Nexstar Media Group Earnings 2020-03-31

Balance Sheet	Income Statement	Cash Flow
Assets, Equity	Rev, G Profit, Net Income	Ops, Inv, Fin

nxst-10q_20200331.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2020


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number: 000-50478

NEXSTAR MEDIA GROUP, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware		23-3083125
(State of Incorporation or Organization)		(I.R.S. Employer Identification No.)

545 E. John Carpenter Freeway, Suite 700, Irving, Texas		75062
(Address of Principal Executive Offices)		(Zip Code)

(972) 373-8800

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name of each exchange on which registered

Class A Common Stock

NXST

NASDAQ Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that it was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 6, 2020, the registrant had 45,262,874 shares of Class A Common Stock outstanding.

TABLE OF CONTENTS

				Page
PART I		FINANCIAL INFORMATION

ITEM 1.		Financial Statements (Unaudited)

		Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019		1

		Condensed Consolidated Statements of Operations for the three months ended March 31, 2020 and 2019		2

		Condensed Consolidated Statement of Changes in Stockholders’ Equity for the three months ended March 31, 2020 and 2019		3

		Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2020 and 2019		4

		Notes to Condensed Consolidated Financial Statements
	Note 1: Organization and Business Operations		5
	Note 2: Summary of Significant Accounting Policies		5
	Note 3: Acquisitions and Dispositions		11
	Note 4: Intangible Assets and Goodwill		12
	Note 5: Assets Held for Sale		13
	Note 6: Investments		13
	Note 7: Accrued Expenses		14
	Note 8: Retirement and Post Retirement Plans		15
	Note 9: Debt		16
	Note 10: Leases		17
	Note 11: Fair Value Measurements		18
	Note 12: Common Stock		18
	Note 13: Income Taxes		19
	Note 14: FCC Regulatory Matters		19
	Note 15: Commitments and Contingencies		22
	Note 16: Segment Data		25
	Note 17: Condensed Consolidating Financial Information		26
	Note 18: Subsequent Events		32

ITEM 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		33

ITEM 3.		Quantitative and Qualitative Disclosures About Market Risk		46

ITEM 4.		Controls and Procedures		46

PART II		OTHER INFORMATION

ITEM 1.		Legal Proceedings		47

ITEM 1A.		Risk Factors		47

ITEM 2.		Unregistered Sales of Equity Securities and Use of Proceeds		48

ITEM 3.		Defaults Upon Senior Securities		48

ITEM 4.		Mine Safety Disclosures		48

ITEM 5.		Other Information		48

ITEM 6.		Exhibits		49

PART I. FINANCIAL INFORMATION

ITEM 1.

Financial Statements

NEXSTAR MEDIA GROUP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except for share and per share information, unaudited)

	March 31,			December 31,
	2020			2019
ASSETS
Current assets:
Cash and cash equivalents	$	434,067		$	232,070
Restricted cash and cash equivalents		16,608			16,608
Accounts receivable, net of allowance for doubtful accounts of $22,175 and $17,205, respectively		888,738			883,921
Spectrum asset		67,171			67,171
Prepaid expenses and other current assets		107,706			151,997
Total current assets		1,514,290			1,351,767
Property and equipment, net		1,546,873			1,290,428
Goodwill		2,879,748			2,996,875
FCC licenses		2,832,457			2,921,465
Network affiliation agreements, net		2,330,436			2,532,266
Other intangible assets, net		705,757			727,354
Assets held for sale		4,524			240,524
Investments		1,322,195			1,477,353
Other noncurrent assets, net		439,157			451,705
Total assets⁽¹⁾	$	13,575,437		$	13,989,737
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of debt	$	56,228		$	109,310
Accounts payable		138,952			157,366
Accrued expenses		533,805			541,803
Income tax payable		53,341			873
Liability to surrender spectrum asset		77,962			77,962
Other current liabilities		55,710			60,243
Total current liabilities		915,998			947,557
Debt		7,990,635			8,383,278
Deferred tax liabilities		1,696,611			1,710,664
Other noncurrent liabilities		856,134			894,745
Total liabilities⁽¹⁾		11,459,378			11,936,244
Commitments and contingencies (Note 15)
Stockholders' equity:
Preferred stock - $0.01 par value, 200,000 shares authorized; none issued and outstanding at each of March 31, 2020 and December 31, 2019		-			-
Class A Common stock - $0.01 par value, 100,000,000 shares authorized; 47,291,463 shares issued, 45,195,405 shares outstanding as of March 31, 2020 and 47,291,463 shares issued, 45,749,788 shares outstanding as of December 31, 2019		473			473
Class B Common stock - $0.01 par value, 20,000,000 shares authorized; none issued and outstanding at each of March 31, 2020 and December 31, 2019		-			-
Class C Common stock - $0.01 par value, 5,000,000 shares authorized; none issued and outstanding at each of March 31, 2020 and December 31, 2019		-			-
Additional paid-in capital		1,333,717			1,353,729
Accumulated other comprehensive income		19,850			19,850
Retained earnings		910,063			778,833
Treasury stock - at cost; 2,096,058 and 1,541,675 shares as of March 31, 2020 and December 31, 2019, respectively		(170,957	)		(121,388	)
Total Nexstar Media Group, Inc. stockholders’ equity		2,093,146			2,031,497
Noncontrolling interests		22,913			21,996
Total stockholders’ equity		2,116,059			2,053,493
Total liabilities and stockholders’ equity	$	13,575,437		$	13,989,737

