CUMULUS MEDIA Announces Successful Completion of $175 Million Debt Paydown

Rhea-AI Summary

Cumulus Media (NASDAQ: CMLS) has successfully reduced its debt by $175 million using available cash. CFO Francisco J. Lopez-Balboa highlighted the positive impact of improving economic conditions on business momentum, leading to this debt repayment strategy. Key actions included a $60 million paydown of its ABL Revolver and approximately $89 million from its Term Loan related to prior asset sales. The company also launched a tender offer to repurchase around $26 million of its Senior Secured Notes, enhancing its financial flexibility with over $200 million in liquidity.

Positive

• Successfully reduced debt by $175 million.
• Improved financial flexibility with over $200 million in liquidity.
• Positive business momentum driven by economic recovery.

Negative

• None.

ATLANTA, June 25, 2021 (GLOBE NEWSWIRE) -- Cumulus Media Inc. (NASDAQ: CMLS) today announced that it has successfully completed its previously announced actions to pay down $175 million of debt using cash on hand as further described below.

Francisco J. Lopez-Balboa, Executive Vice President and Chief Financial Officer of CUMULUS MEDIA, said, “As the improvement in economic and public health conditions continues to drive momentum in business trends, we felt it appropriate to accelerate several debt repayments in order to expedite our balance sheet de-levering, reduce interest expense, and increase our free cash flow generation. We believe this better leverage and free cash flow profile, more than $200 million of available liquidity⁽¹⁾ and solid rebound trajectory are significantly enhancing our financial flexibility. Given our strong competitive position, proven execution track record, and numerous revenue growth drivers, we are confident in our multiple pathways to grow shareholder value.”

Details of Debt Reduction:

On May 17, 2021, the Company completed a $60 million repayment of its ABL Revolver due 2025, which represented the entirety of the amount outstanding under the facility. Following the paydown, the ABL Revolver due 2025 is undrawn and available as liquidity for general corporate purposes.

On May 25, 2021, the Company paid down approximately $89 million of its Term Loan Credit Facility due 2026 (the “Term Loan”) related to a mandatory prepayment obligation arising from the Company’s previously announced sale of land in Bethesda, MD, in June 2020 and sale of towers and related assets (the “Tower Sale”) in September 2020.

Pursuant to the terms of its 6.75% Senior Secured First Lien Notes due 2026 (the “Notes”), on May 26, 2021, the Company launched a tender offer (the “Tender Offer”) to repurchase approximately $26 million of the Notes at par, which represents the pro rata amount required to be offered from the proceeds of the Tower Sale. As of the expiration of the Tender Offer, approximately $3 million of Notes were validly tendered, accepted for payment and subsequently cancelled. Giving effect to the impact of the Tender Offer, approximately $450 million principal amount of Notes remains outstanding.

On June 24, 2021, the Company submitted an irrevocable paydown notice to the administrative agent of the Term Loan to effectuate a required paydown of $23 million, which represents the remainder of the initial amount of the Tender Offer that was not validly tendered prior to the expiration date. Holders of the Term Loan will receive their pro rata portion of such paydown on or around June 28, 2021.

This press release does not constitute a notice of redemption under the optional redemption provisions of the indenture governing the Notes, nor does it constitute an offer to sell, or a solicitation of an offer to buy, any security. No offer, solicitation, or sale will be made in any jurisdiction in which such an offer, solicitation, or sale would be unlawful.

Footnote:

1. Represents $294 million of unrestricted cash on hand as of March 31, 2021, less $175 million used to paydown debt as described herein plus $83 million of availability under the ABL Revolver due 2025.
   

About CUMULUS MEDIA

CUMULUS MEDIA (NASDAQ: CMLS) is a leading audio-first media and entertainment company delivering premium content to over a quarter billion people every month — wherever and whenever they want it. CUMULUS MEDIA engages listeners with high-quality local programming through 415 owned-and-operated stations across 86 markets; delivers nationally-syndicated sports, news, talk, and entertainment programming from iconic brands including the NFL, the NCAA, the Masters, CNN, the AP, the Academy of Country Music Awards, and many other world-class partners across nearly 7,300 affiliated stations through Westwood One, the largest audio network in America; and inspires listeners through its rapidly growing network of original podcasts that are smart, entertaining and thought-provoking. CUMULUS MEDIA provides advertisers with personal connections, local impact and national reach through broadcast and on-demand digital, mobile, social, and voice-activated platforms, as well as integrated digital marketing services, powerful influencers, full-service audio solutions, industry-leading research and insights, and live event experiences. CUMULUS MEDIA is the only audio media company to provide marketers with local and national advertising performance guarantees. For more information visit www.cumulusmedia.com.

Disclosure Regarding Forward-Looking Statements

Certain statements in this release may constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Such statements are statements other than historical fact and relate to our intent, belief or current expectations primarily with respect to our future operating, financial, and strategic performance. Any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual results may differ from those contained in or implied by the forward-looking statements as a result of various factors including, but not limited to, risks and uncertainties related to the implementation of our strategic operating plans, the evolving and uncertain nature of the COVID-19 pandemic and its impact on the Company, the media industry, and the economy in general and other risk factors described from time to time in our filings with the Securities and Exchange Commission. Many of these risks and uncertainties are beyond our control, and the unexpected occurrence or failure to occur of any such events or matters could significantly alter our actual results of operations or financial condition. CUMULUS MEDIA assumes no responsibility to update any forward-looking statements, which are based upon expectations as of the date hereof, as a result of new information, future events or otherwise.

For further information, please contact:

Investor Relations Department
IR@cumulus.com
404-260-6600

FAQ

What recent debt reduction actions did Cumulus Media (CMLS) take?

Cumulus Media announced a $175 million debt reduction, including a $60 million paydown of its ABL Revolver and approximately $89 million from its Term Loan.

How much liquidity does Cumulus Media (CMLS) have after the debt paydown?

Cumulus Media maintains over $200 million in liquidity following the recent debt paydown.

What impact does Cumulus Media's (CMLS) debt reduction have on shareholders?

The debt reduction enhances financial flexibility and free cash flow generation, potentially increasing shareholder value.

What is Cumulus Media's (CMLS) position in the market after recent actions?

Cumulus Media believes its competitive position and execution track record are strong, which supports multiple pathways to grow shareholder value.