Audacy
Shaboozey’s “A Bar Song (Tipsy)” updates a long-standing country music tradition — drowning one’s sorrows in whiskey — by way of J-Kwon’s 2004 rap hit “Tipsy.” The first time the singer played it for his label, EMPIRE, one question was top of mind for those in attendance: “Everybody was like, ‘When are you going to country radio?’” recalls EMPIRE CEO Ghazi.
In Ghazi’s view, that was a “very limited” plan. He had a more ambitious one: Push the song to multiple formats simultaneously. “For a record like that,” he says, “it’s a no-brainer.” Shaboozey released “A Bar Song (Tipsy)” in April; within a month, EMPIRE was promoting it to five different segments of the airwaves.
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Radio promotion is traditionally expensive, which is why it’s one of the last frontiers in the music industry that is still dominated by the major labels. Yet “A Bar Song (Tipsy),” released by an independent, recently became the first single in history to crack the top 10 on Billboard’s Country Airplay, Pop Airplay, Adult Pop Airplay and Rhythmic Airplay charts. (Adult pop is like regular pop but more sedate, while rhythmic usually mixes rap, R&B and some dance music; the rankings are based on airplay from a panel of stations in each format.)
“It’s important that Shaboozey has been able to show that you can do that as an independent artist,” says Heather Vassar, senior vp of operations for EMPIRE in Nashville. “We had several offers from majors who wanted to work the record, and it was really important that we were able to stay true to how we operate” — and scale the charts without their help. All that airplay counts towards the Hot 100, which Shaboozey has topped twice in non-consecutive weeks; notably, when “A Bar Song (Tipsy)” rebounded to No. 1 on the latest ranking, it was down in streams and sales, but up 11% in radio audience.
Songs that do well in multiple spaces on the airwaves usually unite coalitions of similar-minded formats. Miley Cyrus’ “Flowers” and The Weeknd’s “Blinding Lights,” for example, both hit No. 1 at pop, adult pop and adult contemporary. “Typically pop will share a lot with adult contemporary,” says Tom Poleman, chief programming officer at iHeartMedia. “It’s a similar group [of listeners], just an older demographic.”
The biggest R&B hits, however, tend to amass a different base of support. Robin Thicke, Pharrell Williams and T.I.’s “Blurred Lines” and Mariah Carey’s “We Belong Together,” both massive radio hits, reached No. 1 at adult R&B, mainstream R&B/hip-hop, rhythmic and pop.
EMPIRE, which has been traditionally strong in hip-hop and Afrobeats, will often promote songs to mainstream R&B/hip-hop, rhythmic and pop, according to Ghazi. But Shaboozey’s combination of formats is unusual. Only 13 songs have ever appeared on all four of the charts where he is now romping inside the top 10.
Country radio in particular has faced criticism in recent years for being unwilling to support songs by women or Black artists. Despite this history, 30 stations played “A Bar Song (Tipsy)” in April before EMPIRE sent the track to country programmers on May 3. “The streaming numbers were undeniable, but I was wondering how long it would take to convince a terrestrial country radio program director” to play the track, says Johnny Chiang, lead programmer for country music at SiriusXM and Pandora. “I am pleasantly surprised that they got it pretty quick.”
EMPIRE brought in Magnolia Music, an indie promotion company that has worked with the singer Randy Houser, to handle its country radio campaign. “Country radio, respectfully, always wants loyalty from artists,” Vassar says. “There was curiosity — is this one-and-done? Is Shaboozey going to go elsewhere [and stop paying attention to country radio] after this?”
Not everyone was concerned, though. For Tim Roberts, Audacy’s vp of country, Shaboozey “was already accepted by a bunch of country artists, so it just seemed natural” to play him. He first learned about “A Bar Song (Tipsy)” from a DJ who told him it was filling the floor at Coyote Joes, a country nightclub outside of Detroit, where Roberts also serves as a brand manager for WYCD. Two Audacy stations, KMLE and WPAW, were among the first prominent supporters of the song.
