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BIA Shows Radio’s Revenue Winners, Losers From 2019-2023.

“Over the past five years, financial and valuation trends in the media ecosystem have been a rollercoaster ride for anyone involved and watching.” That’s Lauren Ross, VP of Media Valuations at BIA, sizing up the pandemic impact on consumer content consumption patterns and advertising trends and the profound trickle-down effect on media revenues.

Of the eight publicly traded radio/audio companies analyzed by BIA for its Media Ecosystem Review, half grew total revenue between 2019 and 2023 and half had revenue declines. The gainers were Urban One (+8%), Townsquare Media (+5%), iHeartMedia (+2%), and Salem Media (+2%). In other words, despite 2020’s precipitous revenue drops, brought on by COVID-triggered advertising pullbacks, these four companies posted higher total revenue in 2023 than in the pre-pandemic year of 2019.

The four other groups analyzed by BIA had revenue declines during the 2019-2023 period. Cumulus Media fell 24% but part of the decline was due to station divestitures – Cumulus shed about 25 radio stations during the four-year period. Audacy tumbled 22%, Saga Communications declined 8.4% and Beasley Media Group decreased 5.5%.

As anyone working in the media business can recall all too vividly, the 2020 revenue declines were steep and fast. Averaged together, revenue at these eight radio companies declined almost 22%, according to BIA. In 2021, they bounced back by 17%. And looking at the four-year 2019-2023 trend shows the eight companies averaged together were down 6.2% from 2019-2023.

BIA’s analysis is based on form 10-K’s reported by the eight companies to the Securities & Exchange Commission.

Panning out to a wider view of the media sector, total local advertising in the U.S. declined by an estimated 6.9% in 2020 (to $138.2 billion), followed by two years of high-single-digit to low-double-digit growth, reaching $163.8 billion in 2022, and a 3.9% decline to $157.4 billion in 2023.

Digital media companies’ revenues and income from operations fared well through the pandemic and beyond. Despite a tough 2022, digital media companies have seen their total enterprise value nearly double between year-end 2019 and year-end 2023. Other companies that have seen growth in total enterprise value between 2019 and 2023 are the News & Information sector, BIA says.

“When we compare some of these traditional sectors to some of the newer advertising sectors, Alphabet and Meta take a real outsized share,” Ross says. “They are the behemoths. At this point, it’s very tough for even the other companies in the digital media sector to compete against them.”

Total Enterprise Value

While revenue performance was a mixed bag for the eight companies that make up the Audio Providers (radio companies) in BIA’s Media Ecosystem review, all eight showed declines in Total Enterprise Value between 2019 and 2023. Apart from Townsquare Media, which dipped 4%, the seven others were down double digits in TEV, Ross said.

BIA computes Total Enterprise Value by taking the market value of the company’s equity (its stock price multiplied by the number of outstanding shares) and then factoring in the company’s net debt, preferred stock, and minority interest.

In the dealmaking space, the action has shifted from the big commercial radio companies to religious operators, led by Educational Media Foundation. Large companies, meanwhile, are mostly doing “one-off” deals, Ross said.

BIA’s Media Ecosystem Review focuses on 36 public companies in six sectors that compete for local advertising, including Digital, Large Diversified Video Providers, Television Groups, Audio Providers, Out-of-Home (OOH), and News & Information Companies.

BIA’s analysis looks at revenue, profitability, valuation trends, and valuation multiples from pre-pandemic 2019 through the pandemic and year-end 2023. The media industry financial firm says it’s important to show a five-year lookback period to provide insights into sector performance during and after the pandemic and to see what companies in the media ecosystem are the current winners and losers.

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