FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 AND 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 2000 Commission file number 1-9645
CLEAR CHANNEL COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
Texas 74-1787539
(State of Incorporation) (I.R.S. Employer Identification No.)
200 East Basse Road
San Antonio, Texas 78209
(210) 822-2828
(Address and telephone number
of principal executive offices)
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 12 months (or for shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes __x__ No _____
Indicate the number of shares outstanding of each class of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at November 10, 2000
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Common Stock, $.10 par value 584,757,113
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
INDEX
Page No.
- - - -
Part I -- Financial Information
Item 1. Unaudited Financial Statements
Consolidated Balance Sheets at September 30, 2000 and
December 31, 1999 3
Consolidated Statements of Operations for the nine and
three months ended September 30, 2000 and 1999 5
Consolidated Statements of Cash Flows for the nine months
ended September 30, 2000 and 1999 6
Notes to Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 13
Item 3. Quantitative and Qualitative Disclosures About
Market Risk 18
Part II -- Other Information
Item 6. Exhibits and reports on Form 8-K 20
(a) Exhibits
(b) Reports on Form 8-K
Signatures 21
Index to Exhibits 22
<PAGE>
PART I
Item 1. UNAUDITED FINANCIAL STATEMENTS
<TABLE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
(In thousands of dollars)
September 30, December 31,
2000 1999
(Unaudited) (*)
Current Assets
<S> <C> <C>
Cash and cash equivalents $ 384,846 $ 76,724
Accounts receivable, less allowance of $74,776 at September 30,
2000 and $26,095 at December 31, 1999 1,612,608 724,900
Other current assets 330,708 123,485
Total Current Assets 2,328,162 925,109
Property, Plant and Equipment
Land, buildings and improvements 1,128,083 338,764
Structures and site leases 2,081,898 1,870,731
Transmitter and studio equipment 1,064,154 427,063
Furniture and other equipment 456,658 222,581
Construction in progress 182,171 89,901
4,912,964 2,949,040
Less accumulated depreciation (681,349) (470,916)
4,231,615 2,478,124
Intangible Assets
Contracts 987,935 817,227
Licenses and goodwill 40,163,099 11,809,882
Other intangible assets 160,781 80,102
41,311,815 12,707,211
Less accumulated amortization (1,273,524) (758,889)
40,038,291 11,948,322
Other Assets
Restricted cash 1,032,346 4,349
Notes receivable 124,509 53,675
Investments in, and advances to, nonconsolidated affiliates 452,219 380,918
Other assets 665,595 251,604
Other investments 1,877,351 779,411
Total Assets $ 50,750,088 $ 16,821,512
* From audited financial statements
See Notes to Consolidated Financial Statements
</TABLE>
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
(In thousands of dollars)
<TABLE>
September 30, December 31,
2000 1999
(Unaudited) (*)
Current Liabilities
<S> <C> <C>
Accounts payable $ 401,150 $ 196,222
Accrued interest 135,818 16,449
Accrued expenses 886,025 337,939
Accrued income taxes 743,671 29,769
Current portion of long-term debt 55,968 30,361
Other current liabilities 261,108 74,775
Total Current Liabilities 2,483,740 685,515
Long-term debt 10,104,315 4,093,543
Liquid Yield Option Notes 495,447 490,809
Deferred income taxes 6,809,775 1,289,783
Other long-term liabilities 212,365 149,032
Minority interest 55,701 28,793
Shareholders' Equity
Common stock 58,474 33,861
Additional paid-in capital 29,519,893 9,216,957
Common stock warrants 249,314 252,862
Retained earnings 736,892 296,132
Other comprehensive income 67,475 282,745
Other (42,276) 2,304
Cost of shares held in treasury (1,027) (824)
Total shareholders' equity 30,588,745 10,084,037
Total Liabilities and
Shareholders' Equity $ 50,750,088 $ 16,821,512
* From audited financial statements
See Notes to Consolidated Financial Statements
</TABLE>
<PAGE>
<TABLE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(In thousands of dollars, except per share data)
Nine Months Ended Three Months Ended
September 30, September 30,
2000 1999 2000 1999
<S> <C> <C> <C> <C>
Gross revenue $ 3,634,804 $ 2,005,591 $ 1,684,787 $ 887,854
Less: agency commissions 309,671 214,956 108,068 91,697
Net revenue 3,325,133 1,790,635 1,576,719 796,157
Operating expenses 2,144,974 1,097,171 1,062,284 495,800
Non-cash compensation expense 3,151 -- 3,151 --
Depreciation and amortization 820,800 473,654 372,059 208,627
Corporate expenses 91,862 44,585 39,417 16,254
Operating income 264,346 175,225 99,808 75,476
Interest expense - net 230,795 126,233 105,335 50,962
Gain on sale of stations 805,183 136,925 805,183 --
Other income (expense) - net (7,340) 9,175 (8,964) (2,221)
Income before income taxes and equity
in earnings of nonconsolidated affiliates 831,394 195,092 790,692 22,293
Income taxes 408,670 106,546 350,198 23,695
Income (loss) before equity in earnings
of nonconsolidated affiliates 422,724 88,546 440,494 (1,402)
Equity in earnings of nonconsolidated affiliates 18,036 6,742 8,433 2,925
Net income 440,760 95,288 448,927 1,523
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments (114,667) (8,275) (54,123) 44,671
Unrealized gains on securities:
Unrealized holding gain (loss) arising during period (64,077) (54,799) (137,193) (27,159)
Less: reclassification adjustment for unrealized gains
on SFX shares held prior to merger (36,526) -- (36,526) --
Less: reclassification adjustment for gains
included in net income -- (14,905) -- --
Comprehensive income $ 225,490 $ 17,309 $ 221,085 $ 19,035
Net income per common share:
Basic $ 1.19 $ .31 $ 1.04 $ .00
Diluted $ 1.13 $ .31 $ .96 $ .00
See Notes to Consolidated Financial Statements
</TABLE>
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands of dollars)
<TABLE>
Nine Months Ended
September 30, September 30,
2000 1999
Cash flows from operating activities:
<S> <C> <C>
Net income $ 440,760 $95,288
Reconciling Items:
Depreciation 242,139 169,123
Amortization of intangibles 578,661 304,531
Deferred taxes 194,236 64,665
Amortization of film rights 16,582 13,112
Amortization of deferred financing charges, bond
premiums and accretion of note discounts 11,541 644
Non-cash compensation expense 3,151 --
Payments on film liabilities (16,091) (12,527)
(Recognition) deferral of deferred income (100,049) 3,509
(Gain) loss on disposal of assets (805,655) (128,953)
Gain on sale of other investments -- (22,930)
Equity in earnings of nonconsolidated affiliates (13,303) (2,950)
Charitable donation of treasury shares -- 4,102
Increase (decrease) minority interest 6,902 1,503
Changes in operating assets and liabilities:
(Increase) decrease accounts receivable (70,886) (62,916)
(Decrease) increase accounts payable, accrued expenses and
other liabilities (79,268) (102,633)
Increase (decrease) accrued interest 26,849 (6,138)