To quell other programmers’ anxieties, EMPIRE played them the rest of Shaboozey’s album, which has plenty of country signifiers, from pedal steel guitars to a sample of a horse neighing. In addition, Vassar says, the label introduced the singer to programmers when they were able to, “so they can understand the world that he’s building.” Roberts met Shaboozey the week of the Academy of Country Music Awards; the singer Jelly Roll brought him out during a performance at Billy Bob’s.
After EMPIRE officially started pushing “A Bar Song (Tipsy)” to country radio in May, 43 more stations threw it into their playlists immediately, including 38 owned by iHeartMedia. The format accounts for more than 20% of the single’s airplay so far, second only to top 40.
Shaboozey’s efforts to conquer pop and adult pop were aided by the fact that those formats have been more receptive to country songs recently — last year, Luke Combs’ “Fast Car” and Morgan Wallen’s “Last Night” both crossed the divide. That sound “has been working at the top 40 format,” says Matt Johnson, program director for WPLW. “And when you combine that with a feel-good song as the weather is getting sweltering, that’s a recipe for a summertime hit.”
iHeartMedia felt similarly. “We got really aggressive at pop on that song because we saw it taking off,” Poleman says. Pop stations now account for more than 40% of Shaboozey’s airplay.
While there has been common ground recently between country and pop-adjacent formats, it’s still rare for country and rhythmic stations to share tracks. “Sometimes programmers follow the rulebook too much where it’s like, ‘This song doesn’t fit the normal criteria of what a rhythmic record should sound like,'” acknowledges Jonathan Steele, brand manager for KKFR in Phoenix. “I listen to everything and ask, is this going to alienate our audience? With Shaboozey, I knew my audience was going to get that hook stuck in their head.”
The rhythmic format was slower to welcome “A Bar Song (Tipsy)” relative to country and pop. But the track kept showing up on Shazam charts in places like Columbus, Ohio, where Chris Harris oversees WCKX, another rhythmic outlet. He started playing Shaboozey’s single in May, and he now has his eye on another alcohol-fueled country-rap fusion, Moneybagg Yo’s “Whiskey Whiskey,” a collaboration with Wallen.
Harris also “took a gamble” at his mainstream R&B/hip-hop station, WIZF, and added “A Bar Song (Tipsy)” there recently. “We got a great response,” he says. But this is the one format EMPIRE targeted where “A Bar Song (Tipsy)” has faltered, failing to get near the upper reaches of the chart.
Still, “Next week, we should be top five at four formats,” Ghazi says. “I’m going to take a stab at going No. 1 at all four. Why not?”
It’s time for another spin around the Executive Turntable, Billboard’s comprehensive(ish) compendium of promotions, hirings, exits and firings — and all things in between — across music. Check out this year’s Pride List of top LGBTQ+ executives in the industry. We also have a weekly interview series spotlighting a single executive and a regularly updated gallery honoring many of the industry figures we’ve lost throughout the year.
Universal Music Sweden managing director Joakim Johansson has been promoted to president of the entire Nordics region for Universal Music Central Europe. He’ll continue MD’ing on the Sweden side but adds oversight of UMG operations in Denmark, Norway and Finland, as well as the Baltics (Estonia, Latvia and Lithuania). The individual directors of those markets (Casper Bengtson/Denmark, Kimmo Valtanen/Finland and Bjørn Rogstad/Norway) will now report directly to Johannson, who continues to beeline to Frank Briegmann, chairman & CEO of UMCE and Deutsche Grammophon. Johansson’s expanded role aligns with Briegmann’s ongoing strategy to amplify cross-market collaboration and innovations throughout Central Europe. Johansson joined the company in 2013 as GM of Universal Music Sweden, being promoted to MD six years later. “The Nordic countries boast a rich musical heritage and are at the forefront of industry innovation,” he said. “It’s an honor to lead our talented team in this vibrant region, and I look forward to driving our vision into the future.”
