Good morning. Welcome to Townsquare Media’s Fourth Quarter and Year-End 2014 Conference call. As a reminder, today’s call is being recorded and you participation implies consent to such recording. At this time, all participants are in listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions]. With that, I would like to introduce the first speaker for today’s call, Alex Berkett, Executive Vice President. Sir, you may proceed.

Thank you, operator. Good morning to everybody. Thank you for joining us today for Townsquare Media’s fourth quarter and full year 2014 financial update. With me on the call today are Steven Price, our Chairman and CEO; and Stuart Rosenstein, our CFO and Executive Vice President. Today, we are going to provide an update on our fourth quarter and full year financial results, as well as provide a brief update on our refinancing opportunity. Please note that during this call, we may make statements that provide information other than historical information including statements relating to our company’s future prospects. These statements are considered forward-looking statements under the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties that could cause the actual results to differ materially from those projections. These statements reflect the company’s beliefs based on current conditions but are subject to certain risks and uncertainties that are detailed in the company’s S1 filed with the SEC and we incorporate these by reference for this call. We may also discuss certain non-GAAP financial measures including direct profit and adjusted EBITDA and make certain pro forma adjustments. Such non-GAAP financial measures should be used in conjunction with all the information contained in the quarterly and year-end reports available on our Web site. At this time, I would like to turn the call over to Steven Price.

Thanks, Alex. Good morning, everyone, and thank you for joining us today. We are very pleased with our results for the fourth quarter and full year 2014. Pro forma for all material M&A activity completed as of year-end. We delivered a net revenue increase of 9.5% in the fourth quarter and 8.4% in the full year. Excluding political, our results were still strong. Revenue increased 5.1% in the fourth quarter and 6.7% for the full year. Pro forma adjusted EBITDA grew 8.6% in the fourth quarter and to 3.5% for the full year period as compared to the prior year periods. In the fourth quarter, on a pro forma basis, local advertising revenue increased 5.6% over the prior year period or 0.6% excluding political revenue. For the year on a pro forma basis, local advertising revenue grew 2.6% or 0.6% excluding political revenue. From a local advertising operating perspective, in 2014, we sought to improve the listener experience on our radio stations and our streams. In many cases, we decreased commercial spot loads and endeavored to raise the quality of our local programming content. We continue to focus on live and local on-air personalities as the backbone of our content strategy. In addition, we rolled out new advertising products to meet the evolving needs of our clients and at year end launched Townsquare University, an in-depth training program for all of our new sales reps. Our local digital content business also performed well and we continue to grow our audience and engagement with strong content and on-air promotion as well as excellent search engine optimization and social marketing. One change that you may have noticed in our filings is that we now report live events as a standalone operating segment. Since our IPO, we have received a number of inquiries…

Thank you, Steven. Good morning, everyone. As a reminder, the results that Steven referred to earlier are not our historical GAAP financials. They are pro forma for all material M&A activity completed by December 31, as they had occurred at the beginning of the reporting and comparison periods. Please refer to the tables that we have provided in our earnings release, which provide GAAP results with a bridge to our pro forma results as well as our non-GAAP performance measures. Since we have made several material acquisitions in the reporting period, we feel it’s important to report our comparative results in a more meaningful way. Unless otherwise stated, all the financial results discussed will be pro forma for these completed acquisitions. For the fourth quarter ended December 31, 2014, net revenue equaled $93.7 million, up $8.1 million for an increase of 9.5% from the same period last year. For the year, net revenue increased $29.7 million or 8.4% over the prior year. Local advertising revenue for the quarter equaled $80.3 million, an increase of approximately $4.2 million or 5.6% over the prior year’s quarter. For the year, local advertising revenue increased $7.6 million or 2.6% over the prior year. These increases include approximately $3.8 million and $5.9 million of political advertising revenue in the quarter and the full year. Excluding political, local advertising revenue increased 0.6% or approximately $500,000 in the quarter and 0.6% or $1.7 million for the year. Live events, our new segment, saw a revenue increase for the quarter of $1.9 million or 53.8% to $5.4 million over the same period last year. For the year, revenue increased $12.4 million or 31.6% over the prior year. This increase is reflective of increases in the number of events we held, the number of attendees at each event and…

