Welcome to the Entravision Communications First Quarter 2015 Earnings Conference Call and Webcast. [Operator Instructions]. At this time, I would like to turn the conference call over to Mr. Walter Ulloa. Please go ahead.

Thank you, Jamie. Good afternoon everyone and welcome to Entravision's first quarter 2015 earnings conference call. Joining me today is Chris Young, our Executive Vice President and Chief Financial Officer. Before we begin, I must inform you that this conference call will contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ. Please refer to our SEC filings for a list of risks and uncertainties that could impact actual results. This call is the property of Entravision Communications Corporation. Any redistribution, retransmission or rebroadcast of this call in any form without the expressed written consent of Entravision Communications Corporation is strictly prohibited. Also, this call will include certain non-GAAP financial measures. The company has provided a reconciliation of these non-GAAP financial measures to their most directly comparable GAAP measures in today's press release. The press release is available on the company's website and was filed with the SEC on Form 8-K. Overall, the first quarter was a good start to the year for Entravision. We generated revenue growth in both our radio and television divisions, while our digital segment continued to deliver double-digit topline increases. Radio performed particularly well as we believe our results will be among the best in the radio industry this quarter. We generated strong year-over-year consolidated adjusted EBITDA and free cash flow growth and continued to return capital to shareholders through our quarterly dividend. Turning to the specifics, first quarter consolidated revenue was $59.6 million, up 13% compared to the first quarter of last year. Consolidated adjusted EBITDA grew 12% to $16.8 million, while free cash flow was $10.3 million, up 10% compared to $9.4 million last year. Finally, earnings per share were $0.06 in the first quarter. Turning to our segment operating highlights, television revenues increased 5% during…

Thank you Walter and good afternoon everyone. As Walter has discussed, net revenue for the quarter was $59.6 million, up 13%. Operating expenses increased 11% to $37.2 million and consolidated adjusted EBITDA increased 12% to $16.8 million. During the first quarter of 2015, the company declared and paid a cash dividends of $0.025 per share to shareholders of the company's Class A, Class B and Class U common stock. The total amount of cash disbursed for the dividend was $2.2 million. The company also announced today that the Board of Directors has declared a quarterly cash dividend of $0.025 per share to shareholders of the company's common stock payable on June 30, 2015. The total amount of the cash to be disbursed for this quarterly dividend will be approximately $2.2 million. As previously announced, we currently anticipate making cash dividends on a quarterly basis in future periods. For the quarter, TV net revenue was up 5% to $39.5 million compared to $37.7 million in the same quarter of last year. The increase in our TV segment revenue was primarily attributable to an increase of approximately $5 million of revenue from channel modifications made to accommodate a telecom operator. This increase was partially offset by decreases in local and national advertising revenue, a decrease in political advertising revenue which was not material in 2015 and a decrease in retransmission consent revenue Radio net revenue for the quarter was up 10% to $16.3 million compared to $14.9 million in the same quarter of last year. The increase in our Radio segment was primarily attributable to increases of local and national advertising. Our Digital Media segment generated $3.7 million for the quarter, resulting from the acquisition of Pulpo in June of 2014 which did not contribute to revenues in prior periods. Retransmission consent…

[Operator Instructions]. Your first question comes from Michael Kupinski from Noble Financial. Please go ahead with your question.

Thanks and congratulations on your quarter that you beat our numbers literally by the amount that you received from this telecommunications company. I was wondering if you can just explain what happened there and if you can give us a little bit more color, the $5 million modification that you got from on the television side from the telecommunications company?

Sure. In one of our markets, we made some technical changes to one of our TV stations to accommodate a telecom operator to launch operations.

Okay, so that's a non-recurring item, right. You are not going to see that in future quarters?

There are potentially other opportunities in the same that we're looking into. So it's not necessarily a onetime event as we see it right now.

And would you anticipate further something like this in the second quarter as well or no?