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Audacy elevated journeyman Jeff Sottolano to chief programming officer, effective immediately. Sottolano, who joined CBS Radio in 2001 as an intern and has served as executive vp and head of programing since 2021, will now oversee content strategy and creation in all formats across broadcast, streaming and podcasts, as well as work with product and technology teams on ways to improve creator tools and more. Over a 15-year stretch at CBS, which was acquired in 2017 by Entercom (later Audacy), Sottolano held programming roles in Rochester and Philadelphia before joining the front office in 2014 as director of programming. During the Entercom era, he rose to executive vp of programming, which carried over following the post-Audacy rebrand. For most of the last decade, Sottolano’s brand portfolio has gained market share in the A25-54 demo and he has led numerous company-wide initiatives including Audacy Launch, the company’s new music discovery platform for rising artists. “I consider myself so fortunate to work with our programmers, talent, anchors, reporters and producers who, together, build incredible brands, entertain and inform, and make a difference in the lives of millions of consumers every day,” said Sottolano.
Spirit Music Group appointed Lou Al-Chamaa to executive vp of A&R, a role based in Los Angeles and reporting to Spirit’s chief creative officer, Frank Rogers, who lauded the new hire’s “drive, passion and experience in building successful writer rosters” while in senior roles at AVEX USA, Sony Music Publishing and during his time as a consultant. “The opportunity to collaborate with such a forward-thinking team and contribute to the evolution of music creation is incredibly inspiring,” Al-Chamaa said. “I am deeply committed to fostering an environment where artists, songwriters, and producers can thrive creatively.”
Capitol Christian Music Group boosted its A&R efforts at a pair of its most storied imprints. Walter Thomas is promoted from director of artist development at CCMG to the new position of vp of artist development for Motown Gospel and TAMLA. Thomas, who joined the UMG label group last year, reports to CCMG co-presidents Brad O’Donnell and Hudson Plachy. Working closely with Thomas is Alexandria “Dria” Dollar, who joined CCMG in the role of senior director of A&R at TAMLA and Motown Gospel following a stretch as director of A&R at Reach Records in Atlanta. “These iconic labels have a legacy of inspiring and uplifting music,” said Thomas, adding that “Alexandria’s innovative approach and keen ear for talent are unmatched, and I am confident that together we will elevate our artists to new heights.”
Kelly Bolton
Credit: Jessica Amerson
Warner Records added Kelly Bolton as vp of A&R. Working out of Nashville, Bolton will work with Warner co-chairman/CEO Aaron Bay-Schuck on signing, developing, and cultivating country artists for the Los Angeles-based label. Bolton will report to executive vp and head of A&R Karen Kwak. Over the past few years, Warner has added artists including Zach Bryan, Dasha and Warren Zeiders to its roster. Bolton most recently served five years at Ashley Gorley’s Tape Room Music, rising to senior vp of A&R. Prior career stops include Big Deal Music and Black River Entertainment. –Jessica Nicholson
RADIO, RADIO: Vox co-founder Melissa Bell is the next CEO of Chicago Public Media, non-profit owner of WBEZ and the Chicago Sun-Times. She succeeds Matt Moog and officially starts Sept. 3 … Not so fast on that retirement, Joe Verbrugge. SiriusXM‘s chief commercial officer was supposed to depart yesterday (June 27) but will instead remain in place until July 31 before switching to a part-time role as advisor to the CEO through the end of the year.
Wasserman Music added three veterans to its global ranks as it looks to build on the firm’s suite of client services. Joining the London team as manager of tour marketing is Adam Clements, who has 15 years of experience between stops at Birmingham’s O2 Academy and O2 Institute, Eventim UK and AEG Presents. Over in Chicago, Oskar Muller joined as director of pricing & ticketing (Chicago) after serving as pricing director at Live Nation Entertainment. Finally, in sunny L.A., Jenn Rilloraza joined as manager of brand partnerships following time as director of marketing, brands and creative services for Create Music Group’s VRTCL vertical. “We are relentless in continually creating new ways to serve our valued clients around the world, and these important new additions to Team Wass reflect that,” glowed Wasserman Music president Lee Anderson.