Increase (decrease) accrued income and other taxes 195,446 36,365
Net cash provided by operating activities 631,015 353,795
</TABLE>
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands of dollars)
<TABLE>
Nine Months Ended
September 30, September 30,
2000 1999
Cash flows from investing activities:
<S> <C> <C>
Decrease (increase) in restricted cash $ (588,101) $ (113,470)
Cash acquired in stock-for-stock mergers 312,122 46,096
Increase in notes receivable - net (25,359) --
Decrease (increase) in investments in, and
advances to, nonconsolidated affiliates - net 3,200 (24,221)
Purchases of investments (61,704) (87,103)
Proceeds from sale of investments -- 29,659
Purchases of property, plant and equipment (320,434) (127,516)
Proceeds from disposal of assets 1,176,698 211,187
Acquisition of radio assets (196,071) (182,751)
Acquisition of outdoor assets (1,455,024) (799,444)
Acquisition of live entertainment assets (59,247) (5,061)
Increase in other-net (237,792) (9,219)
Net cash used in investing activities (1,451,712) (1,061,843)
Cash flows from financing activities:
Proceeds from issuance of long-term debt 9,204,234 1,880,338
Payments on long-term debt (8,109,502) (1,671,467)
Proceeds from exercise of stock options and stock purchase plan 30,642 32,440
Proceeds from issuance of common stock -- 512,917
Proceeds from exercise of common stock warrants 3,445 --
Net cash provided by financing activities 1,128,819 754,228
Net increase in cash and cash equivalents 308,122 46,180
Cash and cash equivalents at beginning of period 76,724 36,498
Cash and cash equivalents at end of period $ 384,846 $ 82,678
See Notes to Consolidated Financial Statements
</TABLE>
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1: PREPARATION OF INTERIM FINANCIAL STATEMENTS
The consolidated financial statements have been prepared by Clear Channel
Communications, Inc. (the "Company") pursuant to the rules and regulations of
the Securities and Exchange Commission ("SEC") and, in the opinion of
management, include all adjustments (consisting only of normal recurring
accruals and adjustments necessary for adoption of new accounting standards)
necessary to present fairly the results of the interim periods shown. 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 SEC rules and regulations. Management
believes that the disclosures made are adequate to make the information
presented not misleading. The results for the interim periods are not
necessarily indicative of results for the full year. The financial statements
contained herein should be read in conjunction with the consolidated financial
statements and notes thereto included in the Company's 1999 Annual Report on
Form 10-K.
The consolidated financial statements include the accounts of the Company and
its subsidiaries, the majority of which are wholly-owned. Investments in
companies in which the Company owns 20 percent to 50 percent of the voting
common stock or otherwise exercises significant influence over operating and
financial policies of the company are accounted for under the equity method. All
significant intercompany transactions are eliminated in the consolidation
process. Certain reclassifications have been made to the 1999 consolidated
financial statements to conform to the 2000 presentation.
Note 2: RECENT ACCOUNTING PRONOUNCEMENTS
In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133 Accounting for Derivative Instruments and
Hedging Activities ("Statement 133"). Statement 133 establishes new rules for
the recognition and measurement of derivatives and hedging activities. Statement
133 is amended by Statement 137 Accounting for Derivative Instruments and
Hedging Activities - Deferral of the Effective Date of FASB Statement No. 133,
and is effective for years beginning after June 15, 2000. The Company plans to
adopt this statement in fiscal year 2001. Had the Company elected early adoption
of Statement 133, total assets and long-term debt at September 30, 2000 would
have increased by $13.1 million each and there would have been no material
effect to results of operations. Management does not believe adoption of this
statement will materially impact the Company's financial position or results of
operations.
In December 1999, the SEC issued Staff Accounting Bulletin 101, Revenue
Recognition in Financial Statements, ("SAB 101"). The bulletin summarizes
certain of the SEC staff's views in applying generally accepted accounting
principles to revenue recognition. SAB 101, as amended through June 26, 2000 is
required to be implemented in the fourth quarter of 2000. The Company is
currently reviewing the requirements of SAB 101 and assessing its impact on the
Company's financial position and results of operations. Management does not
believe adoption of this statement will materially impact the Company's
financial position or results of operations.
Note 3: RECENT DEVELOPMENTS
AMFM Merger
On August 30, 2000, the Company closed the merger with AMFM Inc. ("AMFM").
Pursuant to the terms of the merger agreement, each share of AMFM common stock
was exchanged for 0.94 shares of the Company's common stock. Approximately 205.4
million shares of the Company's stock were issued in the AMFM merger, valuing
the merger, based on average share value at the signing of the merger agreement,
at $15.9 billion plus the assumption of AMFM's outstanding debt of $3.5 billion.
Additionally, the Company assumed options and common stock warrants with a fair
value of 1.3 billion, which are convertible, subject to applicable vesting, into
approximately 25.5 million shares of the Company's common stock. The Company
refinanced $540.0 million of AMFM's long-term debt at the closing of the merger
using the Company's credit facility. This merger has been accounted for as a
purchase with resulting goodwill of approximately $7.1 billion, which is being
amortized over 25 years on a straight-line basis. This purchase price allocation
is preliminary pending completion of appraisals and other fair value analysis of
assets and liabilities. The results of operations of AMFM have been included in
the Company's financial statements beginning August 30, 2000.
AMFM owned, programmed, or sold airtime for 415 radio stations, owned Katz
Media, a full-service media representation firm, and owned an approximate 28%
equity (11% voting) interest in Lamar Advertising Company ("Lamar").
To obtain clearance from the United States Department of Justice, the Company
and AMFM agreed to sell 99 radio stations in 27 markets. Before consummating the
merger with AMFM, the Company and AMFM completed the sale of 85 of these
stations. The remaining 14 stations will be sold pursuant to governmental
directives. The Company has 150 days from August 29th to complete the sale of
these 14 stations. In addition, the Company agreed to sell AMFM's equity stake
in Lamar by December 31, 2002. Furthermore, the Company's investment must be
passive while it continues to hold any part of this stake in Lamar.
