Nexstar Media Group Earnings 2020-09-30

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

nxst-10q_20200930.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 September 30, 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 November 5, 2020, the registrant had 44,045,015 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 September 30, 2020 and December 31, 2019		1

		Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2020 and 2019		2

		Condensed Consolidated Statement of Changes in Stockholders’ Equity for the three and nine months ended September 30, 2020 and 2019		3

		Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2020 and 2019		5

		Notes to Condensed Consolidated Financial Statements
	Note 1: Organization and Business Operations		6
	Note 2: Summary of Significant Accounting Policies		6
	Note 3: Acquisitions and Dispositions		13
	Note 4: Intangible Assets and Goodwill		19
	Note 5: Assets Held for Sale		20
	Note 6: Investments		20
	Note 7: Accrued Expenses		22
	Note 8: Retirement and Post Retirement Plans		22
	Note 9: Debt		23
	Note 10: Leases		26
	Note 11: Fair Value Measurements		27
	Note 12: Common Stock		28
	Note 13: Income Taxes		28
	Note 14: FCC Regulatory Matters		29
	Note 15: Commitments and Contingencies		32
	Note 16: Segment Data		36
	Note 17: Subsequent Events		38

ITEM 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		39

ITEM 3.		Quantitative and Qualitative Disclosures About Market Risk		58

ITEM 4.		Controls and Procedures		58

PART II		OTHER INFORMATION

ITEM 1.		Legal Proceedings		59

ITEM 1A.		Risk Factors		59

ITEM 2.		Unregistered Sales of Equity Securities and Use of Proceeds		60

ITEM 3.		Defaults Upon Senior Securities		60

ITEM 4.		Mine Safety Disclosures		60

ITEM 5.		Other Information		60

ITEM 6.		Exhibits		61

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)

	September 30,			December 31,
	2020			2019
ASSETS
Current assets:
Cash and cash equivalents	$	409,906		$	232,070
Restricted cash and cash equivalents		16,610			16,608
Accounts receivable, net of allowance for doubtful accounts of $29,082 and $17,205, respectively		782,198			883,921
Spectrum asset		-			67,171
Prepaid expenses and other current assets		132,498			151,997
Total current assets		1,341,212			1,351,767
Property and equipment, net		1,598,081			1,290,428
Goodwill		2,861,314			2,996,875
FCC licenses		2,856,374			2,921,465
Network affiliation agreements, net		2,290,684			2,532,266
Other intangible assets, net		664,400			727,354
Assets held for sale		4,524			240,524
Investments		1,313,858			1,477,353
Other noncurrent assets, net		360,055			451,705
Total assets⁽¹⁾	$	13,290,502		$	13,989,737
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of debt	$	22,921		$	109,310
Accounts payable		161,083			157,366
Broadcast rights payable		111,144			120,165
Accrued expenses		279,816			422,511
Liability to surrender spectrum asset		-			77,962
Operating lease liabilities		34,434			35,043
Deferred revenue		47,498			18,725
Other current liabilities		14,846			6,475
Total current liabilities		671,742			947,557
Debt		7,859,619			8,383,278
Deferred tax liabilities		1,686,238			1,710,664
Other noncurrent liabilities		818,187			894,745
Total liabilities⁽¹⁾		11,035,786			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 September 30, 2020 and December 31, 2019		-			-
Class A Common stock - $0.01 par value, 100,000,000 shares authorized; 47,291,463 shares issued, 44,035,015 shares outstanding as of September 30, 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 September 30, 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 September 30, 2020 and December 31, 2019		-			-
Additional paid-in capital		1,351,372			1,353,729
Accumulated other comprehensive income		19,850			19,850
Retained earnings		1,149,638			778,833
Treasury stock - at cost; 3,256,448 and 1,541,675 shares as of September 30, 2020 and December 31, 2019, respectively		(286,705	)		(121,388	)
Total Nexstar Media Group, Inc. stockholders’ equity		2,234,628			2,031,497
Noncontrolling interests		20,088			21,996
Total stockholders’ equity		2,254,716			2,053,493
Total liabilities and stockholders’ equity	$	13,290,502		$	13,989,737

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

(1)

