Entravision Communications Corporation (EVC) Q1 2016 Earnings Report, Transcript and Summary

Good day and welcome to the Entravision First Quarter 2016 Earnings Call and Webcast. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Walter Ulloa, Chairman and Chief Executive Officer. Please go ahead.

Thank you, Carey, and good afternoon, everyone, and welcome to Entravision’s first quarter 2016 earnings conference call. Joining me today on the call 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 a 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 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 it was filed with the SEC on Form 8-K. Moving on to our review of the first quarter. Overall, we had a good start of the year, as we continue to make progress executing a multi-platform strategy. While overall performance was impacted by non-advertising revenues we generated during the prior period – prior year period, on a core basis, we delivered revenue growth across our audio and television station groups. We also continue to generate strong digital revenue growth, as we capitalize on our unique collection of digital assets and capabilities. Our audience reach across all major platforms continues to increase, as we remain focused on transforming Entravision into a leading multi-platform media company across all acculturation levels. Our audio and television assets are well-positioned across the nation’s most densely populated Latino markets. Today, we deliver advertisers with a largest Latino audience spend in all major platforms, including online and via mobile devices We also continue to return capital to shareholders via our quarterly dividend. Looking now at specific results. First quarter consolidated revenue was $58.1 million, a decrease of 2% compared to last year. Our reported revenues were impacted by $5 million in non-advertising revenue, related to a channel modification we made to accommodate a telecom operator in the year ago period. Excluding this non-advertising revenue, total revenues on a consolidate basis increased 7% during the first quarter. Consolidated adjusted EBITDA was $12.6 million in the quarter compared to $16.8 million last year. The decrease is primarily related to non-advertising revenues previously mentioned. Turning to our TV segment operating highlights, television revenue decreased 7% during the first quarter, again, due to the impact of non-advertising revenue in the prior year period. Excluding non-advertising revenue, television revenues increased 6% in the first quarter. National revenue was up 14%, while local revenue was down 2%. Retransmission revenues increased 16% during the quarter. Excluding the impact of non-advertising revenue, political and retransmission revenues, core television advertising revenues were up 2% with core national advertising revenue up 9%, while core local revenue was down 4% during the first quarter. The automotive category continues to be a strong contributor to our television advertising revenue growth. Automotive was up 13% in the first quarter, driven by double-digit increases by Nissan, Ford, and Honda. Auto tier growth was double-digits in Tier 1 and Tier 2. Beyond auto, we generated advertising revenue growth across several other categories, including legal services up 8%, restaurants up 3%, media 4%, finance up a 11%, and political, which represented approximately $726,000 in television revenue for the quarter. During the first quarter, we continue to expand our roster of television advertising partners. We had a 52 new television advertisers who spent more than $10,000, which totaled approximately 1.3 million in advertising revenue. These new advertisers included companies and brands, such as Brightwood College, Hillary for America and American Electric Power. Turning to our ratings performance, our television – Univision television affiliates built up their market leadership in the February 2016 sweeps. For adults 18 to 49 in early local news, our Univision television stations finished ahead of their Telemundo competitor in all of our markets except one where we tied. Additionally, our early local newscasts are ranked number one or two against English and Spanish competitors in 10 markets. During a full week, our Univision and UniMás television stations combined have a cumulative audience of 3.1 million Hispanics in our markets combined compared to Telemundo’s 1.9 million Hispanics. We have 60% more viewers than Telemundo in our Univision television affiliate footprint and our reach is up 2% over the same period last year. During weekday prime time when comparing all stations in total adults 18 to 49, we had high ratings of