Townsquare Reports Second Quarter 2017 Results

GREENWICH, Conn., Aug. 9, 2017 /PRNewswire/ -- Townsquare Media, Inc. (NYSE: TSQ) ("Townsquare," the "Company," "we," "us," or "our") announced today financial results for the second quarter ended June 30, 2017.

"We are pleased to report another solid quarter that was in line with our expectations," commented Steven Price, Chairman and Chief Executive Officer of Townsquare.  "In the second quarter, net revenue increased 2.6%, and net income and Adjusted EBITDA were approximately flat.  Our second quarter performance was anchored by our Local Marketing Solutions segment, where revenue increased 4.3% over the prior year, and 4.8% excluding political revenue.  Our results in this segment are representative of the continued strength of our local advertiser solutions and the strength our local teams."

Second Quarter Highlights*

• As compared to the second quarter of 2016:
• Net revenue increased 2.6%, consistent with previously issued guidance
• Local Marketing Solutions net revenue increased 4.3%
• Entertainment net revenue was approximately flat
• Net income was approximately flat
• Adjusted EBITDA was approximately flat, consistent with previously issued guidance
• Diluted net income and diluted Adjusted Net Income Per Share of $0.20 and $0.21, respectively

Year to Date Highlights*

• As compared to the first half of 2016:
• Net revenue decreased 1.1%
• Local Marketing Solutions net revenue increased 2.9%
• Entertainment net revenue decreased 10.2%
• Net income decreased 39.4%
• Adjusted EBITDA decreased 5.0%
• Repaid $6.7 million of long-term debt

* See below for discussion of non-GAAP measures and reconciliations to GAAP measures.

Segment Reporting
We have two reportable segments, Local Marketing Solutions, which provides broadcast and digital products and solutions to advertisers and businesses within our local markets, and Entertainment, which provides live event experiences and music and lifestyle content directly to consumers, and promotion, advertising and product activations to local and national advertisers.

Quarter Ended June 30, 2017 Compared to the Quarter Ended June 30, 2016

Net Revenue
Net revenue for the quarter ended June 30, 2017 increased $3.5 million, or 2.6%, to $140.7 million, as compared to $137.2 million in the same period last year.  Local Marketing Solutions net revenue increased $3.8 million, or 4.3%, to $90.5 million and Entertainment net revenue decreased $0.2 million, or 0.5%, to $50.2 million, due to revenue declines in certain of our live events and in our national digital business.  Excluding political revenue, net revenue increased $3.9 million, or 2.9%, to $140.1 million and Local Marketing Solutions net revenue increased $4.2 million, or 4.8%.

Net Income
Net income for the quarter ended June 30, 2017 decreased $39 thousand, or 0.7%, to $5.6 million as compared to $5.6 million in the same period last year.

Adjusted EBITDA
Adjusted EBITDA for the quarter ended June 30, 2017 increased $0.1 million, or 0.2%, to $25.3 million as compared to $25.3 million in the same period last year.

Six Months Ended June 30, 2017 Compared to the Six Months Ended June 30, 2016

Net Revenue
Net revenue for the six months ended June 30, 2017 decreased $2.5 million, or 1.1%, to $229.1 million, as compared to $231.6 million in the same period last year.  Local Marketing Solutions net revenue increased $4.6 million, or 2.9%, to $166.5 million and Entertainment net revenue decreased $7.1 million, or 10.2%, to $62.5 million, in part due to revenue declines in our live events business, in part due to the prior year sale of certain live events, in addition to revenue declines in our national digital business.  Excluding political revenue and the sale of certain live events, net revenue increased $0.1 million, or 0.0%, to $228.0 million, Local Marketing Solutions net revenue increased $5.9 million, or 3.7%, to $165.5 million and Entertainment net revenue decreased $5.9 million, or 8.6%, to $62.5 million.

Net Income
Net income for the six months ended June 30, 2017 decreased $1.7 million, or 39.4%, to $2.6 million, as compared to $4.2 million in the same period last year.

Adjusted EBITDA
Adjusted EBITDA for the six months ended June 30, 2017 decreased $1.9 million, or 5.0%, to $35.4 million, as compared to $37.2 million in the same period last year.

Liquidity and Capital Resources
As of June 30, 2017, we had a total of $31.1 million of cash on hand and $50.0 million of available borrowing capacity under our revolving credit facility. As of June 30, 2017, we had $571.9 million of outstanding indebtedness, representing 5.5x and 5.2x gross and net leverage, respectively, based on Adjusted EBITDA for the twelve months ended June 30, 2017 of $104.9 million.

The table below presents a summary, as of August 8, 2017, of our outstanding common stock and securities convertible into common stock, excluding options issued under our 2014 Omnibus Incentive Plan.

Conference Call
Townsquare Media, Inc. will host a conference call to discuss certain second quarter 2017 financial results on Wednesday, August 9, 2017 at 8:00 a.m. Eastern Time. The conference call dial-in number is 1-877-407-0784 (U.S. & Canada) or 1-201-689-8560 (International) and the confirmation code is 13667230. A live webcast of the conference call will also be available on the equity investor relations page of the Company's website at www.townsquaremedia.com.

