Westwood One, Inc. Reports Results for the First Quarter 2011

        Westwood One, Inc. Reports Results for the First Quarter 2011

  PR Newswire

  NEW YORK, May 16, 2011

NEW YORK, May 16, 2011 /PRNewswire-FirstCall/ -- Westwood One, Inc. (NASDAQ:
WWON), a leading independent provider of network radio content to the radio
and digital sectors, today reported operating results for the first quarter
2011.

As of March 31, 2011, Westwood One was organized into two business segments,
Network Radio and Metro Traffic, as reflected in our financial statements. In
this earnings release, our first quarter results include the results of the
Metro Traffic business, which we sold on April 29, 2011. 

As previously reported, the sale of the Metro Traffic business reduced the
Company's outstanding senior debt by approximately $104.0 million,
strengthened the Company's balance sheet, and positioned the Company for
future growth.

Westwood One's first quarter revenue decreased $1.9 million, or 2.1%, to
$90.9million from $92.8million in 2010. The revenue decrease occurred in
Network Radio, and is primarily due to the absence in 2011 of the Winter
Olympics, which contributed significantly to first quarter 2010 Network radio
revenue, a decline in news revenue, and the compressed selling period for the
NCAA Men's Basketball Championship after the contract was renewed in January.
These revenue decreases were partially offset by revenue increases in Network
music and entertainment, and certain news and talk programs including The
Osgood File with Charles Osgood, the longest running news/talk feature on
radio. The revenue decrease was also partially offset by increased Metro
Traffic revenue.

"We are focused on expanding our Network radio and digital business by
launching new radio programs and digital video content, expanding distribution
of our current programs, and supporting our revenue structure with the
necessary resources," said Rod Sherwood, President. "We are well positioned in
the marketplace. Our new talk programs, including the Robert Wuhl Show and
Urbanski, are generating increasing revenue and gaining distribution. In
April, we launched new programs, including The Daily Wrap , in partnership
with The Wall Street Journal, Rocsi on the Radio , with Rocsi Diaz, (the
popular co-host of BET's hit television show, 106 & Park), and a suite of Rick
Dees programming . "

Adjusted EBITDA (1) in the first quarter was a loss of $5.2 million, which
includes incremental broadcast rights expense of $3.7 million related to a new
sports content agreement, compared to the first quarter of last year. Of the
$3.7 million of incremental broadcast rights expense, $0.7 was paid in the
period and $3.0 million was non-cash. Excluding the incremental non-cash
broadcast rights expense, Adjusted EBITDA would have been a loss of $2.2
million in 2011 compared to Adjusted EBITDA income of $2.1 million in the
first quarter of 2010. The incremental non-cash expense related to the new
broadcast rights agreement is expected to be $2.4 million for the twelve
months ended December 31, 2011, which will be paid in future years.

Three Months Ended March 31, 2011

For the three months ended March 31, 2011, revenue was $90.9million, a
decrease of $1.9million, or 2.1%, compared to $92.8million in the first
quarter of 2010.

Network Radio revenue was $51.7million, a decrease of $3.8million, or 6.9%,
compared to $55.6million in the first quarter of 2010. As previously stated,
advertising revenue decreased in sports and news, which was partially offset
by increased revenue in music and entertainment, and certain talk programs.

Overall, Metro Traffic revenue for the first quarter was $39.2million, an
increase of $1.9 million, or 5.0%, from $37.3million in 2010. Revenue for
Metro Traffic Radio was $31.2 million, an increase of $3.5 million or 12.5%,
compared to $27.7 million in 2010. This increase was based largely on
increased advertising revenue in the key categories of financial services,
travel and entertainment. Revenue for Metro Television was $8.0 million, a
decrease of $1.6 million, or 16.6%, from $9.6 million in 2010, primarily due
to lower ratings and audience levels.

Operating loss in the first quarter of 2011 increased by $6.5million to
$13.1million from $6.6million in 2010. This increased loss was largely due
to increased station compensation to support increased distribution, and to
higher programming and operating costs associated with new agreements. This
included higher non-cash broadcast rights expense of $3.0 million. The
increased loss was partially offset by lower corporate expenses, and lower
restructuring and special charges.