Included in the purchase price of AMFM is $439.9 million of restricted cash
related to the disposition of AMFM assets in connection with the merger. In
addition, the Company swapped assets valued at $228.0 million in transactions
with third parties in order to comply with governmental directives regarding the
AMFM merger. The Company also divested certain assets in connection with
governmental directives related to the AMFM merger, which resulted in a gain on
sale of stations of $805.2 million and an increase in income tax expense (at the
Company's statutory rate of 38%) of $306.0 million in the third quarter of 2000.
The Company anticipates deferring a portion of this tax expense based on its
ability to replace the stations sold with qualified assets. A portion of the
proceeds from divestitures are being held in restricted trusts until suitable
replacement properties are identified. The following table details the
reconciliation of divestiture and acquisition activity in the restricted trust
accounts.
In thousands of dollars
Restricted cash resulting from Clear Channel divestitures $ 792,448
Restricted cash purchased in AMFM merger 439,896
Restricted cash used in acquisitions (206,941)
Interest, net of fees 6,943
Restricted cash balance at September 30, 2000 $ 1,032,346
The Company is in the process of finalizing plans to restructure AMFM's
operations. Thus far, it has been decided and communicated to all effected
employees that the Company will close the AMFM corporate offices in Dallas,
Texas and Austin, Texas by March 31, 2001. Other operations of AMFM will be
either discontinued or integrated into existing similar operations of the
Company. To date, the restructuring has resulted in the actual or pending
termination of approximately 400 employees. It is expected that the majority of
the restructuring will be completed during the first half of 2001. The Company
has recorded a $185.0 million liability in purchase accounting primarily related
to severance for terminated AMFM employees.
SFX Merger
On August 1, 2000, the Company consummated its merger with SFX Entertainment,
Inc. ("SFX"). Pursuant to the terms of the merger agreement, each share of SFX
Class A common stock was exchanged for 0.6 shares of the Company's common stock
and each share of SFX Class B common stock was exchanged for one share of the
Company's common stock. Approximately, 39.1 million shares of the Company's
common stock were issued in the SFX merger. Based on average share value at the
signing of the merger agreement, this merger is valued at $2.9 billion plus the
assumption of SFX's outstanding debt of $1.5 billion. Additionally, the Company
assumed all options and warrants with a fair value of $211.8 million, which are
exercisable for approximately 5.6 million shares of the Company's common stock.
The Company refinanced $815.8 million of SFX's long-term debt at the closing of
the merger using the Company's credit facility. This merger has been accounted
for as a purchase with resulting goodwill of approximately $4.1 billion, which
is being amortized over 20 years on a straight-line basis. This purchase price
allocation is preliminary pending completion of appraisals and other fair value
analysis of assets and liabilities. The results of operations of SFX have been
included in the Company's financial statements beginning August 1, 2000.
A number of lawsuits were filed by holders of SFX Class A common stock alleging,
among other things, that the difference in consideration for the Class A and
Class B shares constituted unfair consideration to the Class B holders and that
the SFX board breached its fiduciary duties and that the Company aided and
abetted the actions of the SFX board. On September 28, 2000, the Company issued
396,943 shares of its common stock, valued at $29.3 million, as settlement of
these lawsuits and has included the value as part of the purchase price.
SFX is a diversified promoter, producer and venue operator for live
entertainment events. In addition, SFX is a fully integrated sports marketing
and management company specializing in the representation of sports athletes and
broadcasters, integrated event management, television programming and production
and marketing consulting services. SFX also operates a network of 92 venues used
principally for music concerts and other live entertainment events in the United
States. Internationally, SFX operates 28 venues used primarily for theatrical
presentations, principally in the United Kingdom.
Other Acquisitions
On January 5, 2000, the Company closed the acquisition of the Ackerley Group
Inc.'s South Florida outdoor advertising division ("Ackerley") for approximately
$300.2 million in cash. The acquisition adds approximately 3,500 display faces
and enhances the Company's position in Florida. On September 1, 2000, the
Company purchased Donrey Media Group ("Donrey") for $381.5 million in cash. The
acquisition adds outdoor assets to domestic markets where the Company operates
other media.
Pro forma
The results of operations for the nine month periods ending September 30, 2000
and 1999 include the operations of AMFM, SFX, Donrey, Ackerley, Jacor
Communications, Inc. ("Jacor"), Dame Media, Inc. ("Dame") and Dauphin OTA
("Dauphin") from the respective dates of acquisition or merger as appropriate.
Assuming the mergers/acquisitions of AMFM, SFX, Donrey, Ackerley, Jacor, Dame
and Dauphin had all occurred at January 1, 1999, unaudited pro forma
consolidated results of operations for the nine months ended September 30, 2000
and 1999 would have been as follows:
Pro Forma (Unaudited)
Nine Months Ended September 30
(In thousands, except per share data)
2000 1999
Net revenue $ 5,977,569 $ 4,747,955
Net loss $ (564,974) $ (235,787)
Net loss per share:
Basic $ (.97) $ (.41)
Diluted $ (.97) $ (.41)
The pro forma information above is presented in response to applicable
accounting rules relating to business acquisitions and is not necessarily
indicative of the actual results that would have been achieved had the
mergers/acquisitions of AMFM, SFX, Donrey, Ackerley, Jacor, Dame and Dauphin
occurred at the beginning of 1999, nor is it indicative of future results of
operations. The Company had other acquisitions during the first nine months of
2000 and during 1999, the effects of which, individually and in aggregate, were
not material to the Company's consolidated financial position or results of
operations.
Public Offerings
On June 14, 2000, the Company completed a debt offering of $250.0 million
floating rate notes due June 15, 2002 and $750.0 million 7.875% notes due June
15, 2005. The net proceeds to the Company of approximately $993.9 million were
used to reduce the outstanding balance on the Company's domestic credit
facilities.
On July 3, 2000, the Company completed a debt offering of Euro 650.0 million
6.50% notes due July 7, 2005. Interest on the notes is payable annually in
arrears on July 7 of each year. The net proceeds to the Company of approximately
$612.9 million were used to reduce the outstanding balance on the Company's
domestic credit facilities.
To facilitate possible future acquisitions as well as public offerings, the
Company filed a registration statement on Form S-3 on July 21, 2000 covering a
combined $3.0 billion of debt securities, junior subordinated debt securities,
preferred stock, common stock, warrants, stock purchase contracts and stock
purchase units (the "shelf registration statement"). The shelf registration
statement also covers preferred securities that may be issued from time to time
by the Company's three Delaware statutory business trusts and guarantees of such
preferred securities by the Company.