one of the big four networks in 11 of our markets. Turning to our audio division. Revenue increased 3% in the first quarter, with local up 2%, and national up 6%. Excluding political revenues, our audio division increased by – increased revenue by 2% with core local revenue up 2% and our core national up 4%. This marks the 6th consecutive quarter where Entravision has outperformed the broader audio industry. Based on Miller Kaplan estimates for the 12 markets, which we subscribe, the industry saw an increase of 2% during the first quarter of 2016. Entravision Solutions Audio Network revenues increased 16% during the first quarter compared to the first quarter of last year. Growth was driven by Home Depot, O’Reilly Auto Parts, AT&T Mobility, and Wells Fargo, as well as new advertisers, including NBC, Universal, T-Mobile, Volkswagen, and GM Chevy. While our overall audio network grew 16%, our syndication sales for the Erazno show grew a whopping 83% in the quarter. Our Entravision Solutions Audio Network continues to benefit from our strong content offerings, which include Oswaldo Díaz, also known as Erazno y la Chokolata, Alex El Genio Lucas, and Eduardo Piolin Sotelo. The top Spanish talents – Spanish language talents working in the industry today continued to be heard, streamed, followed and connected across Entravision’s media properties. The power of our Entravision Solutions Network continues to attract advertising dollars. In the first quarter, we had 36 Entravision Solutions Network advertisers. This was an increase of 6% compared to the prior year. On the Erazno show, we had 21 active national advertisers, representing a 31.8% [ph] increase over the prior year. Our audio division recorded revenue growth in five of our top 10 categories in the first quarter, including automotive, which was up 27% in the quarter. The strong performance in automotive was driven by Toyota, Nissan and General Motors. Other advertising categories that showed strong growth in the first quarter were legal services up 24%, auto up 19%, and political, which represented $248,000 in revenue for the quarter. Similar to our television business, we continued to expand our base of advertising partners. During the first quarter, we had 33 new audio advertisers who spend more than $10,000, which generated approximately $682,000 in incremental advertising revenues. Notable new advertisers included Buy Now Insurance, The Dominguez Firm, Hillary for America, [indiscernible] Lopez & Associates and Rent-A-Center. Turning to Los Angeles, which remains our largest audio market, our LA revenue was up 2% in the quarter, and was in line with our overall market, which also finished [indiscernible] plus 2 based on Miller Kaplan. KYY continues to be a top ranked LA radio station delivering a number of key demos for the most recent three book Nielsen survey against the coveted 18 to 49 demo, KYY delivered the number one afternoon drive show with Erazno y la Chokolata and the number four drive show with Alex El Genio Lucas. And this is regardless of language against all LA or against all Los Angeles radio competitors. Now, let’s move on to our digital business. Digital revenues increased an impressive 26% to $4.7 million in the first quarter. Digital revenue now accounted for approximately 8% of our total revenue during the first quarter. We continued to generate strong digital revenue growth due to our unique combination of assets and capabilities, which included Pulpo and Luminar, as well as our strong content offering and reach. During the first quarter, we had a several new brands to our digital clients such as Wendy’s, H&R Block, LOL, Southwest Airlines, Aquaphor and Florida Lottery and others in comparison to first quarter last year. We grew in almost every quarter; automotive grew 16%, entertainment 12%, consumer goods 26%, retail 64%, and travel 100%. Our digitals platform continues to deliver the largest digital U.S. Latino reach to advertisers. Our unmatched reach is driven by Pulpo, which targets Latino – Latinos nationwide across all devices and platforms, and then leverages Luminar’s big data programmatic targeting and yield optimization tools. This is strengthened by a focus on mobile centric offerings from growing social media, following as well as our commitment to delivering compelling content across all media platforms, including our owned and operated websites. According to comScore, Pulpo’s desktop reach among Spanish Dominant, Latinos is over 7 million unique users, which represents 23% of online Latinos. This accounts for over 205 million monthly viewed pages. Our Pulpo Bicultural reach is even greater with over 16 million unique