6-4-13
From the Moody's note (which you can read HERE), the ratings company mentions the 10 spoken word formats CEO Lew Dickey has been focused on fixing, in its upgrade. "Debt ratings are pressured by challenges related to turning around 10 underperforming stations in eight of its larger markets which are expected to breakeven in the second half of 2013. Management indicates that four of these 10 stations have successfully been turned around." Moody's also seemed pleased with the amount of debt paid off and cash flow margins.
The Moody's note also says The company's national scale, geographic and market size diversity as well as expected run rate EBITDA margins exceeding 37% support ratings." Cumulus paid down $35.6 million of term loan debt in April 2013. "Moody's expects Cumulus to generate roughly $175 million of annual free cash flow versus our prior estimate of $200 million to reflect management's comments that it expects to invest roughly $25 million annually in CBS Sports Radio, Nash FM and related country format branding, its Traffic network, as well as SweetJack.
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