On September 7, 2000, the Company completed a debt offering of $750.0 million
7.25% senior notes due September 15, 2003 and $750.0 million 7.65% senior notes
due on September 15, 2010. Interest is payable on both series of notes on March
15 and September 15 of each year. The net proceeds to the Company of
approximately $1.49 billion were used to reduce the outstanding balance of the
Company's domestic credit facility.
The domestic credit facility was used to redeem all of AMFM's outstanding 9%
subordinated notes due 2008, 9.25% subordinated notes due 2007, 12% exchange
debentures due 2009 and 12.75% senior discount notes due 2009. The domestic
credit facilities were also used to pay a total of $232.2 million of the
outstanding publicly traded indebtedness of AMFM and SFX put to the Company by
the holders of such indebtedness pursuant to outstanding change of control
offers.
Note 4 SEGMENT DATA
The Company is managed based on three principal business segments - radio,
outdoor advertising and live entertainment. The components of the radio segment
are domestic and international radio, Premiere Radio Networks and Katz Media.
The components of the outdoor advertising segment are domestic and international
billboards, transit displays and street furniture. The components of the live
entertainment segment are music, theatrical, family entertainment and motor
sports. The Company also aggregates television, sports representation and
internet into the category "other".
<PAGE>
<TABLE>
In thousands of dollars
Nine Months Ended Three Months Ended
September 30, September 30,
2000 1999 2000 1999
Net revenue
<S> <C> <C> <C> <C>
Radio $ 1,453,304 $ 822,587 $ 601,672 $ 406,494
Outdoor 1,235,224 845,451 441,149 349,163
Live Entertainment 457,542 -- 457,542 --
Other 179,063 122,597 76,356 40,500
Consolidated $ 3,325,133 $ 1,790,635 $ 1,576,719 $ 796,157
Operating expenses
Radio $ 846,377 $ 504,117 $ 330,740 $ 251,069
Outdoor 777,428 526,508 275,686 222,930
Live Entertainment 399,202 -- 399,202 --
Other 121,967 66,546 56,656 21,801
Consolidated $ 2,144,974 $ 1,097,171 $ 1,062,284 $ 495,800
Depreciation and Amortization
Radio $ 435,266 $ 208,991 $ 204,705 $ 115,153
Outdoor 311,637 248,896 110,938 89,622
Live Entertainment 43,609 -- 43,609 --
Other 30,288 15,767 12,807 3,852
Consolidated $ 820,800 $ 473,654 $ 372,059 $ 208,627
Operating income (loss)
Radio $ 168,640 $ 104,368 $ 63,593 $ 30,251
Outdoor 118,758 51,701 45,539 30,378
Live Entertainment 10,326 -- 10,326 --
Other (33,378) 19,156 (19,650) 14,847
Consolidated $ 264,346 $ 175,225 $ 99,808 $ 75,476
Total identifiable assets
Radio $ 34,017,411 $ 9,565,523 $ 34,017,411 $ 9,565,523
Outdoor 7,393,146 6,110,446 7,393,146 6,110,446
Live Entertainment 5,318,886 -- 5,318,886 --
Other 4,020,645 765,920 4,020,645 765,920
Consolidated $ 50,750,088 $ 16,441,889 $ 50,750,088 $ 16,441,889
</TABLE>
Net revenue of $649,473 and $260,876 for the nine and three months ended
September 30, 2000, respectively, and $346,773 and $172,798 for the nine and
three months ended September 30, 1999, respectively, and identifiable assets of
$2,452,121 and $1,242,843 as of September 30, 2000 and 1999, respectively, are
included in the data above and are derived from the Company's foreign
operations.
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Results of Operations
Comparison of Three and Nine Months Ended September 30, 2000 to Three and Nine
Months Ended September 30, 1999.
<TABLE>
(In thousands of dollars, except per share data)
Nine Months As-Reported Pro Forma Three Months As-Reported Pro Forma
Ended September 30, % Increase % Increase Ended September 30, % Increase % Increase
Consolidated 2000 1999 (Decrease) (Decrease) 2000 1999 (Decrease) (Decrease)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net revenue $ 3,325,133 $ 1,790,635 85.7% 25.9% $ 1,576,719 $796,15798.0% 15.3%
Operating expenses 2,144,974 1,097,171 95.5% 28.3% 1,062,284 495,800 114.3% 23.3%
Depreciation and
amortization 820,800 473,654 73.3% 22.4% 372,059 208,627 78.3% 2.4%
Operating income 264,346 175,225 50.9% 173.0% 99,808 75,476 32.2% 67.2%
Interest expense, net 230,795 126,233 82.8% 105,335 50,962 106.7%
Net income (loss) 440,760 95,288 362.6% 448,927 1,523 29,376.5%
Net income (loss) per share:
Basic $ 1.19 $ .31 279.9% $ 1.04 $ .00 n/a
Diluted $ 1.13 $ .31 264.4% $ .96 $ .00 n/a
</TABLE>
The majority of the growth in the "as-reported" net revenue and operating
expenses for the three and nine months ended September 30, 2000 was due to the
acquisitions of AMFM Inc. ("AMFM") on August 30, 2000, SFX Entertainment,
Inc.("SFX") on August 1, 2000, Donrey Media Group ("Donrey") on September 1,
2000, Ackerley's South Florida outdoor advertising division ("Ackerley") on
January 5, 2000, Jacor Communications, Inc. ("Jacor") in May 1999, and Dame
Media, Inc., ("Dame") and Dauphin OTA, ("Dauphin") in July 1999. In addition, 55
radio stations and approximately 65,000 outdoor display faces were purchased, in
multiple transactions, during the first nine months of 2000, the effects of
which, individually and in the aggregate, were not material to the Company's
consolidated financial position or results of operations. Corporate expenses
increased 106% for the first nine months of 2000 versus the first nine months of
1999 as a result of the integration of corporate operations of the Company and
the aforementioned acquisitions.
The majority of the increase in "as-reported" depreciation and amortization was
primarily due to the acquisition of the tangible and intangible assets
associated with the above-mentioned business combinations. Interest expense
increased as a result of greater average borrowing levels related to the
aforementioned acquisitions and higher average borrowing rates. During the nine
months ended September 30, 2000, approximately 35% of the Company's debt had a
floating interest rate based on LIBOR. LIBOR rates increased 25% from an average
of 5.18% in the first nine months of 1999 to an average 6.48% during the first
nine months of 2000. This increase in average borrowing rates was partially
offset by the issuance of convertible notes in the fourth quarter of 1999 at
1.5% annual interest. Equity in earnings of nonconsolidated affiliates increased
168% primarily due to the improved operating results from our equity investments
in Mexico, New Zealand and Australia. The majority of the increase in pre-tax
income is due to a one-time gain of $805.2 million included in the three and
nine-month periods ended September 30, 2000, which related to the sale of
stations associated with the governmental directives regarding the AMFM merger.
