Urban One Reports $109.9 Million Revenue, Net Loss of $2.9 Million for Q1 2023

Urban One, Inc. reported a net revenue of $109.9 million for the three months ended March 31, 2023, a decrease of 2% from $112.1 million in the same period of 2022. The decline in revenue was attributed to lower advertising sales in the cable television segment, which fell to $49.7 million from $56.2 million year-over-year. The radio broadcasting segment, however, saw an increase in revenue to $35.2 million, up from $31.5 million, primarily due to the acquisition of three stations in Indianapolis and growth in Atlanta. The company recorded a net loss attributable to common stockholders of $2.9 million, compared to a profit of $16.5 million in the prior year.

Operating expenses surged by 34.5% to $101.7 million, driven by a significant impairment charge of $16.8 million related to the KROI-FM radio broadcasting license. Other expenses included increased programming and technical costs, which rose to $33.9 million, and selling, general, and administrative expenses, which increased to $36.7 million. The company also reported a stock-based compensation expense of $3.3 million, a notable rise from just $0.1 million in the previous year.

In terms of strategic developments, Urban One completed the sale of its interest in MGM National Harbor for approximately $136.8 million in April 2023, following the exercise of a put option. The company also entered into an asset purchase agreement with Cox Media Group to acquire its Houston radio cluster for $27.5 million, which was finalized on August 1, 2023. Additionally, Urban One is in the process of divesting its KROI-FM radio broadcasting license, with the transaction expected to close in 2024.

Operationally, Urban One's total assets decreased to $1.28 billion as of March 31, 2023, down from $1.34 billion at the end of 2022. The company reported a cash and cash equivalents balance of $71.9 million, with no outstanding borrowings under its asset-backed credit facility. The company’s employee headcount remained stable, and it continues to focus on enhancing its operational efficiency and market presence.

Looking ahead, Urban One anticipates challenges due to macroeconomic conditions, including inflation and interest rate volatility, which may impact advertising revenues. The company is also addressing material weaknesses in its internal controls over financial reporting, which could affect its compliance with Nasdaq listing requirements. Urban One is committed to implementing a remediation plan to strengthen its internal controls and improve its financial reporting processes.