DARTMOUTH, NS — Newfoundland Capital Corporation Limited, owner and operator of Newcap Radio, reported decreases in its quarterly and year-to-date revenues, primarily due to revenue declines in the company’s Alberta and Newfoundland and Labrador operations.
Newcap’s revenue for the second quarter of 2017 was $43.6 million, which is $0.6 million or 1% lower than its revenue in the same quarter last year. The company’s year-to-date revenue at the end of the second quarter was $79.3 million, a decrease of $1.8 million or 2% when compared to the first half of 2016.
These revenue decreases were largely as a result of the continued economic challenges faced by the company in its Alberta and Newfoundland and Labrador markets, Newcap said in a press release. Another negative factor was the decline experienced by Newcap Radio’s Ottawa operation due to downward pressure on advertising rates in that market, Newcap said. These declines were partially offset by growth in Newcap Radio’s Toronto and Sudbury, Ont., operations, which have achieved strong listener ratings, Newcap added.
The company’s adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $13.9 million in the second quarter of 2017 was on par with its second quarter last year, but its year-to-date adjusted EBITDA of $20.9 million was $1.1 million or 5% lower when compared to the first half of 2016. However, excluding the impact of a $0.4 million non-cash expense related to the extension of certain executive stock options, adjusted EBITDA would have been 3% higher for the quarter due to the company’s focus on controlling costs and operating efficiently, Newcap said.
Newcap’s profit for the second quarter of 2017 was $8.4 million, which is $0.1 million or 1% higher than the same quarter in 2016. However, year-to-date profit for the company was $11.3 million, a decrease of $1.6 million or 12% compared to the first half of last year, due primarily to its lower revenue, Newcap said.
Among the significant events experienced by the company in the second quarter of 2017, Newcap received CRTC approval for the purchase of three radio stations in Kamloops, B.C., which the company finalized in June. Also in June, Newcap received CRTC approval and finalized the sale of CISL-AM in Vancouver.
After the quarter ended, the company’s board of directors approved an increase in dividends to $0.50 per share per annum, up from $0.20 per share per annum. As a result, the board of directors declared a dividend of $0.25 per share on each of the company’s Class A subordinate voting shares and Class B common shares, payable on September 15, 2017, to all shareholders of record at the close of business on August 31, 2017, the company announced in a separate press release.
“The company had a successful second quarter as a focus on controlling costs resulted in savings that more than offset a slight decline in broadcasting revenue,” said Rob Steele, president and CEO of Newfoundland Capital Corporation, in the press release announcing the company’s second quarter results. “We are pleased with the company’s overall results as our efforts to operate efficiently have allowed us to grow margins in the broadcasting segment compared to the same quarter last year.”