Adjusted EBITDA (1) in the first quarter was a loss of $5.2 million, which
includes incremental broadcast rights expense of $3.7 million related to a new
sports content agreement, compared to the first quarter of last year. Of the
$3.7 million of incremental broadcast rights expense, $0.7 was paid in the
period and $3.0 million was non-cash. Excluding the incremental non-cash
broadcast rights expense, Adjusted EBITDA would have been a loss of $2.2
million in 2011 compared to Adjusted EBITDA income of $2.1 million in the
first quarter of 2010. The incremental non-cash expense related to the new
broadcast rights agreement is expected to be $2.4 million for the twelve
months ended December 31, 2011, which will be paid in future years.

Interest expense in the first quarter of 2011 decreased $0.3million, or 5.0%,
to $5.1million from $5.4million in the first quarter of 2010. This reflects
lower average balances of our outstanding debt, primarily as a result of our
debt repayments in 2010, partially offset by increased interest on our
revolving credit line.

The Company's tax benefit increased $2.2million to $7.4million compared to
$5.2million in the first quarter of 2010, due to a higher pre-tax loss.

Net loss for the first quarter was $9.8million, or $0.45 per diluted share,
compared with a net loss of $6.7 million, or $0.33 per diluted share, in 2010.
The year-over-year change in net loss reflects the higher operating losses of
$6.5 million, partially offset by a higher tax benefit of $2.2 million and
other income of $1.1 million related to the fair market value adjustment from
the $10.0 million of common stock purchased by Gores this past February. First
quarter 2010 average share amounts were lower than average share amounts in
the first quarter of 2011 as a result of the $15.0 million of common stock
that was issued to Gores in September 2010 and February 2011.

Free cash flow(2) usage in the first quarter of 2010 was $6.6 million as
compared to a free cash flow source of $2.7 million in 2010, representing
decreased cash flow of $9.3 million. This was due to unfavorable working
capital changes of $3.7 million, a higher net loss of $3.1 million and
non-cash adjustments of $2.8 million, partially offset by lower capital
expenditures of $0.3 million.

Outlook

Westwood One is focusing strategically on expanding its leadership position in
network radio as the premium content provider of news, sports, information,
talk, music and entertainment programming. 

Assuming that economic conditions remain relatively stable, we believe our
investments in new network radio programming and digital content will provide
a foundation for revenue growth over time.

About Westwood One

Westwood One (NASDAQ: WWON) is one of the nation's largest providers of
network radio programming serving more than 5,000 radio stations in the U.S.
Westwood One provides over 150 news, sports, music, talk and entertainment
programs, features and live events to numerous media partners.

Footnotes to Press Release

(1) Adjusted EBITDA is a non-GAAP financial measure that is reconciled to net
income in the accompanying financial tables. We use Adjusted EBITDA to
evaluate our performance relative to our competitors and have included it in
this press release because we believe Adjusted EBITDA represents an effective
means by which to measure our operating performance. Although we primarily
view Adjusted EBITDA as an operating performance measure, we also consider it
to be useful to investors because it enables them to evaluate and compare our
results from operations and cash resources generated from our business in a
more meaningful and consistent manner by excluding specific items which are
not reflective of ongoing operating results. Adjusted EBITDA is not a
measurement of financial performance under GAAP (Generally Accepted Accounting
Principles) and should not be considered as an alternative to net income,
operating income or any other performance measure derived in accordance with
GAAP, as an alternative to GAAP cash flow from operating activities or as a
measure of our profitability or liquidity.

(2) Free cash flow is a non-GAAP financial measure that is reconciled to net
income in the accompanying financial tables. We use free cash flow to
evaluate our performance relative to our competitors and have included it in
this press release because we believe free cash flow represents an effective
means by which to measure our operating performance. Although we primarily
view free cash flow as an operating performance measure, we also consider it
to be a useful to investors because it provides them with an important
perspective on the cash we have available to service our debt, maintain
capital assets and fund ongoing operations and make strategic acquisitions
and/or investments. Free cash flow is not a measurement of our financial
performance under GAAP and should not be considered as an alternative to net
income, operating income, or any other performance measure derived in
accordance with GAAP, as an alternative to GAAP cash flow from operating
activities or as a measure of our profitability or liquidity.

