iHeartMedia SVP and Treasurer Brian Coleman even joked that he was getting more love from analysts this quarter with many more questions being tossed his way. Those questions were on the future liquidity of the company, something Coleman said he’s comfortable with because there are “a host of things to look at to generate liquidity.” Those things include the possibility of selling non-core assets and the capacity to issue debt, according to Coleman. The company borrowed $190 million in Q3 for general corporate purposes and for the first nine months of 2015 cash flow used in operating activities was $363 million. IheartMedia has $20 billion dollars in debt and the cost of debt is 8.4% compared to 8.1% one year ago. In the third quarter iHeart paid $556 million in interest on that $20 Billion in debt. They are expecting to pay another $314 million in Q4.
Wells Fargo analyst Marci Ryvicker also wrote to investors that there were a lot of questions related to iHeartMedia’s liquidity and liquidity levers. “High yield bond trading levels indicate the circumstances here are getting a bit more dire. Management mentioned ”many levers” it has to address liquidity concerns, including accessing CCO’s revolver and raising debt at other entities (which we certainly believe could mean Clear Channel Outdoor). Bottom line: While Q3 results were admittedly lackluster, we believe the liquidity concerns at the parent are exacerbating the stock decline today (rightfully). Unfortunately, we don’t see this overhang being resolved anytime soon.” Ryvicker does not cover iHeartMedia. She does cover Clear Channel Outdoor.