Good morning, and welcome to the Spanish Broadcasting System First Quarter 2022 Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press Star then one on your telephone keypad. To withdraw your question, please press Star then two. Please note this event is being recorded. I would now like to turn the conference over to Brad Edwards. Please go ahead. Thank you, Andrea, and good morning, everyone. Before we begin, please recognize that certain statements on this conference call are not historical fact. They may be deemed, therefore, to be forward-looking statements under the Private Securities Litigation Reform Act of 1995. In particular, statements about future results expected to be obtained from the company's current strategic initiatives are forward-looking statements. Many important factors may cause the company's actual results to differ materially from those discussed in any such forward-looking statements. Spanish Broadcasting System undertakes no obligation to publicly update or revise its forward-looking statements. Please also note we will be discussing non-GAAP financial measures. The company believes that operating income or loss before depreciation and amortization, gain or loss on the disposal of assets, recapitalization costs, and other operating income or expense, excluding non-cash stock-based compensation or Adjusted OIBDA, is useful in evaluating its performance because it reflects a measure of performance for the company's stations before considering costs and expenses related to capital structure and dispositions. This information is not intended to be considered in isolation or as a substitute for operating income, net income or loss, cash flows from operating activities, or any other measure used in determining the company's operating performance or liquidity that is calculated in accordance with U.S. GAAP. A reconciliation of the company's U.S. GAAP information to Adjusted OIBDA is provided in the tables attached to the company's 2022 first quarter earnings release, which is available on the investor relations section of the company's website at www.spanishbroadcasting.com. I will now turn the conference over to Mr. Albert Rodriguez. Good morning, ladies and gentlemen. Welcome to the SBS 2022 First Earnings Conference Call. On today, we will provide an overview of recent operating developments and review our financial results. Joining me today are José I. Molina, our Chief Financial Officer, and Richard D. Lara, our General Counsel. Our first quarter results are a strong start to the year and build on the momentum we generated during 2021. Our team is executing at a high level and the power of our audio network and digital and mobile assets have never been clearer. Our performance in the first quarter was among the best in the industry, and our radio business in particular had incredible solid results. We delivered radio revenue growth of 75%, Adjusted OIBDA growth of 151%, and operating margins far superior to both our Spanish and English language peers. No one in the radio industry even came close to the performance of Spanish Broadcasting. Our compelling station formats, unique digital and mobile content, and deep connection with Latinos across all the markets we serve continues to drive strong financial performance and multi-platform audience growth. This past quarter, we closed on the acquisition of two audio stations in the Orlando and Tampa area, which made us the largest Hispanic radio operator in the state of Florida. We moved quickly to introduce our compelling El Zol Spanish tropical format at both stations, and the reaction from the listeners have been fantastic. If our first quarter results are any indication, 2022 is going to be another amazing year for SBS, our brand partners, and the communities we serve. Now let's review our operations, and we'll start with the AIRE Radio Network. For the first quarter, AIRE Radio Networks outpaced the marketplace by 27%. AIRE Network was able to widen the gap and had strong categories in this period. Such categories included retail at +155%, government 148%, pharmaceuticals +72%, insurance +94%, and general services +24%. AIRE continues its commitment to super serving Hispanics and asserts its position as the largest minority-owned and certified Spanish language audio network in the nation. Its core competitive advantages include 95% reach of the U.S. Hispanic audience with adults 18-49, 15 million weekly listeners across 100 markets nationwide, presence in the top 50 U.S. Hispanic markets. One of the key highlights for AIRE's initiatives includes Al Aire con el Terrible, La Mezcla con Alex Sensation, the Influencer Network, delivering campaign messages through a national platform while penetrating local markets, and Adicta 360, where brands are aligned with Latin artists. For the first quarter of the year, AIRE Radio Networks was up 34%. Miller Kaplan reported the market up by almost 6.7%. AIRE completely beat the total market in terms of revenue growth. Turning to our audio division, where we are number one in our top markets across the nation with