Thanks, Stu. In summary, we’re pleased with our performance in 2014 and our ability to meet the guidance we have provided. Looking forward, I’m excited about the growth prospects for our company. We are pleased with our diversified Townsquare Everywhere product and service offerings that allow us to grow with our advertisers wherever and however they choose to reach their customers. As always, we will remain active in shareholder outreach and will search for ways to grow shareholder value in the future. Today, we also released an investor presentation and earlier this year, we released our annual shareholder letter, which I encourage you all to read. Please do not hesitate to call us with any questions or just to check in. Thanks again for taking the time to dial in this morning. With that, we’re now happy to open the call for questions. Operator, will you please open up the lines.

Thank you. We will now be conducting a question-and-answer session. [Operator Instructions]. Thank you. Our first question is coming from the line of Michael Kupinski with Noble Financial. Please proceed with your questions.

Thank you for taking the question. I was wondering if you can give me some thoughts on how advertising was looking by month in the first quarter? And if you’re starting to see pacing kind of improve as you head into the second quarter?

I’ll take that. It’s Steven. Thanks, Mike. We don’t give guidance by month and we gave a decent amount of guidance on the call. I would say generally it’s gotten better and in part because weather has gotten better. Weather was – the harsh weather, as you know it was a tough winter. In fact tougher winter this year, I think it will be proven out certainly for a lot of people than last winter not necessary because of the cold but because of the number of selling days that were missed, because of the amount of snow, particularly in the North East, which really affected January a little bit, February, March better and the pacing for second quarter do look quite a bit better.

Thank you. I was wondering if you could give me a little bit more color on the live events in the fourth quarter. On a pro forma basis, how many live events were in the quarter and how many events were comped against an event that was held in the prior year? And if you can just give us a little color on the revenue growth for those events and maybe the margins?

Okay. So I don’t have the – we did about 140 events in the fourth quarter, which was up from about 125 or so in the fourth quarter of the year before. So sort of broadly speaking roughly comparable number, but as we’ve been moving forward on our live event business as we’ve talked about, we’ve been as focused on concepts and growing the concepts that we think makes sense and proving out smaller and lower margin events. So we’re not as focused on growing the absolute number. So 500 doesn’t have to go to 600 to 700, et cetera, if we keep the number roughly the same but that will mean that I’m making it up, there will be 50 to 100 new ones and we’ll stop doing 50 or 100 of the older ones. So if you’re asking of the ones – the exact same ones we did, what’s the comparison, I don’t exactly have that number.

Okay.

But in general we’ve been weeding out the smaller and lower margin events.

To speak to the growth point, Mike, this is Alex speaking, in the fourth quarter overall live events growth was about 53% on a pro forma basis and a little over 31% for the year, so we’re pleased with the growth we’re getting from this segment.

Okay. And then if you can give us any updates on the M&A environment, like what the pipeline might look like there, the size, that sort of thing.

We continue to look sort of across the landscape and across the places that we invest in digital, radio and events as well as other things that come out way. We haven’t seen things that are so attractive material acquisitions. We’re looking at a lot. There are a handful of things I would say on the broadcast side that we have looked at. Price expectations these days are quite high I would say and we’ve tended to be prudent and disciplined as we said we would on our IPO and as we’ve continued to talk about. So we would like to make acquisitions on the broadcast side. We just haven’t found somebody that meets the three criteria that we’re looking for, which are small to midsized right kind of markets for us, dominant clusters at the right price. And as we’ve said, we will be aggressive if we can find things that meet those three criteria and less so if they don’t meet all of those criteria. On the events and digital side, we’re seeing things. They tend to be smaller, so we haven’t seen anything of scale that’s interesting recently.

Okay, great. That’s all I had. Thank you.

Thanks, Mike.

Thanks, Mike.

Our next question is coming from the line of Jim Goss with Barrington Research. Please proceed with your questions.

Hi. I’ve got several. One would be related to political. I don’t think you have talked about exactly what the total political values were and I don’t know if you’re willing to share anything about that. But I was sort of wondering whether there is a crowding out issue at all in radio as there is in broadcasting or whether that’s really not the case because there is a lot more available inventory in radio versus TV and so therefore political tends to be entirely or mostly incremental rather than partly incremental? And then I’ll come back with a couple more.

