<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
For the fiscal year ended December 31, 1995 Commission File No. 1-8283
Citicasters Inc.
Incorporated under the IRS Employer
laws of Florida Identification No. 59-2054850
One East Fourth Street
Cincinnati, Ohio 45202
Phone: (513) 562-8000
Securities registered pursuant to Section 12(b) of the Act: None.
Securities registered pursuant to Section 12(g) of the Act:
Title of Each Class Quoted On
Common Stock, $.01 par value NASDAQ/NMS
Other securities for which reports are submitted pursuant to Section
15(d) of the Act: 9-3/4% Series B Senior Subordinated Notes due
December 15, 2004.
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and need
not be contained, to the best of Registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. [X]
Indicate by check mark whether the Registrant has filed all
documents and reports required to be filed by Section 12, 13, or 15(d)
of the Securities Exchange Act of 1934 subsequent to the distribution of
securities under a plan confirmed by a court. Yes X No
As of March 1, 1996, there were 20,007,552 shares of Common
Stock outstanding. The aggregate market value of Common Stock held by
non-affiliates of the Registrant at March 1, 1996, was approximately
$262.5 million (based on non-affiliated holdings of 9,012,497 shares and
a market price of $29.125 per share).
Documents Incorporated by Reference:
Proxy Statement for the 1996 Annual Meeting of Shareholders
(portions of which are incorporated by reference in Part III hereof).
<PAGE>
<TABLE>
CITICASTERS INC.
INDEX TO ANNUAL REPORT
ON FORM 10-K
<CAPTION>
Page
<S> <C> <C>
Part I
Item 1 - Business 1
Item 2 - Properties 6
Item 3 - Legal Proceedings *
Item 4 - Submission of Matters to a Vote of Security Holders *
Part II
Item 5 - Market for Registrant's Common Equity and Related
Stockholder Matters 7
Item 6 - Selected Financial Data 8
Item 7 - Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
Item 8 - Financial Statements and Supplementary Data 12
Item 9 - Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure *
Part III
Item 10 - Directors and Executive Officers of the Registrant 12
Item 11 - Executive Compensation 12
Item 12 - Security Ownership of Certain Beneficial Owners and
Management 12
Item 13 - Certain Relationships and Related Transactions 12
Part IV
Item 14 - Exhibits, Financial Statement Schedules and Reports
on Form 8-K S-1
* The response to this Item is "none."
</TABLE>
<PAGE> 1
PART I
ITEM 1
Business
Introduction
Citicasters Inc. is a holding company engaged in the ownership
and operation of radio and television stations and derives substantially
all of its revenue from the sale of advertising time. Its address is
One East Fourth Street, Cincinnati, Ohio 45202 and its telephone number
is (513) 562-8000. American Financial Group, Inc. ("American
Financial") and its Chairman, Carl H. Lindner, owned approximately 55%
of Citicasters' common stock at March 1, 1996. Citicasters Inc.'s
operations are conducted through its principal subsidiary, Citicasters
Co.
During June 1995, Citicasters acquired its second FM station in
Portland (KKCW) for $30 million. During August 1995, Citicasters
acquired a second FM radio station in Tampa (WTBT) for $5.5 million.
The purchase price for WTBT-FM could increase to $8 million depending on
the satisfaction of certain conditions. Citicasters began operating
WTBT-FM during March 1995.
During January 1996, Citicasters acquired two additional FM
radio stations (WHOK and WLLD) and an additional AM radio station (WLOH)
in Columbus for $24 million.
On February 12, 1996, Citicasters and Jacor Communications,
Inc., entered into a "merger agreement" ("Merger Agreement") by which
Jacor will acquire Citicasters. Under the Merger Agreement, for each share
of Citicasters' stock, Jacor will pay cash of $29.50 plus a five-year warrant
to purchase approximately .2 shares of Jacor Common Stock at
$28 per share. If the closing occurs after September 1996
the exercise price of the warrant would be reduced to $26 per share and
the per share cash price would increase at the rate of $.2215 per month.
American Financial and certain of its affiliates have agreed to execute
irrevocable consents in favor of the Jacor transaction on March 13,
1996. The closing of the transaction is conditioned on, among other
things, receipt of FCC and other regulatory approvals.
<PAGE> 2
General
At March 1, 1996, Citicasters owned and operated fourteen FM
radio stations, five AM radio stations and two network-affiliated
television stations in eight markets. The following tables give the
location and market information for these stations:
<TABLE>
<CAPTION>
Radio Stations
Market and Station Stations
Revenue Call Station Rank(b) in
Rank (a) Letters 12+ 18-34 25-54 Market Format
<S> <C> <C> <C> <C> <C> <C> <C>
Atlanta, GA 10 WKLS-FM 9 4 6 23 Album Oriented Rock
Phoenix, AZ 17 KSLX-FM 10 6 5 32 Classic Rock
Phoenix, AZ 17 KOPA-AM n/m n/m n/m 32 Classic Rock
Tampa, FL 21 WXTB-FM 5 2 5 27 Album Oriented Rock
Tampa, FL 21 WTBT-FM 15 10 12 27 Classic Rock
Cincinnati, OH 20 WKRQ-FM 5 3 7T 22 Contemporary Hits
Cincinnati, OH 20 WWNK-FM 10 8 9 22 Adult Contemporary
Portland, OR 23 KKCW-FM 6 8 1T 30 Adult Contemporary
Portland, OR 23 KKRZ-FM 5 1 12 30 Contemporary Hits
Portland, OR 23 KEX -AM 3 13 9 30 Adult Contemporary
Sacramento, CA 25 KSEG-FM 9 8T 7 23 Classic Rock
Sacramento, CA 25 KRXQ-FM 13T 7 13 23 Album Oriented Rock
Columbus, OH 28 WLVQ-FM 6 4 4 23 Album Oriented Rock
Columbus, OH 28 WTVN-AM 3 13 7 23 Adult Contemporary
Columbus, OH 28 WHOK-FM 7T 8T 9 23 Country
Columbus, OH 28 WLLD-FM 12 8T 12T 23 Country
Columbus, OH 28 WLOH-AM n/m n/m n/m 23 News
Kansas City, MO 32 KYYS-FM 10 5 6 25 Album Oriented Rock
Kansas City, MO 32 WDAF-AM 1 14 10 25 Country
(a) Rankings derived from Duncan's Radio Market Guide by
James Duncan, Jr., 1995 edition.
(b) Rankings for Metro Area, 6am-midnight, Monday-Sunday.
All persons aged 12 and over, Adults aged 18-34 and
Adults aged 25-54. Source: Arbitron Radio Market
Report, Fall 1995. "T" = tied.
n/m Separate rating not meaningful. The station is
operated in conjunction with the related FM station.
</TABLE>
<TABLE>
<CAPTION>
Television Stations
TV Station Rank(a) Commercial Cable
Market and Households Station TV Adults Stations In Sub- Network
National Market In DMA Call House- Aged Market scriber- Affili-
Rank (a) (000's) Letters holds 25-54 VHF UHF ship ation
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Tampa, FL 15 1,395 WTSP 2 4 2 8 70% CBS
Cincinnati, OH 29 793 WKRC 3 1T 3 2 61% ABC(b)
(a) Rankings for Designated Market Area ("DMA"), 6:00 a.m.
to 2:00 a.m., Sunday-Saturday for "TV Households" and
"Adults aged 25-54." "T" = tied. The source of
market information is the Nielsen Station Index,
November 1995.
(b) This station is scheduled to switch its network
affiliation to CBS in June 1996.
</TABLE>
<PAGE> 3
Substantially all of Citicasters' broadcast revenues come from
the sale of advertising time to local and national advertisers. Local
advertisements are sold by each station's sales personnel and national
spots are sold by independent national sales representatives.
Citicasters' television and radio stations compete for revenues with
other stations in their respective signal coverage areas as well as with
all other advertising media. Advertising revenues are significantly
affected by economic conditions on both the national and local level.
Citicasters' AM radio stations offer their listeners a range of
programs including news, music, discussion, commentary and sports.
Citicasters' FM radio stations offer primarily album oriented rock,
classic rock and contemporary hit music programming designed to appeal
to a more youthful audience. Companies that operate radio stations must
always be alert to the possibility of another station changing its
programming format to compete directly for listeners and advertisers.
If another station converts to a format similar to that of one of
Citicasters' radio stations in the same market, the result could be
lower ratings and advertising revenue, increased promotion and other
expenses and consequently lower operating results.
Citicasters' television stations receive a significant portion
of their programming from their respective networks; the networks sell
commercial advertising time within such programming. The competitive
position of the stations is directly affected by viewer acceptance of
network programs. In recent years, the national audience shares
obtained by the networks declined as a result of increased competition
from cable television networks and other competing program sources. As
of 1991, these declines began to diminish and it is expected that
significant declines will not occur during the next several years. The
non-network programs broadcast by the stations are either produced by
the stations or acquired from other sources. Locally originated
programs include a wide range of show types such as news, sports,
entertainment, public affairs and religious programs.
Broadcast stations also compete for audience with other forms of
home entertainment, such as cable television, pay television systems of
various types and home video and audio recordings. These competing
services, which have the potential of providing improved signal
reception or increased home entertainment selection, have experienced
rapid growth in recent years. The major competing television services
today are provided by a large number of advertiser-supported and pay
cable television networks. Cable subscribership presently exceeds 60%
of television households in the United States and is not expected to
grow beyond 65% within the next several years. There are other related
forms of home entertainment which, with continued technological advances
or regulatory changes, can be expected to become increasingly
competitive with Citicasters' broadcast properties. In addition, recent
statutory changes brought on by passage of the Telecommunications Act of
1996 (the "1996 Act") may affect the competition faced by Citicasters.
