ATLANTA, May 07, 2020 (GLOBE NEWSWIRE) — Gray Television, Inc. (“Gray,” the “Company,” “we,” “us” or “our”) (NYSE: GTN) today announced financial results for the first quarter ended March 31, 2020, and addressed the impact of the novel coronavirus and its disease (collectively, “COVID-19”) pandemic on its business and outlook. Gray reported that its first quarter revenue and expenses were each slightly below the low end of the previously issued guidance ranges due primarily to a significant reduction of demand for advertising resulting from the coronavirus pandemic. In particular:
Revenue of $534 million, increasing $16 million, or 3%, from the first quarter of 2019. The primary components of revenue were: combined local and national broadcast advertising revenue of $250 million, political advertising revenue of $36 million, and retransmission revenue of $213 million.Net income attributable to common stockholders for the first quarter of 2020 was $40 million, or $0.40 per fully diluted share. Net income attributable to common stockholders, excluding non-cash stock-based compensation, was $43 million, or $0.43 per fully diluted share.Broadcast Cash Flow was $181 million for the first quarter of 2020, increasing $58 million, or 47%, from the first quarter of 2019. Our Adjusted EBITDA for the first quarter of 2020 was $169 million, increasing $19 million, or 13%, from the first quarter of 2019.As of March 31, 2020, our total leverage ratio, as defined in our senior credit facility, was 4.23 times on a trailing eight-quarter basis after netting our total cash on hand of $296 million and after giving effect to all Transaction Related Expenses (as defined below). We have not drawn any funding from our $200 million revolving credit facility, and, as a result, we are not subject to any maintenance covenants in our credit facilities at this time.During the first quarter of 2020, we repurchased slightly over one-half million shares of our common stock on the open market at an average price of $11.42 per share, including commissions, for a total cost of approximately $6 million, under a stock repurchase authorization adopted in November 2019. Government and private measures adopted to limit the spread of COVID-19 have affected, and are continuing to affect, our businesses in a number of ways. We have experienced a reduction in demand for advertising across our television stations and digital platforms, a very significant reduction in demand in the market for the video production of sporting and other events by our production companies, and reductions in the supply of programming, especially sports content, provided by television networks. At the same time, we have experienced significant increases in viewership of our local newscasts and related digital assets. We did not access any stimulus or relief grants or loans from any governmental unit during the first quarter of 2020. The net impact of these factors has been adverse to our financial and operational results starting in early March 2020 and continuing today. The ultimate duration and impact of these disruptions cannot be predicted at this time. In light of this uncertainty, the Company cannot provide guidance for the three-month period ending on June 30, 2020, and the Company hereby withdraws its previously issued guidance for calendar year 2020. Notwithstanding the foregoing, however, we continue to anticipate that in calendar year 2020, our political advertising revenue will be between $250 million to $275 million and the Company will remain free cash flow positive.Selected Operating Data (unaudited):(1) Excludes depreciation, amortization and (gain) loss on disposal of assets.
(2) See definition of non-GAAP terms and a reconciliation of the non-GAAP amounts to net income included elsewhere herein.
(3) Amounts for the three months ended March 31, 2018, and related percentage changes from prior periods, are per the Company’s Current Report on Form 8-K/A, furnished to the SEC on May 9, 2018.Results of Operations for the First Quarter of 2020
Transaction Related ExpensesFrom time to time, we have incurred incremental expenses (“Transaction Related Expenses”) on an As-Reported Basis that were specific to acquisitions, divestitures, and financing activities, including but not limited to legal and professional fees, severance and incentive compensation and contract termination fees. In addition, we have recorded certain non-cash stock-based compensation expenses. These expenses are summarized as follows (in millions):TaxesDuring the first quarter of 2020, we made no material federal or state income tax payments. During the remainder of 2020, we anticipate making income tax payments (net of refunds) of approximately $65 million. As of March 31, 2020, we have approximately $438 million of federal operating loss carryforwards, which expire during the years 2023 through 2037. We expect to have federal taxable income in the carryforward periods. We therefore believe that these federal operating loss carryforwards will be fully utilized. Additionally, we have an aggregate of approximately $677 million of various state operating loss carryforwards, of which we expect that approximately half will be utilized.Other Financial Data:
The CompanyWe are a television broadcast company headquartered in Atlanta, Georgia, that is the largest owner of top-rated local television stations and digital assets in the United States (“U.S.”). Gray currently owns and/or operates television stations and leading digital properties in 93 television markets that collectively reach approximately 24 percent of U.S. television households. Over calendar year 2019, Gray’s stations were ranked first in 68 markets, and first and/or second in 86 markets, as calculated by Comscore’s audience measurement service. We also own video program production, marketing, and digital businesses including Raycom Sports, Tupelo-Raycom, and RTM Studios, the producer of PowerNation programs and content, which we refer to collectively as our “production companies.”Cautionary Statements for Purposes of the “Safe Harbor” Provisions of the Private Securities Litigation Reform ActThis press release contains statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and the federal securities laws. These “forward-looking statements” are not statements of historical facts, and may include, among other things, statements regarding our current expectations and beliefs of operating results for future periods, future income tax payments and other future events. Actual results are subject to a number of risks and uncertainties and may differ materially from the current expectations and beliefs discussed in this press release. All information set forth in this release is as of the date hereof. We do not intend, and undertake no duty, to update this information to reflect future events or circumstances. Information about certain potential factors that could affect our business and financial results and cause actual results to differ materially from those expressed or implied in any forward-looking statements are included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in our Annual Report on Form 10-K for the year ended December 31, 2019, and may be contained in reports subsequently filed with the U.S. Securities and Exchange Commission (the “SEC”) and available at the SEC’s website at www.sec.gov.Conference Call Information
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