Good morning and Welcome to Spanish Broadcasting System's Q2 2022 Conference Call. All participants will be in a 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 with Investor Relations. Please go ahead. Thank you, Chad, 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 that we will be discussing non-GAAP financial measures. The company believes that operating income before depreciation and amortization, gain on the disposal of assets, recapitalization costs, and other operating income, 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 Q2 E arnings 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 Q2 Earnings Conference Call. On today's call, we'll provide an overview of recent operating developments and review our financial results. Joining me today are Jose Molina, our Chief Financial Officer, and Richard Lara, our General Counsel. Our Q2 results reflect continued solid performance by our audio assets, offset by a period of strategic investments in our business as we look to drive accelerated growth and performance in the coming years. We made investments to support our newly acquired Tampa and Orlando station cluster, as well as further differentiate our digital offerings. Earlier this week, we announced the launch of our Digidea digital marketing solutions platform, which will make SBS a one-stop shop for our brand partners for Hispanic marketing needs. Digidea's full service digital solutions includes search marketing, display, OTT, CTV, email and social, in addition to their vast Spanish language portfolio of radio, TV, streaming, audio and programmatic platforms. Digidea will allow advertisers of all shapes and sizes from any industry to build robust marketing programs to meet their targeted consumer and demographic groups across every stage of the purchase journey. At SBS, we have always been committed to operating the best diverse minority-owned Spanish language audio and digital entertainment platform in the nation. The targeted investments we are making will build our market leadership and history of industry outperformance. Today, our assets and reach is unmatched, and we are delivering an increasing multi-platform audience to our advertising partners. The Latino population has never been larger, had more influence or been more sought after than right now. We've never been more confident in the future of SBS and ever-expanding touch points we have with the Latino population across the nation's largest and most densely populated markets. Today, SBS offers a premium investment, which is at the intersection of diverse, targeted, and diverse owned. We also offer a scale and reach that is incomparable to any other out there to help brands meet their diversity and inclusion goals. This is a core initiative to our business enterprise. Our audio revenues increased 6% in the Q2, and we are currently tracking + mid-single digits in the Q3. The 6% growth in the Q2 demonstrated the power of SBS. In the 2021 Q2, SBS grew revenue versus 2020 at an incredible 160% over the prior period. No other radio broadcaster even got close to that number. Our audio revenues are accelerating, which demonstrates what we have long believed and history has shown, audio is recession-proof and remains a reach vehicle for advertisers given its efficient CPMs. In the first six months of 2022, the markets SBS serves grew by 13%. SBS grew revenue at 29% versus 2021 per Miller Kaplan. SBS grew revenue faster than any other radio broadcaster in the nation. In addition, as TV viewership continues to migrate to OTT or streaming options, advertisers are looking to address a growing inefficiency and find new and compelling options to replace their TV advertising. Digidea digital marketing solutions platform will enhance our overall TV and video operations. As these dollars continue to shift, Spanish-language radio offers a highly compelling alternative, given the ever-expanding power of the rapidly growing Hispanic market here in the U.S. Today, Hispanics represent 19% of the total U.S. population, and by 2040, it's expected to represent over 25% of the overall population. Today, Hispanics represent $1.7 trillion in buying power, and that will only grow as the Latino population does. Now let's review our operations, and we'll start with AIRE Radio Networks for the Q2 of 2022. AIRE Radio Networks outpaced the marketplace by 25%. AIRE network was able to widen the gap and had strong categories in this period. Such categories included home products +83%, insurance and mortgages +123%, pharmaceuticals +459%. Retail is +7%, and QSR is +59%. AIRE continues its commitment for super serving Hispanics and asserts its position as the largest diverse minority-owned and certified Spanish language audio network in the nation. Its core competitive advantages include 95% reach of the U.S. Hispanic market in key demographic groups, 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 initiative includes El Terrible Morning Show, La Mezcla with Alex Sensation, the influencer network delivering campaign messaging through a national platform while penetrating local markets, and Artistas360, where brands are aligned with Latin artists. For the Q2 of the year, Aire Radio Network was up 26%, and Miller Kaplan reported the network category by 1.5%. Turning to the audio division, where we were the number one in our top markets across the nation with unrelenting, rock-solid rating, performance, and