users, which represents 52% of online Latinos. This accounts for over 560 million monthly viewed pages. Our audience delivery expands all key demographics as well as Spanish Dominant – Bicultural or English Dominant Latinos. Entravision today delivers U.S. Latino market across all acculturation levels. For perspective comScore continues to rank Pulpo the number one ranked digital platform reaching Latinos in the United States, while our websites deliver over 2.2 million monthly unique visitors. We published over 11,000 local news stories and videos across our digital properties in the first quarter, while streaming over 5 million hours of audio entertainment to over 2 million unique listeners on our ONO digital network. The majority of our audience continues to engage with our content via mobile devices. The high mobile usage rate among our audience continues to drive strategic investments in our mobile app offerings and mobile first websites. Our digital teams remain hard at work, developing apps and mobile first websites associated with our leading content personalities including Alex El Genio Lucas, the LM Show and El Show De Piolin. As you might recall, in January, we launched Erazno y la Chokolata app. The response to the app continues to be very strong and today the app has been downloaded 145,000 times, with nearly 100,000 active monthly users and achieving conversion rates as high as 25%. In addition, we remain on track to launch El Genio Lucas, new mobile first website during the current quarter. Turning now to social media, we continue to grow our engagement metrics. We currently have over 6.5 million social media followers across key networks including Facebook, Twitter and Instagram. Lastly, mobile remains our fastest growing revenue stream today and contributes 28% of our total digital revenues. We expanded our mobile reach and offerings to given the Latinos continued over index and mobile ownership and media consumption. According to comScore, we have surpassed 13 million unique Spanish Dominant Latinos for mobile devices and 27 million unique Bicultural Latinos through mobile devices to our Pulpo digital network. A multiple mobile offerings also include our text and MMS operations. In the first quarter, we sent over 1.9 million text messages and are overall users level continues to increase. This has led to a steady increase in the number of MMS texts sent, which represented roughly 54% of our total text messages in the first quarter. Now let’s take a look at our patient for the first quarter, our television advertising revenues currently pacing in the positive high single-digits versus the second quarter of last year. Our audio advertising revenues currently pacing in the negative low single-digits compared to the last – to the last year’s second quarter, but we are seen momentum building as we move through the quarter. Digital revenues are currently pacing as approximately 50% above bookings at this point in the second quarter of last year. We should also note that all of this pacing detail is core advertising as we have yet to book any material political revenue thus far in the second quarter. In summary, the first quarter was a good start to the year and we are on track to achieve our full-year goals. We generated core advertising growth across our television and audio station groups, which continue to outperform the broader industry in our Spanish language peers. Our digital revenues continue to rapidly grow and we are making further progress extending online and mobile capabilities and offerings. We remain well-positioned across all media platforms and our overall audience reach continues to grow. Finally, we remain enthusiastic about the 2016 politically year. Our media assets are well-positioned across key swing states including Florida, Colorado, Nevada, New Mexico, and Virginia, at a time, when Latino population continues to grow a number and most importantly in influence. We continue to anticipate impressive political revenue increases versus 2012 and presently we expect more than 85% of our political revenue for the year to be placed in the second half of the current presidential election cycle. While the political investment cycles have yet to show consistent patterns of growth in each presidential cycle, our total Q1 political revenue generation of approximately $1 million with 10 times more than 2012 generated from a cross-section of local state, national issue and pack oriented campaigns, including Trump for President on our English language Fox Stations. At this time, I’ll turn the call over to Chris Young, our Chief Financial Officer for review of our financial information.

