BBGI stock rose in pre-market trading on November 3, 2020, after the company reported excellent growth.
Beasley Broadcast reported Q3 EPS of (8c) versus the (27c) estimate. The company reported Q3 revenue of $49.6M versus the $43M estimate.
Commenting on the financial results, CEO Caroline Beasley said, “The strong recovery of our business continued in the third quarter of 2020. It is clear that the immediate actions we took to address the pandemic, including reducing station operating expenses, headcount reductions, furloughs, and negotiated discounts with landlords, service providers and partners have contributed to Beasley’s ability to rebound quickly. This focus, combined with the resumption of advertising in key categories, the experience of our teams who have managed through previous economic challenges, the quality of our content, and the role we play in the communities we serve, have all contributed to our ability to turn the corner as evidenced by the positive SOI recorded in the 2020 third quarter.
Throughout the third quarter, our sales teams drove monthly sequential revenue improvements with July up 8% over June, August up 24% over July and September rising 22% over August. Total net revenue for October increased in the low- to mid-single digits, and November revenue is currently pacing down in the low teens.
In addition to the resumption of advertising in key categories and the benefit of the political cycle, Beasley generated continued positive results from its digital and esports investments, which have been less impacted by the pandemic. Third-quarter digital revenue rose 1.8% year-over-year to $5.0 million and our new esports operations generated approximately $500,000 of revenue during the period. Digital revenue accounted for approximately 10.1% of total third-quarter revenue, compared to 7.4% of total revenue in the prior-year period.
Reflecting our initiatives to address the pandemic, including reducing operating expenses and corporate overhead and realigning our company-wide cost structure, Beasley’s third-quarter total operating expenses declined by 15.9% and the company expects to reduce its operating expenses through year-end by more than $32 million compared to our 2020 operating budget. We anticipate that a meaningful portion of the operating expense reductions realized since the onset of the pandemic will be recurring, as we continue to make fundamental changes to improve processes and efficiencies across the organization.
While the last several months have presented unprecedented challenges for ad-reliant businesses, I am extremely proud of the way our corporate and station level leaders and valued team members rose to the occasion and worked tirelessly to enable Beasley to return to positive cash flow in the third quarter. Looking ahead to the fourth quarter and 2021, we intend to continue our focus on growing our cash flow and maintaining a strong balance sheet with liquidity at current or higher levels. Growing ratings, diversifying revenue and delivering exceptional content and services to our listeners, advertisers, online users and esports fans will remain our focus. And we believe the tremendous resilience of our team and steps we’ve taken to strengthen our financial position and achieve ongoing operational efficiencies have helped ensure that Beasley Broadcast Group remains well-positioned for near- and long-term success.”