unrelenting, rock-solid rating, performance, and listener growth. Our deep-rooted and hyperlocal super serving of the Hispanic community has driven our success. We have content and personalities that listeners just absolutely love to listen to. New York, we report again and again and again that we are the most potent audio combo in all of the five boroughs. Proof of the synergy and passion of the SBS team. WSKQ-FM Mega 97.9 FM is the number one audio station in the nation. With WPAT-FM 93.1 Amor, we have the number one and number two station in New York City. Our genuine involvement and listener appreciation of the New York Hispanic community has allowed us to build an unshakable, unbeatable listener relationship. WSKQ 97.9 and WPAT 93.1 Amor are the top stations in the market, regardless of language. Our online digital stream ratings indicate that WSKQ La Mega FM is the fastest and number one most listened to station in New York in any language format and all of the top demographics each quarter and year after year. No one in New York City has the digital stream ratings that WSKQ has. It does not exist. No one is even close. We continue to innovate and open our opportunities for growth in audience and revenues. For example, we have launched a new initiative. Our programming team has created new, original, and audio-on-demand content available on LaMusica.com. Our content is far superior than any of our peers or competitors. Our content is at Hollywood quality. Original and best moments of our top shows across the nation are now available on LaMusica.com. We are now turning to Los Angeles. We're excited to announce the launch of Omar and Argelia Morning Show on KXOL Mega 96.3 FM. This is no ordinary morning show. They are a married couple with over 18 years of success. On day one of launch on their new home, our streaming numbers more than tripled in audience. The show is fun and has unexpected, breathtaking moments. The listeners have spread the word among friends and family that Omar and Argelia are now on Mega 96.3 FM KXOL, Los Angeles. Just months after returning to his home, DJ AI is now the number one Spanish-rated afternoon show, adults 18- 34, Monday through Friday on KXOL Mega 96.3 FM from 3 P.M.- 6 P.M. KLAX La Raza is the number one Hispanic regional Mexican station, and our morning show, Al Aire con el Terrible, is the number one morning show among all stations, regardless of language. His commitment to the community, providing food, wellness information, and original fun entertainment, makes us the number one morning show among all Hispanics in the entire Los Angeles area. Puerto Rico's ratings have absolutely exploded. We have a station with the number one in just about every single demographic group. WODA, La Nueva 94, number one, 18-34. WMEG, La Mega 106.9, number one, 18-49. WZNT is number one with men 25-54. In Miami, WCMQ-FM Zeta 92.3 is at the top of the morning with audio and video journalist Oscar Haza, and it remains number one overall weekly with adults 18-34. WXDJ El Zol is gearing up for our upcoming MiamiBash concert, a highly anticipated event by our listeners that creates excitement in the market. WRMA Ritmo 95 is at the heart of the Cuban community and is the home of a unique blend of musical sounds and artists exclusive to the station, not heard anywhere else. Ritmo 95.7 is the only station that has established a powerful connection to listeners and clients in Miami with its continuous support of community efforts. Our overall station impressions continued to surpass the vast market. According to Miller Kaplan, the first quarter marked our 21st back-to-back quarter of outperformance as we beat our competitors by over 300 basis points. Now to MegaTV, where our national footprint remains more than 21 million homes via our cable and satellite broadcast partners. Our prime time content remains an area of focus, and we are making progress driving audience growth among critical demographic groups. Turning now to our live events division, SBS Entertainment also produced and delivered the first-ever three-day sold-out Calibash concert in L.A. On January 14th through January 16th, SBS Entertainment also launched the first-ever Latin Festival commemorative NFT, celebrating the 15th anniversary of the Calibash brand. Calibash Las Vegas and Día Nacional de la Banda, held in January, also saw record-breaking attendance and revenue outperforming all prior years. Based on the momentum and performance of the entertainment division, the company has focused on a robust calendar of events in 2022, including Mexican regional format concerts in markets like Chicago, San Francisco, and Los Angeles. The entertainment division is also developing strategic partnership with co-promoters in markets like Orlando, Puerto Rico, to expand its existing heritage shows. The division currently has over 16 shows scheduled just this year alone, which is an increase of over 100%. Now turning to our mobile and digital platforms and strategic initiatives. Over the last several years, we have had great success transforming SBS into the leading