iHeartMedia Inc (IHRT) 2024 Q1 法說會逐字稿

Hello. Thank you for standing by. My name is Sarah, and I will be your conference operator today. At this time, I would like to welcome everyone to the iHeartMedia Q1 2024 earnings call. (Operator Instructions) I would now like to turn the conference over to Mike McGuinness, Head of Investor Relations. You may begin.

你好。謝謝你的支持。我叫莎拉，今天我將擔任你們的會議操作員。此時此刻，我歡迎大家參加 iHeartMedia 2024 年第一季財報電話會議。（操作員指示）我現在想將會議轉交給投資者關係主管 Mike McGuinness。你可以開始了。

Good morning, everyone, and thank you for taking the time to join us for our first quarter 2024 earnings call. And joining me for today's discussion are Bob Pittman, our Chairman and CEO; and Rich Bressler, our President, COO, and CFO. At the conclusion of our prepared remarks, management will take your questions. In addition to our press release, we have an earnings presentation available on our website that you can use to follow along with our remarks.

大家早安，感謝您抽出時間參加我們的 2024 年第一季財報電話會議。與我一起參加今天討論的是我們的董事長兼執行長 Bob Pittman；以及我們的總裁、營運長兼財務長 Rich Bressler。在我們準備好的發言結束後，管理階層將回答您的問題。除了我們的新聞稿之外，我們的網站上還提供了收益演示文稿，您可以使用它來了解我們的評論。

Please note that this call may include forward-looking statements regarding our financial performance and operating results. These statements are based on management's current expectations and actual results could differ from what is stated as a result of certain factors identified on today's call and in the Company's SEC filings.

請注意，本次電話會議可能包括有關我們財務績效及經營績效的前瞻性陳述。這些聲明是基於管理層目前的預期，由於今天的電話會議和公司向 SEC 提交的文件中確定的某些因素，實際結果可能與所述結果有所不同。

And additionally, during this call, we will refer to certain non-GAAP financial measures. Reconciliations between GAAP and non-GAAP financial measures are included in our earnings release, earnings presentation and our SEC filings, which are available in the Investor Relations section of our website.

此外，在本次電話會議中，我們將提及某些非公認會計準則財務指標。GAAP 和非 GAAP 財務指標之間的調整包含在我們的收益發布、收益簡報和 SEC 文件中，這些資訊可在我們網站的投資者關係部分找到。

And now I'll turn the call over to Bob.

現在我將把電話轉給鮑伯。

Thanks, Mike, and good morning, everyone. We're pleased to report that our first quarter 2024 results were in line with our previously provided adjusted EBITDA and revenue guidance ranges. As expected, we saw February March improve over the January pace of business.

謝謝麥克，大家早安。我們很高興地報告，我們 2024 年第一季的業績符合我們先前提供的調整後 EBITDA 和收入指導範圍。正如預期的那樣，我們看到 2 月 3 月的業務增速比 1 月有所改善。

Although the marketplace continues to be dynamic with the changing outlook on interest rates, inflation trends and global and domestic uncertainty, we remain confident that this is a recovery year, highlighted by the strong momentum in our podcast business and the sequential improvement of our multi-platform Group's year-over-year adjusted EBITDA performance. We also see material upside from political advertising in the back half of the year and the benefit of our ongoing focus on cost efficiencies as well.

儘管隨著利率前景的變化、通膨趨勢以及全球和國內的不確定性，市場繼續充滿活力，但我們仍然相信今年是復甦的一年，我們的播客業務的強勁勢頭和我們的多業務的連續改善凸顯了這一點。我們也看到下半年政治廣告的實質優勢以及我們持續關注成本效率的好處。

Now let me take you through some of the key financial results of the quarter. In the first quarter, we generated adjusted EBITDA of $105 million in the middle of the guidance range we provided of $100 million to $110 million. Our consolidated revenues for the quarter were down 1.5% compared to the prior year quarter within the guidance range of flat to down 2%.