The Academy of Country Music made promotions and new hires across several departments. Tommy Moore has been promoted to chief of staff and vp, industry relations & awards, board administration and governance. Kris Reyes has been promoted to senior director of finance, operations and HR. Meanwhile, Jesse Knutson has been elevated to director of publicity and media relations. Haley Montgomery has been elevated to director of industry relations & awards, while Jennifer Davis has been promoted to senior manager of events. Brittany Uhniat has been promoted to manager of content & creative production. New hires include Katie Casserly as coordinator of social media, with Maggie Feyrer hired as coordinator of strategic partnerships and Delaney Loughran as assistant, industry relations & awards. –J.N.
BOARD SHORTS: The Association of Music Producers elected Matt Nelson of Yessian Music as the ad music trade group’s new president of its national board. Nelson, who joined the board’s eastern chapter six years ago, succeeds Carol Dunn as national board president. Succeeding Nelson as president of the eastern chapter will be Made Music Studio executive Amy Crawford … The International Bluegrass Music Association elected two new members of its board and welcomed the return of a third. After a year away, former IBMA board chair Mike Simpson is back, and joins newcomers CJ Lewandowski and Annie Savage as board officers … Musicians On Call appointed True Public Relations co-owner Marcel Pariseau and songwriter Sam Hollander to its national board of directors.
Dylan Brewer, a veteran label executive and experiential marketer, launched a new creative music company dubbed FRAUDULENT. Since forming, the Los Angeles-based firm has already worked on campaigns for Laufey (alongside Microsoft) and Jessie Reyez. The two-time Clio award winner was most recently vp of marketing and head of experiential at Epic Records, working on a roster including Ozzy Osbourne, Madison Beer, Bakar, BEAM, AG Club, Headie One, J Hus and more. Prior to joining Epic in 2018, Brewer was a marketing and strategy lead at Def Jam Recordings for over three years, and earlier in his career produced music campaigns at Google. Reach out to Brewer at hi@fraudulent.live.
WHY&HOW added veteran artist manager Patrick Farr to its management team, based in Nashville. Farr arrives following six years at his own Revelator Management company, and another six at Philymack before that. During his career he has worked with such artists as Nick Jonas, DNCE and Demi Lovato, as well as Sophia Scott, who comes with him to WHY&HOW. “Not only does Patrick bring immense experience, but a fitting addition to our roster in Sophia Scott,” said WHY&HOW founder & CEO Bruce Kalmick. “I’ve been a fan of Patrick’s work ethic and savvy approach to artis development for a long time – we look forward to having him jump in with our team.”
NASHVILLE NOTES: Lauren Thomas was promoted to Columbia Nashville svp of promotion from vp and will have a day-to-day role with both the Columbia and RCA Nashville imprints … Big Machine Label Group promoted Ashley Sidoti to svp of promotion and digital for its Valory Music Co. imprint. Sidoti most recently served as vp of promotion and digital … The Gospel Music Association appointed veteran producer, marketer and network leader Steve Gilreath as executive director of the Christian & Gospel Music Museum at the Dove Center. Gilreath will report directly to Jackie Patillo, president of the Gospel Music Association … The Academy of Country Music is looking for a director of brand creative and design, as well as a director of strategic partnerships. View the listings here.
Influencer marketing agency VRTCL elevated Imani “Mango” Lewis to director, overseeing operations for the entire VRTCL team. Lewis, who is based in Los Angeles, joined VRTCL in March 2021 as music department manager before rising to head of music — and then director of music — last year. Recent wins for the viral content firm include campaigns for Beyonce’s “Texas Hold Em,” Kasha’s “Austin” and Lil Durk’s “All My Life.” “Imani’s exceptional talent and dedication have consistently driven some of our most successful influencer campaigns in recent years,” said Ash Stahl, CEO of umbrella company FH Media. “Her innovative strategies and unwavering commitment to excellence make her an invaluable asset to the VRTCL team.”