For example, telephone companies will, in the future, be permitted to
deliver video services to homes in their telephone service areas, either
as cable operators or on a common carrier basis. Telephone companies
will therefore be able to compete directly with presently existing cable
systems.
Regulation
Citicasters' business is subject to various federal and state
laws and regulations which can affect the profitability of operations.
Citicasters' television and radio broadcasting operations are subject to
the jurisdiction of the FCC under the Communications Act of 1934, as
amended. Among other things, FCC regulations govern issuance, renewal
and transfer of licenses which are necessary for operation of television
and radio stations, the ownership of such licenses by aliens, and
ownership limitations with respect to such licenses. Upon application,
and in the absence of adverse findings as to the licensee's
qualifications, such licenses are currently renewed without hearing for
regular terms of five years for television stations and seven years for
radio stations. Under the 1996 Act, future radio and television license
renewals will normally be granted for eight-year terms. Representatives
of special interest and minority groups have, in the past, filed
petitions to deny renewal applications of various broadcast stations.
All of Citicasters' broadcast stations presently operate under regular
renewal authorizations. A regular renewal application is presently
pending for WKLS-FM in Atlanta.
<PAGE> 4
Under the 1996 Act, there will be no maximum national ownership
limit on the number of radio or television stations that may be under
common ownership. The only national ownership limit that will remain
will prohibit common ownership of television stations that would, in the
aggregate, reach more than 35% of U.S. television households.
The FCC's current television ownership rules, which are being
reexamined in a pending FCC rule making proceeding, limit television
ownership to one station in each market. Pursuant to the 1996 Act, the
FCC's rules with respect to local radio ownership will be amended to
incorporate the following new limits:
Number of Radio Maximum Number of
Stations in Commonly Owned
Market Stations in Market
45 or more Eight, no more than five of which may
be AM or FM.
30 - 44 Seven, no more than four of which may
be AM or FM.
15 - 29 Six, no more than four of which may be
AM or FM.
14 or fewer Five, no more than three of which may
be AM or FM, but no more than 50% of
stations in the market.
Current FCC regulations also prohibit the ownership of both
radio and television stations in the same geographic market area.
Pursuant to waivers of those rules granted by the FCC, Citicasters
currently owns both radio and television stations in Cincinnati and
Tampa. These "one-to-a-market" rules are also being reviewed in a
current FCC rule making proceeding.
The Congress and FCC may, in the future, consider and adopt new
laws, regulations and policies regarding a wide variety of matters that
could affect, directly or indirectly, the operation, ownership and
profitability for the Company's radio broadcast stations, result in the
loss of audience share and advertising revenues for the Company's radio
and television broadcast stations, and affect the ability of the Company
to acquire additional broadcast stations or finance such acquisitions.
Such matters include: spectrum use or other fees on FCC licensees;
revision to the FCC's equal employment opportunity rules and other
matters relating to minority and female involvement in the broadcasting
industry; proposals to change rules relating to political broadcasting;
technical and frequency allocation matters; proposals to restrict or
prohibit the advertising of beer, wine and other alcoholic beverages on
radio and/or television; changes in the FCC's cross-interest, multiple
ownership and cross-ownership policies; changes in broadcast technical
requirements; proposals to limit the tax deductibility of advertising
expenses by advertisers; and proposals to auction the right to use the
radio broadcast spectrum to the highest bidder, instead of granting FCC
licenses and subsequent license renewals.
<PAGE> 5
The FCC is also investigating new methods of "digital" radio
broadcasting. "Digital Radio" would permit radio transmission and
reception at a level of quality comparable to that afforded by compact
discs, and would be far less subject to interference than present radio
broadcasts. Present day radio receivers would not be able to receive
digital radio broadcasts because digital radio, in addition to utilizing
different technology, may use totally different transmission frequencies
than used by present radio stations. As the result of frequency
allocations made by the World Administrative Radio Conference in 1992,
digital radio is expected to be developed initially in the U.S. as a
satellite-delivered system, and in Europe, Canada and Mexico as a
terrestrial system. If terrestrial digital radio is implemented in the
U.S., it will likely be through the use of "in-band" systems that send
digitalized signals over the frequencies currently used for AM and FM
broadcasting. Several U.S. industry groups are already experimenting
with the development of such "in-band" technology. In January 1995, the
FCC allocated frequencies for satellite-delivered digital radio, and in
June 1995, it began a proceeding to develop licensing and other rules
for the service. In September 1995, the FCC granted one of the
proponents of satellite service a waiver to begin construction prior to
receipt of an authorization. It is anticipated that delivery of
satellite digital service could begin within the next several years.
Industry groups are conducting trials of in-band terrestrial service,
which is not expected to be offered to the public before the end of the
century. The ultimate advent of digital radio broadcasting may affect
the long-term value of Citicasters' radio franchises either positively
or negatively.
While the FCC relies largely on the interplay of marketplace
forces in lieu of direct government regulation, the FCC continues to
regulate closely some aspects of broadcast station operations. Examples
of such regulation include equal employment practices, political
broadcast practices and rates, television stations' performance in
providing educational and informational programs for children,
televisions stations' compliance with maximum commercial limits in
children's programs, and compliance with various technical regulations.
It is also FCC policy to encourage increasing competition among
different electronic communications media. As a result of rapidly
developing technology, Citicasters' television stations can be expected
to confront increased competition from many other systems by which
information and entertainment are delivered to the home on both a free
and paid basis. Such competing delivery systems include cable
television, delivery of video services by telephone companies, direct
broadcasting to homes by communications satellites, new low power
television stations authorized by the FCC, pay television delivered to
homes via microwave by "wireless cable" systems, common carriers and
videocassettes.
Legislation adopted in 1992 affords most television licensees
the right either to have their station's signals carried on local cable
systems ("must-carry") or, alternatively, to require that operators of
local cable systems obtain "retransmission consent" to carry each
television station's signal on cable. Both of Citicasters' television
stations are presently carried by cable systems in their local service
areas, in most cases pursuant to retransmission consent agreements. The
stations will be required to make a new election between must-carry and
retransmission consent as to all cable systems in each station's local
television market by October 1, 1996. Such elections will be effective
for a three-year period beginning January 1, 1997.
New methods of digital television transmission will make it
technically feasible for television stations to transmit "high
definition television" having greatly improved picture resolution, color
rendition and sound, and wider screen picture. Alternatively, digital
transmission will permit stations to transmit multiple standard
definition television channels and other non-broadcast materials in the
same amount of frequency space currently used to transmit one current
television signal. Digital broadcasting will ultimately also permit
consumers to utilize a single reception device for television, computer
data, materials offered via the Internet, and any other form of digital
information. Because existing television sets cannot receive a digital
signal, however, it will be necessary to transition to a new digital
system by broadcasting digital signals on a second set of television
channels for a period of years, while existing stations continue to
broadcast their present analogue signals on their present channels.
After the transition is complete, the government intends to reclaim one
set of channels.
<PAGE> 6
Under the 1996 Act, the FCC would be permitted to allocate
frequency space for the transition to digital television. If the FCC
does make such an allocation, the 1996 Act provides that the eligibility
to receive the additional transition frequencies will be limited to
existing television licensees; that special fees would be assessed such
licensees with respect to any non-broadcast uses of the frequencies; and
that, under a schedule to be determined by the FCC (and which continues
to be a subject of debate within the government), each broadcaster would
eventually be required to give back to the government one of its two
frequencies. Notwithstanding these provisions of the 1996 Act, various
members of Congress continue to advocate a present auction of the
transition frequencies, and the FCC has agreed to make no allocation of
transition channels until Congress has had a further opportunity to
review the matter.
Broadcasters who obtain a second channel for the transition to
digital transmission will be required to make significant capital
investments in order to build and operate a second station in each
market. Should broadcasters fail to make this additional investment,
they would in the long-term be likely to suffer adverse competitive
effects because cable television, direct broadcast satellites and
distributors of recorded video materials are likely to deliver digital
signals and programs to consumers. Broadcasters would also suffer
adverse effects were the government to determine that the digital
transition channels must be made available for present auction, or if
the time period permitted for the digital transition process were unduly
short.
Employees
At December 31, 1995, Citicasters and its subsidiaries employed
approximately 800 full-time employees and 250 part-time employees.
ITEM 2
Properties
Citicasters owns both of its television station studios,
buildings and transmission sites. It owns its radio studios and
buildings in Cincinnati. All other radio station studios are operated
from leased facilities. Citicasters owns all of its AM station
transmission sites (other than Phoenix for which the lease expires in
1997) and owns its FM station transmission sites in Cincinnati and
Sacramento. Citicasters leases its FM station transmission sites in
Atlanta (lease expires in 1998), Columbus (2003), Portland (2001),
Phoenix (2000), Tampa (1996 and 1997) and Kansas City (2004). In
January 1996, WXTB-FM in Tampa began transmitting from a new tower which
is owned by the Company.
<PAGE> 7
PART II
ITEM 5
Market for Registrant's Common Equity
and Related Stockholder Matters
On June 8, 1994, the Company changed its name to Citicasters,
and its trading symbol was changed from "GACC" to "CITI." Citicasters
Common Stock is traded on the NASDAQ National Market.
The following table sets forth, for the periods indicated, the
high and low per share sales prices of the Common Stock on the NASDAQ
National Market System adjusted for both of the 3-for-2 stock splits
(which occurred in May and November of 1995).