multimedia Hispanic media company, period. Today, we connect brands with more Hispanics than ever before, and our aggregate audience continues to expand. For our brand partners, there has never been a more important time to have a Latino-focused marketing strategy and outreach program. The Latino population is growing rapidly in size, cultural influence, and tremendous purchasing power. SBS has the multimedia assets, the reach, and over four decades of experience and commitment to the Latino community across the U.S. As such, we can deliver compelling and integrated advertising opportunities that cross all of our major media platforms and offer access to coveted demographic groups. As I stated, our aggregate audience continues to grow. As of March 30, our total audience was up 22% compared to Q1 the prior year. Our LaMusica platform reaches 1.8 million people who combine for over 19 million streaming hours per month. Usage and adoption of LaMusica continues to accelerate as it offers a truly unique mobile and digital experience, including original daily video content, short form programming, millions of songs, and a personalized experience. Overall, we have placed strategic emphasis on identifying new digital revenue streams as well as increasing our CPMs on existing digital offerings. During the first quarter, our streaming audience surpassed 1.7 million per month. This audience delivered 52 million listening hours and over 46 million total sessions in the quarter. Given Hispanics heavily overindex on mobile phone ownership and usage, mobile remains the primary driver of our mobile digital traffic and accounted for approximately 95% of our total digital traffic in the quarter. In the first quarter, LaMusica had a record of 500 million audio ad impressions, in addition to the 140 million display impressions and 90 million video pre-roll impressions. A key driver of growth in streaming hours and sessions has been the expansion of our La Música user base, as well as increasing consumption of our podcast and playlist products, with an average time spent listening of over 45 minutes in the most popular categories. We have added over 20 new shows in Q1 to our podcast offerings, and we expect a tremendous growth on this category for the rest of 2022. In summary, the first quarter marked a strong start to 2022. We delivered a strong financial performance, and we have sustained momentum we generated during 2021. Our audio business will be further strengthened by the addition of El Zol Orlando and Tampa stations, and we continue to meaningfully grow our aggregate multi-platform audience. In addition, our digital and mobile engagement metrics continue to grow, and we are connecting leading national brands with highly engaged Latino consumers in more ways than ever. We had a strong 2021 and entered this year with significant momentum across our business. Our first quarter results demonstrate our ability to build on that momentum and deliver industry-leading growth. We could not be more excited about the year ahead. These are exciting times for SBS, and we see a number of opportunities to drive accelerated growth and deepen our connection with Latinos across the communities we serve. This marks the fourth consecutive quarter of SBS generating revenue at much higher levels than we were at the pandemic. Thanks for your time and your attention. Now, let me turn the call over to José Molina for the financial overview. José? Thank you, Albert. Now turning to our first quarter results. Our consolidated revenues totaled $40.4 million, compared to $24.6 million for the same prior year period, resulting in an increase of $15.8 million or 64%. Our radio revenues totaled $38 million, increasing $16.3 million or 75%. This growth was primarily due to increases in special event revenue and local network and digital sales. Additionally, our radio revenues exceeded the same pre-pandemic period in 2019 by $4 million or 12%, which marks the fourth consecutive quarter that radio revenues are above 2019 levels. Our television revenues totaled $2.4 million, a decrease of approximately $500,000 or 18% due to lower national barter and local sales. Our consolidated Adjusted OIBDA, a non-GAAP measure, totaled $6.7 million compared to $1.4 million for the same prior year period, representing an increase of $5.3 million. Our radio Adjusted OIBDA increased $7.1 million, primarily due to the increase in revenues of $16.3 million, partially offset by an increase in operating expenses of $9.2 million. Our radio station operating expenses increased mainly due to special event expenses, compensation and benefits, local commissions, advertising and promotions, travel and entertainment expenses, music license fees, and barter expense, partially offset by decreases in the allowance for doubtful accounts and professional fees. Also and again, for the fourth consecutive quarter, our radio Adjusted OIBDA exceeded the same pre-pandemic period in 2019. Our television Adjusted OIBDA decreased approximately $400,000 due to the decrease in revenues. Corporate expenses increased $1.3 