Here comes Audacy Atlas...

[TheBigA]

The fact is that even if they sell the stations & properties in the LLC, it still won't add up to the $2 billion debt.

This situation is starting to remind me of what happened at Cumulus when some members of the Board of Directors replaced Lew Dickey and changed the direction of the company. It wasn't enough to save it from eventual bankruptcy. But they made changes that postponed the inevitable for a few years. A similar thing happened at SiriusXM when its stock was trading for pennies. They managed to turn things around. But they need to make very dramatic changes for that to happen. It's very clear that cost cutting and asset sales won't change the minds of investors.

 

[tbolt909]

The fact is that even if they sell the stations & properties in the LLC, it still won't add up to the $2 billion debt.

Hubris and managerial incompetence are the reasons for this Mountain of Debt. The belief that making money is not enough. They think it's possible and necessary to make ALL THE MONEY. Savvy investors know that companies cannot "cut their way to prosperity"...

 

[TheBigA]

Hubris and managerial incompetence are the reasons for this Mountain of Debt.

In the realm of big business, this isn't a "mountain of debt." Consider that Apple Computer has $100 billion in debt, and the United States is over $30 TRILLION in debt. Everything needs context. The only reason Audacy is in trouble is there's a perception that they can't get out of this. But what would change that impression in five seconds is to get a partner with deep pockets. That's what happened at SiriusXM.

 

[tbolt909]

Sure, all Audacy needs is a Charles Foster Kane. There's a scene in the film where he says "My newspaper lost $1 million last year. I expect to lose $1 million this year. At that rate I'll have to close it down in 60 years"...

 

[TheBigA]

Sure, all Audacy needs is a Charles Foster Kane. There's a scene in the film where he says "My newspaper lost $1 million last year. I expect to lose $1 million this year. At that rate I'll have to close it down in 60 years"...

He was wrong. That movie was based on the Hearst company, and they're still in business over 80 years later.

About | Hearst

www.hearst.com

 

[Mediafrog+]

He was wrong. That movie was based on the Hearst company, and they're still in business over 80 years later.

The scene that included the "million dollars a year" dialogue was set in the early 1900s, so it would be 120 years later.

 

[Rusty Bridges]

In the realm of big business, this isn't a "mountain of debt." Consider that Apple Computer has $100 billion in debt, and the United States is over $30 TRILLION in debt. Everything needs context. The only reason Audacy is in trouble is there's a perception that they can't get out of this. But what would change that impression in five seconds is to get a partner with deep pockets. That's what happened at SiriusXM.

Good take ... but OK yeah, just fer shytz 'n giggles, let's do put that in context. Compare Audacy's debt to Saga, another publicly held company. Also, what's Audacy trading at vs. Saga? As to Apple computer, Apple makes items the public wants... really wants and thinks it needs. Radio? Pffft. Apple can handle debt. Radio? Ya got yer iHearts, Cumuluses and now Audacy. It's like Groundhog Day

Regarding WTSS and WLKK, EMF buying either or both would be a blockbuster on this board and in the market. EMF would take a revenue competing signal out of play. The Breeze would be thrilled. As to WLKK, it's not hard to envision Banned-For-Life-Buddy latching on to that signal. Frankly, it's kinda weird that Audacy is diluting its Buffalo cluster by putting two FM signals, one of which is a legacy Hot AC, in the Atlas portfolio. But I guess when your stock is trading at less than 30 cents a share ... chortle. Yeah, everything is in play.

 

[TheBigA]

Good take ... but OK yeah, just fer shytz 'n giggles, let's do put that in context. Compare Audacy's debt to Saga, another publicly held company. Also, what's Audacy trading at vs. Saga?

How many major markets is Saga in? How many employees? You're comparing two different things. Like comparing New York and Chicago with Cedar Rapids. The crime is much lower in Cedar Rapids. They may be in the same business, but not the same ballpark.

 

[SirRoxalot]

How many major markets is Saga in? How many employees? You're comparing two different things. Like comparing New York and Chicago with Cedar Rapids. The crime is much lower in Cedar Rapids. They may be in the same business, but not the same ballpark.

Reality is that Townsquare, which focuses on smaller markets, is in much better fiscal shape than iHeart. OTA radio as a medium is likely to last longer in smaller markets than major markets. The money may not be the same, but at least it will be profitable.

 

[davideduardo]

How many major markets is Saga in? How many employees? You're comparing two different things. Like comparing New York and Chicago with Cedar Rapids. The crime is much lower in Cedar Rapids. They may be in the same business, but not the same ballpark.

But the point is that Saga grew intelligently and conservatively with very limited or no debt, adding markets slowly.. the exact opposite of Citadel and Cumulus. Further, they focused on local revenue and were not hit nearly as much by the huge agency business cuts in the 2008 to 2012 period.

Smaller, yes. But smarter and that is why they did not overdo the buying spree of the early years of consolidation and are well suited for today's economy.

We could also compare with Townsquare, which focused on multiple services for local merchants, becoming the de facto ad agency for many local businesses.

This is not about how large but about how well managed.

