leases, programming contracts, employment agreements, and other operating contracts. For additional information concerning our future cash obligations see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation — Summary Disclosures About Contractual Obligations” in our annual report on Form 10-K for the year ended December 31, 2022.
We anticipate that our contractual cash obligations will be financed through funds generated from operations or additional borrowings under the Credit Facility, or a combination thereof.
Recent Accounting Pronouncements
Recent accounting pronouncements are described in Note 2 to the accompanying financial statements.
Inflation
The impact of inflation on our operations has not been significant to date. We are, however, starting to see the effects of higher inflation starting to impact costs of most goods and services. There can be no assurance that a high rate of inflation in the future would not have an adverse effect on our operations.
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