現在讓我向您介紹本季的一些主要財務表現。第一季度，我們調整後的 EBITDA 為 1.05 億美元，位於我們提供的 1 億至 1.1 億美元指引範圍的中間。我們本季的綜合收入與去年同期相比下降了 1.5%，處於持平至下降 2% 的指導範圍內。

Our Q1, free cash flow was negative $81 million, a significant improvement compared to the negative $133 million in the prior year. As a reminder, Q1 is our seasonal low point for free cash flow in the year, and we will generate positive free cash flow in each of the remaining quarters in 2024, with each quarter increasing sequentially, we anticipate our full year free cash flow to be significantly higher than last year.

我們第一季的自由現金流為負 8,100 萬美元，與前一年的負 1.33 億美元相比有了顯著改善。提醒一下，第一季是我們今年自由現金流的季節性低點，我們將在2024 年剩餘的每個季度產生正的自由現金流，隨著每個季度依次增加，我們預計全年自由現金流將達到明顯高於去年。

Turning now to our individual operating segments. The Digital Audio Group generated first quarter revenues of $239 million, up 7% versus prior year and represented 30% of the Company's total revenue for the quarter. The audio group generated adjusted EBITDA of $68 million, up 26% versus prior year. The digital audio group's adjusted EBITDA margins were 29%, up from 24% in Q1 2023, marking the Digital Audio Group segment's highest Q1 EBITDA margin ever. Within the Digital Audio Group, our podcast revenues grew 18% versus prior year. Podcasting continues to be the hottest new consumer medium, and we are the leader in that medium in every key metric.

現在轉向我們各自的營運部門。數位音訊集團第一季營收為 2.39 億美元，比去年同期成長 7%，占公司該季總營收的 30%。音頻集團調整後 EBITDA 為 6,800 萬美元，比上年增長 26%。數位音訊集團調整後的 EBITDA 利潤率為 29%，高於 2023 年第一季的 24%，標誌著數位音訊集團第一季 EBITDA 利潤率創下歷史新高。在數位音訊集團內，我們的播客收入比去年增長了 18%。播客仍然是最熱門的新消費媒體，我們在每個關鍵指標上都是該媒體的領導者。

Audience revenue and earnings. Podcasting remains a strong growth engine for the Company and our financial discipline in podcasting EXPENSES continues to pay off as our podcasting EBITDA margins remain accretive to our total company. Adjusted EBITDA margins. In March, iHeart was once again ranked the number one podcast publisher in the US with more monthly downloads than the next two largest podcast publishers combined according to pod track, our leadership position in podcasting is in part the result of the power of our broadcast radio assets.

觀眾收入和收入。播客仍然是公司強勁的成長引擎，我們在播客支出方面的財務紀律繼續得到回報，因為我們的播客 EBITDA 利潤率仍然為我們整個公司帶來增值。調整後的 EBITDA 利潤率。3 月份，iHeart 再次被評為美國第一大播客發行商，根據播客追踪，每月下載量超過了排名第二的兩家播客發行商的總和，我們在播客領域的領導地位部分歸功於我們廣播電台的力量資產。

As a reminder, we've used those assets to build not only the podcast business, but also the iHeart Radio app, which is the number one digital radio service and our marquee live events business, which includes the recent I. iHeartRadio Music Awards and the iHeart Country Festival.

提醒一下，我們不僅利用這些資產建立了播客業務，還建立了 iHeart Radio 應用程序，這是排名第一的數位廣播服務和我們的大型現場活動業務，其中包括最近的 I. iHeartRadio 音樂獎和iHeart 鄉村音樂節。

In addition to our industry-leading podcast business and our digital radio streaming service, which has five times the listing of our closest competitor. We also have the largest social footprint of any audio service by a factor of seven, and we operate 3,000 national and local websites that reach more than 110 million people in the United States each month, all of which represent additional opportunities for our advertising partners to interact with our highly engaged consumer base and provide additional revenue growth for the Company.

