FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File No. 0-12404
JACOR COMMUNICATIONS, INC.
An Ohio Corporation Employer Identification
No. 31-0978313
1300 PNC Center
201 East Fifth Street
Cincinnati, Ohio 45202
Telephone (513) 621-1300
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding twelve
months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such
filing requirements for the past ninety days.
Yes___X____ No_________
At May 10, 1996, 18,240,022 shares of common stock were
outstanding.<PAGE>
JACOR COMMUNICATIONS, INC.
INDEX
Page
Number
PART I. Financial Information
Item 1. - Financial Statements
Condensed Consolidated Balance Sheets
as of March 31, 1996 and December 31,
1995 3
Condensed Consolidated Statements of
Operations for the three months ended
March 31, 1996 and 1995 4
Condensed Consolidated Statements of
Cash Flows for the three months ended
March 31, 1996 and 1995 5
Notes to Condensed Consolidated Financial
Statements 6
Item 2. - Management's Discussion and Analysis
of Financial Condition and Results of
Operations 11
PART II. Other Information
Item 6. - Exhibits and Reports on Form 8-K 18
Signatures 20
<PAGE>
<TABLE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
______________
<CAPTION>
March 31, December 31,
1996 1995
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 5,889,086 $ 7,436,779 Accounts receivable, less allowance for
doubtful accounts of $1,792,000 in 1996
and $1,606,000 in 1995 25,301,411 25,262,410
Other current assets 8,459,513 3,916,140
Total current assets 39,650,010 36,615,329
Property and equipment, net 39,214,100 30,801,225
Intangible assets, net 165,282,175 127,157,762
Other assets 109,101,988 14,264,775
Total assets $353,248,273 $208,839,091
LIABILITIES
Current liabilities:
Accounts payable $ 2,670,017 $ 2,312,691
Accrued payroll 1,623,631 3,177,945
Accrued federal, state and
local income tax 3,756,596 3,225,585
Other current liabilities 6,550,488 3,463,344
Total current liabilities 14,600,732 12,179,565
Long-term debt 183,500,000 45,500,000
Other liabilities 6,115,602 3,468,995
Deferred tax liability 8,657,456 8,617,456
Total liabilities 212,873,790 69,766,016
SHAREHOLDERS' EQUITY
Common stock, no par value, $.10 per share
stated value 1,823,723 1,815,721
Additional paid-in capital 117,101,914 116,614,230
Common stock warrants 387,998 388,055
Retained earnings 21,060,848 20,255,069
Total shareholders' equity 140,374,483 139,073,075
Total liabilities and
shareholders' equity $353,248,273 $208,839,091
The accompanying notes are an integral part
of the condensed consolidated financial statements.<PAGE>
</TABLE>
<TABLE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the three months ended March 31, 1996 and 1995
(UNAUDITED)
____________
<CAPTION>
1996 1995
<S> <C> <C>
Broadcast revenue $ 33,572,314 $ 26,840,493
Less agency commissions 3,498,278 2,824,310
Net revenue 30,074,036 24,016,183
Broadcast operating expenses 23,870,578 19,959,660
Depreciation and amortization 2,619,466 2,111,971
Corporate general and
administrative expenses 1,138,560 884,026
Operating income 2,445,432 1,060,526
Interest expense (2,111,496) (104,822)
Gain on sale of radio stations 2,539,407
Other income, net 227,212 309,610
Income before income taxes
and extraordinary loss 3,100,555 1,265,314
Income tax expense (1,259,000) (514,000)
Income before extraordinary loss 1,841,555 751,314
Extraordinary loss, net of income
tax credit (950,775) <PAGE>
Net income $ 890,780 $ 751,314
Net income per common share:
Before extraordinary loss $ 0.09 $ 0.04
Extraordinary loss (0.05)
Net income per common share $ 0.04 $ 0.04 $
Number of common shares used in per
share computations 20,502,752 21,347,440
The accompanying notes are an integral part
of the condensed consolidated financial statements.<PAGE>
</TABLE>
<TABLE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
for the three months ended March 31, 1996 and 1995
(UNAUDITED)
___________
<CAPTION>
1996 1995
<S> <C> <C>
Cash flows from operating activities:
Net income $ 890,780 $ 751,314
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation 1,010,964 686,522
Amortization of intangibles 1,608,502 1,425,449
Extraordinary loss 950,775
Provision for losses on accounts