Forward-Looking Statements

Certain statements in this release constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements involve known and unknown risks, uncertainties
and other factors which may cause the actual results, performance or
achievements of Westwood One to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. The words or phrases "guidance," "expect,"
"anticipate," "estimates" and "forecast" and similar words or expressions are
intended to identify such forward-looking statements. In addition any
statements that refer to expectations or other characterizations of future
events or circumstances are forward-looking statements. Various risks that
could cause future results to differ from those expressed by the
forward-looking statements included in this release include, but are not
limited to: continued declines in our operating income; our significant amount
of indebtedness and limited liquidity; the higher cost of our indebtedness;
the availability of additional financing; our future cash flow from operations
and our ability to achieve our financial projections; changes to our CBS
arrangement; introduction of The Portable People Meter™; maintenance of an
effective system of internal controls; increased competition and technological
changes and innovations; failure to obtain or retain the rights in popular
programming; acceptance of our content; continued consolidation in the
industry; further impairment charges; and Gores' influence over our corporate
actions. Our key risks are described in our reports filed with the SEC,
including our Quarterly Report on Form 10-Q for the quarter ended March31,
2011 and our Annual Report on Form 10-K for the year ended December31, 2010.
Except as otherwise stated in this news announcement, Westwood One, Inc. does
not undertake any obligation to publicly update or revise any forward-looking
statements because of new information, future events or otherwise.

                              WESTWOOD ONE, INC
                    CONSOLIDATED STATEMENT OF OPERATIONS
                  (In thousands, except per share amounts)
                                          Three Months Ended March 31,
                                           2011                  2010
                                       $            $        
Revenue                                          90,879               92,842
Operating costs                                   94,080               88,448
Depreciation and amortization                      4,595                4,496
Corporate, general and
administrative expenses                            3,036                3,912
Restructuring charges                                835                  743
Special charges                                    1,468                1,823
Total expenses                                   104,014               99,422
Operating loss                                  (13,135)              (6,580)
Interest expense                                   5,106                5,376
Other expense (income)                           (1,096)                    1
Loss before income tax                          (17,145)             (11,957)
Income tax benefit                               (7,379)              (5,234)
                                     $             $        
Net loss                                         (9,766)              (6,723)
Loss per share:
Common Stock
                                   $            $         
Basic                                             (0.45)               (0.33)
                                   $            $         
Diluted                                           (0.45)               (0.33)
Weighted average  shares
outstanding:
Common Stock
Basic                                             21,749               20,544
Diluted                                           21,749               20,544

                              WESTWOOD ONE, INC
                         CONSOLIDATED BALANCE SHEETS
                  (In thousands, except per share amounts)
                                       March 31, 2011      December 31, 2010
ASSETS
Current assets:
                                     $           $         
 Cash and cash equivalents                       6,396            2,938
 Accounts receivable, net of
 allowance for doubtful accounts
 Income tax receivable                            93,198               96,557
 Prepaid and other assets                         16,830               18,421
   Total current assets                          116,424              117,916
Property and equipment, net                       38,044               37,047
Intangible assets, net                            89,759               92,487
Goodwill                                          38,945               38,945
Other assets                                       1,936                1,879
                                       $          $         
   TOTAL ASSETS                                 285,108            288,274
LIABILITIES AND STOCKHOLDERS'
(DEFICIT) EQUITY
Current liabilities:
                                     $           $         
 Accounts payable                                49,824            45,907
 Amounts payable to related parties                  982                  859
 Deferred revenue                                  7,266                6,736
 Accrued expenses and other
 liabilities                                      31,298               33,819
   Total current liabilities                      89,370               87,321
Long-term debt                                   137,675              136,407
Deferred tax liability                            29,820               36,174
Due to Gores                                      10,350               10,222
Other liabilities                                 22,563               24,142
   TOTAL LIABILITIES                             289,778              294,266
Commitments and Contingencies
STOCKHOLDERS' (DEFICIT) EQUITY
Common stock, $.01 par value:
authorized: 5,000,000 shares 
 issued and outstanding: 22,591
 (2011) and 21,314 (2010)                            226                  213
Class B stock, $.01 par value:
authorized: 3,000 shares;
 issued and outstanding: 0                             -                    -
Additional paid-in capital                        99,727               88,652
Accumulated deficit                            (104,623)             (94,857)
   TOTAL STOCKHOLDERS' (DEFICIT)
   EQUITY                                        (4,670)              (5,992)
   TOTAL LIABILITIES AND              $          $         
   STOCKHOLDERS' (DEFICIT) EQUITY              285,108            288,274