除了我們行業領先的播客業務和我們的數位廣播串流服務，其清單是我們最接近的競爭對手的五倍。我們還擁有音訊​​服務中最大的社會影響力七倍，並且我們經營著 3,000 個國家和地方網站，每月覆蓋美國超過 1.1 億人，所有這些都為我們的廣告合作夥伴提供了額外的機會與我們高度參與的消費者群互動，並為公司帶來額外的收入成長。

Turning now to the multi-platform group, which includes our broadcast radio networks and events business in the first quarter revenues were $493 million, down 6.7% versus prior year and down 7.6%. Excluding the impact of political advertising adjusted EBITDA was $77 million, down 11.3% versus prior year. And this represents a substantial sequential quarterly adjusted EBITDA improvement from down 38% year over year in Q4 2023. I Heart continues to be ranked number one in radio audience in more markets than the next two largest radio companies combined.

現在轉向多平台集團，其中包括我們的廣播廣播網路和活動業務，第一季營收為 4.93 億美元，比去年同期下降 6.7%，比去年同期下降 7.6%。排除政治廣告的影響，調整後的 EBITDA 為 7,700 萬美元，比上年下降 11.3%。這意味著季度調整後 EBITDA 比 2023 年第四季同比下降 38% 有了大幅改善。I Heart 繼續在更多市場的廣播聽眾中排名第一，比排名第二的兩家廣播公司的總和還要多。

And our events business continues its strong momentum. For example, the I Heart Radio Music Awards generated 84 billion social impressions, three times more than the Super Bowl and 2.3 times more than the Grammys. And we've continued to make meaningful progress in the development of our programmatic platforms that enable the automated buying, selling and planning of our broadcast radio inventory, which give our broadcast radio inventory exposure to the digital TAM.

我們的活動業務持續保持強勁勢頭。例如，I Heart Radio 音樂獎產生了 840 億次社會印象，是超級盃頒獎典禮的三倍，是葛萊美頒獎典禮的 2.3 倍。我們在程序化平台的開發方面繼續取得有意義的進展，該平台能夠自動購買、銷售和規劃我們的廣播電台庫存，從而使我們的廣播電台庫存暴露於數位TAM。

Looking at the business as a whole, we had our first quarter of year-over-year adjusted EBITDA growth in five quarters, driven by the substantial sequential year-over-year improvement in the performance of all of our segments, the multi-platform group, the Digital Audio Group and the Audio & Media Services Group positive indicators of a recovery year. In addition, to continuing to build out our business and develop new consumer and revenue opportunities. Our management team remains focused on expense management, driving efficiencies and structuring our business using technology, including a eye for long-term profitability and maximize shareholder value.

從整體業務來看，我們的第一季調整後 EBITDA 在五個季度中實現了同比增長，這得益於我們所有細分市場的業績同比大幅改善，多平台集團、數位音訊集團以及音訊和媒體服務集團今年出現了積極的復甦跡象。此外，繼續發展我們的業務並開發新的消費者和收入機會。我們的管理團隊仍然專注於費用管理、提高效率和利用技術來建立我們的業務，包括著眼於長期獲利能力和股東價值最大化。

And now I'll turn it over to Rich.

現在我會把它交給里奇。

Thank you, Bob. As I take you through our results, you'll notice that, as Bob mentioned, our first quarter 2024 results were in line with our previously provided revenue and adjusted EBITDA guidance ranges. Our Q1 2024 consolidated revenues were down 1.5% year over year, in line with the guidance we provided of flat to down 2%. Our consolidated direct operating expenses decreased 0.9% for the quarter. This decrease was primarily driven by lower variable content costs, lower event costs related to timing of the 2024 I Heart Radio Music Awards, which were on April 1 this year and March 27 last year, partially offset by higher third-party digital costs related to the increase in digital revenues.