It's tough for me to say the timing of these types of deals; they take a while to work out. It's highly possible something else could happen within the next three quarters, but it's tough for me peg which quarter.

And literally, none of that's baked into your guidance numbers for the second quarter there. So, it didn't look like expenses would go up as much as one would expect with that type of modification or anything like that. Can you talk a little bit about the television expense side? And, obviously, you did a really good job in managing you expenses. Any inputs for the modification or anything that would be consequence in terms of expenses related to that?

No, there is no expense related to the modification revenue. So, on TV expenses, on a cash basis were up 1% and the only thing that's probably a little higher than in a normal year, is we've got some additional -- some slight additional expenses related to our news production. We got a new news production down in Tier 1, that's raised expenses a little bit. But otherwise, the expenses are pretty normalized.

And then on the digital revenue growth on a pro forma basis, what was it without Pulpo, the acquisition? What was the pro forma revenue growth in the digital side without the acquisition?

I'm going to have to get back to you on that, Michael; I don't think we have the number in front of us.

And then I think in terms of your guidance for the second quarter, you're using the base revenue for Q2 of 2014 in digital. You indicated mid-teens revenue growth. I assume that you're not factoring in the Pulpo acquisition in that guidance, is that correct?

No. We're.

So you're saying that -- I think last year you had about $2.5 million in the second quarter in digital revenues. You are saying that, that you anticipated that digital was going to be positive in the mid-teens?

Yes.

And that includes the Pulpo acquisition that was completed in June of last year?

Correct. Those numbers are included in our prior year numbers.

Our next question comes from Tracy Young from Evercore. Please go ahead with your question.

Your 2Q guidance for Radio, I guess that was up mid-teens. What should we expect in terms of expenses, is there some revenue share that you mentioned with some radio personality -- no margins?

There is a portion of the compensation that goes to some of the content is a revenue share, based on -- we don't really guide expenses, but I think previously we've talked about expenses for the year being kind of a low to mid single-digit number for radio, depending on what the variability of the revenue was. And that's kind of consistent with what we're seeing going forward.

And then should we expect retrans to be flattish for Q2 or is it going to be down again?

No, we're expecting retrans, generally speaking, for the year to be up. We had some one-time offsets for the first quarter or through the first quarter now.

And our next question comes from Amy Yong from Macquarie. Please go ahead with your question.

I have two questions. Thank you for providing, the first is on digital. Thank you for providing what digital is as a percentage of revenue and some of the growth drivers that you have there. I guess with all the mobile initiatives that you are putting in place, how should we think about the digital opportunity going forward kind of on a three-year view? And then my second question is on the broadcast incentive auction. Can you remind us on what your stance is and what's kind of next in the process and what do you think you can get from -- or you can benefit from if the auction starts?

Amy, as to your first question about digital growth, I mean certainly we're focusing lot of attention and resources on digital and the opportunity. Our goal is to get to -- that digital become 10% of our total revenue. We think we have a shot at that goal this year, maybe high single digits is certainly possible. And we'd like to see ourselves get to 20% perhaps next year or the year after. So it's definitely top of mind for us. Everything we're looking at today is somehow related to digital. And the second part of question had to do with the spectrum auctions.

The auction and trying to put some numbers on the potential for [indiscernible]. We're in data crunch mode as we speak with respect to the upcoming auction. We've got full-time staff working on nothing but auction. We're looking at potentially participating in the auction and we're also looking at as an opportunity to potentially participate via sharing of our existing facilities with other folks who may otherwise participate in the auction. So, lots of options we're working through. And as far as trying to put numbers on this event, you're still way too far off. We have to wait for the new rules to come out which we're expecting probably in the next 30 to 60 days and once those rules come out that will be another page-turner for us as far as our strategy is concerned. I know that's a long winded non-answer, but that's as best as I can do.

Our next question comes from Howard Rosencrans from Value Advisory. Please go ahead with your question.