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

(1)

The consolidated total assets as of March 31, 2020 and December 31, 2019 include certain assets held by consolidated VIEs of $330.4 million and $332.6 million, respectively, which are not available to be used to settle the obligations of Nexstar. The consolidated total liabilities as of March 31, 2020 and December 31, 2019 include certain liabilities of consolidated VIEs of $57.2 million and $61.7 million, respectively, for which the creditors of the VIEs have no recourse to the general credit of Nexstar. See Note 2 for additional information.

NEXSTAR MEDIA GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share information, unaudited)

	Three Months Ended
	March 31,
	2020			2019
Net revenue	$	1,091,822		$	626,647
Operating expenses (income):
Direct operating expenses, excluding depreciation and amortization		445,059			292,863
Selling, general and administrative expenses, excluding depreciation and amortization		218,384			142,360
Amortization of broadcast rights		37,208			14,362
Amortization of intangible assets		70,583			36,738
Depreciation		35,406			27,437
Reimbursement from the FCC related to station repack		(12,758	)		(14,187	)
Gain on disposal of stations and entities, net		(7,075	)		-
Total operating expenses		786,807			499,573
Income from operations		305,015			127,074
Income (loss) on equity investments, net		14,158			(491	)
Interest expense, net		(101,284	)		(52,957	)
Loss on extinguishment of debt		(7,477	)		(1,698	)
Pension and other postretirement plans credit, net		10,762			1,400
Other income (expenses), net		864			-
Income before income taxes		222,038			73,328
Income tax expense		(64,344	)		(16,441	)
Net income		157,694			56,887
Net income attributable to noncontrolling interests		(779	)		(1,995	)
Net income attributable to Nexstar Media Group, Inc.	$	156,915		$	54,892

Net income per common share attributable to Nexstar Media Group, Inc.:
Basic	$	3.43		$	1.20
Diluted	$	3.30		$	1.15

Weighted average number of common shares outstanding:
Basic		45,702			45,785
Diluted		47,615			47,784

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

NEXSTAR MEDIA GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

For the Three Months Ended March 31, 2020 and 2019

(in thousands, except share information, unaudited)

											Accumulated
	Class A				Additional						Other										Total
	Common Stock				Paid-In			Retained			Comprehensive		Treasury Stock						Noncontrolling		Stockholders’
	Shares		Amount		Capital			Earnings			(Loss) Income		Shares			Amount			interests		Equity
Balances as of December 31, 2019		47,291,463	$	473	$	1,353,729		$	778,833		$	19,850		(1,541,675	)	$	(121,388	)	$	21,996	$	2,053,493
Purchase of treasury stock		-		-		-			-			-		(950,000	)		(72,587	)		-		(72,587	)
Stock-based compensation expense		-		-		10,685			-			-		-			-			-		10,685
Vesting of restricted stock units and exercise of stock options		-		-		(29,316	)		-			-		395,617			23,018			-		(6,298	)
Dividends declared on common stock ($0.56 per share)		-		-		-			(25,676	)		-		-			-			-		(25,676	)
Contribution from a noncontrolling interest		-		-		-			-			-		-			-			138		138
Disposal of an entity		-		-		(1,381	)		(9	)		-		-			-			-		(1,390	)
Net income		-		-		-			156,915			-		-			-			779		157,694
Balances as of March 31, 2020		47,291,463	$	473	$	1,333,717		$	910,063		$	19,850		(2,096,058	)	$	(170,957	)	$	22,913	$	2,116,059

Price	101.81	EPS	6
Shares	48	P/E	18
MCap	4,879	P/FCF	15
Net Debt	8,202	EBIT	382
TEV	13,080	TEV/EBIT	34
TTM 2019-09-30, in MM, except price, ratios