listener growth. We are very proud to announce for the first time in history, a laser-focused Hispanic program. We have a No. 1-rated station beating all the stations in two of the significant major markets. No. 1 in New York with WSKQ, Mega. No. 1 in Miami, WXDJ, El Zol, among all adults 18 to 49, Monday through Sunday, 6 A.M. to midnight. To have a No. 1 beating all stations irrespective of language is a feat that proves that we are the pioneers in setting new trends in the Hispanic market. Our digital stream ratings continue to grow every month. La Mega 97.9 once again is the reigning most streamed online audio content in the nation. Our recently launched initiative of daily on-demand audio and top-rated shows has grown listening and engagement by over 1,000% on our LaMusica app. Our programming team created new original and audio on-demand content. Podcasts from our top shows are now available exclusively on LaMusica app. As mentioned earlier, WXDJ El Zol is now the rating leader in Miami among all persons. El Zol is the only Hispanic female leading morning host with El Vacilón, La Gatica, and she is number one in the morning. In Miami, WCMQ, Zeta 92.3 is at the top in the mornings with radio and TV journalist Oscar Haza, and it still remains number one overall in the adults 18 to 34 demographic group. WRMA, Ritmo, is celebrating its sixth anniversary and gearing up for the Cubatonazo concert. This yearly station event is with the participation of the hottest Cuban artists, such as Gente de Zona and Chacal. We have never had non-Cuban artists pop up, such as Don Omar. This event will have many surprises. Now I wanna say that there are only one or two times in a lifetime when we can launch two stations from scratch. The success is exemplary and is recognized by Nielsen as a historic launch because of the immediate rating success. WPYO-FM, El Nuevo Zol 95.3 is the fastest-growing radio station in the entire Orlando DMA. In less than 8 weeks on air and in most current Nielsen weekly rating is now beating all other Hispanic stations in various day parts. We had an exclusive on-air in studio with an artist that took over from the most prominent star, Bad Bunny. We are now turning to Los Angeles. Our launch on the Omar Y Argelia morning show, KXOL Mega 96.3, has become a rating success with over 100% among Hispanic adults. Since day one, our morning streaming audience has remained at the top of the charts. Omar and Natalia are actual married couple airing all of their love and couple situations. It has a very unique connection with the new listeners on Mega 96.3 KXOL, Los Angeles. The hottest club and Los Angeles DJ is now the number one Spanish rated show in the afternoon on Mega KXOL among 18-34 adults, and that show is from 3:00 P.M. to 7:00 P.M. KLAX La Raza 97.9 is the number one Hispanic regional station and is home to the number one Hispanic morning show, El Terrible. His commitment to the community, providing food, wellness information and original fun entertainment makes it the number one show among all Hispanics in L.A. Puerto Rico's ratings have exploded. We have a station number one in each demographic group. WODA, La Nueva 94, number one, 18-34. WMEG, Mega 106.9 FM, number one, 18-49. WZNT, number one in men, 25-54. Now to Mega TV, where our national footprint reaches millions of 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. During the Q2, SBS Entertainment Division continued to make progress in the Orlando market, executing a two-day festival on the Orlando Fairgrounds, Guaya Guaya and Día Nacional de la Zalsa. These were attended by over 13,000 people each day and received significant client and sponsorship interest. The events in the Orlando-Tampa market will continue to see significant growth with the radio station acquisitions in those markets. SBS also produced the Mega Mezcla concert in New York. This event was sold out within 60 days of launching and generated almost $2 million in gross revenue, which is a record breaker for the New York show. The division continues to expand and grow with over 14 shows scheduled from now through the end of January 2023. We are extremely optimistic about the live event space and its strategic positioning within the market. Now turning to our mobile and digital platforms and strategic initiatives. Over the last several years, we have had great success transforming SBS into a leading multimedia Hispanic media company. 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 Latino-focused marketing strategy and outreach program. The diverse Latino population is growing rapidly in size, cultural influence and 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 major media platforms and offer access to coveted demographic groups. As I stated, our aggregate audience continues to grow. As of June 30, our total audience was up 16% compared to Q2 the prior year. Programmatic revenue grew by 122%. The total division grew by 42% year-over-year. Our LaMusica platform reaches over 1.9 million people who combine for over 20 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 Q2, our total streaming audience surpassed 1.7 million unique listeners per month. This audience delivered 60 million listening hours and over 50 million total sessions in the quarter. Given Hispanics heavily over-index on mobile phone use, ownership and usage, mobile remains the primary driver of our mobile digital traffic and accounted for 94% of