I'm trying to sort of normalize the TV numbers. If we take out retransmission from the mix, can you tell us where TV ran in the, I guess takeout Olympics or whatever or World Cup? And the second, I'd like to know first and second quarter sort of on an apples to apples core TV without retrans. And then you also made a comment on a retrans decline that I didn't fully understand, but I'd like to understand the advertising side to begin with. Thank you.

Sure, the retrans was down to $6.4 million versus $6.7 million last year. We had a payment that -- we had reverse comp; it went up slightly for non-Univision affiliate that was in Q1 of this year. Last year's retrans number was abnormally high because we received from Univision true-up payments for several periods prior to that. So last year's number was abnormally high, this year's number was slightly lower than where it normally is.

So the total adjustment was $300,000 downward?

And we're expecting to see growth out of that revenue segment for the foreseeable future. So just had a one quarter kind of hiccup there on that front. As far as normalizing revenue for Q1, if you took out that -- you take out the one-time service agreement that we mentioned at the beginning of call, your total ad revenue for TV was a minus 9. If you exclude political and non-returning Affordable Care Act money, you get to a core number of minus 6. And then for Q2, if you take the total pace we talked about being in the negative high teens and you exclude political and the World Cup you're talking about core revenue growth right now is in the negative high single digits for the TV segment.

Can you give us little more color on, as to what -- certainly the English speakers didn't registered black ink across the board. Can you give us some more color there?

Sure, I guess for Q2 what we will say is, I'll just give you the categories that are producing the drag as far as the Q2 momentum is concerning. You've got some spenders with us last year in Q2 on the media front that have pulled back significantly, you've got services which is basically political advocacy, insurance companies and legal firms that are showing slight declines over prior year. You've got some challenges in telecom, particularly with two larger telecom ad spends that we had at this point last year that aren't looking as strong as they did this point last year. And then you've got retail which is soft as well. I think the bottom line takeaway is the World Cup was a strong distortion with respect to traditional media spending trends in Spanish last year and we're going to have to ripple through that here through Q2. It's unique to us, because really no one else had World Cup to contend with last year. It is our Super Bowl, it only happens once every four years and we're now in kind of that hangover quarter against it and we'll just have to cycle through it. I will say that the trends that we're seeing for the second half of the year are significantly better than what we're seeing for the first half of the year.

But just to get some more color on this -- when you're talking about the minus 9% from the second quarter, that your ex-ing out the World Cup and political and whatever else, so that's sort of an apples-to-apples. You mentioned a decline in -- if I got the word right, you said spenders, I don't know if you had -- who you were referring to. You said telecom and retail, you cited in particular. Where the other categories outside it that are meaningful to you that were particularly weak outside of telecom and retail?

No. The categories that I went through, media, services, telecom and retail those are the big ones that we're having to cycle through.

And if I remove telecom which is particularly cyclical or not cyclical, particularly lumpy, if I remove telecom, any sense of how we fell then?

I don't think any one category of the five that I mentioned are really -- you take one away, I don't think the picture materially changes. This isn't being skewed by one of those five categories.

And then I'll continue with one more question. You just expressed some optimism in the second half. How much visibility do you have to the second half? Can you put some more color behind that, please?

Sure. It is early, but we're seeing radio pace exceed that of what we talked about in second quarter radio paces beyond the 20% range. So that's always good news although it is early. And we're seeing core TV right now pacing in the flattish to low single-digit range for third quarter.

I'll throw in one more. And, if we were to engage, what sort of margin if we -- before corporate -- do you have a standalone margin on the digital side?

No. What we've guided for the year, Howard, is $1.5 million in cash flow against a top line number. We've got a topline number in the high teens.

But the cash flow from the digital business is about $1.5 million?

Yes, yes, it's correct.

Our next question comes from James Dix from Wedbush Securities. Please go ahead with your question.

