Pandemic Means Radio Companies Now Drawing from Credit Lines
| RADIO ONLINE | Monday, March 23, 2020 | 7:03am CT |
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In the wake of the coronavirus pandemic, many radio companies are being hit hard with a sudden and unexpected loss of advertising revenue. The result is drawing from credit lines - and in very big numbers.
In a quarterly earnings call, Urban One President/CEO Alfred Liggins III revealed his company has drawn 27.5 million from its asset-backed credit facility - something Liggins says is similar to what many companies are doing.
Townsquare Media is one such company and has borrowed $50 million under the revolving credit facility portion of its credit agreement with administrative agent Royal Bank of Canada (RBC). Townsquare disclosed the transaction on Friday via an SEC filing, one day after its Q4 and year-end 2019 earnings call. Townsquare CEO Bill Wilson said on the call that the impact to his company this month "has been significant."
"This is an evolving situation, which we know will have a negative impact to our business, and we will make the necessary plans and adjustments," said Wilson. "The extent of that impact is uncertain at this time. What I can say with certainty and confidence is that, overall, we remain very confident and optimistic about the long-term demand for our products and marketing and advertising solutions."