BSI Merch, a UK-based independent music merch and tech company, selected Charlie Simmonds to lead its expansion into the Asia-Pacific market. Located in Tokyo, the new outpost will primarily focus on e-commerce, merch supply, tour support, sales and superfan-related services. “By focusing on e-commerce and localising our services, we aim to deliver world-class support and grow our presence in this key market,” said Andy Allen, CEO. Throughout his career, Simmonds has worked with such artists as Billie Eilish and Sticky Fingers, and events including New York Comic Con and Signature Brew.
ICYMI:
Cheryl Paglierani
UK Music made it official, appointing interim chief Tom Kiehl as full-on chief executive of the music trade body. He succeeds Jamie Njoku-Goodwin, who left last year to work for soon-to-be former Prime Minister Rishi Sunak … Music agent Cheryl Paglierani joins CAA from UTA, where she served as a partner … Rodrigo Prichard was named general manager of Rimas Entertainment, effective July 1. Meanwhile, Kristen Quintero-Garriga has been named vp of brand partnerships under RIT.MO.
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Jelly Roll‘s hard-fought journey from prison inmate to Billboard chart-topper is well-known, and was even the focus of the Hulu documentary Jelly Roll: Save Me. Onstage and in interviews, he is unfiltered and down-to-earth in relating to his audience and sharing his story. Explore Explore See latest videos, charts and news See latest videos, charts […]
Audacy has reduced its workforce by 2%, according to a company spokesperson. Affected employees included a Boston sports reporter who was laid off the day before today’s NFL Draft, a Chicago afternoon news anchor and roughly 98 other employees, according to reports. “It’s like, ‘How many layoffs can they go through before there’s nobody left?’” […]
Six weeks after Audacy filed for bankruptcy, a corporate maneuver that sees Soros Fund Management emerge as the radio company’s primary shareholder.
Soros Fund Management takes its seat at the head of the table after acquiring a sizeable chunk of Audacy’s debt, roughly $414 million in total.
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The private investment management fund takes around 40% of Audacy’s total senior debt, source tells the New York Post, outsizing the stakes held by the likes of PGIM, Capital Commercial Finance, Goldman Sachs Asset Management, Mockingbird Credit Opportunities Company, and Solus Alternative Asset Management.
Billboard reached out to Audacy but reps hadn’t responded at press time.
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Led by chairman George Soros, who founded the private investment management fund in 1970, Soros Fund Management has experience working with radio and media assets, including $80 million invested for Latino Media Networks by way of Lakestar Finance, notes Radio Ink, plus investments in Vice Media and Crooked Media.
Addressing the Soros development, Audacy noted, “The decision by our existing and new debtholders to become equity holders in Audacy represents a significant vote of confidence in our company and the future of the radio and audio business.”
Its statement continues, “We expect to emerge from our restructuring process with a strong capital structure and well-positioned to capitalize on our strategic transformation into a scaled leading multi-platform audio content and entertainment company. We intend to continue running our business, executing our strategy and delivering for our listeners and advertisers as we always do.”
The Soros investment comes amid a turbulent time for Audacy, which on Jan. 7 said it would file for Chapter 11 bankruptcy protection to reduce debts.
The Philadelphia-based broadcasting giant, formerly named Entercom, said at the time that a deal with debt holders would reduce its debt load by about 80%, from $1.9 billion, acquired primarily from its 2017 merger with CBS Radio, down to $350 million, according to The Hollywood Reporter.
That agreement, first disclosed by The Wall Street Journal, would give Audacy’s debt holders equity in the reorganized company.
Audacy’s portfolio includes 230 radio stations, among them WCBS in New York, KROQ in Los Angeles, WFAN Sports Radio in New York and WBBM Newsradio in Chicago. Audacy’s podcasting brands include two studios, Cadence13 and Pineapple Street Studios, and Popcorn, an online marketplace for connecting creators and brands. Each month, the business claims to engage with over 170 million.
Trouble was brewing back in May 2023 when the business warned that a weak financial outlook could cause it to default on its debt.
Audacy has previously said it does not expect any operational impact due to the bankruptcy and restructuring.