Thank you, Walter and good afternoon everyone. As Walter as discussed, net revenue for the quarter was down 2% at $58.1 million, compared to $59.6 million in the same quarter of last year. Operating expenses increased 5% to $39 million consolidated adjusted EBITDA was $12.6 million. During the first quarter of 2016, the company paid cash dividend to $0.3125 per share to shareholders of the company’s Class A, Class B and Class U common stock. The total amount of cash disbursed with the dividend was $2.8 million. The company also announced today that the Board of Directors has declared a quarterly cash dividend of $0.3125 per share to shareholders of the company’s common stock payable on June 30, 2016. The total amount of cash to be dispersed for this quarterly dividend will be approximately $2.8 million. As previously announced, we currently anticipate making cash dividends on a quarterly basis in future periods. For the quarter, TV net revenue was down 7% to $36.6 million, compared to 39.5 million in the same quarter of last year. The decrease in our TV segment revenue was primarily attributable to approximately $5 million of revenue associated with TV station channel modifications made by the company in order to accommodate the operations of the telecommunications operator included in the first quarter of 2015, which did not recur in the first quarter of 2016. Excluding the $5 million associated with station channel modification, our total television advertising revenues were up 4% for the first quarter, compared to the first quarter of last year. Excluding political core TV advertising revenues were up 2%, compared to last year. Retransmission consent revenue for the quarter was $7.4 million, compared to $6.4 million in the same quarter of last year. Radio net revenue for the quarter was up 3% to $16.9 million, compared to $16.3 million in the same quarter of last year. The increase in our radio segment was primarily attributable to increases in local and national advertising and an increase in political advertising revenue, which is not material in 2015. Excluding political core radio revenues were up 2%, compared to the first quarter of last year. Digital net revenue for the quarter was up 26% to $4.7 million compared to $3.7 million in the same quarter of last year. The increase in our digital segment was primarily attributable to increases in national and local advertising revenue. Operating expenses for the quarter were $39 million, up 5%. TV operating expenses excluding non-cash compensation expense were up 4%, and $20.4 million. Radio operating expenses excluding non-cash compensation expense were up 7% at $15.7 million, primarily due to higher talent costs. Digital operation – operating expenses excluding non-cash compensation expense were up 1% and $2.6 million. Corporate expenses for the quarter were up 12% to $5.6 million compared to $5 million in the same quarter of last year. Excluding non-cash compensation expense corporate expenses for the quarter were $5 million versus $4.5 million at the same quarter of last year, an increase of 11%. Excluding non-cash compensation expense, the increase in corporate expenses was primarily due to an increase in salary expense. Income tax expense was $1.5 million for the quarter, while the cash taxes paid was 200,000. Given the elimination of our full valuation allowance in the fourth quarter of 2013, future income tax expense will run at approximately 40% of pretax income, although most of this expense will continue to be non-cash given our NOL offsets. Earnings per share for the quarter were $0.03 per share, compared to $0.06 per share in first quarter of last year. Free cash flow as defined in our earnings release, decreased 36% to $6.6 million or $0.07 per share for the quarter compared to $10.3 million or $0.12 per share in the same quarter last year. Cash interest expense for the quarter was $3.7 million, compared to $3 million in the same quarter of last year, due to the interest rate swap agreement that went into effect in January of this year. Cash capital expenditures for the quarter were $2.1 million. Capital expenditures for 2016 are expected to be approximately $10.5 million. Turning to our balance sheet, as of March 31, 2016, our total debt was $315.6 million and our trailing 12 month consolidated adjusted EBITDA was $72.1 million. Cash and cash like securities on the books was $53 million as of 3/31/2016. Net of $20 million of unrestricted cash in the books, our total leverage as defined in our 2013 credit agreement was 4.1 times as of 3/31/2016. This concludes our formal remarks. Walter and I will now be happy to take your questions. Carey, I’ll turn it over to you.