<TABLE>
<CAPTION>
High Low
<S> <C> <C>
1994:
First Quarter ............................ $ 8.17 $ 6.89
Second Quarter ........................... $ 8.84 $ 6.84
Third Quarter ............................ $10.00 $ 7.67
Fourth Quarter ........................... $11.00 $ 8.95
1995:
First Quarter ............................ $13.61 $11.00
Second Quarter ........................... $18.83 $13.56
Third Quarter ............................ $26.17 $18.33
Fourth Quarter ........................... $25.25 $19.75
</TABLE>
At March 1, 1996, there were approximately 1,400 holders of
record of the Company's Common Stock.
Citicasters paid an annual dividend of $.03 per share during the
fourth quarter of 1995. No dividends were paid on the Company's Common
Stock during 1994. The Company's debt instruments contain covenants
which limit the amount of dividends which Citicasters is able to pay on
its Common Stock. Under the most restrictive provision of Citicasters'
debt covenants, dividends are limited to a maximum of $2.5 million
annually. Under the Merger Agreement, no dividends may be paid without
the prior consent of Jacor.
<PAGE> 8
ITEM 6
Selected Financial Data
The following table (in millions except for per share data) sets
forth certain data for the periods indicated and should be read in
conjunction with "Management's Discussion and Analysis of Financial
Condition and Results of Operations":
<TABLE>
<CAPTION>
Citicasters Predecessor(a)
1995 1994 1993 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
Statement of Operations Data:
Consolidated net revenues $136 $197 N/A $205 $211 $ 202
Operating income (loss)(b) 37 52 N/A 40 (642) 12
Net earnings (loss) from
continuing operations 14 63 N/A (67) (613) (33)
Net earnings (loss)(c) 14 63 N/A 341 (597) 84
Per share data (d) $.68 $2.55 N/A - - -
Balance Sheet Data (e):
Consolidated assets $416 $403 $720 N/A $714 $1,475
Consolidated long-term debt 132 122 433 N/A 635 693
Minority interest,
preferred stock of
subsidiary - - - N/A 275 251
Shareholders' equity
(deficit) 160 151 139 N/A (339) 258
(a) For purposes of this table, the term "Predecessor"
refers to Great American Communications Company prior
to its emergence from chapter 11 bankruptcy in December
1993.
(b) The recorded amount of intangible assets as of December
31, 1992 was reduced by $658 million to reflect the
carrying value of its broadcasting assets at estimated
fair value at that time.
(c) Net earnings for the year ended December 31, 1993
includes, as an extraordinary item, a one-time gain of
$414 million relating to debt discharged in the
reorganization.
(d) Per share data are not presented for the Predecessor
due to the general lack of comparability as a result of
the reorganization.
(e) Balance sheet data at December 31, 1993 reflects the
adoption of fresh-start reporting. The application and
effects of fresh-start reporting is discussed in more
detail in Note B to the Financial Statements.
N/A - not applicable.
</TABLE>
As a result of the Company's emergence from bankruptcy and its
adoption of fresh-start reporting as of December 31, 1993, the Balance
Sheet at and after December 31, 1993 and the Statements of Operations
for periods after December 31, 1993 will not be comparable to the
Financial Statements for prior periods included elsewhere herein. See
Notes to Financial Statements.
<PAGE> 9
ITEM 7
Management's Discussion and Analysis
of Financial Condition and Results of Operations
GENERAL
The following discussion should be read in conjunction with the
Financial Statements beginning on page F-1.
LIQUIDITY AND CAPITAL RESOURCES
Citicasters is a holding company and depends on advances,
dividends and tax allocation payments from its operating subsidiary,
Citicasters Co., to meet its expenditures for administrative expenses
and debt service obligations. Based upon current levels of Citicasters
Co.'s operations and anticipated growth, it is expected that operating
cash flow will be sufficient to meet expenditures for operations
(including capital expenditures), administrative expenses and debt
service. Citicasters Co. is permitted to advance funds or pay dividends
to Citicasters Inc. for administrative expenses, borrowing costs and
payment of dividends. Citicasters' credit agreement provides two credit
facilities: an acquisition facility of $125 million and a working
capital facility of $25 million. At March 1, 1996, $26 million had been
drawn under the acquisition facility.
During January 1996, Citicasters purchased two FM radio stations
and an AM radio station in Columbus for $24 million. Citicasters
borrowed from its acquisition facility to fund the purchases.
RESULTS OF OPERATIONS
The financial results of Citicasters' business are seasonal.
Revenues are generally higher in the second and fourth calendar quarters
than in the first and third quarters.
The amount of broadcast advertising time available for sale by
Citicasters' stations is relatively fixed, and by its nature cannot be
stockpiled for later sale. Therefore, the primary variables affecting
revenue levels are the demand for advertising time, the viewing or
listening audience of the station and the entry of new stations in the
marketplace. The major variable costs of operation are programming
(news, sports and entertainment), sales costs related to revenues and
promotional costs. The success of the programming determines the
audience levels and therefore affects revenue.
Citicasters' management believes that operating income before
depreciation and amortization is helpful in understanding cash flow
generated from its broadcasting operations which is available for debt
service, capital expenditures and taxes, and in comparing operating
performance of Citicasters' broadcast stations to other broadcast
stations. Operating income before depreciation and amortization is also
a key factor in Citicasters' assessment of station performance.
Operating income before depreciation and amortization should not be
considered an alternative to net income as an indicator of Citicasters'
overall performance.
On December 28, 1993, Great American Communications Company
completed its comprehensive financial restructuring through a
prepackaged plan of reorganization under chapter 11 of the Bankruptcy
Code. Pursuant to generally accepted accounting principles for entities
in reorganization under the bankruptcy code, Great American
Communications Company revalued its assets and liabilities to estimated
fair values upon consummation of the restructuring. Great American
Communications Company and its subsidiaries are hereafter referred to as
"Predecessor." See Note B to the Financial Statements.
The net earnings in 1994 and 1993 include significant non-recurring
transactions including gains from asset sales and debt
refinancing transactions. The gains realized from asset sales, debt
discharge and debt refinancing transactions totaled $50 million and $408
million in 1994 and 1993, respectively. Gains from these types of
transactions are not part of normal operations and no assurance can be
given that such transactions will recur in the future or if they recur
that gains will result.
<PAGE> 10
<TABLE>
Net revenues and operating income are shown below (in thousands):
<CAPTION>
Predecessor
1995 1994 1993
<S> <C> <C> <C>
Net revenues
Television broadcasting:
Local $ 31,485 $ 67,308 $ 73,085
National 27,332 56,972 60,027
Other 2,775 6,138 6,464
Total 61,592 130,418 139,576
Radio broadcasting:
Local 61,157 54,305 53,704
National 13,050 11,666 10,848
Other 615 654 1,040
Total 74,822 66,625 65,592
Total net revenues 136,414 197,043 205,168
Operating, selling, general
and administrative expenses (80,929) (117,718) (133,070)
Corporate general and
administrative expenses (4,303) (4,796) (3,996)
Operating income before
depreciation and amortization 51,182 74,529 68,102
Depreciation and amortization (14,635) (22,946) (28,119)
Operating income $ 36,547 $ 51,583 $ 39,983
</TABLE>
Net revenues and operating income adjusted to
remove the operating results of the four television stations sold in
1994 are shown below (in thousands):
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Net revenues
Television broadcasting $ 61,592 $ 61,750 $ 54,005
Radio broadcasting 74,822 66,625 65,592
Total net revenues 136,414 128,375 119,597
Operating, selling, general
and administrative expenses (80,929) (79,950) (81,199)
Corporate general and
administrative expenses (4,303) (4,796) (3,996)
Operating income before
depreciation and
amortization 51,182 43,629 34,402
Depreciation and amortization (14,635) (13,005) (14,260)
Operating income $ 36,547 $ 30,624 $ 20,142
</TABLE>
<PAGE> 11
1995 compared to 1994
Television revenues declined $68.8 million (53%) in 1995
primarily due to the sale of four television stations in 1994.
Excluding the results of the stations sold, television revenues
decreased slightly. Revenue increases at the Cincinnati station were
offset by decreases in Tampa where WTSP switched its network affiliation
from ABC to CBS. Radio revenues increased $8.2 million (12%) in 1995
due to the expanding economy, sales efforts and the acquisition of two
additional FM stations. Excluding the results of stations purchased
during 1995, radio revenues increased $4 million (6%).
Costs and expenses decreased $37.3 million (30%) as a result of
the sale of the television stations. Excluding expenses of the
television stations sold in 1994 and the expenses of the radio stations
acquired in 1995, costs and expenses decreased $2.4 million (3%) in 1995
due to cost controls.
Operating income declined $15 million (29%) as a result of the
sale of the four television stations in 1994. Excluding the results of
the television stations sold in 1994 and the radio stations acquired in
1995 operating income increased $5.3 million (17%) due to increases in
net revenue and expense controls.
1994 compared to 1993
Television revenues declined $9.2 million (7%) in 1994 due to
the sale of four television stations in September and October 1994.
Excluding the results of the four television stations sold, television
revenues increased $7.7 million (14%) during 1994. Revenue increases
were due to several factors including: the expanding economy's effect
on advertising expenditures; national and local elections; and sales
efforts. Radio revenues increased $1.0 million (2%) during 1994. The
results for 1993 include one more FM radio station than for 1994 and,
although the purchase and sale of radio stations in 1994 did not have a
material effect on the consolidated results for 1994, the percentage
increases in revenues and decreases in expenses were affected by these
transactions. The revenues of the eight FM and four AM stations owned
in both years increased 9.6%.