A hearing to approve the Audacy restructuring plan is set for Feb. 20 in a Houston bankruptcy court.
Radio company Audacy has reached a deal with a supermajority of lenders for a prepackaged Chapter 11 bankruptcy deal that will reduce its debt from $1.9 billion to $350 million, the company announced Sunday (Jan. 7). The agreement, first disclosed last week by The Wall Street Journal, will give Audacy’s debt holders equity in the reorganized company.
Chapter 11 proceedings began on Sunday in the United States Bankruptcy Court for the Southern District of Texas. Audacy filed a proposed plan of reorganization that incorporates the terms of the agreement with lenders. The company expects the court to hold a confirmation hearing in February and to exit bankruptcy proceedings once it receives FCC approval.
Some of Audacy’s lenders have committed to providing $57 million in debtor-in-possession financing — $32 million from a term loan and $25 million from an increase in an existing accounts receivable financing facility. The financing, along with the company’s cash from operations, will help Audacy maintain its operations and pay its employees, vendors and partners.
Once the plan is approved by the court, the terms of the current board of directors will expire and a new board of directors will be assigned. The plan of reorganization calls for the new board of directors to adopt a management incentive plan to reward employees and directors of the reorganized company. The plan will set aside 10% of new common stock for stock options, restricted stock, appreciation rights and other equity-based awards.
A 2017 merger with CBS Radio helped Audacy — then named Entercom — expand its business but also increased its debt load. The interest payments would have been more manageable in a growing business, but “the perfect storm of sustained macroeconomic challenges over the past four years facing the traditional advertising market has led to a sharp reduction of several billion dollars in cumulative radio ad spending,” David J. Field, Audacy chairman/president/CEO, said in a statement. “These market factors have severely impacted our financial condition and necessitated our balance sheet restructuring.”
The Philadelphia-based company’s portfolio of about 230 radio stations includes WCBS in New York, KROQ in Los Angeles, WFAN Sports Radio in New York and WBBM Newsradio in Chicago. Audacy’s podcasting brands include two studios, Cadence13 and Pineapple Street Studios, and Popcorn, an online marketplace for connecting creators and brands.
Sunday’s announcement eliminated nearly half of Audacy’s remaining equity value as the company’s share price fell 47.1% to $0.1058 on Monday. Audacy has traded over the counter since it was delisted from the New York Stock Exchange in May. A 30-for-1 reverse stock split increased the share price from $0.07 to $2.13 on June 30, but the stock lost nearly all its value over the next six months as financial problems mounted.
Audacy is expected to file for Chapter 11 bankruptcy after reaching an agreement with its lenders, according to a report at the Wall Street Journal. The prepackaged bankrupcy would be financed by the lenders, who would take ownership of the radio company following the restructuring, the report said.
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An Audacy spokesperson had no comment when contacted by Billboard.
Audacy, formerly named Entercom, is saddled by $2 billion in debt acquired primarily from its 2017 merger with CBS Radio. That deal expanded Audacy’s revenue but also increased its debt nearly fourfold from $468 million at the end of 2016 to $1.86 billion at the end of 2017.
The Philadelphia-based company’s portfolio of about 230 radio stations includes WCBS in New York, KROQ in Los Angeles, WFAN Sports Radio in New York and WBBM Newsradio in Chicago. Audacy’s podcasting brands include two studios, Cadence13 and Pineapple Street Studios, and Popcorn, an online marketplace for connecting creators and brands.
The company sounded alarm bells in May when it warned that a weak financial outlook could cause it to default on its debt. In an SEC filing, the company said “macroeconomic conditions” such as rising interest rates and depressed advertising revenue “have created, and may continue to create, significant uncertainty in operations.” As a result, its forecasted revenue was “unlikely to be sufficient” to maintain its debt covenants.
Third-quarter revenue of $299.2 million was down 5.6% year over year and in early November its fourth-quarter revenue was on pace to decline 9% from the prior-year period. Noting the company’s “current challenges,” CEO David J. Field said Audacy was in conversation with its lenders to recapitalize its balance sheet.
