Local Revenue Keeps Townsquare Strong

Although it’s not a big percentage of the Townsquare revenue pie, CEO Steven Price made a point to use the word “drag,” when describing the contribution national business made to Townsquare’s revenue in Q2. It’s something we’ve heard on several occasions during Q2 earnings calls.

Overall, revenue jumped 2.6% for the quarter with its Local Marketing Solutions segment (radio) increasing 4.3%. Townsquare got some help from the stabilization of energy markets such as Texas and the Dakotas. Townsquare has now turned in 14 consecutive quarters of growth from its Local Marketing Solutions division.

Price says national business has been trending down for two years and that trend is continuing. National business makes up about 10% of the Townsquare revenue pie. Part of that blame has to go toward political revenue. For Townsquare that revenue dropped from $1 million in 2016 to $600K in Q2 of 2017, although local to national political revenue was not broken out and Townsquare does operate in small and medium markets where there is less national money spent. Beasley, Radio One and Saga also reported national was down and of course all companies are reporting political revenue is down being that we are in a non-political year. It’s also important to note that iHeartMedia reported higher national revenue for the quarter.

Price also said automotive was flat for the quarter and retail and entertainment were strong. Entertainment revenue for the company was flat.

On the topic of M&A, despite rumors and speculation that Townsquare was on the block, Price says the company is still a willing buyer of radio stations. He doesn’t see the Entercom/CBS merger the place where Townsquare could participate in any spin-off deals because of the market sizes of those stations. He does however hope that some of the iHeartmedia stations will eventually shake loose. “We are a willing buyer in the right markets, at the right price. Whether or not something shakes out from iHeart or elsewhere, I don’t know. I hope so.”