ATLANTA, GA — May 26, 2021: Cumulus Media Inc. (NASDAQ: CMLS) today announced that it has initiated actions to pay down $175 million of debt using cash on hand.
Mary G. Berner, President and Chief Executive Officer of CUMULUS MEDIA, said, “As I noted on our recent earnings call, the continuing improvement in economic and public health conditions is fueling very encouraging momentum across all our businesses. Against that backdrop, we are accelerating debt repayments, which will de-lever the balance sheet more quickly, reduce interest expense, and further increase our free cash flow. Since emerging from bankruptcy in 2018, we have reduced our net debt (1) by almost $600 million, despite the impact of a global pandemic. Looking ahead, our better leverage profile and more than $200 million of available liquidity (2) will provide us meaningful financial flexibility as we continue along our strong rebound trajectory. Cumulus Media’s strong competitive position, proven track record of solid execution, numerous revenue growth drivers, and ability to consistently generate significant free cash flow give us multiple pathways along which to grow shareholder value in the short- and long-term.”
Details of Debt Reduction
On May 17, 2021, the Company completed a $60 million repayment of its ABL Revolver due 2025, which represented the entirety of the amount outstanding under the facility. Following the paydown, the ABL Revolver due 2025 is undrawn and available as liquidity for general corporate purposes.
The Company was required by the terms of its debt agreements to make mandatory debt prepayments from the proceeds of the Company’s previously announced sale of land in Bethesda, MD, in June 2020 (the “Land Sale”) and sale of towers and related assets (the “Tower Sale”) in September 2020, after giving effect to a right of reinvestment. On May 25, 2021, the Company paid down approximately $89 million of its Term Loan Credit Facility due 2026 (the “Term Loan”) related to this mandatory prepayment obligation. Approximately $65 million of the prepayment related to the Land Sale, and approximately $23 million of the prepayment related to the Tower Sale.
Additionally, pursuant to the terms of its 6.75% Senior Secured First Lien Notes due 2026 (the “Notes”), the Company launched a tender offer for the Notes at par for approximately $26 million, which represents the pro rata amount required to be offered from the proceeds of the Tower Sale. Following the expiration of the tender offer, any amounts that remain untendered will be directed toward an additional prepayment of the Term Loan.
This press release does not constitute a notice of redemption under the optional redemption provisions of the indenture governing the Notes, nor does it constitute an offer to sell, or a solicitation of an offer to buy, any security. No offer, solicitation, or sale will be made in any jurisdiction in which such an offer, solicitation, or sale would be unlawful.
- The Company presents the non-GAAP financial measure “net debt” which is total debt less cash and cash equivalents. Management believes that net debt is an important measure to monitor leverage and evaluate the balance sheet. Debt amounts shown below exclude unamortized debt issuance costs.
|(in thousands)||June 30, 2018||March 31, 2021||Change|
|Total debt||$ 1,300,000||$ 982,635||$ (317,365)|
|Cash and cash equivalents||37,444||293,806||256,362|
|Net debt||$ 1,262,556||$ 688,829||$ (573,727)|
- Represents $294 million of unrestricted cash on hand as of March 31, 2021, less $175 million used to paydown debt as described herein plus $83 million of availability under the ABL Revolver due 2025.
About CUMULUS MEDIA
CUMULUS MEDIA (NASDAQ: CMLS) is a leading audio-first media and entertainment company delivering premium content to over a quarter billion people every month — wherever and whenever they want it. CUMULUS MEDIA engages listeners with high-quality local programming through 415 owned-and-operated stations across 86 markets; delivers nationally-syndicated sports, news, talk, and entertainment programming from iconic brands including the NFL, the NCAA, the Masters, CNN, the AP, the Academy of Country Music Awards, and many other world-class partners across nearly 7,300 affiliated stations through Westwood One, the largest audio network in America; and inspires listeners through its rapidly growing network of original podcasts that are smart, entertaining and thought-provoking. CUMULUS MEDIA provides advertisers with personal connections, local impact and national reach through broadcast and on-demand digital, mobile, social, and voice-activated platforms, as well as integrated digital marketing services, powerful influencers, full-service audio solutions, industry-leading research and insights, and live event experiences. CUMULUS MEDIA is the only audio media company to provide marketers with local and national advertising performance guarantees. For more information visit www.cumulusmedia.com.
Disclosure Regarding Forward-Looking Statements
Certain statements in this release may constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Such statements are statements other than historical fact and relate to our intent, belief or current expectations primarily with respect to our future operating, financial, and strategic performance. Any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual results may differ from those contained in or implied by the forward-looking statements as a result of various factors including, but not limited to, risks and uncertainties related to the implementation of our strategic operating plans, the evolving and uncertain nature of the COVID-19 pandemic and its impact on the Company, the media industry, and the economy in general and other risk factors described from time to time in our filings with the Securities and Exchange Commission. Many of these risks and uncertainties are beyond our control, and the unexpected occurrence or failure to occur of any such events or matters could significantly alter our actual results of operations or financial condition. CUMULUS MEDIA assumes no responsibility to update any forward-looking statements, which are based upon expectations as of the date hereof, as a result of new information, future events or otherwise.
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