FOR IMMEDIATE RELEASE
Wednesday, December 11, 2013
Media General Presents at UBS Global Media & Communications Conference
RICHMOND, Va. – Media General, Inc. (NYSE: MEG), a local broadcast television and digital media company, presented today at the 41st UBS Global Media & Communications Conference in New York. George L. Mahoney, president and chief executive officer, and James F. Woodward, senior vice president and chief financial officer, discussed the company’s merger with Young Broadcasting that was completed on November 12, 2013.
Mr. Mahoney said, “Our merger with Young was an all-stock transaction. To say it was transformational for both companies dramatically understates the case. First, we promised $30 million of synergies when we announced this transaction. We said they’d be realized in 12-15 months from the closing. Today, our expected synergies already stand at $44 million, and we believe they could go higher.
“We also said the merger would be immediately accretive to free cash flow. The new credit facility we put in place has allowed us to refinance Media General’s and Young’s debt at a significantly lower cost than we’d anticipated. Our new, combined balance sheet will be even stronger going forward than we’d hoped.
“We’re working hard on integration issues, melding two companies and assimilating the best of each into our new organization. This too is going well. We’ve found that our two companies approach the world – and their responsibilities to, and their roles in their communities – all in virtually the same ways. Culture is not only not a problem, rather, it’s an accelerant.
“We’re excited at our prospects as we look ahead to 2014. Political once again will be a hot category. Our digital and mobile platforms will continue to drive meaningful, industry-leading audience and revenue growth. And, we’ll continue to benefit from the rising market for retransmission revenues, dropping much of this new, pay-model revenue to our 2014 bottom line. 2012 pro forma retransmission revenues were $69.6 million. This year, we expect retrans to increase 35-40% from that base. In 2014, we expect to increase again by a similar percentage,” said Mr. Mahoney.
Mr. Woodward said, “In addition to our strong balance sheet, improved credit profile, synergies and accretion to free cash flow, we have combined NOLs of more than $500 million and do not expect to pay any significant cash income taxes for the next 5-7 years.
“After the merger closed, we drew our new credit facilities and repaid the existing term loans for Media General and Young, including call premiums, transaction fees and expenses. Our credit facilities are also funding a $50 million contribution to Media General’s pension plan. Tomorrow, we are redeeming our 11-3/4% Senior Notes, which will complete our refinancing process. After tomorrow’s redemption of the senior notes, we will have $885 million of debt, an interest rate of 4.25% and annual cash interest expense of $37 million,” he said.
Mr. Woodward also reported that for the first nine months of 2013, pro forma combined revenues were $394 million, pro forma combined operating income was $43 million, and pro forma combined EBITDA was $87 million.
A copy of the presentation is available on the company’s website www.mediageneral.com.
This news release contains forward-looking statements that are subject to various risks and uncertainties and should be understood in the context of the company’s publicly available reports filed with the Securities and Exchange Commission. Media General’s future performance could differ materially from its current expectations.
About Media General
Media General, Inc. is a leading local television broadcasting and digital media company, providing top-rated news, information and entertainment in strong markets across the U.S. The company owns or operates 31 network-affiliated broadcast television stations and their associated digital media and mobile platforms, in 28 markets. These stations reach 16.5 million, or 14%, of U.S. TV households. Their network affiliations include CBS (12), NBC (9), ABC (7), Fox (1), MyNetwork TV (1) and CW (1). Sixteen of the 31 stations are located in the top 75 designated market areas. Media General first entered the local television business in 1955 when it launched WFLA in Tampa, Florida as an NBC affiliate. The company subsequently expanded its station portfolio through acquisition. In November of 2013, Media General and Young Broadcasting merged, combining Media General’s 18 stations and Young’s 13 stations into the 31-member group that exists today. Five of the stations have been on the air since 1949: WCMH in Columbus, Ohio; WVTM in Birmingham, Alabama; WJAR in Providence, Rhode, Island; KWQC in Davenport, Iowa; and KRON in San Francisco.
Contact Media General
Media General maintains extensive company information on its website www.mediageneral.com. The company’s media and investor contact is Lou Anne J. Nabhan, Vice President-Corporate Communications, firstname.lastname@example.org or 804-887-5120.