I’ll let Alex, Jim, touch that, but in general we haven’t seen or crowded out. We still think that radio is an incredibly cost effective targeted medium for many political races and we’ve thought that historically and from what we saw in our company in the fourth quarter, we thought that.

Jim, to give you the specific numbers, I think you can back deep into the 10-K MD&A, but just for your reference purposes we saw 4.9 million of political revenue in the fourth quarter and 8.1 million political revenue for the year, which was generally in line with our expectations.

Okay. In terms of the broadcasting or the radio acquisitions, for example, CBS has been talking about remaining in radio but refining its portfolio to its very largest markets. Now maybe even its smaller markets is above what you’d be looking to, but either there or elsewhere who do you think would be your principal competitors in terms of acquired properties at this stage?

I don’t know. It depends on the property, what it is, where it is, what the size of the acquisition is. There are a number of publicly traded radio companies. There are private equity firms. There are diversified media companies. There are probably lots of people who would be interested in radio. As you know, it has high margins and free cash flow, so I think they could be a bunch of people out there. We’ve been going to them over the last four years and things that we think makes sense for us and we’ll continue to do so. And I still think we can grow in the broadcasting space. But as to specific acquisitions, we don’t really comment on that. And as to the competition, everyone may be different.

Okay. This is pretty far away before it’d have an impact on you [ph], the Pandora has been trying to take what it says is a significant share of radio. And then it’s been hiring sales staff, mostly in its key larger markets to try to take a share of radio ad dollars. And even though that’s – the connected car issue isn’t as big an issue right now. It does seem like the opportunity is growing on that side. And I’m wondering how you view it as a competitive threat at any stage in terms of the radio ad dollars?

Yes, so as the big national players, Pandora and like, we really don’t see their sellers in our size markets. I don’t think it’s cost effective to go into the kind of markets we’re in. It seems to me that their strategy and it would probably be my strategy if I were them would be to focus on the very biggest markets. And in general, the competitive threat – I mean there’s been – as you know because you’ve been around this business a long time, there have been competitive threats to radio with 8tracks and jukeboxes and cds and iPods and lots of different things. If people just want to listen to a streaming music, actually that’s now Pandora because Pandora has commercial. But if somebody just wants to listen to music, there are lots of ways to do that, the me [ph] experience. But radio has always on the audio side occupied a slightly different space, which is sort of the we experience, which is the ability to feel connected to a community. So it’s not just listening to the music but know what the DJs and other people in your community think about the music and other things that they do, lifestyle things related to interest in that music. So our view is if we have great live and local content, compelling content that people want to find us at home, at work, in the car, in the shower, everywhere. And if we don’t have compelling content, then they won’t find us even if there a very few alternative choices. So we stress that we are content company, great live and local content that’s relevant to the community. And if we can continue to do that they are going to seek us out and find us either on an app, on a stream, on the radio, on their computer, in their car, wherever and that’s sort of the strategic thrust of our content and programming strategies since the beginning.

Okay. And the last thing. In the concert area, you had really great success in the Minneapolis country event that I think you’ve talked about potentially being able to expand. If you had an opportunity to buy one of those, do you have an appetite to make bigger impact ones, vis-à-vis the acquisition – the rollout strategy you just described about creating certain types of events and making those more numerous around the country in your markets?

Sure. We like the events space and to the extent that we can go at prudent prices and find things that make sense for us, we’ll continue to try to do that. It’s a good place for us and I think we’ve proven over the last number of years that we know how to buy these things right and importantly run them. They’re kind of tricky to run. You have to understand how to promote and produce and put on especially if you’re taking capital risks in the events not just doing a co-promotion or being the marketing partner, but actually putting on and producing the event, booking the talent, doing the event. And I think we’ve proven we know how to do that considering that we have less than – over the last three years a 2% loss rate, so 98% of our events make money and have for the past three years. So I think we understand how to do that. If we could find either smaller or larger events, we would look very seriously on them.

Okay. Thanks much. I appreciate it.

Thanks.

Thank you. [Operator Instructions]. The next question comes from the line of David Bank with Townsquare [ph]. Please proceed with your questions.