Costs and expenses decreased $14.6 million (11%) during 1994 due
primarily to the sale of the four television stations. Excluding the
results of the four television stations sold, expenses declined 1% as a
result of cost controls and the decrease in the number of FM radio
stations.
Operating income increased $11.6 million (29%) during 1994
despite the sale of the four television stations. Excluding the sale of
the four television stations, operating income increased $10.5 million
(52%) during 1994 due to the combination of revenue increases and
expense controls.
Other Income (Expense) Information Interest expense decreased
approximately $18 million in 1995 compared to 1994, due to reduced debt
levels resulting from the sale of the four television stations.
Interest expense decreased $33.0 million (51%) during 1994 compared to
1993 due primarily to reduced debt levels resulting from the
reorganization and to a lesser extent the sale of four television
stations.
During 1994 Citicasters sold four television stations for $355 million
in cash and a five year warrant to purchase 5 million shares of New
World Class A common stock at $16 per share.
Reorganization Items Reorganization items represent the expenses
incurred as a result of the chapter 11 filings and subsequent
reorganization, including, among other things, the adjustments to record
the fair values of assets and liabilities at December 31, 1993 (see Note
B to the Financial Statements).
<PAGE> 12
ITEM 8
Financial Statements and Supplementary Data
Page
Report of Independent Auditors F-1
Balance Sheet:
December 31, 1995 and 1994 F-2
Statement of Operations:
Years ended December 31, 1995, 1994 and 1993 F-3
Statement of Changes in Shareholders' Equity:
Years ended December 31, 1995, 1994 and 1993 F-4
Statement of Cash Flows:
Years ended December 31, 1995, 1994 and 1993 F-5
Notes to Financial Statements F-7
"Selected Quarterly Financial Data" has been included in Note L to
Citicasters' Financial Statements.
_____________________
PART III
The information required by the following Items will be included
in Citicasters' definitive Proxy Statement which will be provided within
120 days after the end of the Registrant's fiscal year:
ITEM 10 Directors and Executive Officers of the Registrant
ITEM 11 Executive Compensation
ITEM 12 Security Ownership of Certain Beneficial Owners and
Management
ITEM 13 Certain Relationships and Related Transactions
<PAGE> F-1
REPORT OF INDEPENDENT AUDITORS
Board of Directors
Citicasters Inc.
We have audited the accompanying balance sheets of Citicasters Inc. and
subsidiaries (formerly Great American Communications Company) as of
December 31, 1995 and 1994, and the related statements of operations,
shareholders' equity and cash flows for each of the three years in the
period ended December 31, 1995. Our audits also included the financial
statement schedules listed in the Index at Item 14(a). These financial
statements and schedules are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements and schedules based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
As more fully described in Note B to the financial statements, effective
December 28, 1993, the Company emerged from bankruptcy pursuant to a
plan of reorganization confirmed by the Bankruptcy Court on December 7,
1993. In accordance with an American Institute of Certified Public
Accountants Statement of Position, the Company has adopted "fresh-start
reporting" whereby its assets, liabilities, and new capital structure
have been adjusted to reflect estimated fair values as of December 31,
1993. As a result, the statements of operations, shareholders' equity
and cash flows for the years ended December 31, 1995 and December 31,
1994 reflect the Company's new basis of accounting and, accordingly, is
not comparable to the Company's pre-reorganization statements of
operations, shareholders' equity and cash flows for the year ended
December 31, 1993.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Citicasters
Inc. and subsidiaries at December 31, 1995 and 1994, and the results of
their operations and their cash flows for each of the three years in the
period ended December 31, 1995, in conformity with generally accepted
accounting principles. Also, in our opinion, the related financial
statement schedules, when considered in relation to the basic financial
statements taken as a whole, present fairly in all material respects the
information set forth therein.
ERNST & YOUNG LLP
Cincinnati, Ohio
February 23, 1996
<PAGE> F-2
<TABLE>
CITICASTERS INC. AND SUBSIDIARIES
BALANCE SHEET
(Dollars in Thousands)
<CAPTION>
December 31,
1995 1994
<S> <C> <C>
ASSETS
Current assets:
Cash and short-term investments $ 3,572 $ 46,258
Trade receivables, less allowance for doubtful
accounts of $1,643 and $1,244 32,495 31,851
Broadcast program rights 5,162 5,488
Prepaid and other current assets 3,059 2,635
Total current assets 44,288 86,232
Broadcast program rights, less current portion 3,296 4,466
Property and equipment, net 33,878 25,083
Contracts, broadcasting licenses and other
intangibles, net 312,791 274,695
Deferred charges and other assets 22,093 13,016
$416,346 $403,492
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable, accrued expenses and other
current liabilities $ 17,061 $ 33,673
Broadcast program rights fees payable 5,298 5,041
Total current liabilities 22,359 38,714
Broadcast program rights fees payable, less
current portion 2,829 3,666
Long-term debt 132,481 122,291
Deferred income taxes 44,822 44,486
Other liabilities 54,163 43,398
Total liabilities 256,654 252,555
Shareholders' equity:
Common Stock, $.01 par value, including
additional paid-in capital, 500,000,000
shares authorized; 19,976,927 and
20,203,247 shares outstanding 82,936 87,831
Retained earnings from January 1, 1994 76,756 63,106
Total shareholders' equity 159,692 150,937
$416,346 $403,492
See notes to financial statements.
</TABLE>
<PAGE> F-3
<TABLE>
CITICASTERS INC. AND SUBSIDIARIES
STATEMENT OF OPERATIONS
(In Thousands except per share amounts)
<CAPTION>
Year ended December 31,
Predecessor
1995 1994 1993
<S> <C> <C> <C>
Net revenues:
Television broadcasting $ 61,592 $130,418 $139,576
Radio broadcasting 74,822 66,625 65,592
136,414 197,043 205,168
Costs and expenses:
Operating expenses 37,416 60,682 71,730
Selling, general and administrative 43,513 57,036 61,340
Corporate, general and administrative
expenses 4,303 4,796 3,996
Depreciation and amortization 14,635 22,946 28,119
99,867 145,460 165,185
Operating income 36,547 51,583 39,983
Other income (expense):
Interest expense, (contractual interest
for 1993 was $69,806) (13,854) (31,979) (64,942)
Minority interest - - (26,776)
Investment income 1,231 1,216 305
Gain on sale of television stations - 95,339 -
Miscellaneous, net (607) 447 (494)
(13,230) 65,023 ( 91,907)
Earnings (loss) before reorganization
items and income taxes 23,317 116,606 (51,924)
Reorganization items - - (14,872)
Earnings (loss) before income taxes
and extraordinary items 23,317 116,606 (66,796)
Income taxes 9,000 53,500 -
Earnings (loss) before extraordinary items 14,317 63,106 (66,796)
Extraordinary items, net of tax - - 408,140
NET EARNINGS $ 14,317 $ 63,106 $341,344
SHARE DATA:
Primary and Fully Diluted:
Net earnings $.68 $2.55 *
Average common shares 21,017 24,777 *
* Share amounts are not relevant due to the effects of the reorganization.
See notes to financial statements.
</TABLE>
<PAGE> F-4
<TABLE>
CITICASTERS INC. AND SUBSIDIARIES
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
(In Thousands)
<CAPTION>
Year ended December 31,
Predecessor
1995 1994 1993
<S> <C> <C> <C>
Common stock, including additional
paid-in capital:
Beginning balance $ 87,831 $138,588 $ 270,891
Common stock issued:
Exercise of stock options 273 - -
Stock bonus awarded - 297 350
Common stock repurchased and retired (5,168) (51,054) -
Effect of restructuring - - (132,653)
Balance at end of period $ 82,936 $ 87,831 $ 138,588
Retained earnings:
Beginning balance $ 63,106 $ - $(609,920)
Net earnings 14,317 63,106 341,344
Application of fresh-start accounting - - 268,576
Cash dividends (667) - -
Balance at end of period $ 76,756 $ 63,106 $ -
TOTAL SHAREHOLDERS' EQUITY $159,692 $150,937 $ 138,588
See notes to financial statements.
</TABLE>
<PAGE> F-5
<TABLE>
CITICASTERS INC. AND SUBSIDIARIES
STATEMENT OF CASH FLOWS
(In Thousands)
<CAPTION>
Year ended December 31,
Predecessor
1995 1994 1993
<S> <C> <C> <C>
OPERATING ACTIVITIES:
Net earnings $ 14,317 $ 63,106 $341,344
Adjustments:
Depreciation and amortization 14,635 22,946 28,119
Non-cash interest expense 190 198 8,780
Other non-cash adjustments (primarily non-
cash dividends on the preferred stock
of a former subsidiary) - - 26,941
Reorganization items - - 14,872
Realized gains on sales of assets - (51,218) (1,871)
Extraordinary gains on retirements
and refinancing of long-term debt - - (408,140)
Decrease (increase) in trade receivables (644) 16,443 (1,635)
Decrease (increase) in broadcast program
rights, net of fees payable 916 (146) 201
Increase (decrease) in accounts payable,
accrued expenses and other liabilities (5,885) (2,891) 9,514
Increase (decrease) in deferred taxes 336 (6,559) -
Other (634) (4,389) 306
23,231 37,490 18,431
INVESTING ACTIVITIES:
Deposits on broadcast stations to be acquired (7,500) - -
Purchases of:
Broadcast stations (50,598) (16,000) -
Real estate, property and equipment (11,857) (7,569) (5,967)
Sales of:
Broadcast stations - 381,547 1,600
Entertainment businesses:
Cash proceeds received - 5,000 -
Cash expenses related to sale (22) (813) (6,021)
Investments and other subsidiaries - 2,841 -
Other (378) 204 (1,131)
(70,355) 365,210 (11,519)
FINANCING ACTIVITIES:
Retirements and refinancing of long-term debt (3,500) (505,824) (370,150)
Additional long-term borrowings 13,500 195,350 355,339
Financing costs - - (13,549)
Common shares repurchased (5,168) (51,054) -
Cash dividends paid on common stock (667) - -
Proceeds from the sale of common stock - - 1,161
Other 273 297 -
4,438 (361,231) (27,199)
NET INCREASE (DECREASE) IN CASH AND SHORT-TERM
INVESTMENTS (42,686) 41,469 (20,287)
Cash and short-term investments at beginning
of period 46,258 4,789 25,076
Cash and short-term investments at end
of period $ 3,572 $ 46,258 $ 4,789
See notes to financial statements.