We will now begin the question-and-answer session. [Operator Instructions] Our first question comes from James Dix of Wedbush Securities. Please go ahead.

Good afternoon, guys. I had a few, I guess first just as you looked at your growth through the quarter in the first quarter, and then as you look forward in your pacing, any month-to-month trends that you would call out? I think you, Walter you might have indicated that there was some strengthening that you were seeing in the second quarter for some of your business, but I think that would be interesting. And then just one other one on advertising, just regarding TV, do you have a sense that events are becoming any more or less incremental to the advertising you would otherwise get I’m just thinking about the fact in the Spanish language more than regular programming tends to be consumed live anyway, whereas in English sometimes, it’s really events, which are necessary to drive that live viewing and whether you’re think there might be any results in terms of the incrementality revenue you get from events because of that. Thanks.

Well, to your first question – about growth or category growth, I mean our automotive continues to standup for us as a strong category that we saw important growth from Q1 and we’re seen the strong growth in Q2 as well. So that continues to do well. I mentioned also that legal services were growing for us – for our television group. And I also said that restaurants were up, media, finance, and we did see some political as well. For radio, again, automotive was a strong category, and then other categories were legal services, as mentioned I earlier, auto repair, political. So that’s and national continues to perform better than local in general. And that’s a good metric to see, because last year national started out rather slowly. This year, it has more momentum. And we see momentum building or like I said, our television businesses is pacing high single-digits or radio for Q2, our radio was negative low single-digits, but we are seeing momentum build here as we move through the quarter, so which gives us confidence that we’re going to continue to build in a positive direction, and then of course, our digital business is off the charts for the quarter – for second quarter in terms of pace, As far as events are concerned, I mean, we do a number of events across our markets, probably 200 events, the biggest one we do, of course, is Reventon here in Los Angeles, big concert that we do every year. But I would say the events probably have a bigger impact on our radio business than they do our television business. But clearly, they’re becoming more important, I believe to every media company as a way to engage with their audiences, to create more brand loyalty, and also to create more digital engagement with our audiences. So that’s my comment on that.

James, just a follow-up on Walter’s thoughts. We saw in the first quarter, what we’re seeing for the second quarter in that the first month of the quarter being April is the low-water market as far as the pace is concerned. Then it builds in May and it builds in further on top of that in June. So directionally things seem to be moving correctly for a better way of putting. We saw the same thing in Q1, it started out weak in January built up through March, we’re seeing that same kind of reloading in the second quarter.

And that’s for both TV and radio?

That’s correct.

That building, okay. And then just two follow-ups, one, maybe this is also for you, Chris. Just with one quarter under your belt, any views on operating expense growth that we should be expecting this year? And in particular, any seasonality perhaps related to either cycling of town contracts, or events, or maybe even election news coverage that we should be thinking out?

Sure.

And then my last – yes, going to do that one, I had one last one on the auction.

Okay, yes. Well, to your point, we – we’re looking at a political year. There will be some news investment and political cover driving TV expense. And to our comments about the first quarter, you’re going to see probably the same impact on our contents renewal for the second quarter. And throughout the year where you’re going to have content representing about an additional 2 to 3 points in operating expense for the radio segment for the balance of the year.

Great. And then my last one was just on the auction. I was just wondering, if you could give a little color on the process as you understand it coming up and then how much it might affect the kind of senior management’s time priorities, especially as we approach and actually go through the actual bidding? I don’t know how long you expect that to occur in terms of days or whatever. I’m just curious as to how you think that’s going to affect your time allocation as we go through the process?

Well, I can’t talk much about the auction other than just confirm that the auction date will start at the end of May, that sets. And as far as time is concerned, we’ve got a team that’s already on top of that. So everyone else is going to be attending to their blocking and tackling. But the auction team that we’ve got in place is going to be obviously very dedicated to the process and that’s a whole separate silo from the ongoing operations here.

Okay, great. Very helpful. Thank you.

Thanks, James.

Our next question comes from Michael Kupinski of Noble Financial. Please go ahead. Hello, Michael, your line is open if you would like to ask your question.

Yes, thank you. I appreciate taking the questions. First of all, I will go back to the operating expenses, it seems like as a percent of sales, operating expenses are probably the highest, I think I’ve ever seen in going back to 2012 or so. Can you kind of flush out what your thoughts are in terms of the expenses, and I guess, what do we look for in terms of expenses being as a percent of revenues, because if I look back to like 2012, the last cycle, I think operating expenses were like roughly 58% of revenues. And I think and if I calculate this correct in the first quarter was almost 70%?

