Townsquare Media is making another move to shore up its financial future with the repurchase of a substantial portion of its shares from MSG National Properties LLC. As of April 1st, Townsquare will repurchase and retire around 1.5 million Class A shares from MSG, at a price of $9.76 per share.
This action follows a similar transaction in June 2023 and will further minimize MSG’s holding in the company. In 2016, Madison Square Garden Company acquired a 12% equity stake in the “digital first” broadcaster.
With these repurchases, including the significant March 2021 buyback from Oaktree Capital Management L.P., Townsquare continues to optimize its leverage. The company has introduced and recently increased its dividend, up to a 7% yield as of March 28.
Townsquare CEO Bill Wilson said, “The strong cash generation characteristics of our business model, which produced $68 million of cash flow from operations in 2023, has afforded us the opportunity to accretively repurchase equity and debt.”
In its 2023 Q4 earnings call, Townsquare reported its digital segments contributed 51% of new revenue and 55% of its Adjusted Operating Income. Digital net revenue in 2023 finished 47% higher than in 2019.
This optimism is further bolstered by reaffirmed guidance for both Q1 and the full year of 2024, anticipating net revenues between $98.5 million to $100 million for Q1 and $440 million to $460 million for the full year, with Adjusted EBITDA expectations ranging from $17.5 million to $18.5 million for Q1, and $100 million to $110 million for the year.
“We are confident in our ability to build shareholder value for our investors through long-term net revenue, Adjusted EBITDA and cash flow growth, net leverage reduction, future dividend payments, and potential future share repurchases,” added Wilson.