Just two things, I guess first on the ad front, are there are any macro things that we should be thinking about, either from a perspective of regions or perhaps certain things which you think are affecting demand for advertising for the Spanish language market in particular as distinct from English-language which you think we should be thinking about as we think about TV and radio ad growth, both in the second quarter and then as you move into the back half of the year? And then I had a second one just on programming heading into the upfront, but I'll stop with that first one.

James, the only thing I would say about the macroeconomic environment is that our local business is certainly performing better than national. There is a softness in national right now that we're certainly working on and figuring out ways to improve. Our digital business continues to do well, but we need to put more emphasis on, well, we're putting more emphasis on national. The macro, there could be some movement of national revenue to digital. We feel that we're in a unique position to address any migration of broadcast revenue to digital, because of our digital assets. So, we continue to certainly to put more emphasis on national digital and to strengthen that effort as we move through the year.

And just following up on that, I mean something we'll talked about the impact of low oil prices for various reasons and potentially affecting employment in some regions, but more generally, potentially boosting consumer demand. Have you heard anything in your markets either locally or nationally that that's having any impact on the advertisers' willingness to target your audiences?

I think just geographically Texas as a region for us has slowed down a little bit. I think that's in part a reflection of what's happening with the economy down there and how sensitive it is to the price of oil.

And then just my other question is on programming, as you go into the broadcast upfront weeks, is there anything sitting from your position is a very large part of Univision's distribution, any important content trends which you would call out for investors who might not be following them maybe as closely as you do and things which you're looking for from the upfront, the news schedules. I'm thinking in terms of particular types of expected programming or the importance of sports. I know that time shifting is not as much of an issue for your demographic, so that's one of the issues you don't have to worry about as an affiliate. But are there any things which you're looking for as you're going into the new season, either from Univision in particular or just to respond to competition from Telemundo that you think we should be thinking about?

Well, I think that the novella genre format will continue to be the core of Univision's primetime programming as we move into 2015, 2016. But I think within that genre, we might start to see at least what we've heard is novellas that are more action oriented that seems to be a theme that is being worked on by the content producers.

[Operator Instructions]. Our next question is a follow-up from Michael Kupinski from Noble Financial. Please go ahead with your follow-up.

I kind of want to go back to the telecom opportunity that you guys had in the quarter. Had you identified the revenue opportunity for future telecom deals? I know that you indicated that there could be some to come, but I was just wondering if you can kind of give us a framework of what you might see in terms of total revenue opportunities if you have other stations that modified for this telecom operator?

Michael, to answer your question, we haven't yet identified what the potential for additional revenue from these telecom collaborations that I just described. But we do believe there is potential, but we can't -- we can't identify what that number might look like.

And then I was wondering if you have any updates in terms of your discussions with Univision on your proxy, the retrans negotiations, any progress there, any timetables when you think that -- are you kind of nearing something or where do you stand with the discussions?

Well, we continue our discussions with Univision. I would say that right now they certainly are focusing more on these issues than in the past, we're too. So we hope to be able to arrive to some agreement here in the future.

In terms of your retransmission opportunity, do you think that it would be in the best interest of the company to kind of take back the negotiations to negotiate your own retrans or do you think you're more likely to kind of keep the kind of the similar process that Univision negotiates the retransmission for you?

We continue to believe that working closely with Univision through our proxy is the way for us to proceed forward with the MVPDs. We certainly believe that that partnership certainly is cohesive and provides us to present the MVPDs with better information. So, our hope is that this arrangement that we have with Univision that this now over six years old will continue.

Ladies and gentlemen, at this time I'm showing no additional questions. I like to turn the conference call back over to management for any closing remarks.

Thank you everyone. This concludes our first quarter 2015 Investor Call. We look forward to talking to all of you when we announce our second quarter results in August of this year. Thank you again.

And ladies and gentlemen that does conclude today's conference call. We do thank you for attending. You may now disconnect your telephone lines.