Clear Channel's Year-End and Fourth Quarter Results Stand Out

News   Clear Channel's Year-End and Fourth Quarter Results Stand Out SFX Entertainment's parent company, Clear Channel Communications (CCU) has reported the "best year in its history with record historical net revenues of $5.3 billion, up 100 percent over 1999." In a recent release, Clear Channel also says its "like period pro forma net revenues of $6.9 billion, [were] up 13 percent over 1999."

SFX Entertainment's parent company, Clear Channel Communications (CCU) has reported the "best year in its history with record historical net revenues of $5.3 billion, up 100 percent over 1999." In a recent release, Clear Channel also says its "like period pro forma net revenues of $6.9 billion, [were] up 13 percent over 1999."

CCU acquired two large firms last year, the radio broadcaster AM/FM and SFX Entertainment. The giant CCU is largely a radio broadcast company and outdoor billboard advertising firm. Its live entertainment assets (including SFX) are relatively small in relation to other company assets and represent about 10 percent of its business.

According to company statements, CCU's "EBITDA (defined as operating cash flow less corporate expenses) of $1.7 billion, [was] up 76 percent over 1999, and like period pro forma EBITDA of $2.4 billion, [showed] an increase of 21 percent over 1999.

After tax cash flow reported for the year was $1.3 billion, an increase of 70 percent from the full year of 1999. The Company's diluted after tax cash flow per share was $2.78 compared to $2.24 for 1999, an increase of 24 percent. After tax cash flow is defined as diluted net income before unusual and non-recurring items plus non-cash items (including non consolidated affiliates)."

For the fourth quarter 2000, CCU had "net revenues of $2.0 billion, up 128 percent over the fourth quarter of 1999, and like period pro forma net revenues of $2.1 billion, an increase of 5 percent over 1999. Historical EBITDA of $634 million was up 94 percent over 1999 and like period pro forma EBITDA of $663 million was up 14 percent over the like period in 1999. " With investors, CCU's push from analysts at Merrill-Lynch has been consistent, and CCU has stood out from others included in Merrill-Lynch's broad array of investment portfolio reports.

In the past few months, Mexican authorities nixed a CCU bid to acquire controlling interest in the Mexican radio interests run by Televisa. As previously reported, Mexican antitrust regulators "unanimously voted against Clear Channel owned Grupo Acir’s bid to merge its radio interests with those of Grupo Televisa. That merger would have created one of Mexico’s “largest radio broadcasters” according to the Wall Street Journal. Acquisitions are normal fare at CCU and SFX, and while a partial merger plan floated by Grupo Televisa has been turned down by target Unavision, some analysts say that "Disney and Clear Channel would have few regulatory issues" should either find Unavision attractive.

As reported earlier, SFX was acquired by Clear Channel on Aug. 1, 2000. Clear Channel has also purchased radio broadcaster AMFM. The company now operates 1,096 radio and 19 television stations in the United States and has equity interests in over 240 radio stations internationally. Clear Channel also operates more than 750,000 outdoor advertising displays, including billboards, street furniture and transit panels across the world.

After an aggressive acquisitions campaign in sports and entertainment, SFX Entertainment established an early lead in marketing “live experiential” events. SFX develops and manages touring Broadway shows and sells Broadway subscription series and individual productions in 55 markets. An integrated franchise that promotes and produces a broad variety of live entertainment events locally, regionally and nationally, SFX has 122 venues overall, and owns or operates venues in 31 of the top 50 domestic markets.

— By Murdoch McBride