and notes receivable 354,583 277,892
Deferred income tax provision (benefit) 40,000 (50,000)
Gain on sale of radio stations (2,539,407)
Other (179,971) (198,570)
Change in current assets and current
liabilities net of effects of
acquisitions:
Accounts receivable 2,778,311 4,844,835
Other current assets (3,852,999) (767,393)
Accounts payable 336,645 (273,728) Accrued payroll, accrued interest
and other current liabilities 2,629,075 (371,551)
Net cash provided by operating activities 4,027,258 6,324,770
Cash flows from investing activities:
Capital expenditures (3,436,834) (707,183)
Cash paid for acquisitions (48,100,000)
Proceeds from sale of radio stations 6,453,626
Purchase of Noble warrant (52,775,170)
Loans made in conjunction with acquisitions (41,625,000)
Other (840,544) (33,029)
Net cash used by investing activities (140,323,922) (740,212 )
Cash flows from financing activities:
Proceeds from issuance of long-term debt 190,000,000
Proceeds from issuance of common stock 495,629 155,515
Reduction in long-term debt (52,000,000)
Payment of finance cost (3,696,658)
Payment of restructuring expenses (50,000) (50,000 )
Net cash provided by financing activities 134,748,971 105,515
Net increase (decrease) in cash and cash
equivalents (1,547,693) 5,690,073
Cash and cash equivalents at
beginning of period 7,436,779 26,974,838
Cash and cash equivalents at end of period $ 5,889,086 $32,664,911
The accompanying notes are an integral part
of the condensed consolidated financial statements.
</TABLE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
___________
1. FINANCIAL STATEMENTS
The December 31, 1995 consolidated balance sheet data
was derived from audited financial statements, but does
not include all disclosures required by generally accepted
accounting principles. The financial statements included
herein have been prepared by the Company, without audit,
pursuant to the rules and regulations of the Securities and
Exchange Commission. Although certain information and
footnote disclosures normally included in financial
statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted
pursuant to such rules and regulations, the Company believes
that the disclosures are adequate to make the information
presented not misleading and reflect all adjustments
(consisting only of normal recurring adjustments) which are
necessary for a fair presentation of results of operations
for such periods. Results for interim periods may not be
indicative of results for the full year. It is suggested
that these financial statements be read in conjunction with
the consolidated financial statements for the year ended
December 31, 1995 and the notes thereto.
2. ACQUISITIONS
Noble Broadcast Group, Inc.
In February 1996, the Company agreed to acquire Noble
Broadcast Group, Inc. ("Noble"), for approximately
$152,000,000 in cash plus related costs and expenses. The
Company entered into an agreement with the stockholders of
Noble to acquire all of the outstanding capital stock of
Noble for approximately $12,500,000. At the same time, the
Company also purchased a warrant for $52,775,170 entitling
the Company to acquire a 79.1% equity interest in Noble (the
``Noble Warrant''). Upon consummation of the purchase of
the outstanding Noble capital stock from the Noble
stockholders and the exercise of the Noble Warrant, the
Company will own 100% of the equity interests in Noble. The
completion of the Company's acquisition of Noble is subject
to various conditions including the receipt of consents from
regulatory authorities. The Company will finance this
acquisition from the proceeds of a new credit facility (see
Note 4).<PAGE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
___________
2. ACQUISITIONS, Continued
Noble owns ten radio stations. Noble's radio stations serve
Denver (two AM and two FM), St. Louis (one AM, two FM) and
Toledo (one AM, two FM). Pending the closing of the
Company's acquisition of Noble, the Company and Noble have
entered into local marketing agreements with respect to
Noble's radio stations in St. Louis and Toledo.
Also, in February 1996, a wholly owned subsidiary of the
Company purchased for approximately $47,000,000 certain
assets from Noble relating to Noble's San Diego operations.
