Salem Media Group, Inc. (NASDAQ:SALM) Q2 2023 Earnings Conference Call August 8, 2023 5:00 PM ET

Company Participants

Evan Masyr – Chief Financial Officer

David Santrella – Chief Executive Officer

Conference Call Participants

Michael Kupinski – NOBLE Capital Markets

David Marsh – Singular Research

Operator

Thank you for standing by. My name Ajeeb and I will be your conference operator today. At this time, I would like to welcome everyone to the Salem Media Group Incorporated 2023 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] Thank you.

I would now like to turn the call over to Evan Masyr, Chief Financial Officer.

Evan Masyr

Welcome and thank you for joining us today for Salem Media Group's second quarter 2023 earnings call. As a reminder, if you get disconnected at any time, you can dial back in or listen from our website at www.salemmedia.com. In the room with me today is David Santrella, Chief Executive Officer; and David Evans, Chief Operating Officer. We'll begin in just a moment with our prepared remarks. Once we are done, the conference call operator will come back on the line to instruct you on how to submit questions. Please be advised that statements made on this call that relate to future plans, events, financial results, prospects or performance are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995.

These forward-looking statements are based on currently available information. Actual results may differ materially from those anticipated and reported results should not be considered an indication of future performance. We do not intend and undertake no obligation to update our forward-looking statements, including forecasts of future performance, the potential for growth of existing markets, the opening of new markets, or the potential growth from future acquisitions. This conference call also contains non-GAAP financial measures within the meaning of regulation G, specifically station operating income, or SOI, EBITDA and adjusted EBITDA. In conformity with Regulation G, information required to accompany the disclosure of non-GAAP financial measures is available on the Investor Relations portion of the company's website at salemmedia.com.

And with that, I will now turn the call over to Dave Santrella. Dave?

David Santrella

Thanks, Evan, and thanks to everyone for joining us on the call and on the webcast. My prepared remarks will include a review of Salem financial performance in the second quarter and a discussion of some assets sales. Once I'm done, I'll turn the call back to Evan to provide more details on the second quarter financial performance, talk about our debt and give guidance for the third quarter. While we continue to face some headwinds from a tough economy and high interest rates, total revenue for the second quarter declined 4.2% and expenses increased 5.2%. This resulted in a 77.2% decline in adjusted EBITDA. While these numbers are in line with the guidance we provided on our last call, we are not happy with these results. Accordingly, we have taken further cost cutting measures, including the elimination of the 401(k) match banning all non-essential travel, a restructure of some general manager positions, and our sales organizations and pay cuts have been taken by senior management. In total these cuts amount to approximately $10 million in annual savings. We continue to look for additional efficiencies as we navigate the challenging economy.