our total digital traffic in the quarter. In the Q2, LaMusica had a record of 515 million audio ad impressions, in addition to 150 million display impressions and 95 million video pre-roll impressions. A key driver for our growth in streaming hours and sessions has been the expansion of our LaMusica user base, as well as increasing consumption of our podcasts and playlist products, with average time spent listening with over 45 minutes in the most popular categories. We have added over 20 new shows in the Q2 of 2022 to our podcast offerings, and we expect tremendous growth on this category for the rest of the year. In summary, the Q2 marked a continuation of strong trends we've seen on the audio and digital sides of our business. Our financial results reflect a period of strategic investment in our business as we look to best position our new Florida station duopoly for accelerated growth, while also further strengthening digital platforms. Our aggregate audience continues to expand, and we are connecting brand partners with the rapidly expanding Latino population in more ways than ever before. The underlying momentum in our business is strong, and after this period of investment, we see a growing number of opportunities that will accelerate our growth and best position SBS for sustained industry outperformance in the years ahead. In particular, Florida. We control Hispanic radio in Florida. No other radio operator in Spanish has the audience that we have. This marks the fifth consecutive quarter of SBS generating revenue at higher levels than we were at pre-pandemic. Thanks for your time and attention. Now let me turn the call over to José Molina for the financial overview. Thank you, Albert. Before we turn to our results, as Albert has mentioned, our results were impacted by investments in our newly acquired Orlando and Tampa startup stations, investments in our digital infrastructure and personnel, and investments in our programming, talent, and content. We expect these investments to continue in the near term, after which we should see our margins and profitability normalize. We believe that we are making the necessary and right investments to drive accelerated long-term growth while also sustaining and building on the power of our brands and market leadership positions. Additionally, during the prior year quarter, our radio, television, and corporate expenses were favorably impacted by $2 million of PPP funds, which were directly used to offset and reduce employee related compensation and benefit expenses. I also want to take a moment to touch on the current economic environment. Like most companies, we are not immune to the impact of challenging economic times and a potential recession. With that said, we have been through tough times before, most recently, the height of the COVID-19 pandemic. Each time, SBS's team works together to rise above the challenges and find ways to reduce expenses while continuing to hold market leadership positions and deliver for our brand partners. Now turning to our Q2 results. Our consolidated revenues totaled $37.5 million, compared to $36.2 million for the same prior year period, resulting in an increase of $1.3 million or 4%. Additionally, our consolidated revenues exceeded the same pre-pandemic period in 2019 by $600,000 or 2%. Our radio revenues totaled $35 million, increasing $2 million or 6%. The growth was primarily due to increases in digital, network, special events, and barter revenues. Our radio revenues also exceeded the same pre-pandemic period in 2019 by $2.1 million or 6%, which marks the fifth consecutive quarter that radio revenues are above 2019 levels. Our television revenue totaled $2.5 million, a decrease of approximately $700,000 or 21%, primarily due to lower national, local, barter, and subscriber related revenues. Our consolidated adjusted OIBDA, a non-GAAP measure, totaled $5.5 million compared to $12.2 million for the same prior year period, representing a decrease of $6.7 million or 55%. Our radio adjusted OIBDA decreased $4.2 million, primarily due to increases in operating expenses of $6.1 million, partially offset by the growth in revenues. Our radio station operating expenses increased mainly due to the lack of PPP proceeds in the current period, increases in compensation and benefits, advertising and promotion, commissions, barter, and T&E. Our television Adjusted OIBDA decreased approximately $800,000 due to lower revenues and an increase in operating expenses of $200,000. Corporate expenses increased $1.7 million, primarily due to increases in compensation and benefits, outside services, and T&E. Operating income totaled $4.7 million compared to $12.6 million for the same prior year period. The decrease in operating income was primarily due to the increase in operating and corporate expenses and the decrease in other operating income, partially offset by a growth in revenues. Our capital expenditures during the Q2 were approximately $1.2 million. As of yesterday, we had cash on hand of approximately $17 million. In addition, if needed, we have the undrawn $15 million revolver fully available. As per our credit agreement, our current net debt to Adjusted EBITDA leverage is 6.9 times. As I mentioned earlier, the recent investments we've made across our business will deliver future top line growth, but will have a near-term impact on our operating results. We remain committed to reduce our leverage and expect it will begin to improve in the coming quarters as our margins and profitability normalize. This will conclude our formal remarks. With that, I would like to turn the call over to the operator for any questions. Operator? Thank you. 