Income tax expense increased due to the increase in pre-tax income. The
effective tax rate decreased from 55% in the first nine months of 1999 to 49% in
the first nine months of this year resulting from the one-time gain on sale of
stations offset by the increased nondeductible amortization expenses associated
with the aforementioned acquisitions.
The pro Forma presentation referred to above assumes the acquisitions of and/or
mergers with AMFM, SFX, Donrey, Ackerley, Jacor, Dauphin and Dame occurred on
January 1, 1999. Pro Forma net revenue increased due to improved advertising
rates and improved sell-out rates in the radio segment. In addition, increased
advertising rates and other less significant acquisitions within the outdoor
segment contributed to the increase in pro forma net revenue. An increase in
music tour dates within the entertainment segment also contributed to the
increase in pro forma net revenue. Pro Forma operating expenses increased
primarily from the incremental selling costs related to the additional revenues
and expenses associated with the additional music tour dates. The majority of
the increase in pro forma operating income for the three and nine month periods
ended September 30, 2000 was due to improved operations during the period
primarily in the radio and outdoor segments.
Liquidity and Capital Resources
The major sources of capital for the Company have been cash flow from
operations, advances on its revolving lines of credit, and funds provided by
various stock, convertible and other bond offerings. As of September 30, 2000
and December 31, 1999, the Company had the following debt outstanding:
(In millions of dollars)
September 30, 2000 December 31, 1999
Credit facilities - domestic $ 1,974.7 $ 1,227.7
Credit facility - international 103.2 120.4
Senior convertible notes 1,575.0 1,575.0
Liquid Yield Option Notes 495.4 490.8
Long-term bonds 6,461.5 1,171.4
Other borrowings 45.9 29.4
Total $ 10,655.7 $ 4,614.7
In addition, the Company had $384.8 million in unrestricted cash and cash
equivalents on hand at September 30, 2000.
On April 27, 2000, shareholders of the Company approved an increase to the
number of the Company's shares of common stock authorized for issuance from 900
million to 1.5 billion in order to have additional shares available for possible
future acquisition or financing transactions, stock splits, stock dividends and
other issuances, or to satisfy requirements for additional reservations of
shares by reason of future transactions which might require increased
reservations. The Company currently has no plans to issue any of the additional
shares of common stock.
On July 21, 2000, the Company filed a Registration Statement on Form S-3
covering a combined $3.0 billion of debt securities, junior subordinated debt
securities, preferred stock, common stock, warrants, stock purchase contracts
and stock purchase units (the "shelf registration statement"). The shelf
registration statement also covers preferred securities that may be issued from
time to time by the Company's three Delaware statutory business trusts and
guarantees of such preferred securities by the Company. In September 2000, the
Company issued $1.5 billion of debt securities registered under the shelf
registration statement, leaving $1.5 billion available for future issuance.
Domestic Credit Facilities:
The Company has a $1.95 billion revolving credit facility, of which at September
30, 2000, $1.8 billion was outstanding and $135.0 million was available for
future borrowings. The credit facility began reducing on September 30, 2000,
with quarterly repayment of the outstanding principal balance to continue over
the next five years, with the entire balance to be repaid by the last business
day of June 2005. During the first nine months of the year, the Company made
principal payments on this credit facility totaling $3.4 billion and drew down
$4.4 billion.
The Company had a 364-day multi-currency revolving credit facility for $1.0
billion. On August 30, 2000, in conjunction with the closing of a new $3.0
billion credit facility, the Company repaid all outstanding borrowings and
terminated the facility. During the first eight months of the year, the Company
made principal payments on the credit facility totaling $1.4 billion and drew
down $1.0 billion.
The Company entered into a $3.0 billion credit facility on August 30, 2000,
concurrent with the closing of the AMFM merger. $1.5 billion of this facility is
a five-year multi-currency revolving credit facility and $1.5 billion is a
364-day revolving credit facility, which the Company has the option upon
maturity to convert into a term loan with a five-year maturity. At September 30,
2000, the outstanding balance was 127.2 million British pounds, or approximately
$187.7 million, and $2.8 billion was available for future borrowings under the
$3.0 billion credit facility.
International Credit Facility:
The Company has an 88.0 million British pounds, or approximately $129.8 million,
revolving credit facility with a group of international banks. This
international credit facility allows for borrowings in various foreign
currencies, which are used to hedge net assets in those currencies. At September
30, 2000, approximately $26.6 million was available for future borrowings and
$103.2 million was outstanding under this credit facility. This credit facility
converted into a reducing revolving facility on January 10, 2000, with an
initial payment of 12.0 million British pounds made in January 2000. An
additional payment of 12.0 million British pounds is due on January 10, 2001.
The credit facility expires on January 10, 2002. At September 30, 2000, interest
rates varied from 4.50% to 7.85%.
Liquid Yield Option Notes:
The Company assumed Liquid Yield Option Notes ("LYONs") as a part of the merger
with Jacor. The Company assumed 4.75% LYONs due 2018 and 5.50% LYONs due 2011
with an aggregated fair value of $490.1 million. Each LYON has a principal
amount at maturity of $1,000 and is convertible, at the option of the holder, at
any time on or prior to maturity, into the Company's common stock at a
conversion rate of 7.227 shares per LYON and 15.522 shares per LYON for the 2018
and 2011 issues, respectively. The LYONs aggregated balance, net of conversions
to common stock, amortization of premium, and accretion of interest, at
September 30, 2000 was $495.4 million.
Long-Term Bonds:
On June 14, 2000, the Company completed a debt offering of $250.0 million
Floating Rate Notes due June 15, 2002 and $750.0 million 7.875% Notes due June
15, 2005. Interest is payable on June 15 and December 15 on the 7.875% Notes and
is payable quarterly on the Floating Rate Notes. On June 14, 2000 the Company
entered into interest rate swap agreements that effectively float the interest
on $750.0 million based upon LIBOR. The net proceeds to the Company of
approximately $993.9 million were used to reduce the outstanding balance on the
Company's credit facilities.
On July 3, 2000, the Company completed a debt offering of Euro 650.0 million
6.50% Notes due July 7, 2005. Interest on the notes is payable annually in
arrears on July 7 of each year. The net proceeds to the Company of approximately
$612.9 million were used to reduce the outstanding balance on the Company's
credit facilities.