</TABLE>
<PAGE> F-6
<TABLE>
CITICASTERS INC. AND SUBSIDIARIES
SUPPLEMENTARY SCHEDULE TO THE STATEMENT OF CASH FLOWS - REORGANIZATION ITEMS
(In Thousands)
<CAPTION>
Year Ended
December 31, 1993
Predecessor
<S> <C>
EFFECTS OF REORGANIZATION ACTIVITIES:
Cash Items:
Operating activities:
Professional fees and other expenses
related to bankruptcy proceedings
and consummation of the reorganization $ (10,633)
Financing activities:
Long-term debt issued for cash $ 6,339
Common stock issued for cash 1,161
$ 7,500
Non Cash Items:
Increase in long-term debt (primarily
reduction in original issue discount) $ 25,967
Net adjustment of accounts to fair value (15,961)
Decrease in liabilities subject to exchange (40,423)
Increase in accrued liabilities
(professional fees and other expenses
related to consummation of the
reorganization) 1,438
Decrease in long-term debt through the
issuance of common stock (221,541)
Elimination of minority interest (preferred
stock of subsidiary) through the
issuance of common stock (274,932)
Common stock issued in reorganization 134,762
$(390,690)
See notes to financial statements.
</TABLE>
<PAGE> F-7
CITICASTERS INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
A. ACCOUNTING POLICIES
ORGANIZATION Citicasters is engaged in the ownership and
operation of radio and television stations and derives
substantially all of its revenue from the sale of advertising
time. The amount of broadcast advertising time available for
sale by Citicasters' stations is relatively fixed, and by its
nature cannot be stockpiled for later sale. Therefore, the
primary variables affecting revenue levels are the demand for
advertising time, the viewing or listening audience of the
station and the entry of new stations in the marketplace. The
major variable costs of operation are programming (news, sports
and entertainment), sales costs related to revenues and
promotional costs. The success of the programming determines
the audience levels and therefore affects revenue.
BASIS OF PRESENTATION The accompanying financial statements
include the accounts of Citicasters Inc. and its subsidiaries.
For purposes of the financial statements and notes hereto the
term "Predecessor" refers to Great American Communications
Company and its subsidiaries prior to emergence from chapter 11
bankruptcy. Significant intercompany balances and transactions
have been eliminated.
On December 28, 1993, the Predecessor completed its
comprehensive financial restructuring through a prepackaged plan
of reorganization under chapter 11 of the Bankruptcy Code (see
Note B for a description of the reorganization). Pursuant to
the reporting principles of AICPA Statement of Position No. 90-7
entitled "Financial Reporting by Entities in Reorganization
under the Bankruptcy Code" ("SOP 90-7"), Predecessor adjusted
its assets and liabilities to their estimated fair values upon
consummation of the reorganization. The adjustments to reflect
the consummation of the reorganization as of December 31, 1993,
including among other things, the gain on debt discharge and the
adjustment to record assets and liabilities at their fair
values, have been reflected in the accompanying financial
statements. The Statements of Operations, Changes in
Shareholders' Equity and Cash Flows for the year ended December
31, 1993 is presented on a historical cost basis without giving
effect to the reorganization. Therefore, the Statements of
Operations, Changes in Shareholders' Equity and Cash Flows for
periods after December 31, 1993 are generally not comparable to
prior periods and are separated by a line (see Note B).
All acquisitions have been treated as purchases. The accounts
and results of operations of companies since their formation or
acquisition are included in the consolidated financial
statements.
American Financial Group, Inc. and its Subsidiaries ("American
Financial") owned 7,566,889 shares (37.8%) of Citicasters'
outstanding Common Stock at March 1, 1996. At that date,
American Financial's Chairman, Carl H. Lindner, owned an
additional 3,428,166 shares (17.1%) of Citicasters' outstanding
Common Stock.
USE OF ESTIMATES The preparation of the financial statements in
conformity with generally accepted accounting principles
requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and
accompanying notes. Changes in circumstances could cause actual
results to differ materially from those estimates.
BROADCAST PROGRAM RIGHTS The rights to broadcast non-network
programs on Citicasters' television stations are stated at cost,
less accumulated amortization. These costs are charged to
operations on a straight-line basis over the contract period or
on a per showing basis, whichever results in the greater
aggregate amortization.
<PAGE> F-8
CITICASTERS INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS - CONTINUED
PROPERTY AND EQUIPMENT Property and equipment are based on cost
and depreciation is calculated primarily using the straight-line
method. Depreciable lives are: land improvements, 8-20 years;
buildings and improvements, 8-40 years; operating and other
equipment, 3-20 years; and leasehold improvements, over the life
of the lease.
CONTRACTS, BROADCASTING LICENSES AND OTHER INTANGIBLES
Contracts, broadcasting licenses and other intangibles represent
the excess of the value of the broadcast station over the values
of their net tangible assets, and is attributable to FCC
licenses, network affiliation agreements and other contractual
or market related factors. Reorganization value in excess of
amounts allocable to identifiable assets represents the excess
of the estimated fair value of Citicasters at the time of the
reorganization over the estimated fair value allocated to its
net identifiable assets. Intangible assets are being amortized
on a straight-line basis over an average of 34 years. On an
ongoing basis, Citicasters reviews the carrying value of its
intangible assets. If this review indicates that intangible
assets will not be recoverable, as determined based on
undiscounted cash flows of broadcast stations over the remaining
amortization period, Citicasters' carrying value of intangible
assets are reduced by the amount of the estimated shortfall of
cash flows.
INCOME TAXES Citicasters files a consolidated Federal income
tax return which includes all 80% or more owned subsidiaries.
Deferred income tax assets and liabilities are determined based
on differences between financial reporting and tax bases and are
measured using enacted tax rates. Deferred tax assets are
recognized if it is more likely than not that a benefit will be
realized.
EARNINGS PER SHARE Primary and fully diluted earnings per share
in 1995 and 1994 are based upon the weighted average number of
common shares and gives effect to common equivalent shares
(dilutive options) outstanding during the respective periods.
As a result of the effects of the reorganization, per share data
for the year ended December 31, 1993 has been rendered
meaningless and, therefore, per share information for this
period has been omitted from the accompanying financial
statements.
STOCK BASED COMPENSATION The Company grants stock options for a
fixed number of shares to employees with an exercise price equal
to the fair value of the shares at the date of grant. The
Company accounts for stock option grants in accordance with APB
Opinion No. 25, Accounting for Stock Issued to Employees, and,
accordingly, recognizes no compensation expense for the stock
option grants.
STATEMENT OF CASH FLOWS For cash flow purposes, "investing
activities" are defined as making and collecting loans and
acquiring and disposing of debt or equity instruments and
property and equipment. "Financing activities" include
obtaining resources from owners and providing them with a return
on their investments, borrowing money and repaying amounts
borrowed. All other activities are considered "operating."
Short-term investments for purposes of the financial statements
are those which had a maturity of three months or less when
acquired.
B. REORGANIZATION On December 28, 1993, Citicasters completed its
comprehensive financial restructuring that was designed to
enhance its long-term viability by adjusting its capitalization
to reflect current and projected operating performance levels.
The Predecessor accomplished the reorganization of its debt and
preferred stock obligations through "prepackaged" bankruptcy
filings made under chapter 11 of the Bankruptcy Code by the
Predecessor and two of its former non-operating subsidiaries.
The Predecessor's primary operating subsidiary, Great American
Television and Radio Company, Inc., was not a party to any such
filings under the Bankruptcy Code.
<PAGE> F-9
CITICASTERS INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS - CONTINUED
Acceptances for a prepackaged plan of reorganization were
solicited in October and early November 1993. The plan of
reorganization described below was overwhelmingly approved by
the creditors and shareholders. The Predecessor filed its
bankruptcy petition with the Bankruptcy Court on November 5,
1993. The plan was confirmed on December 7, 1993 and became
effective on December 28, 1993. Under the terms of the plan the
following occurred:
* Predecessor effected a reverse stock split; issuing
2.25 shares of a new class of common stock for each 300
shares of common stock outstanding prior to the
reorganization.
* Debt with a carrying value of $634.8 million was
exchanged for 23,256,913 shares of common stock and
$426.6 million in debt.
* Preferred stock of a subsidiary was exchanged for
1,515,499 shares of common stock.
* American Financial fulfilled a commitment to contribute
$7.5 million in cash for which it received
approximately $6.3 million principal amount of 14%
Notes and 213,383 shares of common stock.