As part of Noble's San Diego operations, Noble provided
programming to and sold the air time for two radio stations
serving San Diego (one AM, one FM), which programming and
air time is now provided and sold by the Company. In
addition, another wholly owned subsidiary of the Company
provided a credit facility to Noble in the amount of
$41,000,000.
Citicasters Inc.
In February 1996, the Company signed an agreement and plan
of merger to acquire Citicasters Inc. (``Citicasters'')
owner of 19 radio stations in eight U.S. markets as well as
two network affiliated television stations. Citicasters'
radio stations serve Atlanta, Cincinnati, Columbus, Kansas
City, Phoenix, Portland, Sacramento, and Tampa. The
television stations serve Cincinnati and Tampa. The
agreement is subject to various conditions including the
receipt of consents from regulatory authorities. In
conjunction with this agreement, the Company has delivered
to the seller a $75,000,000 non-refundable deposit in the
form of a letter of credit. The letter of credit requires
annual fees of 1.25% and can be drawn upon by Citicasters if
the merger agreement is terminated.<PAGE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
___________
2. ACQUISITIONS, Continued
The Company will pay $29.50 in cash per share, plus, in the
event that the closing does not occur prior to October 1,
1996, for each full calendar month ending prior to the
merger commencing with October 1996, an additional amount of
$.22125 per share in cash. In addition, for each share of
Citicasters common stock held, Citicasters shareholders will
receive one Jacor warrant to purchase a fractional share of
Jacor common stock (which fraction is anticipated to be
.2035247) at a price of $28.00 per full share of Jacor
common stock. If the merger is not consummated by October
1, 1996, the exercise price for the warrants to purchase
4,400,000 shares of Jacor stock will be reduced to $26.00
per share. The cash purchase price, which is approximately
$630,000,000, will increase by approximately $5,000,000 for
each full month subsequent to October, 1996 but prior to the
merger.
The above acquisitions will be accounted for as purchases.
The excess cost over the fair value of identifiable net
assets acquired will be amortized over 40 years. Assuming
each of these acquisitions had taken place at the
beginning of 1996 and 1995, respectively, unaudited pro
forma consolidated results of operations would have been
as follows:
Three Months Ended
March 31,
1996 1995
Net revenue $ 67,005 $ 64,591
Loss before extraordinary items (8,258) (7,022)
Net loss per share (0.28) (0.23)
3. OTHER ASSETS
The Company's other assets at March 31, 1996 and December
31, 1995 consist of the following:
March 31, December 31,
1996 1995
Noble Warrant $ 52,775,170
Loan to Noble 40,000,000
Other 16,326,818 $14,264,775
$109,101,988 $14,264,775
<PAGE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
___________
4. DEBT AGREEMENT
The Company's debt obligations at March 31, 1996 and
December 31, 1995 consist of the following:
March 31, December 31,
1996 1995
Indebtedness under the 1993
Credit Agreement $45,500,000
Indebtedness under the
Existing Credit Facility
(described below) $183,500,000 __________
$183,500,000 $45,500,000
On February 20, 1996 the Company entered into a new credit
facility. The Company's new senior debt consists of two
facilities (the " Facilities") provided under an agreement
(the "Existing Credit Facility") with ten banks: a
$190,000,000 reducing revolving credit facility (``Revolving
A Loans'') and a $110,000,000 reducing revolving credit
facility ("Revolving B Loans"). Both facilities mature on ''
December 31, 2003. The indebtedness of the Company under
the Facilities is collateralized by liens on substantially
all of the assets of the Company and its operating
subsidiaries and by a pledge of the operating subsidiaries'
stock, and is guaranteed by those subsidiaries.
The Revolving A Loans will be used primarily to refinance
existing debt and to complete the Noble acquisition. The
Revolving B Loans will be used to finance acquisitions,
stock repurchases and for working capital and other general
corporate purposes.
The commitment under the Revolving A Loans will be reduced
by $2,500,000 each quarter commencing January 1, 1997 and by
increasing quarterly amounts in each succeeding year. The
commitment under the Revolving B Loans will be reduced by
$5,000,000 for each quarter commencing January 1, 1998.
