Entravision Communications Corp (EVC) 2024 Q2 法說會逐字稿

Greetings, and welcome to the Entravision second quarter 2024 earnings conference call. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Roy Nir, Vice President, Financial Reporting, and Investor Relations. Thank you. You may begin.

您好，歡迎參加 Entravision 2024 年第二季財報電話會議。提醒一下，本次會議正在錄製中。現在我很高興向大家介紹主持人羅伊·尼爾 (Roy Nir)，他是負責財務報告和投資者關係的副總裁。謝謝。你可以開始了。

Good afternoon, everyone, and welcome to Entravision's second quarter 2024 earnings conference call. Joining me today are Michael Christenson, Chief Executive Officer; and Mark Boelke, Chief Financial Officer.

大家下午好，歡迎參加 Entravision 2024 年第二季財報電話會議。今天與我一起出席的是執行長麥可‧克里斯滕森 (Michael Christenson)；財務長馬克‧博爾克(Mark Boelke)。

Before we begin, I must inform you that this conference call will contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ. Please refer to Entravision’s SEC filings for a list of risks and uncertainties that could impact actual results.

在我們開始之前，我必須通知您，本次電話會議將包含前瞻性陳述，這些陳述存在可能導致實際結果不同的風險和不確定性。請參閱 Entravision 向 SEC 提交的文件，以了解可能影響實際結果的風險和不確定性清單。

This call will also include non-GAAP financial measures. The Company has provided a reconciliation of these non-GAAP financial measures to their most comparable GAAP measures in today's press release. The press release is available on the company's Investor Relations page and was filed with the SEC on Form 8-K.

此次電話會議還將包括非公認會計準則財務指標。在今天的新聞稿中，本公司提供了這些非公認會計原則財務指標與其最具可比性的公認會計原則財務指標的調節表。該新聞稿可在公司的投資者關係頁面上獲取，並以 8-K 表格形式向 SEC 提交。

I will now turn the call over to Michael Christenson.

我現在將把電話轉給邁克爾·克里斯滕森。

Thank you, Roy, and thank you to all of you for joining us on this call today. In our second quarter of 2024 we completed the transformation that we outlined for you in our first quarter report.

謝謝羅伊，也謝謝大家今天參加我們的電話會議。在 2024 年第二季度，我們完成了第一季報告中為您概述的轉型。

We reached an agreement to divest our digital platform representation business to Aleph Group and we closed that transaction on June 28. The transaction included all of our digital platform representation operations including those in Latin America and Asia, more than 320 people in 32 countries serving a dozen digital advertising platforms.

我們達成協議，將我們的數位平台代理業務剝離給 Aleph Group，並於 6 月 28 日完成了該交易。該交易包括我們在拉丁美洲和亞洲的所有數位平台代理業務，在 32 個國家/地區擁有超過 320 名員工，為十幾個數位廣告平台提供服務。

Earlier in the second quarter, on May 6, we sold our controlling 51% interest in Adsmurai, a marketing technology and services company based in Barcelona to our partners who owned the other 49%. That transaction included another 350 people in two countries.

在第二季早些時候，即 5 月 6 日，我們將位於巴塞隆納的行銷技術和服務公司 Adsmurai 的 51% 控股股權出售給了擁有另外 49% 股權的合作夥伴。該交易涉及兩個國家的另外 350 人。

These actions represent a positive step forward for Entravision. We now have the opportunity to focus on our core US media business at a critical time as we navigate the unprecedented changes in the broadcast industry.

這些行動代表 Entravision 向前邁出了積極的一步。在我們應對廣播產業前所未有的變化的關鍵時刻，我們現在有機會專注於我們的核心美國媒體業務。

Entravision is a trusted source of news, information and entertainment for our Latino audience. This is an audience that we have served for three decades. We have made significant investments this year to expand our news production capabilities and the amount of news that we provide for our audience.

Entravision 是拉丁裔觀眾值得信賴的新聞、資訊和娛樂來源。這是我們服務了三十年的觀眾。今年我們進行了大量投資，以擴大我們的新聞製作能力和為觀眾提供的新聞數量。

We now have morning, midday, early evening, and late news in all of our markets, and we have weekend early evening and late news in San Diego, Las Vegas, Denver, El Paso, and McAllen, Texas.

現在，我們在所有市場都有早晨、中午、傍晚和晚間新聞，並且在聖地亞哥、拉斯維加斯、丹佛、埃爾帕索和德克薩斯州麥卡倫有週末早晨和晚間新聞。

We have also invested in our sales organization to build a team that can engage directly with political decision makers and educate them about our audience and how Entravision can help them reach our audience. One in five of the Latinos in America are in our broadcast markets. We believe our audience will be critical to determining the outcome of the 2024 elections and future elections.