The net expense incurred as a result of the chapter 11 filings
and subsequent reorganization has been segregated from ordinary
operations in the Statement of Operations. Reorganization items
for 1993 include the following (in thousands):
Financing costs $25,967
Adjustments to fair value (15,961)
Professional fees and other expenses
related to bankruptcy 4,914
Interest income (48)
$14,872
Financing costs consist of the unamortized portion of original
issue discount and deferred financing costs relating to debt
subject to exchange as of the date the petition for bankruptcy
was filed (November 5, 1993). Adjustments to fair value reflect
the net change to state assets and liabilities at estimated fair
value as of December 31, 1993. Interest income is attributable
to the accumulation of cash and short-term investments after
commencement of the chapter 11 cases.
Pursuant to the fresh-start reporting provisions of SOP 90-7,
the Predecessor's assets and liabilities were revalued and a new
reporting entity was created with no retained earnings or
accumulated deficit as of the effective date. The period from
the effective date to December 31, 1993 was considered
immaterial thus, December 31, 1993 was used as the effective
date for recording the fresh-start adjustments. Predecessor's
results of operations for the period from the effective date of
the restructuring to December 31, 1993 have been reflected in
the Statement of Operations for the year ended December 31,
1993.
The reorganization values of the assets and liabilities were
determined based upon several factors including: prices and
multiples of broadcast cash flow (operating income before
depreciation and amortization) paid in purchase and business
combination transactions, projected operating results of the
broadcast stations, market values of publicly traded broadcast
companies, economic and industry information and the reorganized
capital structure. The foregoing factors resulted in a range of
reorganization values between $75 and $200 million. Based upon
an analysis of all of this data, management determined that the
reorganization value of the company would be $138.6 million.
<PAGE> F-10
<TABLE>
CITICASTERS INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS - CONTINUED
<CAPTION>
The gain on debt discharge is summarized as follows (in thousands):
<S> <C>
Carrying value of debt securities subject to
exchange, including accrued interest $318,447
Carrying value of preferred stock of subsidiary,
including accrued dividends 309,608
Aggregate principal amount of 14% Senior
Extendable Notes issued in exchanges,
including accrued interest since June 30, 1993 (71,236)
Aggregate value of common stock
issued in exchanges (134,762)
Expenses attributable to consummation of the
reorganization (7,573)
Total gain on debt discharge (See Note J) $414,484
</TABLE>
C. ACQUISITIONS AND DISPOSITIONS During June 1995, Citicasters
acquired its second FM station in Portland (KKCW) for $30
million. During August 1995, Citicasters acquired a second FM
radio station in Tampa (WTBT) for $5.5 million. The purchase
price for WTBT-FM could increase to $8 million depending on the
satisfaction of certain conditions. Citicasters began operating
WTBT-FM during March 1995. In December 1995, the Company began
operating WHOK-FM, WLLD-FM and WLOH-AM in Columbus under a local
marketing agreement and acquired the stations in January 1996
for $24 million.
During 1994, Citicasters sold one AM and three FM radio stations
and acquired or commenced the operation of two FM radio
stations. The following table sets forth certain information
regarding these radio station transactions:
<TABLE>
<CAPTION>
Date Operations Date of Acquisition Price/
Commenced/Ceased Closing Sales Price
<S> <C> <C> <C>
Acquisitions:
Sacramento (KRXQ-FM) January 1, 1994 May 27, 1994 $16 million
Cincinnati (WWNK-FM) April 25, 1994 April 21, 1995 $15 million
Dispositions:
Detroit (WRIF-FM) January 23, 1994 September 23, 1994 $11.5 million
Milwaukee (WLZR-FM&AM) April 14, 1994 April 14, 1994 $7 million
Denver (KBPI-FM) April 19, 1994 August 5, 1994 $8 million
</TABLE>
In the aggregate, the purchases and sales of radio stations
completed in 1994 and 1995 did not have a material effect on
Citicasters' results. No gain or loss was recognized on the
radio stations sold during 1994, because those stations were
valued at their respective sales price under the fresh-start
reporting provision of SOP 90-7.
During September and October 1994, Citicasters sold four of its
network affiliated television stations to entities affiliated
with New World Communications Group Incorporated ("New World").
The stations sold included KSAZ in Phoenix, WDAF in Kansas City,
WBRC in Birmingham and WGHP in Greensboro/Highpoint.
Citicasters received $355.5 million in cash and a warrant to
purchase, for five years, 5,000,000 shares of New World Common
Stock at $15 per share. The warrant was valued at $10 million
and is included in the balance sheet caption "Deferred charges
and other assets." Citicasters recorded a pretax gain of $95.3
million ($50.1 million after tax) on these sales. Proceeds from
the sales were used to retire long-term debt and to repurchase
shares of the Company's Common Stock. During 1995, the terms of
the warrant were amended to modify the registration rights
relating to the underlying shares. In consideration for such
modification, the exercise price was increased from $15 to $16
per share.
<PAGE> F-11
CITICASTERS INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS - CONTINUED
The following unaudited proforma financial information is based
on the historical financial statements of Citicasters, adjusted
to reflect the television station sales, retirement of long-term
debt, the effects of the December 1993 reorganization and the
February 1994 refinancing of subordinated debt (in thousands
except per share data).
<TABLE>
<CAPTION>
Year ended December 31,
1994 1993
<S> <C> <C>
Net revenues $128,375 $119,597
Operating income $ 30,624 $ 20,142
Net earnings $ 11,582 $ 4,244
Net earnings per share $ .47 $ .16
</TABLE>
D. PROPERTY AND EQUIPMENT Property and equipment at December 31,
consisted of the following (in thousands):
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Land and land improvements $ 5,883 $ 5,305
Buildings and improvements 15,458 10,710
Operating and other equipment 22,771 13,873
44,112 29,888
Accumulated depreciation (10,234) (4,805)
$ 33,878 $ 25,083
</TABLE>
Pursuant to the fresh-start reporting principles of SOP 90-7,
the carrying value of property and equipment was adjusted to
estimated fair value as of the effective date of the
reorganization, which included the restarting of accumulated
depreciation. Depreciation expense relating to property and
equipment was $5.4 million in 1995; $8.7 million in 1994; and
$11.6 million in 1993.
E. CONTRACTS, BROADCASTING LICENSES AND OTHER INTANGIBLES
Contracts, broadcasting licenses and other intangibles at
December 31, consisted of the following (in thousands):
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Licenses, network affiliation agreements
and other market related intangibles $322,749 $275,629
Reorganization value in excess of amounts
allocable to identifiable assets 7,998 7,998
330,747 283,627
Accumulated amortization (17,956) (8,932)
$312,791 $274,695
</TABLE>
<PAGE> F-12
CITICASTERS INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS - CONTINUED
Citicasters' carrying value of its broadcasting assets was
adjusted to estimated fair value as of the effective date of the
reorganization pursuant to the reporting principles of SOP 90-7.
This adjustment included, among other things, the restarting of
accumulated amortization related to intangibles.
Amortization expense relating to contracts, broadcasting
licenses and other intangibles was $9.3 million in 1995; $14.2
million in 1994; and $16.5 million in 1993.
F. LONG-TERM DEBT Long-term debt at December 31, consisted of the
following (in thousands):
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Citicasters:
9-3/4% Senior Subordinated Notes
due February 2004, less unamortized
discount of $2,519 and $2,709
(imputed interest rate 10.13%) $122,481 $122,291
Subsidiaries:
Bank credit facility 10,000 -
Total long-term debt $132,481 $122,291
</TABLE>
At December 31, 1995, the only sinking fund or other scheduled
principal payments due during the next five years is $10
million, due in 1998.
Cash interest payments were $12.9 million in 1995; $27.1 million
in 1994; and $45.1 million in 1993.
In February 1994, Citicasters refinanced its 14% Notes and the
13% Senior Subordinated Notes due 2001 through the issuance of
$200 million principal amount of 9-3/4% Senior Subordinated
Notes due 2004 ("9-3/4% Notes"). The 9-3/4% Notes were issued
at a discount; the net proceeds were $195.4 million. No gain or
loss was recognized on these transactions. A portion of the
proceeds from the sale of the four television stations ($305
million) was used to retire long-term debt including $75 million
principal amount of the 9-3/4% Notes.
In October 1994, Citicasters entered into a bank credit
agreement with a group of banks providing two revolving credit
facilities: a $125 million facility to fund future acquisitions
and a $25 million working capital facility. The acquisition
facility is available through December 31, 2001. The maximum
amount available under this facility will be reduced by $7.5
million per quarter beginning in the first quarter of 1998. The
working capital facility is available through December 31, 1997.
Citicasters is required to use excess cash flow to reduce
amounts outstanding under the facilities if leverage ratios
exceed certain levels.
The interest rate under the facilities varies depending on
Citicasters' leverage ratio. In the case of the base rate
option, the rate ranges from the base rate to the base rate plus
.75%. In the case of the eurodollar rate option, the rate
ranges from 1% to 2% over the eurodollar rate. The bank credit
facilities are secured by substantially all the assets of
Citicasters. As of March 1, 1996, Citicasters had $26 million
outstanding under the acquisition facility.
<PAGE> F-13
CITICASTERS INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS - CONTINUED
Citicasters' 9-3/4% Notes require a prepayment of the 9-3/4%
Notes in the event of certain changes in the control of
Citicasters and further require the proceeds from certain asset
sales to be used to partially redeem 9-3/4% Notes.
At December 31, 1995 the market of the 9-3/4% Notes exceeded
carrying value by approximately $1.5 million.
