Salem Media Group Sees Revenue, Earnings Increase in Second Quarter 2021
Salem Media Group, one of the largest Christian broadcasters in the country, and the only one that is publicly traded, recently released its results for the three months ended June 30, 2021.
Total revenue increased 20.6 percent to $63.8 million from $52.9 million. It was the second quarter of revenue increase.
The company’s operating income was $5.6 million compared to an operating loss of $0.9 million the year before. This, too, was the second quarter of profitable operations. The company generated net income of $2.3 million, compared to a net loss of $2.5 million the previous year. The company saw improvements in every area of operation: broadcast, digital, and publishing.
Among the material events reported in its second quarter file were these:
- A $0.1 million net gain on the disposition of assets relating to a $0.5 million pre-tax gain on the sale of Singing News Magazine and Singing News Radio offset by $0.4 million additional loss recorded at closing on the sale of radio station WKAT-AM and FM translator in Miami, Florida and various fixed asset disposals; and
- A $0.2 million non-cash compensation charge ($0.1 million, net of tax) related to the expensing of stock options.
- A $17.3 million impairment charge ($12.8 million, net of tax, or $0.48 per share), of which $0.3 million related to impairment of mastheads, and the remainder to broadcast licenses due to the financial impact of the COVID-19 pandemic;
- A $0.3 million impairment charge ($0.2 million, net of tax, or $0.01 per share) related to the company’s goodwill; and
- A $0.2 million non-cash compensation charge ($0.1 million, net of tax, or $0.01 per share) related to the expensing of stock options.
Salem also reported that it had $11.2 million outstanding on Paycheck Protection Program (“PPP”) loans from the Small Business Administration (“SBA”), as of June 30. However, it also said that during July 2021, the SBA forgave all but $20,000 of the loans. The company will record the loan forgiveness in the period in which the loans are forgiven.
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Among the acquisitions it reported: On July 1, 2021, the company acquired the ShiftWorship.com domain and digital assets for $2.6 million of cash. On June 1, 2021, the company acquired radio stations KDIA-AM and KDYA-AM in San Francisco, California for $0.6 million in cash. On April 28, 2021, the company closed on the acquisition of the Centerline New Media domain and digital assets for $1.3 million of cash.
Salem owns nearly 100 Christian and conservative talk radio stations, and it syndicates programs for such conservative celebrities as Dennis Prager and Eric Metaxas. As MinistryWatch previously reported, in May 2020 Moody’s Investors Service downgraded Salem Media Group’s “corporate family rating” and senior secured notes rating to Caa1 from B3. The future-looking outlook was also lowered from stable to negative. According to Moody’s, any company with a “C” rating is a “poor quality and very high credit risk.” In March 2021, Moody’s affirmed the “C” rating but changed its future outlook from negative back to stable.
On August 25, Salem Media Group (SALM) was trading at $2.72 per share. On May 25, Salem Media Group (SALM) was trading at about $2.04 per share. Mar. 11, 2021, Salem Media Group (SALM) was trading for about $3.20 per share. In 2004 it traded for more than $30 per share.