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're 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 today will come from Tim Daggett from RBC. Please go ahead. Hey, guys. Good morning. Good morning, guys. Thanks for taking my question. On the Q3 outlook, I think you said it's tracking up mid-single digit. Is that for the whole company or just the radio business? Then any detail on how national network and local are doing respectively? Thanks. Tim, that's a great question. I'm glad you asked it. We're pacing in mid-single digits for radio. Television is off. National is probably gonna be flat or maybe up, maybe close to 1%, but it's probably gonna be close to flat. The Standard Media Index for the month of July reported that nationally ad revenues were down 13%. SBS Radio was up 9%. That's a 21% swing ahead. Although there's hints of some of our brand partners holding back on certain investments, we are focusing on share. We're focusing on share. You've seen the performance of Spanish Broadcasting that we always do better than all of our peers. That's just one example of our performance even moving forward, even in this economy. Okay, great. Then the new stations that you acquired in Florida, are those free cash flow positive now? If not, when will those be free cash flow positive, those two stations? Look, those stations are stations, obviously. We've made investments. I'm glad you asked about the new stations because we have information on that. Before we go into a market, we do extensive research of why we should be in it. Per census shows Hispanics at 19%. In markets like Orlando, it's way above the national average of the Hispanic population. Orlando is close to 40%. Tampa is well above in the 20% in terms of Hispanic population. Those are markets that strategically, because of the content that we provide to Hispanics across the nation, they make sense for us. They make sense for us for several reasons. They're Orlando and Tampa is the fastest-growing DMA in the nation. Okay. It solidified our position in Florida and Miami. During the due diligence process, we found that a lot of our brand partners had extensions of their business in Orlando and Tampa, and we're doing a lot of three-market deals. Another key factor is obviously the content that we serve from, in particular, where a lot of the reggaeton and urban content comes out of, from Puerto Rico. Puerto Rico is an extension of all of this wonderful content. In particular, I can give you the example of Bad Bunny. He's the most streamed Hispanic artist in the world. Those marketplaces like Tampa and Orlando are a reflection of that. Now, with respect to, in terms of profitability, both stations are gonna be profitable, as you look at it in the next, I would say, closer to the next six months or maybe 12 months. That's what the plan is. José, did you want to add anything else to it? No. I think it's key to note that these are startup stations. We bought sticks. I think that's very important to know, you know, new sales team, new programming team, new logo. We have to educate the market that we are a Spanish station. These stations were Anglo. It's a complete flip. It's gonna take the required investments in these markets to A, be known, and B, establish a very good position in the market, which I think Orlando just the telltale sign. Yeah. For eight weeks, we've established a pretty good ground. We're in top leadership in ratings. Tim, I think I'm glad you asked the question about Tampa and Orlando because that is extremely important for the footprint of Hispanics nationwide. This company's been in business for four decades, when our chairman and chairman emeritus founded the company, a lot of people said, "Are you sure you're gonna go into New York?" It was 40 years ago. That station in New York is the most listened to station in America. Most listened to stream station, most listened to station in the tri-state New York area, and it is the most listened to Hispanic station globally. We're going in the right direction as the Hispanic population continues to grow. Those are vibrant Hispanic markets. Orlando and Tampa being one of the fastest growing Hispanic DMAs in the nation, and those two markets could not be overlooked. We're pleased we're there, and we're gonna continue to grow revenue there. We're gonna look at, obviously, our expenses, but we're gonna make sure that the stations are profitable. Are there any other stations or markets in Florida that you'd look to get into besides those two? I think for right now, I think we're good with those two. Those are I call them the Golden Triangle, and it's given us such a competitive edge. In particular, I'll tell you, in even in Miami, as we transact business on a daily basis, they, our clients have a lot of extensions in Tampa and Orlando, and we do a lot of this freely. So it's helping the content that we deliver. It's helping the revenue we generate. It helps Miami. It helps Puerto Rico. It helps our network. It helps our national footprint. In terms of our experiential footprint, we're gonna be doing events in both of those markets. And our digital footprint is continuing to go through the roof. There was