G. SHAREHOLDERS' EQUITY Citicasters is authorized to issue 500
million shares of Class A Common Stock, $.01 par value, 125
million shares of Class B Common Stock, $.01 par value and 9.5
million shares of Serial Preferred Stock, $.01 par value. The
preferred stock may have such preferences and other rights and
limitations as the Board of Directors may designate with respect
to each series.
During 1995 and 1994, Citicasters acquired 254,760 and 2,354,475
shares of its common stock from several unaffiliated
institutions for $5.2 million and $51.1 million, respectively.
Under the most restrictive provision of Citicasters' debt
covenants, Citicasters may acquire an additional $8.7 million of
its common stock.
During 1995, Citicasters' Board of Directors twice declared
three-for-two stock splits of its outstanding common stock. All
share and per share data have been restated to reflect both
stock splits.
The Company's debt instruments contain certain covenants which
limit the amount of dividends which Citicasters is able to pay
on its common stock. Under the most restrictive provision of
Citicasters' debt covenants, dividends are limited to a maximum
of $2.5 million annually. Citicasters paid a dividend of $.03
per common share in 1995. Under the merger agreement with Jacor
(see Note M), Citicasters will not be permitted to pay dividends
without the prior consent of Jacor.
Changes in the number of shares of common stock are shown in the
following table:
<TABLE>
<S> <C>
Predecessor:
Outstanding at January 1, 1993 56,729,434
Effect of reverse stock split
in restructuring (56,303,963)
Issued in restructuring for
exchanges of securities 24,772,412
Issued for cash 213,383
Citicasters:
Stock bonuses awarded to employees 52,425
Outstanding at December 31, 1993 25,463,691
Stock bonuses awarded to employees 37,125
Stock repurchased and retired (5,297,569)
Outstanding at December 31, 1994 20,203,247
Exercise of stock option 29,812
Stock repurchased and retired (256,132)
Outstanding at December 31, 1995 19,976,927
</TABLE>
<PAGE> F-14
CITICASTERS INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS - CONTINUED
Following the consummation of the reorganization, the Board of
Directors established the 1993 Stock Option Plan. The Plan
provides for granting both non-qualified and incentive stock
options to key employees. There are 1,800,000 common shares
reserved for issuance under the 1993 Plan. During 1994, the
Board of Directors established the 1994 Directors Stock Option
Plan. The Plan provides for the granting of options to
non-employee directors of Citicasters. There are 450,000 common
shares reserved for issuance under the 1994 Plan. Options under
both plans become exercisable at the rate of 20% per year
commencing one year after grant and expire at the earlier of 10
years from the date of grant, three months after termination of
employment or retirement as a director, or one year after the
death or disability of the holder.
Stock option data for Citicasters' stock option plans are as
follows:
<TABLE>
<CAPTION>
1995 1994
Option Price Option Price
Shares Per Share Shares Per Share
<S> <C> <C> <C> <C>
Outstanding, beginning
of period 1,614,375 $6.67-$10.33 1,307,250 $6.67
Granted 57,500 $18.00-$25.50 498,375 $9.77-$10.33
Exercised (29,812) $6.67 - -
Terminated - - (191,250) $6.67
Outstanding, December 31 1,642,063 $6.67-$25.50 1,614,375 $6.67-$10.33
Exercisable, December 31 516,263 $6.67-$10.33 223,200 $6.67
Available for grant
December 31 607,937 635,625
</TABLE>
H. INCOME TAXES Deferred income taxes reflect the impact of
temporary differences between the carrying amounts of assets and
liabilities recognized for financial reporting purposes and the
amounts recognized for income tax purposes. Significant
components of Citicasters' deferred tax assets and liability as
of December 31, are as follows (in thousands):
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Deferred tax assets:
Accrued expenses and other $ 8,409 $ 8,190
Deferred tax liability:
Book over tax basis of depreciable
assets 53,231 52,676
Net deferred tax liability $44,822 $44,486
</TABLE>
<PAGE> F-15
CITICASTERS INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS - CONTINUED
The following is a reconciliation of Federal income taxes at the
"statutory" rate of 35% in 1995, 1994, and 1993 and as shown in
the Statement of Operations (in thousands):
<TABLE>
<CAPTION>
Predecessor
1995 1994 1993
<S> <C> <C> <C>
Earnings (loss) from continuing
operations before income taxes $23,317 $116,606 ($ 66,796)
Extraordinary items - - 408,140
Adjusted earnings before
income taxes $23,317 $116,606 $341,344
Income taxes at the statutory rate $ 8,161 $ 40,812 $119,470
Effect of:
Book basis over tax basis of
stations sold - 8,472 -
Goodwill 74 599 (630)
Minority interest - - 9,372
Certain reorganization items - - (127,606)
State taxes net of Federal
income tax benefit 650 3,575 -
Other 115 42 (606)
Income taxes as shown in the
Statement of Operations $ 9,000 $ 53,500 $ -
Income tax provision as applied to continuing operations consists of (in thousands):
Predecessor
1995 1994 1993
Current taxes $ 7,300 $42,800 $ -
Deferred taxes 700 5,200 -
State taxes 1,000 5,500 -
$ 9,000 $53,500 $ -
</TABLE>
Federal income taxes of $8.4 million and $7 million were paid in
cash during 1995 and 1994, respectively.
I. DISCONTINUED OPERATIONS During 1994, Citicasters received an
additional $5 million related to the 1991 sale of its
entertainment businesses. The after-tax proceeds were credited
to reorganization intangibles. A final distribution is
scheduled to occur in December 1996. It is not possible to
quantify the amount of the distribution Citicasters will receive
at that time.
J. EXTRAORDINARY ITEMS Predecessor's extraordinary items in 1993
consisted of a loss of $6.3 million from the retirement of debt
prior to the reorganization and a gain of $414.5 million on debt
discharge in the reorganization.
<PAGE> F-16
CITICASTERS INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS - CONTINUED
K. PENDING LEGAL PROCEEDINGS Management, after review and
consultation with counsel, considers that any liability from
litigation pending against Citicasters and any of its
subsidiaries would not materially affect the consolidated
financial position or results of operations of Citicasters and
its subsidiaries.
L. ADDITIONAL INFORMATION Quarterly Operating Results (Unaudited) -
The following are quarterly results of consolidated operations
for 1995 and 1994 (in thousands except per share data).
<TABLE>
<CAPTION>
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
<S> <C> <C> <C> <C> <C>
1995
Net revenues $29,045 $36,886 $34,126 $36,357 $136,414
Operating income 4,724 11,588 8,910 11,325 36,547
Net earnings 1,278 5,242 3,282 4,515 14,317
* Net earnings
per share $.06 $.25 $.15 $.21 $.68
1994
Net revenues $48,449 $60,423 $50,908 $37,263 $197,043
Operating income 7,193 18,321 13,386 12,683 51,583
Net earnings (loss) (1,752) 5,161 44,851 14,846 63,106
Net earnings (loss)
per share ($.07) $.20 $1.75 $.67 $2.55
</TABLE>
* The sum of the quarterly earnings per share does not
equal the earnings per share computed on a year-to-date
basis due to rounding.
Citicasters' financial results are seasonal. Revenues are
higher in the second and fourth quarter and lower in the first
and third quarter; the first quarter is the lowest of the year.
During the third and fourth quarters of 1994, Citicasters
recorded net earnings of $41.7 million and $8.4 million
respectively, attributable to the sale of the four television
stations.
Included in selling, general and administrative expenses in
1995, 1994 and 1993 are charges of $5.8 million, $7.2 million
and $6.6 million, respectively, for advertising and charges of
$1.3 million, $2.2 million and $2.4 million, respectively, for
repairs and maintenance.
M. SUBSEQUENT EVENT On February 12, 1996, Citicasters and Jacor
Communications, Inc. entered into a merger agreement by which
Jacor will acquire Citicasters. Under the agreement, for each
share of Citicasters stock, Jacor will pay cash of $29.50 plus
a five-year warrant to purchase approximately .2 shares
of Jacor common stock at $28 per share. If the closing
occurs after September 1996 the exercise price of the warrant
would be reduced to $26 per share and the per share cash price
would increase at the rate of $.2215 per month. American
Financial and certain of its affiliates have agreed to execute
irrevocable consents in favor of the Jacor transaction on March
13, 1996. The closing of the transaction is conditioned on,
among other things, receipt of FCC and other regulatory
approvals. Upon consummation of the merger, holders of the
9-3/4% Notes have the right to put their notes to the Company at
101% of principal.
<PAGE> S-1
PART IV
ITEM 14
Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) Documents filed as part of this Report:
1. Financial Statements are included in Part II, Item 8.
2. Financial Statement Schedules:
A. Selected Quarterly Financial Data is included in Note L
to the Financial Statements.
B. Schedules filed herewith:
Page
For 1995, 1994 and 1993:
I - Condensed Financial Information of Registrant S-2
All other schedules for which provisions are made in
the applicable regulation of Securities and Exchange
Commission have been omitted as they are not
applicable, not required, or the information required
thereby is set forth in the Financial Statements or the
notes thereto.
3. Exhibits - see Exhibit Index.
(b) Reports on Form 8-K filed during the fourth quarter of 1995:
None
<PAGE> S-2
<TABLE>
CITICASTERS INC.
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
(In Thousands)
CONDENSED BALANCE SHEET
<CAPTION>
December 31,
1995 1994
<S> <C> <C>
ASSETS:
Cash $ 82 $ 210
Investment in subsidiaries 305,375 277,969
Deferred income tax assets 3,266 3,266
$308,723 $281,445
LIABILITIES AND CAPITAL:
Accounts payable and accrued expenses $ 26,550 $ 8,217
Long-term debt 122,481 122,291
Capital 159,692 150,937
$308,723 $281,445
</TABLE>
<PAGE> S-3
<TABLE>
CITICASTERS INC.
