After picking up Don Imus from CBS, Citadel hopes revenue will rebound.
Citadel Broadcasting (NYSE: CDL, Bullboard) has one thing going for it. Don Imus. The veteran shock jock was pushed out of CBS Radio and MSNBC for racial remarks. Citadel picked him up for its NYC flagship station, WABC. When Imus was at CBS, he billed over 50% of the $30 million his home station brought in each year.
Citadel recently came out with earnings. The company had a huge jump in revenue because it bought ABC Radio late last year. Revenue rose to $206 million from $93 million in the same period a year ago. Operating income went from $35 million to $69 million.
Adjusted for the additional new business, the picture was not quite as good. Revenue was fairly flat. Because of debt that the company took on to buy ABC Radio, interest payments for last quarter were $35.5 million, a big nut for such a small company.
Shares in the radio firm have come way down, mostly due to debt. The stock is now at $1.65 off from a 52-week high of $8.95. The forward P/E is 5.9. The question now is can income from Imus pay the note?
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