a lot of data management platforms that confirm that those are two key markets for the audience that we serve, which is the fastest growing and diverse segment of this population today in the nation. Okay, great. Maybe last one for me. What are you seeing in terms of political revenues? Is anything coming in yet? What's the expectation for the rest of the year on political? Thanks, guys. Look, we're excited about political. We were seeing some of it come in. Political historically in midterm election cycles always come in very, very strong in after the Labor Day. I'll tell you, because of our digital platform, we're riding on political ads, not only in the top 10 markets, but in markets that we don't have owned and operated stations. Thank you. The next question will come from Matt Swope from Baird. Please go ahead. Matt, good morning. Great to hear from you today. Good morning, guys. Yes, happy to be on. I would love to just follow up on the expense issue or, you know, reconciliation to the extent that José is comfortable. Could you just break out, José, a little bit more the decrease of $6.7 million year-over-year? Obviously, we have the $2 million PPP component to that. You guys have talked about the startup expenses. To the level you're comfortable, could you please just maybe itemize that decrease a little more for us? Sure. Like you mentioned, PPP is $2 million. Orlando and Tampa, let's say from an EBITDA perspective is $1 million. The TV loss is about $800,000. Corporate expenses were up $1.7 million, but of that there was about $900,000 in discretionary and retention bonuses. The rest pretty much is increase in compensation, mainly driven in the areas of programming and selling. Pretty much investing in personnel. I see. Thank you. That's really helpful. Is some of this being driven by labor cost inflation or are these fully investments in people and growing the business? I would say both. I would say the Q1 we did see a tough labor market, tight labor market. We had some turnover. Yeah, look, again, you know, when employees get squeezed and things start costing more, the company needs to do what we need to do to have our employees not worried about living and focus on work. We did what we had to do to retain our valuable employees. Right. Nope. That certainly makes sense. We've talked about a $50 million kind of EBITDA target as we think about getting back to previous levels. Has that changed for you at all with Tampa and Orlando? Obviously, the world's changed on us in the last six months or so. How do you think about getting back to that $50 million level and when that might be able to happen? Look, when we did our projections, obviously last year, in late year, there were signs of the country and globally getting out of the pandemic, and we were starting our concert and event business again. Clients, we kept on hearing about the microchip that the microchip issue was gonna get better. Automotive is a key category for us. We're in a lot of the Sun Belt states, so we're very optimistic. At the same time, we're gonna continue to be optimistic. We believe radio, audio is recession-proof. In particular, Spanish broadcasting, in the Q2 of 2021, we were the only one that, compared to 2020, was able to get to 160%. No one in radio was able to climb out of the pandemic on a few factors. Number one, we were the first radio group in the nation to get out of the pandemic. Number two, when we got out of the pandemic, our revenues went through the roof. We were at 160%. No other broadcaster was even close to 100%. That's another key factor. In the marketplace where we transact today, there is more appeal for diversity and inclusion in terms of diversity-owned media, diverse targeted media. We checked off both of those boxes. We are uniquely positioned, Spanish Broadcasting, to grow faster than every broadcaster in the nation. Our content is relevant. Nielsen has us, in particular Mega in New York, as the number one station in America. Where a lot of people focus on, well, the economy might not be doing as well as expected, maybe we cut back. We get more aggressive than the marketplace does, and we grow our share because we're in it for the long term. We've been doing this for 40 years, and we have a proven strategy, proven track record of being the gold standard of radio in the nation. We are not. We. Look, we want the economy to be better, but we're not afraid of it because we know we're gonna grow faster than all of our peers. We're gonna grow faster than the industry. Tampa and Orlando, we're staring it in the face in terms of the I-4 corridor fastest Hispanic area in the nation in terms of growth with population. Those were markets we could just simply not pass up. Now, we investing. We're making sound investments. We're not making investments so we can show a profit maybe in a month or two, okay? We're making investments that we're gonna be making significant profits in the very near future because I believe, we believe we staff appropriately in those markets. Per Nielsen has never seen the phenomenon of a station that went from one format in one language into another one grow in an exponential way. We feel very, very. We feel bullish. We feel that we're on the right track. Our content is relevant. I can put up our content team to anybody in Hollywood, and I believe it's better. We can put up our technology team up to people in Silicon Valley, and I believe our