The Company is required to make mandatory prepayments of the
Facilities equal to (i) net proceeds from any debt
offerings, (ii) 50% of net proceeds from any equity
offerings to bring the Company's leverage ratio down to 5 to
1, (iii) 50% of excess cash flow, as defined, beginning in<PAGE>
1997, and (iv) net after tax proceeds received from asset
sales or other dispositions.<PAGE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
___________
4. DEBT AGREEMENT, Continued
Interest under the Facilities is payable, at the option of
the Company, at alternative rates equal to the Eurodollar
rate plus 1% to 2 3/4% or the base rate announced by Banque
Paribas plus up to 1 1/2%. The spreads over the Eurodollar
rate and such base rate vary from time to time, depending
upon the Company's financial leverage. The Company will pay
quarterly commitment fees of 3/8% to 1/2% per annum on the
unused portion of the commitment on both Facilities
depending on the Company's financial leverage. The Company
also is required to pay certain other fees to the agent and
the lenders for the administration of the Facilities.
The Existing Credit Facility contains a number of covenants
which, among other things, require the Company to maintain
specified financial ratios and impose certain limitations on
the Company with respect to (i) the incurrence of additional
indebtedness; (ii) investments and acquisitions, except
under specified conditions; (iii) the incurrence of
additional liens; (iv) the disposition of assets; (v) the
payment of cash dividends; (vi) capital expenditures; and
(vii) mergers, changes in business, and transactions with
affiliates.<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
During the three-months ended March 31, 1996, the Company entered
into agreements to acquire Citicasters Inc. (``Citicasters'') and
Noble Broadcast Group, Inc. (``Noble'').
On February 12, 1996, the Company, JCAC, Inc., a Florida
corporation and a wholly owned subsidiary of the Company, and
Citicasters, entered into an agreement and plan of merger
pursuant to which JCAC, Inc. will merge with and into
Citicasters, with Citicasters as the surviving corporation. As a
result of the merger, Citicasters will become a wholly owned
subsidiary of the Company.
The Company will pay $29.50 in cash per share, plus, in the event
that the closing does not occur prior to October 1, 1996, for
each full calendar month ending prior to the merger commencing
with October 1996, an additional amount of $.22125 in cash per
share. In addition, for each share of Citicasters common stock
held, Citicasters shareholders will receive one warrant to
purchase a fractional share of Company common stock (which
fraction is anticipated to be .2035247) at a price of $28.00 per
full share of common stock. If the merger is not consummated by
October 1, 1996, the exercise price for the warrants to purchase
4,400,000 shares of Company stock will be reduced to $26.00 per
share. The cash purchase price, which is approximately $630.0
million, will increase by approximately $5.0 million for each
full month subsequent to October, 1996 but prior to the merger.
The merger agreement may be terminated prior to the consummation
of the merger by either the Company or Citicasters under various
circumstances, including the failure to consummate the merger on
or before May 31, 1997. If the merger agreement is terminated
upon the occurrence of certain triggering events, including the
failure to consummate the merger by May 31, 1997, Citicasters may
draw upon an irrevocable direct pay letter of credit in the
amount of $75.0 million obtained by the Company and issued to an
escrow agent on behalf of Citicasters. Except in certain
circumstances, the right to terminate the merger agreement and
receive a maximum of $75.0 million pursuant to a draw on the
letter of credit is Citicasters' exclusive remedy upon the
occurrence of a triggering event.<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES, Continued
Citicasters' outstanding 9 3/4% Senior Subordinated Notes (the
``Notes'') will become obligations of the surviving corporation
in the merger. As a result of a change in control covenant in
the Notes, the holders of the Notes will have the option to cause
the Company to purchase the Notes at 101% of the principal amount
thereof. As part of the financing of the Citicasters
acquisition, the Company is negotiating a New Credit Facility
which will allow the Company to purchase the Notes, if necessary.
The aggregate value of the merger, when consummated, is estimated
to be approximately $799.4 million.
On February 21, 1996, the Company entered into an agreement with
the stockholders of Noble to acquire all of the capital stock of
Noble for approximately $12.5 million. At the same time, the
Company also purchased a warrant for approximately $52.8 million,
entitling it to acquire a 79.1% equity interest in Noble. Upon
consummation of the purchase of the outstanding Noble capital
stock from the Noble stockholders and the exercise of the
warrant, the Company will own 100% of the equity interests in
Noble. The Company also purchased for approximately $47.0
million certain assets relating to Noble's San Diego operations.