我們也投資於我們的銷售組織，以建立一個可以直接與政治決策者互動的團隊，並向他們介紹我們的受眾以及 Entravision 如何幫助他們接觸我們的受眾。美國五分之一的拉丁美洲人在我們的廣播市場。我們相信，我們的觀眾對於決定 2024 年選舉和未來選舉的結果至關重要。

In addition to our investments in US media, we are also making significant investments in our remaining advertising technology and services businesses, Smadex and Adwake, to improve their platforms and operational capabilities. Both of these businesses are now growing faster than their industry growth rates and they are profitable.

除了對美國媒體的投資外，我們還對剩餘的廣告技術和服務業務 Smadex 和 Adwake 進行了大量投資，以改善他們的平台和營運能力。目前，這兩項業務的成長速度都快於產業成長率，並且都實現了獲利。

These combined actions are all good for Entravision. They put us in a stronger financial position with positive momentum. We are excited about the opportunities ahead, and we are looking forward to building value for our Company and our shareholders.

這些綜合行動對 Entravision 來說都是有利的。它們使我們的財務狀況更加強勁，勢頭積極。我們對未來的機會感到興奮，並期待為我們的公司和股東創造價值。

Now I will pass the call over to Mark Boelke, our CFO to provide the financial report.

現在我將把電話轉給我們的財務長馬克·博爾克 (Mark Boelke)，以提供財務報告。

Thanks Mike. As Mike stated, during the second quarter of 2024, Entravision completed the sale of our global sales representation business known as Entravision Global Partners, or EGP. As a result of this sale, financial results for EGP are reported in our financial statements as discontinued operations, for both the second quarter and prior periods, and I will review second quarter financial results for our continuing operations.

謝謝邁克。正如 Mike 所說，2024 年第二季度，Entravision 完成了我們的全球銷售代表業務（稱為 Entravision Global Partners，簡稱 EGP）的出售。由於此次出售，EGP 的財務業績在我們的財務報表中報告為第二季和前期的非持續經營業務，我將審查我們持續經營業務的第二季財務業績。

On a consolidated basis, revenue for the second quarter was $82.7 million, up 12% compared to the second quarter of 2023. The increase was driven primarily by our digital segment and political advertising revenue in our television and audio segments, partially offset by decreases in overall advertising revenue, spectrum rights usage revenue, and retransmission consent revenue.

合併後第二季營收為 8,270 萬美元，較 2023 年第二季成長 12%。這一成長主要是由我們的數位部門以及電視和音訊部門的政治廣告收入所推動的，但部分被整體廣告收入、頻譜權使用收入和轉播許可收入的下降所抵消。

I’ll now review each of our operating segments. Starting with our digital segment, revenue for the second quarter was $41.1 million, up 36% compared to the second quarter of 2023. The growth in the digital segment was driven primarily by Smadex, our programmatic ad purchasing platform, and Adwake, our mobile growth solutions business.

我現在將回顧我們的每個營運部門。從我們的數位部門開始，第二季的營收為 4,110 萬美元，比 2023 年第二季成長 36%。數位領域的成長主要由我們的程式化廣告購買平台 Smadex 和我們的行動成長解決方案業務 Adwake 推動。

During the second quarter, operating margin for the Digital segment was 6%, compared to negative 1% in the second quarter of 2023. Operating margin on net revenues, minus the cost of revenue, was 16%, compared to negative 2% in the second quarter of 2023. The improvement in digital segment operating margins was attributed to better performance and margins in Smadex and Adwake.

第二季度，數位部門的營業利潤率為 6%，而 2023 年第二季為負 1%。扣除收入成本後的淨收入營業利潤率為 16%，而 2023 年第二季為負 2%。數位部門營運利潤率的提高歸因於 Smadex 和 Adwake 更好的業績和利潤。

Looking ahead to the third quarter, revenue from our Digital segment is currently pacing plus 17% compared to the third quarter of 2023.

展望第三季度，與 2023 年第三季相比，我們數位部門的營收目前成長 17%。

Moving on to our Television segment, revenue for the second quarter was $28.6 million, down 5% compared to the second quarter of 2023. The decrease in television revenue was driven by decreases in overall advertising revenue, spectrum rights usage revenue, and retransmission consent revenue, which was partially offset by increased political advertising revenue.