謝謝你，鮑伯。當我向您介紹我們的業績時，您會注意到，正如鮑勃所提到的，我們 2024 年第一季的業績與我們之前提供的收入和調整後的 EBITDA 指導範圍一致。我們的 2024 年第一季合併收入年減 1.5%，與我們提供的持平至下降 2% 的指導一致。本季我們的綜合直接營運費用下降了 0.9%。這一下降主要是由於可變內容成本降低、與 2024 年 I Heart Radio 音樂獎舉辦時間相關的活動成本降低（今年 4 月 1 日和去年 3 月 27 日），部分被與數位收入的增加。

Our consolidated SG&A expenses decreased 4.4% for the quarter. This decrease was driven by lower marketing expense due to the timing of the 2024 I Heart Radio Music Award and lower variable bonus expense, partially offset by an increase in certain costs incurred in connection with the execution of our cost savings initiatives. We generated a first quarter GAAP operating loss of $34.7 million compared to a GAAP operating loss of $48.9 million in the prior year quarter. Our first quarter adjusted EBITDA was $105 million, up 12% compared to $93 million in the prior year quarter and within the guidance range we provided of $100 million to $110 million.

本季我們的綜合 SG&A 費用下降了 4.4%。這一下降是由於2024 年I Heart Radio 音樂獎的舉辦時間導致的營銷費用降低以及可變獎金費用的降低造成的，但由於執行成本節約計劃而產生的某些成本的增加部分抵消了這一下降。我們第一季的 GAAP 營運虧損為 3,470 萬美元，而去年同期的 GAAP 營運虧損為 4,890 萬美元。我們第一季調整後的 EBITDA 為 1.05 億美元，比去年同期的 9,300 萬美元成長 12%，處於我們提供的 1 億至 1.1 億美元的指導範圍內。

Turning now to the performance of our operating segments, and as a reminder, there are slides in the earnings presentation on our segment performances. In the first quarter, the Digital Audio Group revenues were $239 million up 7% year over year and now comprise 30% of our first quarter consolidated revenues. Digital Audio group's adjusted EBITDA was $68 million, up 25.9% year over year. And our Q1 margins were 28.5%, a year-over-year increase of 428 basis points.

現在轉向我們營運部門的業績，提醒一下，收益報告中有關於我們部門業績的幻燈片。第一季度，數位音訊集團營收為 2.39 億美元，年增 7%，目前占我們第一季合併營收的 30%。數位音訊集團調整後 EBITDA 為 6,800 萬美元，較去年同期成長 25.9%。我們第一季的利潤率為 28.5%，年增 428 個基點。

This was the highest Q1 EBITDA margin for the Digital Audio Group in our company's history within the Digital Audio Group, our podcasting revenues, which grew 18% year over year, and our non podcasting digital revenues, which grew 1.2% year over year. The multi-platform Group revenues were $493 million, down 6.7% year over year or down 7.6% excluding the impact of political, adjusted EBITDA was $77 million, down 11.3% year over year, and this represents a substantial sequential improvement from down 38% year over year. In Q4 2023, the multi-platform group's adjusted EBITDA margins were 15.6%.

這是數位音訊集團史上第一季 EBITDA 利潤率最高的數位音訊集團，我們的播客營收年增 18%，我們的非播客數位營收年增 1.2%。多平台集團營收為 4.93 億美元，年減 6.7%，剔除政治因素影響後下降 7.6%，調整後 EBITDA 為 7,700 萬美元，年減 11.3%，與下降 38% 相比，環比大幅改善一年又一年。2023 年第四季度，該多平台集團調整後 EBITDA 利潤率為 15.6%。

Turning to the Audio & Media Services Group, revenues were $69 million, up 12.7% year over year, and adjusted EBITDA was $24 million, up 54% from $15 million in the prior year. Excluding the impact of political, the Audio & Media Services Group revenues were up 6.1%. At quarter end, we had approximately $4.86 billion of net debt outstanding, which was the lowest net debt position in the history of our company. Our total liquidity was $788 million at quarter end, which includes a cash balance of $361 million.