In recent months, Audacy has reached agreements with a number of lenders to extend the grace periods for interest payments from a credit facility and outstanding notes.
Audacy was delisted from the New York Stock Exchange the May for violating the exchange’s rules on minimum share price. It has since traded over the counter. Although a 30-for-1 reverse stock split increased the share price from $0.07 to $2.13 on June 30, the stock lost nearly all its value over the next six months.
On Wednesday, Audacy shares closed at $0.1896 per share, giving the company a market capitalization of less than $900,000.
Radio broadcaster Audacy has begun talks with its lenders to restructure the company’s debt as a soft advertising market clouds its long-term outlook. The discussions, first reported by the Wall Street Journal, follow the May 10 statement by chairman/president/CEO David Field during the company’s first quarter earnings call that Audacy was “finalizing its preparation to […]
A couple of years after the COVID-19 pandemic took radio listeners out of their vehicles and a recession caused an advertising slowdown, the radio industry is experiencing another decline. That has complicated the financial position of Audacy, the second-largest radio company in the United States and a major player in the podcast market.
Warning lights appeared again last week when the company revealed in its May 10th 10-Q filing that “current macroeconomic conditions” such as rising inflation and interest rates and lower advertising revenue “have created, and may continue to create, significant uncertainty in operations.” Those factors “have had, and are expected to continue to have, a material adverse effect” on Audacy’s forecasted revenue, which is “unlikely to be sufficient” to maintain compliance of the financial debt covenants its lenders impose to ensure it can make its interest payments. As a result, Audacy explained, the company could default on its debt — which could then cause that debt to become immediately payable.
On Tuesday (May 16), a week after the March 10 filing, the New York Stock Exchange (NYSE) decided to halt trading of Audacy’s shares in order to delist the company. It was an expected move. Audacy, which changed its name from Entercom in March 2021, last traded at $0.09 per share — down nearly 63% year-to-date — before trading on the NYSE was halted. The NYSE, which has rules to maintain minimum share prices, issued a warning to Audacy on July 31 because its average closing price over a consecutive-day trading period was below $1. Audacy last closed above $1 per share on July 5, 2022 — meaning it remained below $1 for 218 consecutive trading days.
Investors have lost some faith in radio companies’ stocks as advertising growth weakened in 2022. Year-to-date, shares of iHeartMedia, the nation’s largest radio company, have fallen 55.3%. Likewise, shares of Cumulus Media, the third-largest radio company, are down 47.5%. Market conditions appear to be improving, however. iHeartMedia expects its adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) to improve throughout 2023, CEO Bob Pittman said during the company’s May 2 earnings call. “And if this advertising market recovery trend continues in 2024,” Pittman added, “we expect to resume our growth trajectory that was interrupted by this period of advertising softness.”
The advertising market is part of Audacy’s problem, but it’s not the entire problem, according to Craig Huber, media analyst at Huber Research Partners. “The number one issue is too much debt in a secular declining industry,” says Huber. Audacy acquired most of its $1.9 billion of long-term debt from its 2017 merger with CBS Radio. That deal increased Audacy’s revenue more than four-fold, from $367 million in 2016 to $1.7 billion in 2018, but also increased its debt from $468 million at the end of 2016 to $1.86 billion at the end of 2017.
The debt has been a drag on Audacy’s cash flow. In 2022, Audacy’s net interest expense was $107.5 million — about 8.6% of the company’s annual revenue of $1.25 billion. After paying interest to service its debt, Audacy’s free cash flow in 2022 was -$31.8 million. “They haven’t done enough to take out costs” to achieve positive free cash flow, says Huber, and revenue hasn’t met the company’s own expectations.
When the merger with CBS Radio was announced in 2017, the combined companies had adjusted EBITDA of $500 million, including “expected transaction synergies,” according to the press release. In 2022, adjusted EBITDA was just $138 million. Even though Audacy was in compliance with its debt covenants on March 31, the company has expressed concern about its ability “to continue as a going concern” over the next 12 months.