The San Diego operating assets included an exclusive sales
agency agreement under which Noble provided programming to and
sold the air time for two radio stations serving San Diego (XTRA-
AM and XTRA-FM). These two radio stations are licensed by, and
subject to the regulatory control of the Mexican government. As
part of the purchase of Noble's San Diego operating assets, the
Company was assigned all of Noble's rights under the exclusive
sales agency agreement, and the Company is now providing the
programming to and selling air time for such stations. In
addition, another wholly owned subsidiary of the Company provided
a credit facility to Noble in the amount of $41.0 million.
The aggregate value of the Noble acquisition, when fully
consummated, is estimated to be approximately $152.0 million, of
which approximately $139.5 million has already been paid. In
order to fund this acquisition, refinance the Company's
outstanding debt of $45.5 million (as of December 31, 1995), and
pay related costs and expenses of approximately $5.0 million, the
Company entered into a $300.0 million reducing revolving credit
facility (the ``Existing Credit Facility''). The Existing Credit
Facility reduces on a quarterly basis commencing March 31, 1997,
and bears interest at floating rates based on a Eurodollar rate
or a bank base rate.<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES, Continued
During the first quarter, the Company made capital expenditures
of approximately $3.4 million. The Company estimates that
capital expenditures for 1996 will be approximately $6.0 million
which includes approximately $2.5 million for the purchase during
the first quarter of the building currently housing the offices
and studios of its Tampa radio stations and to complete the
relocation of the offices and studios of its Atlanta radio
stations. The Company estimates that capital expenditures for
the properties to be acquired from Citicasters and Noble would be
approximately $4.0 million in the 12-month period following the
consummation of the acquisitions.
The actual level of spending will depend on a variety of factors,
including general economic conditions and the Company's business.
In connection with the merger, the Company anticipates entering
into a new senior credit agreement (the ``New Credit Facility'')
which would provide for availability of $600.0 million pursuant
to; a $200.0 million reducing revolving facility under which the
aggregate commitments would reduce on a semi-annual basis
commencing three years from the date of the closing; a $300.0
million amortizing term loan that would reduce on a semi-annual
basis commencing two years from the date of the closing, and; a
$100.0 million amortizing term loan that would reduce on a semi-
annual basis commencing three years from the date of the closing.
It is anticipated that the New Credit Facility would bear
interest at floating rates based on a Eurodollar rate or a bank
base rate. The Company also anticipates that the New Credit
Facility will provide the Company with additional credit for
future acquisitions as well as working capital and other general
corporate purposes.<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES, Continued
The cash to be paid in connection with the merger, the
refinancing of Citicasters' bank debt, a portion of the cash to
be paid in connection with the Noble acquisition and the
repayment of certain existing indebtedness incurred in connection
with such acquisition, together with the fees and expenses
incurred in connection therewith, will be financed through (i)
the anticipated net proceeds from a public offering of 11,250,000
shares of the Company common stock; (ii) the anticipated net
proceeds of approximately $100.0 million from an offering by the
Company of its Liquid Yield Option Notes due 2011; (iii) the
anticipated net proceeds of an offering by the Company of $100.0
million aggregate principal amount of its Senior Subordinated
Notes due 2006;(iv) the anticipated borrowings under the New
Credit Facility and (v) excess cash. These funds together with
cash generated from operations will be sufficient to meet the
Company's liquidity and capital needs for the foreseeable future.
The Company has filed with the Securities and Exchange Commission
registration statements with respect to the public offering of
its common stock, the Liquid Yield Option Notes, and the Senior
Subordinated Notes. The Company expects to complete these
offerings during the second quarter of 1996.
As a result of entering into the Existing Credit Facility in the
first quarter of 1996, Jacor expensed approximately $1.6 million
of unamortized cost associated with its 1993 credit agreement.
In connection with entering into the New Credit Facility, the
Company anticipates that it will write off during the second
quarter of 1996 approximately $3.4 million of unamortized cost
associated with its Existing Credit Facility.
