Audacy Philadelphia

[uhaul396]

We should not rule out audacy selling more assets and stations , especially if they start to do it in the major cities. Company will go chapter 11, if they don't make more cuts and please the negotiators handling the debt restructuring.

 

[uhaul396]

The majority of Audacy and IHearts revenue comes from its stations. And the large markets is where the money is. Selling stations will hurt the company long term

Given both companies money issues , they may have to sell some things . Audacy has already sold some stations and even selling the land the towers sit on . I'm sure iheart may do the same.

 

[davideduardo]

We should not rule out audacy selling more assets and stations , especially if they start to do it in the major cities. Company will go chapter 11, if they don't make more cuts and please the negotiators handling the debt restructuring.

At the current market values, selling stations won't cover enough of the debt. The alternative for Audacy is some form of exchanging debt for equity to reduced the loans and keep the producing radio stations.

 

[Larry]

Not that it’s a reason for Audacy to keep 1210 AM but they are having 1210 air the Phillies game tomorrow (Sunday) because of the conflicting Eagles game. They have used WOGL in the past for this but I assume they’d rather not break the music flow on 98.

 

[AbrahamJSimpson]

I’m sure Audacy Buffalo did not want to sell WTSS. And misses the revenue it made

Cool, who held a gun to their head? I missed that part of the story.

 

[fybush]

Cool, who held a gun to their head? I missed that part of the story.

Their lenders, mostly.

 

[ixnay]

"Where is matters" is Bucks, Chester, Delaware, Philadelphia, Montgomery counties in PA, Burlington, Camden and Gloucester in New Jersey. All are 100% part of the Philadelphia Metro Survey Area. Nielsen does not measure towns and cities... it measures counties.

Only 27% of the Philadelphia MSA lives in Philadelphia County. Only Delaware and Chester counties are to the west. All the rest are to the north, east and south.

Does Nielsen measure levels of income? Because I imagine the impoverished in North Philly, Chester, Camden are off the radar of WPHT's (and KYW's) sales staffs. That may be akin to what I'm really trying to ask? Don't "PHT and KY' go for the upper middle class and above?

 

[CassChopper96]

Audacy and IHeart would probably like to own more stations but FCC regulations prevents that.

 

[AbrahamJSimpson]

Their lenders, mostly.

And they made that choice of how to deal with their circumstances. They had a buyer interested, and took the offer.

Circumstances may align that way again, and it would again be the choice of whether to make a deal or not.

The idea that they didn’t sell before so they won’t now, or some such thing, is silly. Or that there’s some kind of emotional attachment. It’s all just business and a series of choices.

 

[davideduardo]

Audacy and IHeart would probably like to own more stations but FCC regulations prevents that.

They can own more stations, just not more in the markets where they have the maximum allowed today, 5 in either service and 8 total.

 

[davideduardo]

Does Nielsen measure levels of income?

Yes, and some advertisers look at that but most don't.

Because I imagine the impoverished in North Philly, Chester, Camden are off the radar of WPHT's (and KYW's) sales staffs. That may be akin to what I'm really trying to ask? Don't "PHT and KY' go for the upper middle class and above?

Again, Nielsen does not measure cities and towns. They measure counties. Even the counties with places like Camden have other areas with higher incomes.

 

[Larry]

Because I imagine the impoverished in North Philly, Chester, Camden are off the radar of WPHT's (and KYW's) sales staffs

I think if you pay attention to the wide range of advertisers /sponsors on KYW they some are advertising to people in Nortb Philly, some to Society Hill and the main line, and some to everyone. SEPTA sponsors segments indicating this was brought to you by (name of subway, el or regional rail station)) which is clearly targeting both people in the inner city and suburbs. Ads for plumbers, window replacement companies, home improvement contractors, car dealerships, retirement communities, retirement financial products are clearly targeting people with more disposable income but SEPTA and Acme supermarkets are targeting everyone. Ironically I once called a plumber that advertised a lot on KYW only to find out they were not licensed in Philadelphia county, only the suburban counties.

 

[ixnay]

I think if you pay attention to the wide range of advertisers /sponsors on KYW they some are advertising to people in Nortb Philly, some to Society Hill and the main line, and some to everyone. SEPTA sponsors segments indicating this was brought to you by (name of subway, el or regional rail station)) which is clearly targeting both people in the inner city and suburbs. Ads for plumbers, window replacement companies, home improvement contractors, car dealerships, retirement communities, retirement financial products are clearly targeting people with more disposable income but SEPTA and Acme supermarkets are targeting everyone. Ironically I once called a plumber that advertised a lot on KYW only to find out they were not licensed in Philadelphia county, only the suburban counties.

