Beasley Broadcast Group has announced its financial results for the second quarter of 2020, showing the impact that the coronavirus had on its finances. Net revenue in Q2 fell by 54 percent from $65.7 million a year ago to $30.4 million. The company took an operating loss of $17.6 million in the quarter, compared to operating income of $10.7 in 2019. Beasley saw a second quarter net loss of $18.2 million after $4.3 million in income during Q2 of 2019.
CEO Caroline Beasley commented, “While Beasley had a strong start to the year, a sharp decline in commercial advertising occurred in the second quarter with the onset of the COVID-19 pandemic. Beasley’s financial results for the three-month period ended June 30, 2020 reflect the economic pressures we experienced across our business as local and national advertisers adapted their media plans to meet the unique challenges of the pandemic. While we saw sequential month-over-month improvement in our commercial advertising revenue performance from April to May, and from May to June, our total net revenues for the second quarter decreased nearly 54 percent, which is in line with reported overall industry levels.
“To address the reduction in traditional advertising revenue that has occurred as a result of the pandemic, during the second quarter, we quickly implemented several changes across the Company, including reducing operating expenses and corporate overhead and realigning our Company-wide cost structure to preserve cash. As a result, Beasley’s second quarter total operating expenses declined by 12.7 percent, and year-to-date, we have taken approximately $26 million out of our cost structure. In addition to these actions, as part of our response, we have taken proactive steps to accelerate our digital transformation initiatives and revenue diversification strategies, and to become a leaner and more efficient organization, with the goal of growing our market leadership position across our stations, our digital operations, and our esports interests. We believe these steps will allow us to emerge from the pandemic as a stronger Company. In addition, during the second quarter, Beasley entered into an agreement to amend the financial covenants and other provisions under our credit agreement to support our liquidity and capital structure as we manage the business through the pandemic.
“Beasley continues to generate positive results from its digital and esports investments, which have been less impacted by the COVID-19 pandemic, with digital accounting for approximately 14% of total second quarter revenue, compared to 7.4 percent of total revenue in the prior year period. On the esports front, in addition to regular season play, in May the Houston Outlaws participated in the ‘Lone Star Showdown,’ an exclusive skills and team competition series versus the Dallas Fuel. This first-of-its-kind event was a tremendous success, and we remain focused on looking for new, innovative ways to monetize our esports content. Overall, we continue to be encouraged by the momentum and long-term growth trajectory of our digital and esports businesses.
“In closing, I am very proud of the work that our teams have done, and continue to do, to deliver high-quality, premium local content and critical safety information to our listeners across all traditional and digital media platforms during this challenging time for our country. Looking ahead, we are guardedly optimistic and remain focused on our strategic priorities of realizing synergy targets, reducing leverage, taking advantage of political and digital revenue opportunities, and benefiting from our esports investments and operations. While we expect that the pandemic will continue to impact our operations in the third quarter, we intend to continue to actively manage our business to best position the Company for the future, with the goal of delivering exceptional content and services to our listeners, advertisers, online users and esports fans, while creating new value for our shareholders.”