The issuance of additional debt will negatively impact the
Company's debt-to-equity ratio and its results of operations and
cash flows due to higher amounts of interest expense, although
the issuance of additional equity will soften this impact to some
extent. Also, if the Company were not able to complete the
merger due to certain circumstances, the Company would incur a
one-time charge of $75.0 million relating to the non-refundable
deposit. If debt were used to finance such payment, it would
negatively impact the Company's future results of operations and
impede the Company's future growth by limiting the amount
available under the Existing Credit Facility.<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
In the following analysis, management discusses station operating
income excluding depreciation and amortization. Station
operating income excluding depreciation and amortization should
not be considered in isolation from, or as a substitute for,
operating income, net income or cash flow and other consolidated
income or cash flow statement data computed in accordance with
generally accepted accounting principles or as a measure of a
company's profitability or liquidity. Although this measure of
performance is not calculated in accordance with generally
accepted accounting principles, it is widely used in the
broadcasting industry as a measure of a company's operating
performance because it assists in comparing station performance
on a consistent basis across companies without regard to
depreciation and amortization, which can vary significantly
depending on accounting methods (particularly where acquisitions
are involved) or non-operating factors such as historical cost
bases. Station operating income excluding depreciation and
amortization also excludes the effect of corporate general and
administrative expenses, which generally do not relate directly
to station performance.
THE THREE MONTHS ENDED MARCH 31, 1996 COMPARED TO THE THREE
MONTHS ENDED MARCH 31, 1995
Broadcast revenue for the first quarter of 1996 was $33.6
million, an increase of $6.8 million or 25.1% from $26.8 million
during the first quarter of 1995. This increase resulted from
the revenue generated at those properties owned or operated
during the first quarter of 1996 but not during the comparable
1995 period and, to a lesser extent, an increase in advertising
rates.
Agency commissions for the first quarter of 1996 were $3.5
million, an increase of $0.7 million or 23.9% from $2.8 million
during the first quarter of 1995 due primarily to the increase in
broadcast revenue.
Broadcast operating expenses for the first quarter of 1996 were
$23.9 million, an increase of $3.9 million or 19.6% from $20.0
million during the first quarter of 1995. These expenses
increased primarily as a result of expenses incurred at those
properties owned or operated during the first quarter of 1996 but
not during the comparable 1995 period and, to a lesser extent,
increased selling and other payroll costs and programming costs.<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
THE THREE MONTHS ENDED MARCH 31, 1996 COMPARED TO THE THREE
MONTHS ENDED MARCH 31, 1995, Continued
Station operating income excluding depreciation and amortization
for the three months ended March 31, 1996 was $6.2 million, an
increase of $2.1 million or 52.9% from the $4.1 million for the
three months ended March 31, 1995.
Depreciation and amortization for the first quarter of 1996 and
1995 was $2.6 million and $2.1 million, respectively. The
increase from quarter-to-quarter resulted primarily from the
acquisitions made by the Company during the second half of 1995.
Operating income for the first quarter of 1996 was $2.4 million,
an increase of $1.3 million or 130.6% from $1.1 million during
the first quarter of 1995.
Interest expense for the first quarter of 1996 was $2.1 million,
an increase of $2.0 million from $0.1 million for the first
quarter of 1995. The increase in interest expense resulted from
the increase in the Company's outstanding long-term debt which is
primarily related to the Company's acquisition activity.
The gain on sale of radio stations in the first quarter of 1996
resulted from the Company's February sale of two FM radio
stations in Knoxville.
The extraordinary item in the first quarter of 1996 represented
the write-off of unamortized costs associated with the Company's
1993 credit agreement which was replaced in February 1996 by the
Company's Existing Credit Facility.