Well, Michael, the two drivers, I’ll just spend a little more time on what’s driving the expense. For television, what we’re trying to do is bolster up our local news operations across the country. The marketplaces have become more competitive. We’ve got competitors now that are multi-competitors in markets. And in order to maintain your leadership status, you got to investment in people and operations, and that’s one of the drivers there for TV, it’s the primary driver. You’ve also got a couple of conventions that we’re going to be investing and as far as coverage is concerned, that’s kind of a one-off situation, where we’re in an election year and we want to be on top of the issues and that’s just part of running the business. As far as radio is concerned, radio – the content is really what drives ratings, and we see this more as a long-term investment rather than a quarter-to-quarter investment. We think of the – eventually the revenue are going to justify the increased expense, because we’re looking at it more as a – of an investment. We are building out our syndication portfolio as we speak a platform and in order to be able to do that successfully, you’ve got to have the content that works and this is part of that strategy.

And – thanks, Chris. And then in terms of Univision is kind of saying that they are now planning the IPO, and of course, this has been delayed many times. But can you add any color in terms of your negotiations whether be just for your proxy agreement or now doesn’t include the master affiliation agreement, what’s holding it up at this point, do you think?

I don’t know if there’s anything holding it up per se, it’s just a long drawn out conversation back and forth that we’re having, it’s just ongoing. And, yes, there are complexities in there that we’re trying to cover and what the process continues.

And in terms of your radio revenue trends, they significantly moderated in the quarter. I guess, obvious you are probably cycling through the benefit from your personalities. Has the company been able to successfully – in syndicating the network programming that you have?

We have, I mean, remember we’ve been talking about the content now for the better part well for the past 12 months. And one of our bigger deals out there is the deal that did with the Univision, where Univision is syndicating our content on the radio stations. We’re pleased to do a deal like that and we’re looking for more deals like that as we go forward. You have to have the content to do that right. Yes, as far as the comps are concerned, just be reminded, you’ve got – Q1 of last year, our radio was a plus 10 as far as – the plus 10 is our comp for Q1 and then Q2 was still a plus 5 against our plus 10, but still the comps are getting tougher as we get into this year. And we’re working against those, but we’re doing what we can to keep the momentum going.

And some of their broadcasters have been saying that they’ve already seen some political advertising being booked in the third and fourth quarters. Are you seeing any visibility in the political advertising in the second-half already?

No, we haven’t, Michael, and not anything material in the second – I should say in the second quarter, to your question about the second-half, yes, we did – we have seen some rather significant orders come in this week that are – they’ve been directed at third and fourth quarters of the year. So like we said earlier, we probably see – we’ll probably see 75% to 85% of all the political revenue coming in the second-half of the year.

And I would just say that congratulations on your Pulpo acquisition. I mean, wow in terms of digital growth, that’s great. I guess, in terms of that growth in looking forward, can you talk about the nature of the investments you might need to support that growth. I mean, what are you looking at maybe to even enhance the growth? What are your thoughts, just kind of give us some color on what type of growth that we – growth rate we should expect as we go into 2017 and in the type of margins that we think are achievable in that division?

Well, you asked a couple of questions here. I mean, a lot of our time now spent looking at digital businesses that complement to what we’ve been able to do with Pulpo and infrastructure that we built around Pulpo. We’ve got a strong national team that are selling Pulpo. We’ve got a strong local team that continues to develop and get better all the time. But digital is right in the front of everything we’re doing right now in terms of how we see the future. We would like to see digital reach 10% of our total revenue this year. We think that’s achievable and we’re certainly on pace to do that. But next year we want to get to 20%, which would be a combination of organic growth and acquisitions. So like I said, we’re spending more and more time on our digital business. The kind of growth that you saw – that we saw in fourth quarter and in the first quarter and now that we’re seeing in Q2 gives us a lot of encouragement that we are doing the right things and that we’re bringing together the right people to help us grow this business.

Well, thanks. That’s all my questions. Thank you.

[Operator Instructions] Our next question comes from Tracy Young of Evercore ISI. Please go ahead.

Hi…

Hi.

I have three questions. In terms – just following up on the discussion about digital. The businesses is break-even this quarter. Do you expect it to be break-even to positive for the rest of the year?