Yes, broad based iow. [eats crow]

Hope oliverheatcool.com is licensed in the city. That's the home improvement biz (near the SEPTA Morton station on the Media/Wawa Line) that sticks in my mind on KYW.

 

[uhaul396]

Would the lenders urge audacy to sell some of its Philly assets, if it comes down to that in order for the company to stay afloat, even if David yadgaroff says you are not selling any of my Philadelphia stations and especially with the listener attachment and loyalty shown on some of their stations ? I know it's philly and people don't want change, but we don't have the final say, the executives that run the companies do.

 

[AbrahamJSimpson]

Is there a buyer? The city is irrelevant. If the buyer is for an asset here, great. But buyers aren’t exactly a dime a dozen.

 

[uhaul396]

Is there a buyer? The city is irrelevant. If the buyer is for an asset here, great. But buyers aren’t exactly a dime a dozen.

I think, one of the 2 AM's audacy owns in Philadelphia will get sold, perhaps by a religious broadcaster or someone else, or they would probably shut one of them down and if they choose, move the format elsewhere. I don't think any of the audacy Philly FM's will get sold.

 

[exdjted]

Would the lenders urge audacy to sell some of its Philly assets, if it comes down to that in order for the company to stay afloat, even if David yadgaroff says you are not selling any of my Philadelphia stations and especially with the listener attachment and loyalty shown on some of their stations ? I know it's philly and people don't want change, but we don't have the final say, the executives that run the companies do.

The lenders only want their money. When it comes due, they really don't care if Audacy sells stations, land or a kidney or spleen. They want their money. Selling off a few stations here and there for a few million means nothing when you owe nearly $2 billion. Selling one cluster for even $30 million is like peeing in the ocean. It doesn't raise the water level even one millimeter. You might feel better emptying your bladder for a while, but sooner or later you have to pee all over again. $30 million or $300 million is nothing when your creditors want $1.9 billion. Also, when you sell those stations, you may gain short-term cash, but you decrease the value of the entire operation long-term.

For those of you who say Audacy would buy more stations if the FCC would loosen the caps, ask yourselves this. Who in the world is going to loan them MORE money to buy MORE stations and get FURTHER in debt? Giving David Field more money to buy stations would be like giving an arsonist a lighter because he got his matches wet. It's just stupid.

Audacy may sell a station or two in the near future, but it will be strategic and a need for quick cash to cover a maturing short-term loan or need. That $1.9 billion ain't getting paid off or down any time soon.

 

[davideduardo]

Would the lenders urge audacy to sell some of its Philly assets, if it comes down to that in order for the company to stay afloat, even if David yadgaroff says you are not selling any of my Philadelphia stations and especially with the listener attachment and loyalty shown on some of their stations ? I know it's philly and people don't want change, but we don't have the final say, the executives that run the companies do.

The current value of the individual stations is vastly and enormously less than the debt. The lenders would only approve the sale of stations that have no revenue and cash flow and which don't contribute to a local city cluster's sales offering.

The most likely scenario is some form of refinancing of the debt where the lenders receive equity while reducing the amount of the debt. The current shareholders would see their shares diluted, and worth less; this is better than a bankruptcy where they lose everything.

For this to work, the prospects of Broadcast Cash Flow (earnings before taxes, interest, amortization and depreciation or "EBITDA") would have to look favorable and give the lenders a prospect of getting debt payment as well as a share of profits from the new equity position. And this option gives them the chance to eventually sell the equity and recover more of the loan amount.

Again, selling by bits and pieces is not going to get the kind of payoff lenders will want. Taking equity and receiving a share of income as shareholders comes closer. Audacy has positive cash flow on operations, and what has them "strangled" is debt service and interest.

There are a variety of ways of doing such a deal, and we have to defer to the finance MBAs at the lender groups to find a suitable solution.

 

[uhaul396]

Let me ask all of you this , if audacy has to sell some Philadelphia assets and stations or even shutting it down , which stations will they let go ?

 

[davideduardo]

Let me ask all of you this , if audacy has to sell some assets and stations in Philadelphia, which stations will they let go ?

They will not break the cluster with the possible exception of 1210 AM which is not productive. The current value of the stations would not even come close to paying the debt. Even if they sold all the stations they own, it would not satisfy the debt.