Net income for the first quarter of 1996 and 1995 was $0.9 and
$0.8 million, respectively.<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
CASH FLOWS
Cash flows provided by operating activities, inclusive of working
capital, were $4.0 million and $6.3 million for the three months
ended March 31, 1996 and 1995, respectively. Cash flows provided
by operating activities for the first quarter of 1996 resulted
primarily from the add-back of $2.6 million of depreciation and
amortization together with the add-back of $1.0 million for the
extraordinary loss net of ($2.5) million from the gain on sale of
radio stations to net income of $0.9 million for the period. The
additional $2.0 million resulted principally from the net change
in working capital of $1.9 million. Cash flows provided by
operating activities for the comparable 1995 period resulted
primarily from the add-back of $2.1 million of depreciation and
amortization together with the net change in working capital of
$3.4 million to net income of $0.8 million for the period.
Cash flows used by investing activities were ($140.3) million and
($0.7) million for the three months ended March 31, 1996 and
1995, respectively. Investing activities include capital
expenditures of $3.4 million and $0.7 million for the first
quarter of 1996 and 1995, respectively. Investing activities
during the first quarter of 1996 include expenditures of $48.1
million, $52.8 million, $41.6 million and $0.8 million,
respectively, for acquisitions, the purchase of the Noble
warrant, loans made to Noble and in connection with the Company's
JSAs and other. Additionally, investing activities for the 1996
period is net of $6.5 million of proceeds from the sale of radio
stations WMYU-FM and WWST-FM in Knoxville.
Cash flows provided by financing activities were $134.7 million
and $0.1 million for the three months ended March 31, 1996 and
1995, respectively. Cash flows provided by financing activities
during the first quarter of 1996 resulted primarily from the
$190.0 million in borrowings under the Existing Credit Facility,
together with $0.5 million in proceeds received from the issuance
of common stock upon the exercise of outstanding stock options
net of the $52.0 million of reduction in long-term debt and $3.7
million of paid finance costs. Cash flows from financing
activities during the comparable 1995 three-month period resulted
primarily from the proceeds received from the issuance of common
stock upon the exercise of outstanding stock options.<PAGE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
__________
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
Number Description Page
11 Statement re computation of consolidated
income (loss) per common share 21
27 Financial Data Schedule 22
99 Press Release dated April 24, 1996 23
(b) Reports on Form 8-K
1. Form 8-K dated February 14, 1996. This Form
8-K described an agreement reached by the
Company to acquire Noble Broadcast Group,
Inc. and that the Company had received
commitments for a new $300.0 million credit
facility to finance this purchase. This
Form 8-K also stated that David M. Schulte
resigned as a Director of the Company.
2. Form 8-K dated February 27, 1996. This Form
8-K described an agreement and plan of merger
between the Company, JCAC, Inc., a wholly
owned subsidiary of the Company and Citicasters
Inc., pursuant to which JCAC, Inc. will merge
with and into Citicasters Inc. with Citicasters
Inc. as the surviving corporation.<PAGE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION, Continued
3. Form 8-K dated March 6, 1996, as amended on March
27, 1996. This Form 8-K described the terms of
the Company's acquisition of Noble Broadcast
Group, Inc. and also incorporated by reference to
a March 22, 1996 Registration Statement on Form
S-3 filed by the Company, the historical and pro
forma financial information called for by Item 7
to Form 8-K.
4. Form 8-K dated March 27, 1996. This Form 8-K
described the completion of certain steps towards
the Company's acquisition of all of the
outstanding capital stock of Citicasters Inc.
This Form 8-K also incorporated by reference to a
March 22, 1996 Registration Statement on Form S-3
filed by the Company, the historical and pro forma
financial statements called for by Item 7 to Form
8-K.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, Registrant has duly caused this Report to be signed on its
behalf by the undersigned, thereunto duly authorized.
JACOR COMMUNICATIONS, INC.