音訊和媒體服務集團的營收為 6,900 萬美元，年增 12.7%，調整後 EBITDA 為 2,400 萬美元，比上年的 1,500 萬美元成長 54%。排除政治因素的影響，音頻和媒體服務集團的收入成長了 6.1%。截至季末，我們的未償淨債務約為 48.6 億美元，這是我們公司歷史上最低的淨債務狀況。截至季末，我們的總流動資金為 7.88 億美元，其中現金餘額為 3.61 億美元。

Our quarter-ending net debt to adjusted EBITDA ratio was 6.9 times in 2024. We expect to make progress towards our goal of a net debt to adjusted EBITDA ratio of approximately four times. As highlighted on past calls, we have no material maintenance covenants and no debt maturities until May 2026. We continue to be opportunistic in responding to market developments and are evaluating all opportunities surrounding our capital structure.

2024 年，我們季末淨負債與調整後 EBITDA 的比率為 6.9 倍。我們預計將在實現淨債務與調整後 EBITDA 比率約為四倍的目標方面取得進展。正如過去電話中所強調的那樣，我們在 2026 年 5 月之前沒有任何實質的維護契約，也沒有債務到期日。我們繼續以機會主義方式應對市場發展，並正在評估圍繞我們資本結構的所有機會。

In aggregate, we now have repurchased $534 million of our eight and three eight senior unsecured notes at a meaningful discount to their par value, generate both earnings and free cash flow accretion. This has reduced the outstanding amount of our eight and three-eighths senior unsecured notes from $1.45 billion to approximately $916 million, resulting in aggregate annualized cash interest savings of approximately $45 million in the first quarter.

總的來說，我們現在已經以相對票面價值大幅折扣的價格回購了 5.34 億美元的 8 期和 3 期 8 期高級無擔保票據，既產生了收益，又增加了自由現金流。這使我們的八分之三優先無抵押票據的未償還金額從 14.5 億美元減少到約 9.16 億美元，從而使第一季的年化現金利息節省總額約為 4,500 萬美元。

Our free cash flow was negative $81 million, a significant improvement from negative $133 million in the prior year quarter. And our Q1 2024 free cash flow excludes the positive impact of the $101 million of cash proceeds from our equity stake in the sale of BMI that we received in February. As a reminder, Q1 is our seasonal low point for free cash flow in the year, and we will generate positive free cash flow in each of the remaining quarters in 2024. Our free cash flow for the year will also benefit from the presidential election cycle, which we expect to generate robust political advertising, which, as a reminder, is paid upfront and will help fuel our free cash flow generation, particularly in Q3 and Q4.

我們的自由現金流為負 8,100 萬美元，比去年同期的負 1.33 億美元有了顯著改善。我們的 2024 年第一季自由現金流不包括 2 月出售 BMI 股權所帶來的 1.01 億美元現金收益的正面影響。提醒一下，第一季是我們今年自由現金流的季節性低點，我們將在 2024 年剩餘的每季產生正的自由現金流。我們今年的自由現金流也將受益於總統選舉週期，我們預計會產生強勁的政治廣告，提醒一下，這些廣告是預先支付的，將有助於推動我們的自由現金流的產生，特別是在第三季和第四季。

Turning now to our outlook for Q2, we expect our Q2 2024 revenues to be approximately flat year over year. We are still closing the month of April but expect revenues to be down 0.4%.

現在轉向我們對第二季的展望，我們預計 2024 年第二季的營收將與去年同期基本持平。我們仍將結束 4 月份，但預計收入將下降 0.4%。

Turning to the individual segments, for Q2, we expect the digital audio Group's revenues to be up high single digits. We expect the multi-platform group revenue to be down mid-single digits, a sequential improvement from Q1, and we expect the Audio & Media Services Group revenues to be down low single digits.

