NAPLES — Naples-based radio operator Beasley Broadcast Group Inc. pulled out a profit in the second quarter, despite a drop in revenues.
The company earned $3.9 million, or 17 cents a share. That was up nearly 40 percent from $2.8 million, or 12 cents a share, in the same quarter a year ago.
Net revenues fell 2.8 percent to $24.8 million, primarily reflecting overall industry weakness in the first month of the quarter and revenue declines in several of its markets, including Fort Myers and Fayetteville, N.C.
Lower operating expenses more than offset the drop in revenues.
Weakness in Fort Myers was primarily attributed to the company's decision not to host a concert in the market in the second quarter, as it did last year. The concert contributed $173,000 in revenues in 2011, said Caroline Beasley, the company's chief financial officer, in a conference call with analysts Friday.
In Fayetteville, declining revenues were partly driven by a drop in auto advertising. Overall, auto advertising across all of it stations rose due to an increase in advertising for imports, led by Toyota and Honda.
The company saw softness in the Las Vegas, Fort Myers and Miami markets in key advertising categories, such as retail, Beasley said.
"On a consolidated basis, local revenue was basically flat for the quarter and national was down low- to mid-single digits at our stations," she said.
Overall, political advertising has been a disappointment, generating only $70,000 in revenues in the second quarter.
"The retail, health and restaurant categories all posted slight declines for the quarter," Beasley said.
In the quarter, the company got an $800,000 boost from a music license fee settlement with BMI, which contributed to a $1.1 million rise in its station operating income, or SOI.
"While the industry and Beasley faced some revenue headwinds in Q2, we again delivered impressive SOI growth and bottom-line results," Beasley said.
The company's station ratings have strengthened in many of its markets, including Philadelphia and Las Vegas.
A continuing effort to reduce debt is paying off. In the second quarter, the company saw a more than 30 percent year-over-year reduction in its interest expense.
"We ended the second quarter with our lowest leverage ratio in over 10 years and remain committed to using cash from operations to further lower debt and other initiatives which can enhance shareholder value," said George G. Beasley, the company's chairman and CEO, in a statement.
Founded in 1961, Beasley Broadcast owns and operates 42 stations in 11 markets across the U.S. It expects to add another station in the Las Vegas market — a deal that's expected to close soon – and the company has an option to buy another station that it manages in that market.
__ Connect with Laura Layden at www.naplesnews.com/staff/laura_layden