It was not a good quarter for Salem Communications. Overall revenue dropped 2.2%, same station broadcast revenue decreased 1.4% and digital revenue was down 12% at a time when all other broadcasters are reporting big revenue increases in digital.
At the same time, operating expenses increased 32.7% to $78.6 million and the company registered a net loss for the quarter of $20 million
The forecast for Q4 isn’t much better. Salem is pacing down 4-6%
The company is in the process of selling a group of AM radio stations. Once those sales close, roughly $9 million will be used to pay down debt. Salem’s leverage is still above 6X and even after the sale of the radio stations it expects to be north of 6X. Other broadcasters are attempting to get leverage under 4X.
Back in September the company reduced the size of its board to reduce expenses.