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
(In Thousands)
CONDENSED STATEMENT OF OPERATIONS
<CAPTION>
Year ended December 31,
Predecessor
1995 1994 1993
<S> <C> <C> <C>
INCOME:
Equity in undistributed earnings of
subsidiaries $27,405 $81,698 $145,939
Other income 31 - 17
27,436 81,698 145,956
COSTS AND EXPENSES:
Interest expense 12,545 17,351 9,348
Loss on bad debts - advances to subsidiary - - 213,054
Other expenses 574 1,241 1,303
13,119 18,592 223,705
Earnings (loss)before reorganization items 14,317 63,106 (77,749)
Reorganization items - - 10,953
Earnings (loss) before extraordinary items 14,317 63,106 (66,796)
Extraordinary items, net of income taxes - - 408,140
NET EARNINGS $14,317 $63,106 $341,344
</TABLE>
<PAGE> S-4
<TABLE>
CITICASTERS INC.
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
(In Thousands)
CONDENSED STATEMENT OF CASH FLOWS
<CAPTION>
Year ended December 31,
Predecessor
1995 1994 1993
<S> <C> <C> <C>
OPERATING ACTIVITIES:
Net earnings $14,317 $ 63,106 $341,344
Adjustments:
Non-cash minority interest expense - - 26,776
Equity in undistributed net earnings
of subsidiaries (27,406) (81,698) (158,298)
Loss on bad debts - advances to subsidiaries - - 213,055
Other non-cash adjustments 190 197 168
Extraordinary gain on retirements
and refinancing of long-term debt - - (408,140)
Increase (decrease) in accounts payable and
accrued expenses 18,333 161 (19,404)
Dividend from subsidiary - 134,443 -
Other - - 63
5,434 116,209 (4,436)
INVESTING ACTIVITIES:
Investment in subsidiary - (113,237) -
Cash advanced from subsidiaries - - 1,447
- (113,237) 1,447
FINANCING ACTIVITIES:
Retirements and refinancings of long-term debt - (150,824) -
Additional long-term borrowings - 195,350 6,339
Proceeds from the issuance of common stock - - 1,161
Common shares repurchased (5,168) (51,054) -
Cash dividend paid on common stock (667) - -
Financing costs - - (1,106)
Other 273 297 -
(5,562) (6,231) 6,394
NET INCREASE (DECREASE) IN CASH AND
SHORT-TERM INVESTMENTS (128) (3,259) 3,405
Cash at beginning of period 210 3,469 64
Cash at end of period $ 82 $ 210 $ 3,469
</TABLE>
<PAGE> S-5
<TABLE>
CITICASTERS INC. AND SUBSIDIARIES
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
(In Thousands)
SUPPLEMENTARY SCHEDULE TO THE CONDENSED STATEMENT OF CASH FLOWS
<CAPTION>
Year ended
December 31, 1993
Predecessor
<S> <C>
EFFECTS OF REORGANIZATION ACTIVITIES:
Cash Items:
Operating activities:
Professional fees and other expenses
related to bankruptcy proceedings ($ 3,743)
Financing activities:
Common stock issued for cash $ 1,161
Long-term debt issued for cash 6,339
$ 7,500
Non Cash Items:
Decrease in long-term debt through the
issuance of common stock ($221,541)
Increase in long-term debt (primarily
reduction in original issue discount) 370
Elimination of minority interest through
the issuance of common stock (274,932)
Common stock issued in reorganization 134,762
Decrease in accrued liabilities subject to
exchange (51,712)
Net adjustment of accounts to fair value (15,961)
Increase in accrued liabilities
(professional fees and other expenses
related to bankruptcy proceedings) 1,438
($427,576)
</TABLE>
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 of the Securities
Exchange Act of 1934, Citicasters Inc. has duly caused this Report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Citicasters Inc.
By: JOHN P. ZANOTTI
Chief Executive Officer
Signed: March 12, 1996
_____________________
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the Registrant and in the capacities and on the dates
indicated:
Signature Capacity Date
JOHN P. ZANOTTI
John P. Zanotti Director March 12, 1996
THEODORE H. EMMERICH
Theodore H. Emmerich Director March 12, 1996
S. CRAIG LINDNER
S. Craig Lindner Director March 12, 1996
CARL H. LINDNER
Carl H. Lindner Director March 12, 1996
JAMES E. EVANS
James E. Evans Director March 12, 1996
JULIUS S. ANREDER
Julius S. Anreder Director March 12, 1996
GREGORY C. THOMAS
Gregory C. Thomas Executive Vice President and
Chief Financial Officer
(Principal Accounting Officer) March 12, 1996
<PAGE> E-1
CITICASTERS INC.
INDEX TO EXHIBITS
Number Exhibit Description
2.1 Joint Prepackaged Plan of Reorganization of Predecessor and
certain subsidiaries under chapter 11 of the Bankruptcy Code,
filed as Exhibit 2.1 to Citicasters Inc.'s Form 10-Q for the
quarterly period ended September 30, 1993. *
3.1 Restated Articles of Incorporation of Citicasters, filed as
Exhibit 3.1 to Citicasters Inc.'s, Form 10-K for 1993. *
3.2 Restated Bylaws of Citicasters, filed as Exhibit 3.2 to
Citicasters Inc.'s, Form 10-K for 1993. *
4.1 Loan Agreement dated as of October 5, 1994, as modified from
time to time, between Citicasters Co., Citicasters Inc. and
certain banks, filed as Exhibit 4.1 to Citicasters Inc.'s, Form
10-Q for the quarterly period ended September 30, 1994. *
4.2 Indenture dated as of February 18, 1994, between Citicasters and
Shawmut Bank, N.A., as Trustee relating to the 9-3/4% Senior
Subordinated Notes due 2004 (the form of which 9-3/4% Senior
Subordinated Notes due 2004 is included therein), filed as
exhibit 4.2 to Citicasters Inc.'s 8-K dated February 18, 1994.*
10.1 Citicasters 1993 Stock Option Plan, filed as Exhibit 10.1 to
Citicasters Inc.'s, Form 10-K for 1993. *
10.2 1994 Directors Stock Option Plan, filed as Exhibit 10.2 to
Citicasters Inc.'s, Form 10-K for 1994. *
10.3 Comprehensive Settlement Agreement dated as of December 1, 1993,
by and among Predecessor, AFC, Carl H. Lindner and other parties
named therein, as incorporated by reference to Exhibit 10.23 to
Amendment No. 2 to Citicasters Inc.'s, Form S-4 Registration
Statement No. 33-63036 dated September 27, 1993. *
11 Computation of earnings per common share
21 Subsidiaries of the Registrant
27 Financial Data Schedule
Registrant has no outstanding debt issues exceeding 10% of the assets of
Registrant and consolidated subsidiaries other than those listed above.
* Incorporated herein by reference
<PAGE> E-2
<TABLE>
CITICASTERS INC. AND SUBSIDIARIES
EXHIBIT 11 - COMPUTATION OF EARNINGS PER COMMON SHARE
(In thousands except per share amounts)
<CAPTION>
Year ended Year ended
December 31, December 31,
1995 1994
<S> <C> <C>
Net earnings used to calculate primary and fully-
diluted earnings per share $14,317 $63,106
Shares used in calculation of primary earnings
per share:
Weighted average common shares 20,102 24,536
Dilutive effect of assumed exercise of certain
options for the purchase of common shares 915 241
Weighted average common shares used to calculate
primary earnings per share 21,017 24,777
Primary earnings per common share $.68 $2.55
Shares used in calculation of fully-diluted
earnings per share:
Weighted average common shares 20,102 24,536
Dilutive effect of assumed exercise of
certain options for the purchase
of common shares 1,076 488
Weighted average common shares used to calculate
fully-diluted earnings per share 21,178 25,024
Fully-diluted earnings per common share $.68 $2.52
</TABLE>
As a result of the effects of the reorganization, earnings per share for
periods ending on or prior to December 31, 1993 have been rendered
meaningless and, therefore omitted from the financial statements.
<PAGE> E-3
CITICASTERS INC.
EXHIBIT 21
SUBSIDIARIES OF THE REGISTRANT
The following is a list of subsidiaries of Citicasters Inc. at
December 31, 1995. All corporations listed are 100% owned subsidiaries
of Citicasters Inc.
State of
Name of Company Incorporation
Citicasters Co. Ohio
The names of certain subsidiaries are omitted, as such subsidiaries
in the aggregate would not constitute a significant subsidiary.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 3,572
<SECURITIES> 0
<RECEIVABLES> 34,138
<ALLOWANCES> 1,643
<INVENTORY> 0
<CURRENT-ASSETS> 44,288
<PP&E> 44,112
<DEPRECIATION> 10,234
<TOTAL-ASSETS> 416,346
<CURRENT-LIABILITIES> 22,359
<BONDS> 132,481
0
0
<COMMON> 82,936
<OTHER-SE> 76,756
<TOTAL-LIABILITY-AND-EQUITY> 416,346
<SALES> 0
<TOTAL-REVENUES> 136,414
<CGS> 0
<TOTAL-COSTS> 85,232
<OTHER-EXPENSES> 14,635
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 13,854
<INCOME-PRETAX> 23,317
<INCOME-TAX> 9,000
<INCOME-CONTINUING> 14,317
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 14,317
<EPS-PRIMARY> .68
<EPS-DILUTED> .68
</TABLE>