million, primarily due to increases in compensation and benefits, travel and entertainment, and outside services. Operating income totaled $5.8 million compared to a loss of $800,000 for the same prior year period, representing an increase of $6.6 million. Capital expenditures during the first quarter were approximately $710,000. As of yesterday, we had cash on hand of approximately $8 million. In addition, we have an undrawn $15 million revolver fully available if needed. On April 29, we closed on the acquisition of our two new FM radio stations in Orlando and Tampa for a purchase price of $12.5 million. We used cash on hand to fund these acquisitions. This will conclude my formal remarks. With that, I would like to turn the call over to the operator for any questions. Operator? We will now begin the question-and-answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. Our first question will come from Tim Daggett of RBC. Please go ahead. Hey, guys. Thanks for taking the questions. Good morning, Tim. Great. Hey, good morning. Could you talk about the trends that you're seeing in the second quarter on both the radio and the TV side as we're halfway through the quarter, and kinda what you're seeing now? I can tell you that national is up mid- to high-single digits. Network is exploding. Network is in the high 30s or 40s. We're seeing the highest gains in the company's history in network. Local is gonna be up a few points. We're doing a concert this month. We have solid projections on that here in New York and with a very high estimate for sponsorships. We're feeling really good. Great. You know, looking at the outlook for 2022, I know we've talked before about the path to getting over $50 million of EBITDA. Does that still seem reasonable, given, you know, the first quarter and kinda the outlook in the second quarter? Do you think we can hit or surpass that $50 million of EBITDA number in fiscal 2022? That's certainly the target. We're very optimistic about this year. There's gonna be a lot of political money coming in and Spanish Broadcasting. Because of the technology and the reach and the content that we have, we will be in pretty much every single swing state in the nation with respect to political advertising. We're very, very excited about that. Our programmatic revenue is absolutely gone through the roof and continues to grow with the certain deals that we've done. We're very optimistic about 2022. Great. We think about the M&A environment. What are you seeing out there in the market in terms of multiples, you know, assets for sale? I know you made the two recent purchases. What are you seeing in terms of, you know, more potential opportunities to buy some stations in the market? Look, after the company's successful. After the company's successful refinance, we are very well positioned to grow our platform because of our content and because of the 2020 census, which showed the Hispanic group in terms of continuing to be the biggest minority, but grew faster than every single other group. There's Hispanics across the nation. If there's stations that make sense for us and the number is right, that's something that we're very open to. We are 100% in the growth mode because of the audience that we serve. Our technology as a broadcaster for radio is the best compared to. We're like a Silicon Valley technologically advanced audio and video company. The reason for that is because we have the number one station in America, which is in New York, Mega. At the same time, that's the number one station, which is Mega New York, on the broadcasting side and on the streaming side. We are uniquely qualified because of the technology, the team, the programmers that we have. We feel we are best in class in audio and streaming, period. Awesome. Then maybe like longer term, you know, the business is executing at a very high level. What's like the longer term plan for Spanish? Maybe, you know, three to five years out, where do you see yourselves? Do you see as a potential sale to somebody else, getting bigger through acquisitions, maybe, you know, selling your TV business? You know, kind of where do you see yourselves, you know, three to five years out? And that's it for me. Thanks for taking the questions. Thank you. Look, that's more of a question for the chairman, but in terms of executing the chairman's vision, the chairman's vision right now is growing the Hispanic footprint in the platform that we have. We are in total growth mode. In my opinion, I don't see in terms of selling right now. His vision is 100% with respect to as the Hispanic market has boomed and grown, he's gonna continue to focus on growing our footprint because our content is so relevant. We're in 100% growth mode. Okay, great. Thank you, guys. Thank you, Tim. The next question comes from Matt Swope of Baird. Please go ahead. Good morning, Matt. Good morning, guys. Good morning. Could I just follow up on the TV part of that last question from Tim? You know, this is a business that just has felt subscale for a long time, is not probably producing the kinds of numbers you want. What