接下來是電視部門，第二季營收為 2,860 萬美元，比 2023 年第二季下降 5%。電視收入的下降是由整體廣告收入、頻譜權使用收入和轉播許可收入的下降所推動的，但政治廣告收入的增加部分抵消了這一下降。

During the second quarter, television segment operating profit was $3.1 million, down 59% compared to the second quarter of 2023. Operating margin was 11%, compared to 25% during the second quarter of 2023.

第二季度，電視部門營業利潤為 310 萬美元，較 2023 年第二季下降 59%。營業利益率為 11%，而 2023 年第二季為 25%。

As we discussed on our last investor call, the decline in television operating margins was primarily due to our decision to expand our local news operations beginning in January 2024. We made this strategic decision in order to provide more local news and information to our audiences, and to provide more opportunities to generate additional revenue in connection with highly valued news inventory, particularly for political advertising during an election year.

正如我們在上次投資者電話會議上討論的那樣，電視營運利潤率的下降主要是由於我們決定從 2024 年 1 月開始擴大本地新聞業務。我們做出這項策略決定是為了向觀眾提供更多本地新聞和信息，並提供更多機會透過高價值的新聞庫存創造額外收入，特別是選舉年期間的政治廣告。

As a result of this decision, we hired 70 additional news employees, and as Mike mentioned, we now provide news in the morning, midday, early evening, and late night in all of our Univision, Fox, and NBC markets, as well as weekend news in five key markets. We now produce more than 280 hours per week of local news across our television portfolio.

由於這項決定，我們額外僱用了 70 名新聞員工，正如 Mike 提到的，我們現在在所有 Univision、Fox 和 NBC 市場以及 NBC 市場的早上、中午、傍晚和深夜提供新聞。新聞。現在，我們的電視節目每週製作超過 280 小時的當地新聞。

For the third quarter, revenue from our television segment is currently pacing plus 9% compared to the third quarter of 2023 and we currently expect that pace to increase as political advertising picks up throughout the quarter.

與 2023 年第三季相比，我們第三季電視部門的營收目前成長了 9%，我們目前預計，隨著整個季度政治廣告的增加，這一成長速度將會加快。

Turning to our audio segment, revenue for the second quarter was $13 million, down 4% compared to the second quarter of 2023. This decrease was primarily driven by a decrease in overall advertising revenue, partially offset by an increase in political advertising revenue.

談到我們的音訊部門，第二季的收入為 1300 萬美元，比 2023 年第二季下降 4%。這一下降主要是由於整體廣告收入的下降造成的，但部分被政治廣告收入的成長所抵消。

For the second quarter, audio segment operating profit was $1.9 million, up 21% compared to the second quarter of 2023. Audio segment operating margin was 15%, compared to 12% for the second quarter of 2023.

第二季度，音響部門營業利潤為 190 萬美元，較 2023 年第二季成長 21%。音頻部門營業利潤率為 15%，而 2023 年第二季為 12%。

The increase in our audio segment operating margins was primarily due to savings in rent expense related to our move from a standalone operations facility into our corporate headquarters, and a decrease in variable expenses associated with the decrease in advertising revenue.

我們的音響部門營業利潤率的成長主要是由於我們從獨立營運設施搬到公司總部相關的租金費用節省，以及與廣告收入減少相關的可變費用的減少。

We’ve taken steps to strengthen our audio content and radio station footprint that we believe will provide stronger ratings in advertising revenue. For example, we’ve had a 10-year partnership with the NFL as the exclusive Spanish-language audio home in the US, and this week we announced that we expanded and extended this relationship for an additional three years, and we believe the NFL continues to see the value and power of connecting with our audiences.

我們已採取措施加強我們的音訊內容和廣播電台足跡，我們相信這將帶來更高的廣告收入收視率。例如，我們與 NFL 建立了長達 10 年的合作關係，作為美國唯一的西班牙語音頻之家，本週我們宣布將這種關係​​再延長三年，我們相信NFL 不斷認識到與觀眾建立聯繫的價值和力量。

For the third quarter, revenue from our audio segment is currently pacing flat compared to the third quarter of 2023. Similar to our television segment, we currently expect this pace to increase as political advertising picks up throughout the quarter.

第三季度，我們音頻部門的營收目前與 2023 年第三季持平。與我們的電視部門類似，我們目前預計隨著整個季度政治廣告的增加，這一速度將會加快。

Corporate expense for the second quarter was $10.8 million, a decrease of 10% compared to the second quarter of 2023. This decrease was primarily due to decreases in professional services expenses and non-cash stock-based compensation, partially offset by an increase in severance expense resulting from recent changes made to our corporate structure.