10-Q	2020-03-31	Filed 2020-05-08
10-K	2019-12-31	Filed 2020-03-02
10-Q	2019-09-30	Filed 2019-11-12
10-Q	2019-06-30	Filed 2019-08-07
10-Q	2019-03-31	Filed 2019-05-09
10-K	2018-12-31	Filed 2019-02-27
10-Q	2018-09-30	Filed 2018-11-08
10-Q	2018-06-30	Filed 2018-08-08
10-Q	2018-03-31	Filed 2018-05-09
10-K	2017-12-31	Filed 2018-03-01
10-Q	2017-09-30	Filed 2017-11-07
10-Q	2017-06-30	Filed 2017-08-09
10-Q	2017-03-31	Filed 2017-05-10
10-K	2016-12-31	Filed 2017-02-28
10-Q	2016-09-30	Filed 2016-11-09
10-Q	2016-06-30	Filed 2016-08-09
10-Q	2016-03-31	Filed 2016-05-10
10-K	2015-12-31	Filed 2016-02-29
10-Q	2015-09-30	Filed 2015-11-05
10-Q	2015-06-30	Filed 2015-08-07
10-Q	2015-03-31	Filed 2015-05-11
10-K	2014-12-31	Filed 2015-03-02
10-Q	2014-09-30	Filed 2014-11-07
10-Q	2014-06-30	Filed 2014-08-08
10-Q	2014-03-31	Filed 2014-05-09
10-K	2013-12-31	Filed 2014-03-03
10-Q	2013-09-30	Filed 2013-11-08
10-Q	2013-06-30	Filed 2013-08-08
10-Q	2013-03-31	Filed 2013-05-10
10-K	2012-12-31	Filed 2013-03-15
10-Q	2012-09-30	Filed 2012-11-08
10-Q	2012-06-30	Filed 2012-08-08
10-Q	2012-03-31	Filed 2012-05-09
10-K	2011-12-31	Filed 2012-03-15
10-Q	2011-09-30	Filed 2011-11-09
10-Q	2011-06-30	Filed 2011-08-11
10-Q	2011-03-31	Filed 2011-05-13
10-K	2010-12-31	Filed 2011-03-16
10-Q	2010-09-30	Filed 2010-11-05
10-Q	2010-06-30	Filed 2010-08-06
10-Q	2010-03-31	Filed 2010-05-14
10-K	2009-12-31	Filed 2010-03-15

8-K	2020-05-20	Regulation FD, Exhibits
8-K	2020-05-15	Other Events, Exhibits
8-K	2020-05-06	Earnings, Exhibits
8-K	2020-04-30	Other Events, Exhibits
8-K	2020-04-03	Regulation FD
8-K	2020-03-02	Regulation FD, Exhibits
8-K	2020-02-26	Earnings, Exhibits
8-K	2020-01-31	Other Events, Exhibits
8-K	2020-01-30	Amend Bylaw, Exhibits
8-K	2020-01-27	Other Events, Exhibits
8-K	2019-11-22	Enter Agreement, Off-BS Arrangement, Other Events, Exhibits
8-K	2019-11-12	Regulation FD, Exhibits
8-K	2019-11-12	Enter Agreement, Other Events, Exhibits
8-K	2019-11-06	Earnings, Exhibits
8-K	2019-11-05	Regulation FD, Exhibits
8-K	2019-10-25	Other Events, Exhibits
8-K	2019-09-20	Regulation FD, Exhibits
8-K	2019-09-19	Enter Agreement, M&A, Off-BS Arrangement, Regulation FD, Other Events, Exhibits
8-K	2019-08-07	Earnings, Exhibits
8-K	2019-07-26	Other Events, Exhibits
8-K	2019-07-03	Enter Agreement, Off-BS Arrangement, Other Events, Exhibits
8-K	2019-06-26	Regulation FD, Exhibits
8-K	2019-06-19	Enter Agreement, Other Events, Exhibits
8-K	2019-06-18	Regulation FD, Exhibits
8-K	2019-06-11	Regulation FD, Exhibits
8-K	2019-06-10	Regulation FD, Exhibits
8-K	2019-06-05	Shareholder Vote
8-K	2019-05-08	Earnings, Exhibits
8-K	2019-04-25	Other Events, Exhibits
8-K	2019-04-07	Regulation FD, Exhibits
8-K	2019-03-20	Enter Agreement, Other Events, Exhibits
8-K	2019-03-20	Regulation FD, Exhibits
8-K	2019-01-24	Other Events, Exhibits
8-K	2019-01-15	Officers, Exhibits
8-K	2018-12-31	Earnings, Exhibits
8-K	2018-12-03	Regulation FD, Exhibits
8-K	2018-11-30	Enter Agreement, Other Events, Exhibits
8-K	2018-10-26	Enter Agreement, Off-BS Arrangement, Exhibits
8-K	2018-10-25	Other Events, Exhibits
8-K	2018-10-18	Other Events, Exhibits
8-K	2018-09-30	Earnings, Exhibits
8-K	2018-08-02	Regulation FD, Exhibits
8-K	2018-07-26	Other Events, Exhibits
8-K	2018-06-30	Earnings, Exhibits
8-K	2018-06-06	Shareholder Vote
8-K	2018-05-01	Regulation FD, Exhibits
8-K	2018-04-26	Other Events, Exhibits
8-K	2018-03-31	Earnings, Exhibits
8-K	2018-02-27	Earnings, Exhibits
8-K	2018-02-01	Other Events, Exhibits
8-K	2018-01-16	Regulation FD

EX-10.87	nxst-ex1087_10.htm
EX-10.88	nxst-ex1088_273.htm
EX-31.1	nxst-ex311_7.htm
EX-31.2	nxst-ex312_9.htm
EX-32.1	nxst-ex321_6.htm
EX-32.2	nxst-ex322_8.htm

NXST 10Q Quarterly Report

Nexstar Media Group Earnings 2020-03-31