Audacy operates in a difficult business that’s losing listening time as people change their listening habits and migrate to streaming platforms. Although Audacy, like iHeartMedia and Cumulus, has invested in digital platforms — it acquired podcasting companies Pineapple Street and Cadence13 in 2019 and was the No. 8 podcasting network in Q3 and Q4, according to Edison Research — revenue fell about 14% between 2018, the first full year after the CBS Radio merger, and 2022.
With no way around the soft advertising market, Audacy has started cutting costs and selling non-core assets. The company expects its costs will decline 4%, or $35 million, in the last three quarters of 2023, chairman/president/CEO David Field said during the May 10 earnings call. He also said the company raised $17 million in the first quarter from sales of broadcast towers and expects to close on the sale of two stations for $15.5 million in the second or third quarter.
As for Audacy’s stock, trading volume will decrease now that it’s been delisted. Since it started selling only over the counter (through a broker-deal, not on an exchange), the share price has fallen: On Wednesday, Audacy shares declined nearly 24% to $0.04, and they ended the week at $0.06.
The company will now take steps to get back to the NYSE. “While we are disappointed by the NYSE’s decision, we are hopeful we will find our way back to the exchange later this year as we execute our action plans which include a reverse stock split to satisfy NYSE rules, the continued execution of our liability management plans and working with our financial advisors to refinance our debt,” Field said in a May 16 press release. Shareholders will vote on the reverse stock split at the annual meeting on May 24. By working with the factors it can control, Audacy can soften the impact of the broader market conditions it cannot control.
The New York Stock Exchange (NYSE) has notified radio and podcast giant Audacy of its plan to delist the company’s Class A common stock from the exchange over its consistently low share price, Audacy announced Tuesday (May 16).
According to a press release, “the NYSE will consider commencing delisting procedures when a company’s listed securities experience an abnormally low selling price.” The NYSE abruptly halted trading of Audacy’s stock at 2 p.m. ET on Tuesday, when shares were trading for $.094 — down slightly from $.10 at the start of the day. The company’s share price is down nearly 63% since the beginning of the year.
NYSE rules require a minimum average closing price of $1 per share over 30 consecutive trading days, but Audacy’s share price hasn’t traded above that threshold since July 5, 2022.
The NYSE has applied to the Securities and Exchange Commission (SEC) to delist Audacy’s stock. While that process plays out, trading in the company’s common stock on the exchange will be suspended, though it can still be traded over the counter.
Audacy signaled its intent to appeal the delisting by filing a written request, which it is required to do within 10 days of receiving the delisting notice. If that appeal is successful, the stock may resume trading on the NYSE.
In a statement, Audacy president/CEO David J. Field said that while the company is “disappointed” in the NYSE’s decision, he is “hopeful” that Audacy stock will start trading on the exchange again later this year “as we execute our action plans which include a reverse stock split to satisfy NYSE rules, the continued execution of our liability management plans and working with our financial advisors to refinance our debt.”
Field also stated that the company is confident it “will benefit from a general market recovery and will be able to capitalize on our investments in strategic transformation that position Audacy well for the future.”
Radio companies have been slammed by an advertising slowdown since the second half of 2022, and Audacy has been particularly hard-hit. In its first-quarter earnings released Wednesday (May 10), the company’s net revenue of $259.6 million was down 5.7% year-over-year, while cash operating expenses were up 3%. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was $3.5 million, compared to $26 million in the first quarter of 2022.
On a May 10 earnings call, Audacy CFO Richard Schmaeling noted that the company’s network advertising revenue fell 6% year-over-year due to inflation and rising interest rates (though its podcast advertising revenue was up 14%). He warned that advertising demand has “further softened” since the start of 2023 and added that “it could get worse before it gets better,” noting that the company “is continuing to work to accelerate revenue growth, develop and execute added cost reduction actions and to sell other noncore assets.”
“However,” Schmaeling continued, “these actions may not be sufficient to fully mitigate the impact of potential further advertising weakness.”