We expect it to produce some important cash flow for us. We think that 20% of margin is achievable and we would like to see, we expect to see that happens. We had positive cash flow growth in 2015. But, in fact, we surpassed our budget come. And again like I said, first quarter is always the lightest quarter of the year, but then from there you start to grow and see more cash flow and we’re seeing certainly projecting cash flow for Q2 as well as the rest of the year.

That’s right. First quarter we anticipate to be the low watermark, Tracy.

Yes.

2015, we did $2.1 million in cash flow out of the digital division. And then going out from Q2 onwards, we expect to Walter’s point about the 20% plus margin, we expect that to come to fruition.

Okay, thanks. The corporate overhead number was little bit higher than I expected. Is there anything in there that we should know?

A lot of that is just expenses that we’ve allocated towards the FCC auction. We’ve got dedicated staff and legal associate with that that’s in part. We’re also raises in Q3 that has hits in the first quarter as well.

Okay, thanks. And then, just lastly, your pacings were really sounded like they were down for 2Q, is there anything going on there?

I think for Q2, really what’s happening is you got two markets, you got Los Angeles and Phoenix that have gotten very soft on this local and national, still doing well. But local in those – and those are two big markets for us. And local has become a soft spot and we’re trying to cycle through those. If you take those two markets out, it would be convenient, but just for the sake of argument, and you’ve got – you’ve got radio pacing in excess of 10%. So we’re working on the local situation on those two markets and hopefully better news to – in the next quarter.

Okay, thank you.

Thank you.

Our next question comes from Gordon Hodge of Tracker Research. Please go ahead.

Yes, thanks for taking my question. Just had a couple, I was curious on the TV pacings, I think the innovation earlier today, you’ve mentioned the Copa America event is generating some excitement among advertisers. I’m just wondering if your pacings reflect similar excitement or if you’re seeing – if you’re expecting that to come later? And then I had a couple of questions on re-trans and support, but start with that one.

Sure Gordon, thank you. Our – we’re excited as well about Copa Centenario, it’s a terrific advantage over Latin American teams are maybe playing here in United States competing for the trophy. We are – right now we’re – I should say that we’re pacing quite well for the Copa. The pace is certainly above the last – the last Copa, well above it. And we’re – we believe we’re well on our way to achieving our budget for the Copa Centenario.

Okay. And just to refresh my memory, there was a Copa – there was a Copa event, last year also or…?

It was Gold Cup I think Coppa d’ Oro last year, which I think that about $0.5 million, nothing or shattering.

Okay, okay.

But maybe with Coppa d’ Oro

You’re saying you’re pacing ahead of that on apples-to-apples?

We are pacing ahead of that and we’re – and again we’re pacing to both television and radio, because we’re broadcasting some of the games on radio where the majority that revenues to be on television about 75% of that will be – of our total actual numbers for Copa Centenario will be on television, and 25% on radio. But right now we’re well within the range to make our budget and we were pleased with the way, we continue to build for this important and Soccer event.

We know it’s going well for us as far as the pace, because auto was the biggest advertiser when it comes to Copas and our automotive category for TV is well. beyond – the pace is well beyond 20% to the positive. So that that’s a good indication that Copa is having a positive impact.

Terrific, and then last question, I want to make sure I heard it correctly, I think you mentioned Chris that re-trans was $7.4 million?

That’s right.

That’s okay. And in that’s a pure number rather than – obviously last year, there were some one time items, but that’s a number that we could look at as an indicative sort of level for this year?

Yes, if you’re modeling out, we don’t guide, but that $7.4 million – it was up 16% only because last year, it was depressed some – because of a couple of one off situations.

Perfect. Great, thank you.

Thanks, Gordon.

And this concludes our question-and-answer session. I would now like to turn the call back over to Walter, for any closing remarks.

Thank you, Carey. This includes our first quarter 2016 earnings conference call. We look forward to reporting to all of you, our second quarter earnings results on our August call. Thank you.

The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect your lines. Have a great day.