第二季企業費用為 1,080 萬美元，較 2023 年第二季下降 10%。這項減少主要是由於專業服務費用和非現金股票薪酬的減少，部分被最近公司結構變化導致的遣散費增加所抵消。

Turning to our balance sheet, we had a total of $88.3 million in cash and marketable securities as of June 30, 2024. Indebtedness under our credit facility at quarter-end was $187.8 million. During 2024 we have prepaid $20 million of our bank debt, including a prepayment of $10 million during the first quarter and an additional $10 million during the second quarter.

就我們的資產負債表而言，截至 2024 年 6 月 30 日，我們的現金和有價證券總額為 8,830 萬美元。截至季末，我們的信貸安排下的債務為 1.878 億美元。2024 年，我們預付了 2,000 萬美元的銀行債務，其中第一季預付 1,000 萬美元，第二季額外預付 1,000 萬美元。

Under our credit agreement, our leverage ratio is calculated net of $50 million of cash, and as of June 30, 2024, our leverage ratio under our credit agreement was 3.0 times. Calculating our leverage ratio net of total cash and marketable securities, our total net leverage was 2.2 times.

根據我們的信貸協議，我們的槓桿率是扣除5000萬美元現金後計算的，截至2024年6月30日，我們信貸協議下的槓桿率為3.0倍。計算扣除總現金和有價證券後的槓桿率，我們的總淨槓桿率為 2.2 倍。

Leverage calculations under our credit agreement are based on consolidated EBITDA for the trailing four quarters, and consolidated EBITDA for second quarter 2024 was $10.5 million. Cash capital expenditures during the second quarter were $2.0 million, representing 11% of net cash provided by operating activities, compared to 78% during the second quarter of 2023.

我們的信貸協議下的槓桿計算是基於過去四個季度的合併 EBITDA，2024 年第二季的合併 EBITDA 為 1,050 萬美元。第二季現金資本支出為 200 萬美元，佔經營活動提供的淨現金的 11%，而 2023 年第二季為 78%。

Cash capital expenditures for the year-to-date period of January through June 2024 were $4.7 million, representing 9% of net cash provided by operating activities, compared to 32% for the prior year period.

2024 年 1 月至 6 月迄今的現金資本支出為 470 萬美元，佔經營活動提供的淨現金的 9%，而去年同期為 32%。

The higher CapEx during 2023 was driven primarily by the buildout of our new office headquarters, which was completed in the third quarter of 2023. Capital expenditures are expected to be approximately $7 million for full-year 2024.

2023 年資本支出較高的主要原因是我們新辦公總部的擴建，該大樓於 2023 年第三季竣工。2024 年全年資本支出預計約 700 萬美元。

During the second quarter, free cash flow, defined as cash provided by operating activities less cash capital expenditures, was $15.7 million, compared to $2.3 million in second quarter 2023. We paid $4.5 million in dividends to stockholders in the second quarter, or $0.05 per share, representing 25% of our net cash provided by operating activities.

第二季的自由現金流（定義為經營活動提供的現金減去現金資本支出）為 1,570 萬美元，而 2023 年第二季為 230 萬美元。第二季我們向股東支付了 450 萬美元的股息，即每股 0.05 美元，占我們經營活動提供的淨現金的 25%。

We paid $9 million in dividends to our stockholders in the six-month period year-to-date period, or $0.10 per share, representing 18% of our net cash provided by operating activities during the period.

在今年迄今的六個月內，我們向股東支付了 900 萬美元的股息，即每股 0.10 美元，佔該期間經營活動提供的淨現金的 18%。

Our Board of Directors has approved a $0.05 dividend per share for the third quarter of 2024, which will be payable on September 30 to stockholders of record as of September 16, 2024, for a total dividend payment of $4.5 million.

我們的董事會已批准 2024 年第三季每股 0.05 美元的股息，將於 9 月 30 日向截至 2024 年 9 月 16 日在冊的股東支付，股息支付總額為 450 萬美元。

This concludes our call. Thank you for joining us. If you have questions, please connect with us through the Investor Relations page on our website, where you will also have access to the transcript of this call, the press release for our results, and a copy of our Form 10-Q which has been filed with the SEC. We welcome feedback and input from our shareholders and we look forward to hearing from you. Thank you. Operator?

我們的通話到此結束。感謝您加入我們。如果您有疑問，請透過我們網站上的投資者關係頁面與我們聯繫，您還可以在該頁面上訪問本次電話會議的文字記錄、我們結果的新聞稿以及我們已發布的10-Q 表格的副本。我們歡迎股東的回饋和意見，並期待您的來信。謝謝。操作員？

This concludes today's teleconference. You may disconnect your lines at this time. And thank you for your participation.

今天的電話會議到此結束。此時您可以斷開線路。並感謝您的參與。