                              WESTWOOD ONE, INC
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                               (In thousands)
                                              Three Months Ended March 31,
                                                2011              2010
Cash Flows from Operating Activities:
                                           $         $        
Net loss                                        (9,766)           (6,723)
Adjustments to reconcile net loss to net
cash   provided by (used in) operating
activities:
    Depreciation and amortization                    4,595              4,496
    Deferred taxes                                 (6,777)            (5,107)
    Paid-in-kind interest                            1,395              1,524
    Non-cash equity-based compensation                 965              1,059
    Change in fair value of derivative
    liability                                      (1,096)                  -
    Amortization of deferred financing
    costs                                                6                  6
    Net change in other assets and
    liabilities                                      5,991              9,660
    Net cash (used in) provided by
    operating activities                           (4,687)              4,915
Cash Flows from Investing Activities:
    Capital expenditures                           (1,912)            (2,183)
    Net cash used in investing activities          (1,912)            (2,183)
Cash Flows from Financing Activities:
    Issuance of common stock                        10,000                  -
    Proceeds from exercise of stock
    option                                             330                  -
    Payments of finance and capital lease
    obligations                                      (273)              (262)
    Proceeds from Revolving Credit
    Facility                                             -              3,000
    Repayments of Senior Notes                           -            (3,500)
    Net cash provided by (used in)
    financing activities                            10,057              (762)
     Net increase in cash and cash
    equivalents                                      3,458              1,970
     Cash and cash equivalents,
    beginning of period                              2,938              4,824
     Cash and cash equivalents, end of    $         $        
    period                                        6,396            6,794

The following table provides a reconciliation of Adjusted EBITDA to net income
determined in accordance with GAAP for first quarter of 2011 and 2010.

                              WESTWOOD ONE, INC
                       ADJUSTED EBITDA RECONCILIATION
                               (In thousands)
                                          Three Months Ended March 31,
                                           2011                  2010
                                          $               $      
Net income                                     (9,766)              (6,723)
Interest expense                                  5,106                 5,376
Depreciation and amortization                     4,595                 4,496
Income taxes provision (benefit)                (7,379)               (5,234)
Restructuring, special charges
and other (a)                                     2,366                 3,162
Stock-based compensation                            965                 1,059
Other non-operating losses
(gains)                                         (1,096)                     1
                                          $             $       
Adjusted EBITDA (b)                            (5,209)                2,137

(a) Restructuring, special charges and other includes expense of $322, $918,
and $1,652 are classified as general and administrative expense on the
Statement of Operations for the three months ended December 31, 2010 and the
years ended December 31, 2010 and 2009, respectively.

(b) Adjusted EBITDA includes incremental broadcast rights expense of $3,719
related to a new sports content agreement, compared to the first quarter of
last year.

The following table provides a reconciliation of Free Cash Flow to net cash
(used in) provided by operating activities determined in accordance with GAAP
for first quarter of 2011 and 2010.

                              WESTWOOD ONE, INC
                        FREE CASH FLOW RECONCILIATION
                               (In thousands)
                                             Three Months Ended March 31,
                                                  2011              2010
Net cash (used in) provided by operating                        $      
activities                               $      (4,687)         4,915
(Less) Capital expenditures                            (1,912)        (2,183)
                                                                $      
Free Cash Flow                            $      (6,599)         2,732

SOURCE Westwood One, Inc.

Website: http://www.westwoodone.com
Contact: Chris Miller, Westwood One, +1-212-641-2108, +1-917-533-7224,
chris_miller@westwoodone.com