technology team is better. For this specific reason, we have the number one most listened to and streamed station in America. Oh, by the way, that station's in Spanish. We're gonna continue to grow our audience. We're gonna continue to grow our revenue share. We're gonna try and obviously get to the prior EBITDA level, and we're gonna get there. Whether it's this year or next year, we're gonna get there. I hope, Matt, that answered your question. I'm glad you asked it. No. That's helpful, Albert, for sure. You know, anybody would question your guys' track record in radio. To that point, some people might question your track record in TV. If I could make me take my last question and say you've got bonds- I'm glad you're gonna ask about TV. Okay. You've got bonds trading at 80, and you got a TV business that you continue to invest in. What if you were to redeploy that capital that's deployed to TV or even sell the TV business and buy back bonds that are trading with a 20-point discount? Look, everything is upon, you know, consideration. The television market has migrated to the OTT marketplace, national viewership on television with all the big broadcasters, ABC, NBC, CBS, Fox, and the Hispanic ones. There's been a decline with respect to HUT levels and PUT levels, houses using television, people using television. It's gone down. In particular, I'll give you a little bit more microscopic vision in Miami. For example, Miami, the Fort Lauderdale, Miami Fort Lauderdale DMA has gone into about 70% linear, 30% broadband, and it continues to grow in the broadband. That's why we had to put our act together. That's why we had to go with Digidea to that audience that's migrating to serve that. We're also looking to be prudent with cost and also be ready with political, because political is coming on TV. You asked me and I wanna be very specific in terms of what your ask is. Yes, we were incredible. We're the gold standard of radio. We've had our challenges with video, but we're doing everything possible to address the shift in viewers and how they consume video across the nation. Your question's a valid one, and everything is upon consideration. Yeah, we would look at anything that will make the right sense for our shareholders. I really appreciate the honest responses. Thanks for. I appreciate you being on today. Thank you, guys. Thank you. Appreciate it. Thanks, Matt. The next question is from Patrick Wang from Voya Investment. Please go ahead. Patrick, good morning. Yeah. Good morning, gentlemen. Great to hear from you today. Good morning. Thank you. I just want to drill down a little bit on the economics on these two Florida radio stations. You spent $12 million, $12.5 million fixed cost. How much do you expect to spend to reformatting it? You know, the station expense, the launch costs, all inclusive, what's the total cost of this investment? What kind of a return invested capital you're actually looking to get out of it? Because, you know, radio stock is trading at 4-5x EV multiple. Unless you get $5 million-$6 million EBIT out of these two stations, I don't even know that economics works in the current environment. Well, Patrick, I'll take that question. From a competitive standpoint, I can't really give you all that detail. We would hate to give our competitors what we're willing to spend. Look, I think what we've done is, if you've followed radio for a very long time, to acquire 2 stations in Orlando and Tampa, which are, you know, significantly emerging markets for Hispanics. Patrick- So- Tampa and Orlando rank top 20 in the nation in terms of population in both radio markets. Both of those markets for radio, for the first 6 months, have done about $60 million in radio revenue. Those marketplaces per Miller Kaplan will do close to $125 million. Jose, why don't you give more color on his question? Sure. Look, I think if you're looking at a standalone acquisition, but you gotta look at it as Albert mentioned, how it fits within the portfolio of Florida, with how it fits in the portfolio of SBS, how there's synergies from an event standpoint. There's a lot of offshoots in these two markets with the research that we've had for many years with our apps. Puerto Ricans are migrating from. You know, we have Puerto Rican stations. Puerto Rico pretty much half of a good portion of Puerto Ricans migrated to Orlando from Puerto Rico and New York. Tampa, there's a lot of migration going on from Miami to Tampa. With all that being said, and how we operate, we believe that we're gonna do very well. I understand that you wanna look at it numerically, which I respect that, but we're trying to grow the consolidated business, so there's a lot of offshoots. This is very synergetic. Right. Well, do you see potential that these two markets will be as big as Miami? Because that Miami is 22% of your total base right now. How big do you think those two will get? Okay. Relative to Miami. I'm sorry, Patrick, that's a great question. Orlando and Tampa are about, in terms of radio revenues from Miller Kaplan, I just mentioned, it's about the same. They've done close to $60 million. I believe it's gonna be close to $125 million each. They're almost at pre-pandemic levels. The Miami market is a little different. The Miami market is around $220 million. Miami, where it ranks within the top 10 in terms of audience and billing, Tampa and Orlando markets are close to, like, 19 and 20. But Tampa and