On September 7, 2000, the Company completed a debt offering of $750.0 million
7.25% Senior Notes due September 15, 2003 and $750.0 million 7.65% Senior Notes
due on September 15, 2010. Interest is payable on both series of notes on March
15 and September 15 of each year. On September 7, 2000, the Company entered into
an interest rate swap agreement that effectively floats the interest based upon
LIBOR for $750 million of the 7.25% Senior Notes. The net proceeds to the
Company of approximately $1.5 billion were used to reduce the outstanding
balance of the Company's credit facilities.
Jacor Long-Term Bonds:
On December 14, 1999, the Company completed a tender offer for the 10.125%
Senior Subordinated Notes due June 15, 2006; 9.75% Senior Subordinated Notes due
December 15, 2006; 8.75% Senior Subordinated Notes due June 15, 2007; and 8.0%
Senior Subordinated Notes due February 15, 2010 of Jacor Communications Company,
an indirect wholly-owned subsidiary of the Company. An agent acting on the
Company's behalf redeemed notes with a value of approximately $571.4 million.
Cash settlement of the amount due to the agent was completed on January 14,
2000. After redemption, approximately $1.0 million face value of the notes
remain outstanding.
AMFM Long-Term Bonds:
The Company assumed long-tern bonds with a face value of $2.8 billion in the
AMFM merger. On September 29, 2000, the Company redeemed all of the outstanding
9% Senior Subordinated Notes due 2008, originally issued by Chancellor Media
Corporation or one of its subsidiaries, for $829.0 million subject to change of
control provisions in the indentures. Subsequent to the end of the third
quarter, the Company redeemed, also subject to change of control provisions in
the indentures, all of the outstanding 9.25% Senior Subordinated Notes due 2007,
originally issued by Capstar Radio Broadcasting Partners, the 12% Exchange
Debentures due 2009, originally issued by Capstar Broadcasting Partners, Inc.
and the 12.75% Senior Discount Notes due 2009, originally issued by Capstar
Broadcasting Partners, Inc., for a total of $508.5 million.
On October 6, 2000, the Company made change of control payments of $231.4
million pursuant to its offers to purchase due to a change of control on the
following series of AMFM debt: 8% Senior Notes due 2008, 8.125% Senior
Subordinated Notes due 2007 and 8.75% Senior Subordinated Notes due 2007,
originally issued by Chancellor Media Corporation or one of its subsidiaries, as
well as the 12.625% Exchange Debentures due 2006, originally issued by SFX
Broadcasting (AMFM Operating, Inc.).
Chancellor Media Corporation, Capstar Radio Broadcasting Partners, Capstar
Broadcasting Partners, Inc. and AMFM Operating Inc., or their successors are all
indirect wholly-owned subsidiaries of the Company. The redemption and change of
control payments were financed with borrowings under the Company's credit
facilities.
SFX Long-Term Bonds:
The Company assumed long-term bonds with a face value of $550.0 million in the
SFX merger. On October 10, 2000, SFX Entertainment, Inc., a wholly-owned
subsidiary of the Company launched a tender offer for any and all of its 9.125%
Senior Subordinated Notes due 2008. An agent acting on the Company's behalf
redeemed notes with a value of approximately $598.1 million. Cash settlement of
the amount due to the agent was completed on November 13, 2000. After
redemption, approximately $6.0 million face value of the notes remain
outstanding. The tender offer was financed with borrowings under the Company's
credit facilities.
Future Contingent Payments:
Certain of the agreements relating to SFX acquisitions provide for purchase
price adjustments and other future contingent payments based on the financial
performance of the acquired companies. The Company will continue to accrue
additional amounts related to such contingent payments if and when it is
determinable beyond a reasonable doubt that the applicable financial performance
targets will be met.
USES OF FUNDS AND CAPITAL RESOURCES
AMFM Merger
On August 30, 2000, the Company closed the merger with AMFM Inc. ("AMFM").
Pursuant to the terms of the merger agreement, each share of AMFM common stock
was exchanged for 0.94 shares of the Company's common stock. Approximately 205.4
million shares of the Company's stock were issued in the AMFM merger, valuing
the merger, based on average share value at the signing of the merger agreement,
at $15.9 billion plus the assumption of AMFM's outstanding debt of $3.5 billion.
Additionally, the Company assumed options and common stock warrants with a fair
value of 1.3 billion, which are convertible, subject to applicable vesting, into
approximately 25.5 million shares of the Company's common stock. The Company
refinanced $540.0 million of AMFM's long-term debt at the closing of the merger
using the Company's credit facility. This merger has been accounted for as a
purchase with resulting goodwill of approximately $7.1 billion, which is being
amortized over 25 years on a straight-line basis. This purchase price allocation
is preliminary pending completion of appraisals and other fair value analysis of
assets and liabilities. The results of operations of AMFM have been included in
the Company's financial statements beginning August 30, 2000.
SFX Merger:
On August 1, 2000, the Company consummated its merger with SFX Entertainment,
Inc. ("SFX"). Pursuant to the terms of the merger agreement, each share of SFX
Class A common stock was exchanged for 0.6 shares of the Company's common stock
and each share of SFX Class B common stock was exchanged for one share of the
Company's common stock. Approximately, 39.1 million shares of the Company's
common stock were issued in the SFX merger. Based on average share value at the
signing of the merger agreement, this merger is valued at $2.9 billion plus the
assumption of SFX's outstanding debt of $1.5 billion. Additionally, the Company
assumed all options and warrants with a fair value of $211.8 million, which are
exercisable for approximately 5.6 million shares of the Company's common stock.
The Company refinanced $815.8 million of SFX's long-term debt at the closing of
the merger using the Company's credit facility. This merger has been accounted
for as a purchase with resulting goodwill of approximately $4.1 billion, which
is being amortized over 20 years on a straight-line basis. This purchase price
allocation is preliminary pending completion of appraisals and other fair value
analysis of assets and liabilities. The results of operations of SFX have been
included in the Company's financial statements beginning August 1, 2000.
A number of lawsuits were filed by holders of SFX Class A common stock alleging,
among other things, that the difference in consideration for the Class A and
Class B shares constituted unfair consideration to the Class B holders and that
the SFX board breached its fiduciary duties and that the Company aided and
abetted the actions of the SFX board. On September 28, 2000, the Company issued
396,943 shares of its common stock, valued at $29.3 million, as settlement of
these lawsuits and has included the value as part of the purchase price.