is the plan with TV? Would you be open to sell that, or would you actually even be looking to acquire to sort of improve the scale there? How do you look at that? Look, right now we're investing in our content. We're up for a big political season. We're gonna be announcing something very big on television, which is gonna be good in terms of content, and we hope to monetize on it. We're also gonna be releasing our app on television. Now, the television broadcast market has been challenging, obviously with linear television video and where the streaming division is going on. If there would be an opportunity for someone to look at the television asset, obviously it would have to make sense for us. For right now, we're focused on growing our content and investing in our content and making sure that we're ready for this very busy political season. Right after the midterms, we're gonna go full force with the presidential election cycle. That's what we're hearing from both sides of the party. We've been making sure that we invest in the right news to make sure that our content resonates with the upcoming political seasons, both of them, which are back-to-back very soon. Right. Gotcha. Thank you. That's helpful. Maybe one for José on the capital structure. You know, you guys have, you guys did a nice job with cash. You're up to close to $20 million at the end of the quarter. We've got this really, you know, tumultuous market right now. Is there any opportunity to buy your bonds back at a discount or to de-lever via debt reduction in any other way? Look, we look at the market and we're open to suggestions, and we look at these things. At the moment right now, we're looking to invest into the business, to de-lever by growing EBITDA. That's our current strategy right now. Look, I mean, if opportunity presents itself, absolutely, we'll look at it. Got it. Great. Thanks, guys. Thank you. The next question comes from Matthew Sandschafer of Mesirow. Please go ahead. Good morning, Matthew. Good morning. I wanted to go back to the political topic. Did you guys generate any political revenue this quarter? We generate some advocacy, but the big political is gonna be starting very soon. We'll be busy kind of stuff. After Labor Day, that's where the big buys come. We're very active right now on negotiating deals with both sides, both parties. Okay. You still think you're on track for the $12 million-$15 million dollar number that, Yeah was thrown out on a previous call. Look, that's what our target is. Okay. Being that we're gonna be in so many of the swing states because of our audio platform, we're gonna get buys in pretty much every single state, Georgia, Pennsylvania, Rhode Island, Pennsylvania, Michigan, Arizona, New Mexico, Nevada, a lot of local races in those states. Plus, Florida, we have a very strong hold on Florida. Now, we're uniquely positioned, obviously, as being the largest Hispanic audio broadcaster, so. Okay. You guys have compared performance to 2019 a few times, and I guess I am curious with that kind of political revenue, you did $51 million in EBITDA in 2019. I guess I understand that to be generally higher margin revenue, and I guess I'm curious why it is that you don't expect to clear the 2019 number by more with the political revenue that you have. Look, we should be. In 2019, there was not that much political revenue. We had some, but not a lot. Month after month, this is the fourth consecutive quarter that we're beating 2019 revenue numbers. We feel really good in terms of we've had a spectacular start in 2022. There has been no other radio broadcaster that even had close to the revenue growth that Spanish Broadcasting did, and I'm talking about total market. None of the larger broadcast radio broadcasters came even close in terms of revenue growth and OIBDA growth, basically the same. Right. I guess revenue is gonna be up big over 2019, but EBITDA is gonna be roughly flat to 2019, is what it sounds like? Possibly. The target is obviously to get a little bit above that 2019 number. Let's see. Look, what probably held back the broadcast industry has been the little bit of the noise of the war. Some of the brand partners were a little reluctant to grow their investments. Hopefully moving forward, that will all pass. Okay. One more question from me, and then I'll stop. The SG&A line obviously moved up a lot this quarter, and José listed along there were a lot of reasons why it's up. I guess, is this the new level we should expect, kind of $20 million a quarter, or were there some things this quarter that were unusually high that'll come down going forward? We've made certain investments. Obviously, we just launched two stations that we've made investments. José, did you wanna give a little color on that? Sure. Yeah. We had a very intense first quarter from an event standpoint. In that number, there's about $6.3 million of event expenses that. You know, those are variable. The quarters that we do have events, you know, there's a lot of expense running through that line item. Okay. What As to guidance. Go ahead. This is radio, so