談到各個細分市場，我們預期第二季數位音訊集團的營收將出現高個位數成長。我們預期多平台集團營收將下降中個位數，比第一季連續改善，我們預期音訊和媒體服務集團營收將下降低個位數。

We expect to generate second quarter adjusted EBITDA in the range of $140 million to $160 million compared to $191 million in the prior year quarter. For this quarter, we will not have our usual flow-through of revenue due to the timing of the I Heart Radio Music Awards, which occurred in Q1 last year and in Q2 this year, we recognize expense associated with the event, including production and marketing costs when the awards are ad on FOX and streamed on Hulu.

我們預計第二季調整後 EBITDA 將在 1.4 億至 1.6 億美元之間，而去年同期為 1.91 億美元。本季度，由於去年第一季和今年第二季度發生的 I Heart Radio 音樂獎的時間安排，我們將不會有通常的收入流動，我們確認與該活動相關的費用，包括製作和獎項在FOX 上做廣告並在Hulu 上進行串流媒體時的行銷成本。

Turning to some of the items affecting our full year free cash flow, we expect our cash taxes to be approximately 10% of adjusted EBITDA in 2024. Our estimate of full year 2024 capital expenditures is expected to be approximately $100 million. Cash restructuring expenses will be approximately $60 million this year as we continue to execute on new opportunities to optimize our organization for efficiency and growth.

談到影響我們全年自由現金流的一些項目，我們預計 2024 年我們的現金稅將約為調整後 EBITDA 的 10%。我們預計 2024 年全年資本支出約為 1 億美元。今年現金重組費用約為 6000 萬美元，因為我們將繼續抓住新機會來優化我們的組織以提高效率和成長。

As Bob mentioned, we continue to see signs of improvements throughout our business and the broader advertising marketplace. And as we look ahead, we expect to generate significant political revenues as a result of the presidential election cycle. Although most of the political revenue comes in the back half of the year as an early indicator, our full year 2024 political revenues are currently pacing approximately 16% higher than the last presidential election cycle when we generated $167 million of political revenue.

正如鮑伯所提到的，我們繼續看到整個業務和更廣泛的廣告市場有所改善的跡象。展望未來，我們預期總統選舉週期將帶來可觀的政治收入。儘管大部分政治收入作為早期指標出現在今年下半年，但我們 2024 年全年的政治收入目前比上一個總統選舉週期高出約 16%，當時我們產生了 1.67 億美元的政治收入。

With that context, we expect to see a significant year-over-year improvement in our full year adjusted EBITDA performance on behalf of our entire management team. Bob and I want to thank our team members who work to deliver for their communities, our advertising partners. And for I Heart every day.

在此背景下，我們預計整個管理團隊的全年調整後 EBITDA 績效將比去年同期顯著改善。鮑伯和我要感謝我們的團隊成員，他們致力於為社區提供服務，我們的廣告合作夥伴。為了我的心每一天。

Now we will turn it over to the operator to take your questions. Thank you.

現在我們將把它交給接線員回答您的問題。謝謝。

(Operator Instructions) There are no questions at this time. I will turn the call to the speakers for closing remarks.

（操作員說明） 目前沒有任何問題。我將請發言者致閉幕詞。

Well, Bob and I and the entire management team began. We'd like to thank you all for taking a few minutes this morning to listen to the eye heart story, and we are available of any time for any follow-up questions again. Thank you all.

好吧，鮑勃和我以及整個管理團隊開始了。我們要感謝大家今天早上花幾分鐘時間來聆聽「眼心」的故事，我們隨時可以再次回答任何後續問題。謝謝你們。

This concludes today's conference call. We thank you for joining. You may now disconnect your lines.

今天的電話會議到此結束。我們感謝您的加入。現在您可以斷開線路。