Thanks. I haven’t joined Townsquare. I’m still with RBC. So my question this morning is I guess from what you can see rather than focus on the revenue side, what are you seeing in terms of changes in consumer behavior? Particularly over the last quarter, have you seen any sort of material changes across the portfolio in terms of time spent listening on the stations and in terms of time spent with the digital properties? And what is the relationship between – I mean ultimately between the revenues flowing back and forth in those different properties? What can you tell from your integrated asset set, if you will, and what consumer behavior changes are you observing? Thanks.

Sure. So I don’t have first quarter numbers, because we don’t have all our ratings and I don’t have all the analysis from our digital properties obviously for the quarter yet. I do have for the first month or two.

Or even going back to the fourth quarter I think is fine.

Yes. For last year, it’s actually been pretty consistent with what we’ve seen since we started, which is that our reach, our cume and our TSL are pretty flat, slightly up over the last number of years on an apples-to-apples sort of same-store sales station-to-station basis. So we have not seen a shift in consumer behavior on the radio side. Our listenership has been pretty stable. On the digital side, our audience has been growing quite nicely and it continued to do so in the fourth quarter. And so on the consumer – we haven’t seen much on the consumer side in changes in their patterns with our content.

Does that surprise you at all?

Yes. I want it to be up and we’re spending a lot of money and time and effort on a live and local content strategy. And we think if you’re in one of our markets, we have the best content out there. If you’re in Missoula or Tyler or Utica, New York or in Buffalo and you want to listen to something audio, you should listen us. We spend a lot of time working on our creative copy to make our commercials sound better. As I said in the prepared remarks, we’ve been working to cut spot loads and cap spot loads in almost all cases. We spend a lot of time on music research and even things like jingles and logos. So we spend time on our content strategy and I think our audience as it’s clear that more people are doing more things audio. We want to get an even bigger share of that and then ultimately turn that into a good share of wallet.

Okay. Thank you very much guys.

Thank you.

Our next question is from the line of Andrew DeGasperi with Macquarie. Please proceed with your questions.

Hi. I’m asking a question on behalf of Amy. First, can you identify the two multi-day live events you will not repeat this year? In other words, the ones that you will not obviously have a show on. And then secondly, can you give us timing on the refinancing? Has that changed at all? And lastly, the adjusted EBITDA guidance, you mentioned this is ex-political. Can you give us the impact of political to just EBITDA last year? Thanks.

I’ll take the first one, Andrew, and then Alex can take or Stu can take the last two. So for competitive reasons, I don’t want to identify exactly where and when these were but these were two larger scale, I would say, tests for us that were fine. They were good at multi-day decent events as you saw from the revenue. Again, for competitive reasons, we didn’t break out the profitability. They were fine but they didn’t meet the threshold and given some competitive and other dynamics, we just decided not to do them. We’re pretty – as we’ve talked about with you guys and on the road show and with investors, they were pretty disciplined because we are taking capital risk in our live event business on the underwriting and process and we underwrite events each time we do them. So just because we’ve done something for one year doesn’t mean we’ll do it for a next year. And if we don’t see the prospects for significant growth and expansion of that and ultimately the kind of margins that we look for, we’ll just not going to go do those again and that’s what happened. That happens somewhat. These happen to be larger events. In a sense, we’re willing to take the hit of not having the recurring revenue and whatever cash flow was because we didn’t think long term it made sense as a long-term occurring event that made our hurdles.

This is Alex speaking, Andrew. As it relates to the refinancing, we issued a conditional call notice at the beginning of this month, which provides us the opportunity to refinance our existing senior notes on April 1. So to the extent that market conditions continue to cooperate, you should think about that from a timing perspective. As it relates to guidance on a more granular level, we think we’ve provided fairly robust guidance certainly and we don’t provide guidance at a segment level, so I just want to keep it there for now. Thanks.

Great, thanks.

[Operator Instructions]. At this time, I’ll now turn the floor back to Mr. Steven Price for closing remarks.

Great. Thanks so much, operator, and thank you all for joining us today. As always, if you have questions or comments, don’t hesitate to give us a call. Talk to you all soon. Thank you.

This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.