I'll give you some guidance on radio. Radio, the operating expense is probably quarter-over-quarter. Stripping out events is gonna be low to mid in the low to mid-20s. Each quarter varies clearly based on revenues. On the TV side, you're looking at about $3 million-$3.5 million of operating expenses quarter-over-quarter. That's all in operating expenses, by the way. Okay. Okay, thank you. Thank you. The next question comes from Craig Carlozzi of Longfellow. Please go ahead. Good morning, Craig. Hey, guys. Thanks. Good morning. Thanks for the time. Shifting gears a little bit, thinking about your equity for a moment and trying to, you know, add some value to the equity holders, given how, just how illiquid it's trading, I mean, I think it's literally $16,000 worth a day on average over the last three or four months. Assuming you don't think that the equity market cap is currently a reflection of the proper value of the business, would you consider even spending a small amount of money supporting or cleaning up the equity? You know, like a $100,000 a month type number could greatly improve the trading performance of the stock. Is that something you'd consider or are considering? José, you wanna take that one? Sure. Look, we'll take everything, you know, we'll take everything into consideration. As we said right now we're looking to really grow the business from a footprint standpoint, from a content standpoint, from a digital standpoint. We believe that there's a huge opportunity in the Hispanic space now that we must capitalize. That's our real initiative for 2022 and going forward. Yeah, absolutely. If something makes sense and we have the capital to use that, we'll consider it. Okay. I mean, you know, the difference between the equity and the bond is obviously to move the needle on interest savings, you have to spend a lot more capital on the bonds. You know, I don't know if there's any benefit to your vision or the next three to five years of having a stock price more reflective of the economic value of the company from a perception standpoint. You know, I do think a small amount of capital dedicated to the equity or rebuying shares might make a lot of sense or something to think about. Anyway, thanks for the time, guys. Thank you. Thanks, Craig Carlozzi, for the feedback. The next question comes from Derek Wagner of Concise Capital. Please go ahead. Yes, Concise Capital. I am a bondholder. Morning. Good morning. I wanted to know, you know, I understand you're in growth mode, but your leverage is still fairly high, and you're planning on delevering through growth and EBITDA. All good. I'm just throwing out some caution here. If you're going to consider an acquisition, which was alluded to earlier as a possibility, that you wouldn't want to lever the company to do such, that maybe you would use your stock in a transaction. I wanted your comments on that. Secondly, I don't believe there's a transcript available for the earnings calls, but that would be helpful if there's not. Certainly. José, did you want to take that one? Sure. Yes, Derek. Look, from an acquisition standpoint, clearly we would have to make a prudent investment. You know, we're not gonna go out and lever up the company. We truly understand that our leverage is high and totally understand that. Again, we're cautiously optimistic with growing the company, clearly. But we, you know, first of all, the bonds are somewhat restricted, right? There is a lot of things here. Now, as to, you know, issuing equity to fund an acquisition, those are options that we have. Then the transcript? We'll get the transcript and put it online. That would be great. I think that's very helpful. Thank you, Derek. Thank you. The next question comes from Ben Brog of Odeon Capital Group. Please go ahead. Good morning, Ben. Hey, it's Ben. Good morning. Ben Brog with Odeon. How are you guys? Good, thanks. Hello, Ben. Great. Hi, guys. Just a quick question on the Cox Radio two station acquisition. Do you guys give any color? Just trying to think pro forma on multiple. Did you guys give any color in terms of what you expect those stations to do from a revenue and EBITDA standpoint? Thank you. Yeah. Right now we're not really much giving any guidance on these two stations, but we do believe that they'll be cash flow positive rather shortly. We are utilizing a lot of the synergies within the company. Yeah, in the beginning, we'll have investments, but in the near term, we believe it will be cash flow positive. Yeah, I agree with that. Yeah. Okay. Thank you, guys. Additional color having the call. Appreciate it. Thank you. Thank you. This concludes our question and answer session. I would like to turn the conference back over to management for any closing remarks. I wanted to take this opportunity and thank everyone who participated in today's earnings call and Q1, and I look forward to discussing our second quarter results with everyone. Have a great day, and thanks for participating. Thank you. The conference is now concluded. Thank you for attending today's presentation, and you may now disconnect.