 

[TheBigA]

But the point is that Saga grew intelligently and conservatively with very limited or no debt,

They also have no digital strategy, no real plan to address the future of the medium.

We could also compare with Townsquare, which focused on multiple services for local merchants, becoming the de facto ad agency for many local businesses.

Except that Townsquare has a digital strategy, where almost 50% of its revenue comes from its digital business. And there were missteps along the way. Investing heavily in the live concert business turned out to be a failure. They're operating with a half a billion in debt.

This is not about how large but about how well managed.

And from what I can see, we're in the early stages of a change in management at Audacy.

 

[davideduardo]

They also have no digital strategy, no real plan to address the future of the medium.

Perhaps they see doing one thing well in smaller markets is the future. I look at the online presence of many/most stations and the content is rehashed and the only thing they offer is a stream link.

Except that Townsquare has a digital strategy, where almost 50% of its revenue comes from its digital business. And there were missteps along the way. Investing heavily in the live concert business turned out to be a failure. They're operating with a half a billion in debt.

And they took a different approach by offering a multi-faceted service to local accounts that can't afford to work with an agency,

And from what I can see, we're in the early stages of a change in management at Audacy.

They should have started at the top.

 

[Majic rockstar]

I’m just thinking out loud but what if cumulus buys 102.5 and the WKSE KISS BRAND And move it to 102.5. I mean all they would be buying is the name. But at least they would be getting the heritage calls and name. And I don’t know how Janet and Nick would fit into it but Cumulus would at least add local jocks back to that lifelsss station plus give it a huge coverage area. So would that be a good move or no?

 

[TheBigA]

Perhaps they see doing one thing well in smaller markets is the future.

That was the point I was trying to make by saying you can't compare small market radio with major markets. You need a digital strategy if you want to compete in places like Seattle and San Francisco. Owning a streaming service is expensive, but necessary. The new CEO has come into Saga knowing the challenges he faces because he is so late to the party.

 

[Majic rockstar]

I’m just thinking out loud but what if cumulus buys 102.5 and the WKSE KISS brand and move it to 102.5. I mean all they would be buying is the name. But at least they would be getting the heritage calls and name. And I don’t know how Janet and Nick would fit into it but Cumulus would at least add local jocks back to that lifelsss station plus give it a huge coverage area. So would that be a good move or no

 

[davideduardo]

That was the point I was trying to make by saying you can't compare small market radio with major markets. You need a digital strategy if you want to compete in places like Seattle and San Francisco. Owning a streaming service is expensive, but necessary. The new CEO has come into Saga knowing the challenges he faces because he is so late to the party.

The "digital strategy" that works is extensive on-demand content that is available online. Podcasts, delayed broadcasts of on-air shows, in-depth versions of short morning show bits and the like.

iHeart is creating a good amount of this, but none of the other broadcast groups have much more than streams and a few bonus photos of the concert last weekend....

 

[TheBigA]

iHeart is creating a good amount of this, but none of the other broadcast groups have much more than streams and a few bonus photos of the concert last weekend....

Cumulus & Salem have done a great job of maximizing their conservative talk show hosts into podcast content. Dan Bongino, Mark Levin, and Ben Shapiro are consistently among the top podcasts. They did it internally, without spending hundreds of millions of dollars buying existing podcast companies at top of market prices. That's why Audacy stock is trading so low, and why they're facing some very difficult decisions.

 

[Yeziknoradio]

I’m just thinking out loud but what if cumulus buys 102.5 and the WKSE KISS brand and move it to 102.5. I mean all they would be buying is the name. But at least they would be getting the heritage calls and name. And I don’t know how Janet and Nick would fit into it but Cumulus would at least add local jocks back to that lifelsss station plus give it a huge coverage area. So would that be a good move or no

No. There is a better chance that K Love radio will buy 102.5. Star can move to 107.7, maybe?
It's one way to get back all that crazy money that (then) Entercom paid to protect WKSE, preventing anyone from launching a hit music station on 107.7 FM.

 

[davideduardo]

Cumulus & Salem have done a great job of maximizing their conservative talk show hosts into podcast content, and they did it internally, without spending hundreds of millions of dollars buying existing podcast companies at top of market prices. That's why Audacy stock is trading so low, and why they're facing some very difficult decisions.

I'd give Cumulus a B- there, and the credit there goes to Westwood One for the most part. Because they own a major syndicator, they have the facilities and experience in production needed. Of course they did not spend millions because they already owned one of the country's two largest syndicators.

Salem has long had non-over-the-air content in publications. They simply expanded those activities into podcasts, but you will note that the circulation is very low. But they are used to small audiences and small circulation content and know how to do it very inexpensively. My question there is whether there is much growth opportunity beyond what they already do now.

 

[Radio-Bored-Op]

I'm already lost.

Just an honest observation:
WTSS & WKSE have been the radio formula of how to pretend to be local while doing the opposite. Sue o'neil and Rob Lucas names you know, Janet & the pickle - people you love ( and cleverly ) mask that 4 hours are local on 98.5 / and maybe 8 hours a day on WTSS.

in other words ,
WTSS and WKSE being prepped for major changes that listeners won't notice or care about