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Jun 30, 2020
iHeartMedia Q2 2020 Earnings Report
Reported a significant negative impact on financial performance due to the COVID-19 pandemic.
Key Takeaways
iHeartMedia Inc. reported a 47% decrease in total company revenue for Q2 2020 compared to the prior-year period, primarily due to the economic downturn resulting from the COVID-19 pandemic. Despite the challenges, the company retained its strong consumer relationship and implemented cost-saving measures to minimize the negative impact on free cash flow.
Total company revenue declined 47% in Q2 compared to the prior-year period.
Podcast revenue grew 103% year-over-year in Q2.
The company had a cash balance of $518 million as of June 30, 2020, and total available liquidity of approximately $868 million on an adjusted basis.
Total direct operating expense savings in 2020 are expected to be approximately $250 million.
iHeartMedia
iHeartMedia
iHeartMedia Revenue by Segment
Revenue by Segment
Audio & Media Services Group Revenue
CapyFin.com Forward Guidance
The company anticipates approximately $50 million of restructuring costs related to achieving our cost savings. Our investments in modernization are expected to deliver annualized run-rate cost savings of approximately $100 million by mid-year 2021, and we expect to achieve approximately 50% of our anticipated run-rate savings in 2020.
Positive Outlook
- Modernization initiatives are expected to deliver annualized run-rate cost savings of approximately $100 million by mid-year 2021.
- The Company expects to continue to make key investments in its strategic initiatives related to Smart Audio and Digital, including podcasting.
- The Company also expects that certain provisions of The CARES Act will partially offset the negative impact of COVID-19 on its 2020 free cash flow and is estimating a reduction in tax-related cash payments in 2020 of approximately $100 million.
- no material maintenance covenants
- no material debt maturities prior to 2023
Challenges Ahead
- The challenges that we have faced due to COVID-19 were unprecedented and had a severe, negative impact on our revenue in the second quarter.
- Financial performance in the second quarter was significantly negatively impacted by the economic downturn resulting from the COVID-19 pandemic
- The Company anticipates approximately $50 million of restructuring costs related to achieving our cost savings.
- weak or uncertain global economic conditions
- fluctuations in operating costs