Orlando are gonna be close to Miami, I believe. Right. As far as the spending is concerned, what's the timing? When do you think that will be complete? Because this quarter looks like they're, you know, the inflation and the investment in the stations reformatting is more like in $2 million-$3 million, I would guess. What's the total, and when that will be done? Look, there's always. The reformatting. Patrick, when you acquire a new station, there's always a introductory period, which is several months, in terms of an action plan, in terms of your marketing, for a few months. Then after, as you grow your audience share and your audience and those respective DMAs are aware that there is new stations, content, Hispanic influencers, then you go into more of a maintenance program. Look, we're very pleased in just a matter of weeks, the Orlando station's close to a 4-share. That's incredible in terms of getting to a number like that in such a short period of time. Right. What you're saying is what takes 2 quarters to kind of It's gonna take a few quarters. Right. Okay. What's going on with special events? This quarter is really disappointing compared to last quarter, and almost zero. What's happening there? Look, we did our event in New York, and because of a lot of artist commitments, we changed the dates and they are gonna be within the next eight months. We'll be doing events in Q3. We're doing a ton of events in Q4, and we're doing our Calibash in January in Los Angeles and Vegas. We have a very busy schedule. We have about 13, 14 nights that we are planning for right now. We have a very busy schedule in the next several months. Patrick, just to be clear, Q1 is always the biggest quarter from an event standpoint. Q2, we had a good amount of co-pro events. The way that we recognize the revenue is a little bit differently. We just recognize the profit. We did quite well on the events that we did. As Albert mentioned, we did one in New York and we did one in Orlando as well. Right. We did well. You're not seeing the revenue, the tickets booked, right? Because it's a co-pro. We did have some good events and we did make money. Okay. What's your projection for the year in terms of events? We have. Did you get back to $5 million level? We have 14 nights. That is the goal. That is the goal right now. 14 nights across the country in several markets. that should be over 2019 levels, right? It should be right in line. It should be right in line. It's a very busy season for us for the events. Right. Okay. Do you anticipate in self funding for the station costs reformatting? 'Cause your cash levels dip to $8 million, and you still have the revolver. Do you see any funding needs for that in the next few quarters? Look, it's available if needed. It's important to mention that we do have a refund from the IRS that's due. It's about $4.4 million, which we're hoping to get in the very near term, which should help out from a liquidity standpoint. Yeah, look, the revolver is there for that reason if we need to tap in. Clearly, we would hate to tap into it, but if we have to, just to fuel the launch of these stations and to continue to, you know, move the company forward from a long-term standpoint, we will. Right. Okay. I saw in the press release there's $4 million cash taxes. I thought you had a significant amount of NOL on the books, and you talked about the refund. Is that the same thing, the $4 million that you paid and you're gonna get it back? Well, it's an ERTC credit, which we amended our payroll tax. This is a government plan. We amended our returns. The government actually reimbursed us about $300,000. So there's 6 checks that are due. We got one, it's $300,000. So now what's left is $4.4 million. As to what we've paid so far from a cash flow standpoint, the $4 million, that's just cash taxes paid, which that should be, give or take, for the year, I would say roughly between $5 million and $6 million. Right. You have $260 million NOL on the books. You shouldn't be paying any cash taxes, right? Can you repeat that question? What? Well, last time I checked, you have net operating losses carried forward of $260 million. Why would you be paying cash taxes if you have that to offset income? Well, there'll be income in the Q3 and Q4. As to the NOLs, they have been limited with the Section 382 limitation. The NOLs don't exactly work that way. I mean, we'll go through the tax accounts. We'll have some NOLs that can shield some income in Puerto Rico, but in the U.S., we have approximately like $5 million. $5 million, but then you net that out. It'll save us some money, but not. It. It. We'll have a tax bill at the end of the year. Right. Okay. What's just as a kind of historical information, what's the historical midterm revenue you guys get from midterm election advertising? Typically around $4 million, $4 or $5 million. $4 million-$5 million. Yeah. Okay. Mm-hmm. All right. Great. Thank you, guys. Thank you, Patrick. Thank you, Patrick. Great hearing from you. Ladies and gentlemen, this concludes our Q&A session. I would like to turn the conference back over to management for any closing remarks. I wanted to say thank you for everyone who participated today on our Q2 2022 Earnings Call. I look forward to speaking to everyone, to all of our colleagues, for the Q3 of 2022. Have a great day. Thank you. Bye-bye. Thank you. Thank you, sir. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.