A replay of the conference call will be available through August 16, 2017. To access the replay, please dial 1-844-512-2921 (U.S. & Canada) or 1-412-317-6671 (International) and enter confirmation code 13667230. A web-based archive of the conference call will also be available at the above website for thirty days after the call.

About Townsquare Media, Inc.
Townsquare is a media, entertainment and digital marketing solutions company principally focused on small and mid-sized markets across the U.S. Our assets include 312 radio stations and more than 325 local websites in 66 U.S. markets, a digital marketing solutions company serving approximately 11,750 small to medium sized businesses, approximately 550 live events with nearly 18 million attendees each year in the U.S. and Canada, and one of the largest digital advertising networks focused on music and entertainment reaching more than 50 million unique visitors each month. Our brands include iconic local media assets such as WYRK, KLAQ, K2 and NJ101.5; acclaimed music festivals such as Mountain Jam, WE Fest and the Taste of Country Music Festival;  unique touring lifestyle and entertainment events such as the America on Tap craft beer festival series, the Insane Inflatable 5K obstacle race series and North American Midway Entertainment, North America's largest mobile amusement company; and leading tastemaker music and entertainment owned and affiliated websites such as XXLmag.com, TasteofCountry.com, Loudwire.com and BrooklynVegan.com. For more information, please visit www.townsquaremedia.com.

Forward-Looking Statements
Except for the historical information contained in this press release, the matters addressed are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often discuss our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as "aim," "anticipate," "estimate," "expect," "forecast," "outlook," "potential," "project," "projection," "plan," "intend," "seek," "believe," "may," "could," "would," "will," "should," "can," "can have," "likely," the negatives thereof and other words and terms. By nature, forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statement. Forward-looking statements are based on current expectations and assumptions and currently available data and are neither predictions nor guarantees of future events or performance. You should not place undue reliance on forward-looking statements, which speak only as of the date hereof. See "Risk Factors" and "Forward-Looking Statements" included in our Annual Report on Form 10-K for the year ended December 31, 2016, filed with the Securities and Exchange Commission on or about the date hereof, for a discussion of factors that could cause our actual results to differ from those expressed or implied by forward-looking statements. Townsquare Media, Inc. assumes no responsibility to update any forward-looking statement as a result of new information, future events or otherwise, except as required by law.

Non-GAAP Financial Measures and Definitions
In this press release, we refer to Adjusted EBITDA, Adjusted EBITDA Less Interest, Capex and Taxes, Adjusted Net Income and Adjusted Net Income Per Share, which are financial measures that have not been prepared in accordance with generally accepted accounting principles in the United States ("GAAP").

We define Adjusted EBITDA as net income (loss) before the deduction of income taxes, other (income) expense (net), interest expense, cancellation and (repurchase) of debt, transaction costs, stock-based compensation, net (gain) loss on sale of assets, impairment of FCC licenses, impairment on investment and depreciation and amortization. Adjusted EBITDA Less Interest, Capex and Taxes is defined as Adjusted EBITDA less net cash interest expense, capital expenditures and cash paid for taxes. Adjusted Net Income is defined as net income (loss) before the deduction of income taxes, transaction costs, net (gain) loss on sale of assets and cancellation and (repurchase) of debt.  Adjusted Net Income Per Share is defined as Adjusted Net Income divided by the weighted average shares outstanding. These measures do not represent, and should not be considered as alternatives to, net income (loss) or cash flows from operations, as determined under GAAP.  In addition, these non-GAAP measures may not be comparable to similarly-named measures reported by other companies.  Reconciliations of these non-GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are set forth in the tables below.

We use Adjusted EBITDA to facilitate company-to-company operating performance comparisons by backing out potential differences caused by variations in capital structures (affecting interest expense), taxation and the age and book depreciation of facilities and equipment (affecting relative depreciation expense), which may vary for different companies for reasons unrelated to operating performance. We use Adjusted Net Income and Adjusted Net Income Per Share to assess total company operating performance on a consistent basis.  We believe that this measure, when considered together with our GAAP financial results, provides management and investors with a more complete understanding of our business operating results, including underlying trends, by excluding the effects of transaction costs, net (gain) loss on sale of assets and cancellation and (repurchase) of debt.  Further, while discretionary bonuses for members of management are not determined with reference to specific targets, our Board of Directors may consider Adjusted EBITDA, Adjusted EBITDA Less Interest, Capex and Taxes, Adjusted Net Income and Adjusted Net Income Per Share when determining discretionary bonuses.

Investor Relations
Claire Yenicay
(203) 900-5555
investors@townsquaremedia.com

The following table reconciles on a GAAP basis net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Net Income for the three and six months ended June 30, 2017 and 2016, respectively (dollars in thousands):

The following table reconciles on a GAAP basis net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA and Adjusted EBITDA Less Interest, Capex and Taxes for the three and six months ended June 30, 2017 and 2016, respectively (dollars in thousands):

The following table reconciles net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA on a quarterly basis for the twelve months ended June 30, 2017 (dollars in thousands):

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SOURCE Townsquare Media, Inc.