Outdoor Acquisition:
On January 5, 2000, the Company closed the acquisition of Ackerley for
approximately $300.2 million in cash. The acquisition adds approximately 3,500
display faces and enhances the Company's position in Florida. On September 1,
2000, the Company purchased Donrey for $381.5 million in cash. The acquisition
adds outdoor assets to domestic markets where the Company operates other media.
Stock Repurchase:
On October 5, 2000, the Board of Directors authorized the repurchase of up to $1
billion of the Company's common stock.
Other:
During the first nine months of 2000, in addition to the acquisitions mentioned
above, the Company acquired approximately 10,000 additional outdoor faces in 39
domestic markets and in malls throughout the U.S. and 55,000 additional display
faces in 23 international markets for a total of $773.3 million in cash. The
Company also acquired 55 radio stations in 17 markets for a total of $194.6
million in cash during the first nine months of 2000. In addition, the Company
acquired a software company for $1.5 million in cash, which is developing
broadcasting software.
During the first nine months of 2000, the Company had capital expenditures of
$320.4 million as follows by segment:
Radio $122.7
Outdoor $166.4
Live Entertainment $19.1
Other $12.2
Capital expenditures included $114.3 million for one-time expenditures primarily
related to facility consolidations and a one-time capital expenditure in
conjunction with the long-term extension of certain operating contracts.
Construction of new revenue-producing advertising displays totaled $102.0
million.
Future acquisitions of broadcasting stations, outdoor advertising facilities,
other media-related properties and live entertainment venues affected in
connection with the implementation of the Company's acquisition strategy are
expected to be financed from increased borrowings under the existing credit
facilities, additional public equity and debt offerings and cash flow from
operations. The Company believes that cash flow from operations, as well as the
proceeds from securities offerings made from time to time, will be sufficient to
make all required future interest and principal payments on the credit
facilities, senior convertible notes and bonds, and will be sufficient to fund
all anticipated capital expenditures.
Ratio:
The ratio of earnings to fixed charges is as follows:
<TABLE>
Nine Months ended
September 30, Year Ended
2000 1999 1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C> <C>
3.58 2.32 2.04 1.83 2.32 3.63 3.32
</TABLE>
The ratio of earnings to fixed charges has been computed on a total enterprise
basis. Earnings represent income from continuing operations before income taxes
less equity in earnings (loss) of nonconsolidated affiliates plus fixed charges.
Fixed charges represent interest, amortization of debt discount and expense, and
the estimated interest portion of rental charges. The Company had no preferred
stock outstanding and paid no dividends thereon for any period presented.
Risks Regarding Forward Looking Statements
Except for the historical information, this report contains various
"forward-looking statements" which represent the Company's expectations or
beliefs concerning future events, including the future levels of cash flow from
operations. The Company cautions that these forward-looking statements involve a
number of risks and uncertainties and are subject to many variables which could
have an adverse effect upon the Company's financial performance. These variables
include economic conditions in the U.S. and in other countries where the Company
currently does business, the ability of the Company to integrate the operations
of Jacor, Dame, Dauphin, Ackerley, SFX, AMFM and Donrey, shifts in population
and other demographics, level of competition for advertising dollars,
fluctuations in operating costs, technological changes and innovations, changes
in labor conditions, changes in governmental regulations and policies, exchange
rates and currency values, capital expenditure requirements, interest rates,
taxes, access to capital markets, the effect of leverage on the Company's
financial position and earnings and certain other factors set forth in the
Company's SEC filings. Actual results in the future could differ materially from
those described in the forward-looking statements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Interest Rate Risk
At September 30, 2000, approximately 35.0% of the Company's long-term debt,
including fixed rate debt on which the Company has entered interest rate swap
agreements, bears interest at variable rates. Accordingly, the Company's
earnings and after-tax cash flow are affected by changes in interest rates.
Assuming the current level of borrowings at variable rates and assuming a two
percentage point change in the first nine months of 2000 average interest rate
under these borrowings, it is estimated that the Company's first nine months of
2000 interest expense would have changed by $ 74.5 million and that the
Company's first nine months of 2000 net income would have changed by $ 44.7
million. In the event of an adverse change in interest rates, management may
take actions to further mitigate its exposure. However, due to the uncertainty
of the actions that would be taken and their possible effects, the analysis
assumes no such actions. Further the analysis does not consider the effects of
the change in the level of overall economic activity that could exist in such an
environment.
The Company has entered into interest rate swap agreements that effectively
float interest at rates based upon LIBOR on $1.5 billion of its current
borrowings. These agreements expire from September 2003 to June 2005. The fair
value of these agreements at September 30, 2000 was $13.1 million.
Equity Price Risk
The carrying value of the Company's available-for-sale equity securities is
affected by changes in their quoted market prices. It is estimated that a 20%
change in the market prices of these securities would change their carrying
value at September 30, 2000 by $352.0 million and would change comprehensive
income by $228.8 million.
Foreign Currency
The Company has operations in forty countries throughout Europe, Asia and North
and South America. All foreign operations are measured in their local
currencies. As a result, the Company's financial results could be affected by
factors such as changes in foreign currency exchange rates or weak economic
conditions in the foreign markets in which the Company has operations. To
mitigate a portion of the exposure to risk of currency fluctuations throughout
Europe and Asia, the Company has a natural hedge through borrowings in some
other currencies. Additionally, the Company has a natural hedge through
borrowings in Euros to mitigate a portion of the exposure to risk of currency
fluctuations in Western Europe. This hedge position is reviewed monthly. The
Company maintains no derivative instruments to mitigate the exposure to
translation and/or transaction risk. However, this does not preclude the
adoption of specific hedging strategies in the future. The Company's foreign
operations reported a loss of $6.6 million for the first nine months of 2000. It
is estimated that a 10% change in the value of the U.S. dollar to foreign
currencies would change net loss for the first nine months of 2000 by $660,000.
The Company's earnings are also affected by fluctuations in the value of the
U.S. dollar as compared to foreign currencies as a result of our investments in
Australia, New Zealand and Mexico, all of which are accounted for under the
equity method. It is estimated that the result of a 10% fluctuation in the value
of the dollar relative to these foreign currencies at September 30, 2000 would
change net income for the first nine months of 2000 by approximately $444,000.
This analysis does not consider the implications that such fluctuations could
have on the overall economic activity that could exist in such an environment in
the U.S. or the foreign countries or on the results of operations of these
foreign entities.
<PAGE>
Part II -- OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
<TABLE>
(a) Exhibits. See Exhibit Index on Page 22
(b) Reports on Form 8-K
Filing Date Items Reported Financial Statements Reported
<S> <C> <C> <C> <C>
8-K 8/04/00 Item 2. Announce December 31, 1999 for SFX Entertainment, Inc.
merger of SFX Entertain- March 31, 2000 for SFX Entertainment, Inc.
ment into Clear Channel Pro forma statement for December 31, 1999
Communications, Inc. and March 31,2000.