(Registrant)
DATED: May 14, 1996 BY /s/ R. Christopher Weber
R. Christopher Weber,
Senior Vice President and
Chief Financial Officer<PAGE>
<TABLE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
EXHIBIT 11
Computation of Consolidated Income (Loss) Per Common Share
for the three months ended March 31, 1996 and 1995
<CAPTION>
1996 1995
<S> <C> <C>
Income for primary and fully
diluted computation:
Income applicable to
common shares before
extraordinary loss $ 1,841,555 $ 751,314
Extraordinary loss, net of
income tax credit (950,775)
Income applicable to
common shares $ 890,780 $ 751,314
Primary (1):
Weighted average common
shares and dilutive common
stock equivalents:
Common stock 18,183,381 19,597,789
Stock purchase warrants 1,124,373 749,223
Stock options 894,998 700,428
Contingently issuable
common shares 300,000 300,000<PAGE>
20,502,752 21,347,440
Primary income
per common share:
Before extraordinary loss $ 0.09 $ 0.04
Net income $ 0.04 $ 0.04
______________________
NOTES:
1. Fully diluted earnings per share is not presented since it
approximates primary income per share.<PAGE>
</TABLE>
EXHIBIT 99
JACOR REPORTS SIGNIFICANT IMPROVEMENTS IN OPERATIONS
CINCINNATI, April 24 - Jacor Communications, Inc. (NASDAQ-JCOR),
owner and operator of radio stations in eight U.S. markets, today
reported a 53-percent increase in broadcast cash flow during the
quarter ended March 31, 1996.
Jacor's first-quarter broadcast cash flow rose to $6.2 million in
1996 from $4.1 million in the same quarter of 1995. First-
quarter net revenues rose 25 percent to $30.1 million from $24.0
million in the 1995 period.
On a ``same station'' basis - reflecting results from stations
operated in the first quarter of both 1996 and 1995 - Jacor's
broadcast cash flow rose 39 percent to $5.8 million for the first
quarter of 1996 from $4.2 million in the same period last year.
The company reported net income of $0.9 million, or 4 cents per
share, during the first three months of 1996. Results for the
same period last year reflected net income of $0.8 million or 4
cents per share.
Jacor Communications, Inc., is headquartered in Cincinnati. The
company plans to pursue growth through continued acquisitions of
complementary stations in its existing markets, and radio groups
or individual stations with significant presence in attractive
markets.
CONTACT: Chris Weber
513/621-1300
OR
Kirk Brewer
312/466-4096<PAGE>
<TABLE>
JACOR COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the three months ended March 31, 1996 and 1995
(UNAUDITED)
____________
<CAPTION>
1996 1995
<S> <C> <C>
Broadcast revenue $ 33,572,314 $ 26,840,493
Less agency commissions 3,498,278 2,824,310
Net revenue 30,074,036 24,016,183
Broadcast operating expenses 23,870,578 19,959,660
Broadcast cash flow (1) 6,203,458 4,056,523
Depreciation and amortization 2,619,466 2,111,971
Corporate general and
administrative expenses 1,138,560 884,026
Operating income 2,445,432 1,060,526
Interest expense (2,111,496) (104,822)
Gain on sale of radio stations 2,539,407
Other income, net 227,646 309,610
Income before income taxes
and extraordinary loss 3,100,989 1,265,314
Income tax expense (1,259,434) (514,000)
Income before extraordinary loss 1,841,555 751,314<PAGE>
Extraordinary loss, net of income
tax credit (950,775)
Net income $ 890,780 $ 751,314
Net income per common share:
Before extraordinary loss $ 0.09 $ 0.04
Extraordinary loss (0.05)
Net income per common share $ 0.04 $ 0.04
Number of common shares used in per
share computations 20,502,752 21,347,440
(1) Operating income before depreciation and amortization and
corporate general and administrative expenses.<PAGE>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 5,889
<SECURITIES> 0
<RECEIVABLES> 27,093
<ALLOWANCES> 1,792
<INVENTORY> 0
<CURRENT-ASSETS> 39,650
<PP&E> 47,579
<DEPRECIATION> 8,365
<TOTAL-ASSETS> 353,248
<CURRENT-LIABILITIES> 14,601
<BONDS> 183,500
<COMMON> 1,824
0
0
<OTHER-SE> 138,550
<TOTAL-LIABILITY-AND-EQUITY> 353,248
<SALES> 0
<TOTAL-REVENUES> 33,572
<CGS> 0
<TOTAL-COSTS> 27,369
<OTHER-EXPENSES> 3,758
<LOSS-PROVISION> 355
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 3,101
<INCOME-TAX> 1,259
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> (951)
<CHANGES> 0
<NET-INCOME> 891
<EPS-PRIMARY> .04
<EPS-DILUTED> .04
</TABLE>
