- The Washington Times - Monday, February 25, 2002

Radio One Inc., the largest radio broadcaster in the nation serving black listeners, said fourth-quarter and yearly losses grew as expenses increased and advertising sales slowed.
But the news did not hurt the Lanham-based company's stock. Shares of Radio One closed at $19.50 Friday on the Nasdaq. They have risen more than 30 percent in the past year.
"It's nothing to throw a party about, but given the state of the economy and the state of the advertising market, it was a good quarter," says Scott Phillips, analyst with Blaylock & Partners.
Radio One reported its fourth-quarter net loss widened to $15.4 million (22 cents per share) from $7.9 million (15 cents). Yearly losses grew to $55.2 million (78 cents) from $4.3 million (16 cents) in 2000.
Sales during the quarter rose 16 percent to $67.4 million from $58 million compared to the like quarter a year before. Annual sales jumped 57 percent to $243.8 million from $155.67 million during 2000.
Radio One, like other radio and TV broadcasters, has been hampered by a decline in ad spending, analysts say. But a recovery is expected as early as June, as broadcast media and entertainment stock indexes rose about 13 percent in January.
"Radio advertising in general was down last year, but [Radio One] held up better than average," says Eric Geil, an analyst wtih Standart & Poor's in New York. "They have a particular niche market that has shown strong growth, so the inherent growth in the market offset some of the overall market decline."
Radio One owns 65 stations throughout the country. The company airs programs like "The Steve Harvey Morning Show" in Washington, Baltimore, Detroit and Los Angeles.
The key to the company's growth has been the lucrative black audience, analysts say.
The typical black consumer 12 years and older spends 24 hours and 30 minutes a week listening to the radio, about three hours and 45 minutes longer than the average for all consumers, according to the Radio Advertising Bureau, a research group in New York.
Mr. Phillips says Radio One reported to analysts that revenue growth throughout various markets has been rising in the past few months.
"In November only one of their markets reported positive revenue growth, whereas in December practically 25 percent of their markets did," he says. "And in January over half did. So I think that's an important thing to hear."
Among Radio One's competitors are InterCity Broadcasting, a smaller private radio company that also targets black audiences. Its other competitors are mainstream station owners such as Clear Channel Communications and Cox Radio.
This year, Radio One plans to focus on managing the numerous radio stations it acquired over the past few years, says Scott Royster, the company's chief financial officer.
"We've made a lot of aquisitions over the past few years and so there's the ongoing process of integrating them," he says. "That's pretty much complete and now we're focused on optimization and maximization on the cash flow."
As the economy improves Mr. Royster says Radio One will make more acquisitions, but none are planned for the immediate future.
"We're also looking at broadening our scope and going in other media forms," he says, refering to satellite radio.
The company has a partnership with XM Satellite Radio Holdings Inc., which began broadcasting its subscription satellite radio service nationwide in November. Radio One has five of its channels on the XM system.


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