8-K 9/06/00 Item 2. Announce December 31, 1999 for AMFM Inc.
merger of AMFM Inc. June 30, 2000 for AMFM Inc.
into Clear Channel Com- Pro forma statement for December 31, 1999
munications, Inc. and June 30, 2000.
</TABLE>
<PAGE>
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CLEAR CHANNEL COMMUNICATIONS, INC.
November 14, 2000 /s/ Herbert W. Hill, Jr.
Herbert W. Hill, Jr.
Senior Vice President and
Chief Accounting Officer
<PAGE>
INDEX TO EXHIBITS
Exhibit Number
Description
2.1 Agreement and Plan of Merger dated as of October 8, 1998, as amended on
November 11, 1998, among Clear Channel Communications, Inc., CCU Merger
Sub, Inc. and Jacor Communications, Inc. (incorporated by reference to
Annex A to the Company's Registration Statement on Form S-4 (Reg. No.
333-72839) dated February 23, 1999).
2.2 Agreement and Plan of Merger dated as of October 2, 1999, among Clear
Channel, CCU Merger Sub, Inc. and AMFM Inc. (incorporated by reference to
the exhibits of the Company's Current Report on Form 8-K filed October 5,
1999.)
2.3 Agreement and Plan of Merger dated as of February 28, 2000, among Clear
Channel, CCU II Merger Sub, Inc. and SFX Entertainment, Inc. (incorporated
by reference to the exhibits of the Company's Current Report on Form 8-K
filed February 29, 2000.)
3.1 Current Articles of Incorporation of the Company (incorporated by reference
to the exhibits of the Company's Registration Statement on Form S-3 (Reg.
No. 333-33371) dated September 9, 1997).
3.2 Second Amended and Restated Bylaws of the Company (incorporated by
reference to the exhibits of the Company's Registration Statement on Form
S-3 (Reg. No. 333-33371) dated September 9, 1997).
3.3 Amendment to the Company's Articles of Incorporation (incorporated by
reference to the exhibits to the Company's Quarterly Report on Form 10-Q
for the quarter ended September 30, 1998).
3.4 Second Amendment to the Company's Articles of Incorporation (incorporated
by reference to the exhibits to the Company's Quarterly Report on Form 10-Q
for the quarter ended March 31, 1999)
3.5 Third Amendment to the Company's Articles of Incorporation. (incorporated
by reference to the exhibits to the Company's Quarterly Report on Form 10-Q
for the quarter ended March 31, 2000)
4.1 Buy-Sell Agreement by and between Clear Channel Communications, Inc., L.
Lowry Mays, B. J. McCombs, John M. Schaefer and John W. Barger, dated May
31, 1977 (incorporated by reference to the exhibits of the Company's
Registration Statement on Form S-1 (Reg. No. 33-289161) dated April 19,
1984).
4.2 Senior Indenture dated October 1, 1997, by and between Clear Channel
Communications, Inc. and The Bank of New York as Trustee (incorporated by
reference to exhibit 4.2 of the Company's Quarterly Report on Form 10-Q for
the quarter ended September 30, 1997).
4.3 First Supplemental Indenture dated March 30, 1998 to Senior Indenture dated
October 1, 1997, by and between the Company and The Bank of New York, as
Trustee (incorporated by reference to the exhibits to the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1998).
4.4 Second Supplemental Indenture dated June 16, 1998 to Senior Indenture dated
October 1, 1997, by and between Clear Channel Communications, Inc. and the
Bank of New York, as Trustee (incorporated by reference to the exhibits to
the Company's Current Report on Form 8-K dated August 27, 1998).
4.5 Third Supplemental Indenture dated June 16, 1998 to Senior Indenture dated
October 1, 1997, by and between Clear Channel Communications, Inc. and the
Bank of New York, as Trustee (incorporated by reference to the exhibits to
the Company's Current Report on Form 8-K dated August 27, 1998).
4.6 Fourth Supplement Indenture dated November 24, 1999 to Senior Indenture
dated October 1, 1997, by the between Clear Channel and The Bank of New
York as Trustee (incorporated by reference to the exhibits of the Company's
Annual Report on Form 10-K for the year ended December 31, 1999).
4.7 Fifth Supplemental Indenture dated June 21, 2000, to Senior Indenture dated
October 1, 1997, by and between Clear Channel Communications, Inc. and The
Bank of New York, as Trustee (incorporated by reference to the exhibits of
Clear Channel's registration statement on Form S-3 (Reg. No. 333-42028)
dated July 21, 2000).
4.8 Sixth Supplemental Indenture dated June 21, 2000, to Senior Indenture dated
October 1, 1997, by and between Clear Channel Communications, Inc. and The
Bank of New York, as Trustee (incorporated by reference to the exhibits of
Clear Channel's registration statement on Form S-3 (Reg. No. 333-42028)
dated July 21, 2000).
4.9 Seventh Supplemental Indenture dated July 7, 2000, to Senior Indenture
dated October 1, 1997, by and between Clear Channel Communications, Inc.
and The Bank of New York, as Trustee (incorporated by reference to the
exhibits of Clear Channel's registration statement on Form S-3 (Reg. No.
333-42028) dated July 21, 2000).
4.10 * Eighth Supplemental Indenture dated September 12, 2000, to Senior
Indenture dated October 1, 1997, by and between Clear Channel
Communications, Inc. and The Bank of New York, as Trustee.
4.11 * Ninth Supplemental Indenture dated September 12, 2000, to Senior
Indenture dated October 1, 1997, by and between Clear Channel
Communications, Inc. and The Bank of New York, as Trustee.
4.12 Fourth Amended and Restated Credit Agreement by and among Clear Channel
Communications, Inc., Bank of America, N.A., as administrative agent, Fleet
National Bank, as documentation agent, the Bank of Montreal and Toronto
Dominion (Texas), Inc., as co-syndication agents, and certain other lenders
dated June 15, 2000 (incorporated by reference to the exhibits of Clear
Channel's registration statement on Form S-3 (Reg. No. 333-42028) dated
July 21, 2000).
11 * Statement re: Computation of Earnings Per Share.
12 * Statement re: Computation of Ratios.
27.1 * Financial Data Schedule at September 30, 2000.
27.2 Financial Data Schedule at September 30, 1999 (incorporated by reference to
exhibit 27.1 of the Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1999).
---------------
* Filed herewith.
<PAGE>