The consolidated total assets as of September 30, 2020 and December 31, 2019 include certain assets held by consolidated VIEs of $339.6 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 September 30, 2020 and December 31, 2019 include certain liabilities of consolidated VIEs of $59.8 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						Nine Months Ended
	September 30,						September 30,
	2020			2019			2020			2019
Net revenue	$	1,118,203		$	663,575		$	3,124,658		$	1,939,234
Operating expenses (income):
Direct operating expenses, excluding depreciation and amortization		423,091			322,327			1,284,789			911,234
Selling, general and administrative expenses, excluding depreciation and amortization		226,544			183,083			638,171			469,501
Amortization of broadcast rights		31,968			18,452			104,916			46,749
Amortization of intangible assets		69,265			42,443			209,360			115,538
Depreciation		36,611			29,363			107,787			84,890
Reimbursement from the FCC related to station repack		(12,873	)		(20,417	)		(51,347	)		(54,020	)
Goodwill and intangible assets impairment		-			63,317			-			63,317
Gain on disposal of stations and entities, net		-			(96,608	)		(7,025	)		(96,608	)
Change in the estimated fair value of contingent consideration attributable to a merger		-			-			3,933			-
Gain on relinquishment of spectrum		-			-			(10,791	)		-
Total operating expenses		774,606			541,960			2,279,793			1,540,601
Income from operations		343,597			121,615			844,865			398,633
Income on equity investments, net		15,861			3,217			41,351			2,061
Interest expense, net		(77,265	)		(93,199	)		(260,800	)		(197,519	)
Loss on extinguishment of debt		(37,371	)		-			(44,848	)		(3,724	)
Pension and other postretirement plans credit, net		10,761			2,578			32,285			5,378
Other (expenses) income, net		(1,093	)		118			(778	)		209
Income before income taxes		254,490			34,329			612,075			205,038
Income tax expense		(65,177	)		(39,507	)		(166,927	)		(82,594	)
Net income (loss)		189,313			(5,178	)		445,148			122,444
Net loss (income) attributable to noncontrolling interests		1,371			(669	)		2,046			(5,397	)
Net income (loss) attributable to Nexstar Media Group, Inc.	$	190,684		$	(5,847	)	$	447,194		$	117,047

Net income (loss) per common share attributable to Nexstar Media Group, Inc.:
Basic	$	4.24		$	(0.13	)	$	9.87		$	2.54
Diluted	$	4.08		$	(0.13	)	$	9.50		$	2.44

Weighted average number of common shares outstanding:
Basic		44,979			46,114			45,313			45,997
Diluted		46,737			46,114			47,064			47,919

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 September 30, 2020 and 2019

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

Accumulated

Class A

Additional

Other

Total

Common Stock

Paid-In

Retained

Comprehensive

Treasury Stock

Noncontrolling

Stockholders’

Amount

Capital

Earnings

Income (Loss)

Amount

interests

Equity

Balances as of June 30, 2020

47,291,463

473

1,340,526

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	2020-09-30	Filed 2020-11-06
10-Q	2020-06-30	Filed 2020-08-06
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	2020-11-05
8-K	2020-10-22
8-K	2020-10-21
8-K	2020-09-25
8-K	2020-09-25
8-K	2020-09-15
8-K	2020-09-15
8-K	2020-09-03
8-K	2020-09-02
8-K	2020-08-05
8-K	2020-07-23
8-K	2020-06-23
8-K	2020-06-03
8-K	2020-05-20
8-K	2020-05-15
8-K	2020-05-06
8-K	2020-04-30
8-K	2020-04-03
8-K	2020-03-02
8-K	2020-02-26
8-K	2020-01-31
8-K	2020-01-30
8-K	2020-01-27
8-K	2019-11-22
8-K	2019-11-12
8-K	2019-11-12
8-K	2019-11-06
8-K	2019-11-05
8-K	2019-10-25
8-K	2019-09-20
8-K	2019-09-19
8-K	2019-08-07
8-K	2019-07-26
8-K	2019-07-03
8-K	2019-06-26
8-K	2019-06-19
8-K	2019-06-18
8-K	2019-06-11
8-K	2019-06-10
8-K	2019-06-05
8-K	2019-05-08
8-K	2019-04-25
8-K	2019-04-07
8-K	2019-03-20
8-K	2019-03-20
8-K	2019-01-24
8-K	2019-01-15
8-K	2018-12-31
8-K	2018-12-03
8-K	2018-11-30
8-K	2018-10-26
8-K	2018-10-25
8-K	2018-10-18
8-K	2018-09-30
8-K	2018-08-02
8-K	2018-07-26
8-K	2018-06-30
8-K	2018-06-06
8-K	2018-05-01
8-K	2018-04-26
8-K	2018-03-31
8-K	2018-02-27
8-K	2018-02-01
8-K	2018-01-16

EX-31.1	nxst-ex311_7.htm
EX-31.2	nxst-ex312_8.htm
EX-32.1	nxst-ex321_9.htm
EX-32.2	nxst-ex322_6.htm

NXST 10Q Quarterly Report

Nexstar Media Group Earnings 2020-09-30