Entravision Communications Corporation Reports Second Quarter 2010 Results

Three-Month Period

Six-Month Period

Ended June 30,

Ended June 30,

2010

2009

% Change

2010

2009

% Change

Net revenue

$      53,431

$      48,696

10%

$      96,504

$      90,411

7%

Operating expenses (1)

31,097

29,646

5%

60,921

61,459

(1)%

Corporate expenses (2)

3,477

3,378

3%

7,225

7,251

(0)%

Consolidated adjusted EBITDA (3)

18,966

16,323

16%

28,494

23,039

24%

Free cash flow (4)

$        7,134

$        5,217

37%

$        4,534

$        4,118

10%

Free cash flow per share, basic and diluted (4)

$          0.08

$          0.06

33%

$          0.05

$          0.05

0%

Net income (loss) applicable to common stockholders

$        6,963

$      (1,827)

NM

$        4,779

$    (16,321)

NM

Net income (loss) per share applicable to common stockholders, basic and diluted

$          0.08

$        (0.02)

NM

$          0.06

$        (0.19)

NM

Weighted average common shares outstanding, basic

84,494,665

84,187,128

84,462,613

84,235,509

Weighted average common shares outstanding, diluted

85,373,021

84,187,128

85,278,162

84,235,509

(1)  Operating expenses include direct operating, selling, general and administrative expenses. Included in operating
expenses are $0.2 million and $0.4 million of non-cash stock-based compensation for the three-month periods ended
June 30, 2010 and 2009, respectively and $0.5 million and $0.7 million of non-cash stock-based compensation for the
six-month periods ended June 30, 2010 and 2009, respectively. Operating expenses do not include corporate expenses,
depreciation and amortization, impairment charge, gain (loss) on sale of assets and gain (loss) on debt extinguishment.

(2)  Corporate expenses include $0.3 million and $0.4 million of non-cash stock-based compensation for the three-month
periods ended June 30, 2010 and 2009, respectively and $0.5 million  and $0.8 million of non-cash stock-based compensation
for the six-month periods ended June 30, 2010 and 2009, respectively.

(3)  Consolidated adjusted EBITDA means net income (loss) plus gain (loss) on sale of assets, depreciation and amortization,
non-cash impairment charge, non-cash stock-based  compensation included in operating and corporate expenses,
net interest expense, gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income (loss) of
nonconsolidated affiliate and syndication programming amortization less syndication programming payments. We use
the term consolidated adjusted EBITDA because that measure is defined in our syndicated bank credit facility and does
not include gain (loss) on sale of assets, depreciation and amortization, non-cash impairment charge, non-cash stock-based
compensation, net interest expense, gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income
(loss) of nonconsolidated affiliate and syndication programming  amortization and does include syndication programming
payments. While many in the financial community and we consider consolidated adjusted EBITDA to be important, it should be
considered in addition to, but not as a substitute for or superior to, other measures of liquidity and financial performance
prepared in accordance with accounting principles generally accepted in the United States of America, such as cash
flows from operating activities, operating income and net income.  As consolidated adjusted EBITDA excludes non-cash gain
(loss) on sale of assets, non-cash depreciation and amortization, non-cash impairment charge, non-cash stock-based
compensation expense, net interest expense, gain (loss) on debt  extinguishment, income tax (expense) benefit, equity
in net income (loss) of nonconsolidated affiliate and syndication programming amortization and includes syndication programming
payments, consolidated adjusted EBITDA has certain limitations because it excludes and includes several important non-cash
financial line items. Therefore, we consider both non-GAAP and GAAP measures when evaluating our business.  Consolidated
adjusted EBITDA is also used to make executive compensation decisions.  

(4)  Free cash flow is defined as consolidated adjusted EBITDA less cash paid for income taxes, net interest expense and
capital expenditures. Net interest expense is defined as interest  expense, less non-cash interest expense relating to
amortization of debt finance costs, less interest income and less the change in the fair value of our interest rate swaps. Free cash
flow per share is defined as free cash flow divided by the basic or diluted weighted average common shares outstanding.

Financial Results

Three Months Ended June 30, 2010 Compared to Three Months Ended June 30, 2009

(Unaudited)

Three-Month Period

Ended June 30,

2010

2009

% Change

Net revenue

$      53,431

$      48,696

10%

Operating expenses (1)

31,097

29,646

5%

Corporate expenses (1)

3,477

3,378

3%

Depreciation and amortization

4,874

5,191

(6)%

Impairment charge

-

2,720

NM

Operating income

13,983

7,761

80%

Interest expense, net

(5,179)

(8,404)

(38)%

Income (loss) before income taxes

8,804

(643)

NM

Income tax expense

(1,928)

(1,099)

75%

Net income (loss) before equity in net income (loss) of nonconsolidated affiliates

6,876

(1,742)

NM

Equity in net income (loss) of nonconsolidated affiliates, net of tax

87

(85)

NM

Net income (loss)

$        6,963

$      (1,827)

NM

(1)  Operating expenses and corporate expenses are defined on page 1.

Six Months Ended June 30, 2010 Compared to Six Months Ended June 30, 2009

(Unaudited)

Six-Month Period

Ended June 30,

2010

2009

% Change

Net revenue

$      96,504

$      90,411

7%

Operating expenses (1)

60,921

61,459

(1)%

Corporate expenses (1)

7,225

7,251

(0)%

Depreciation and amortization

9,597

10,621

(10)%

Impairment charge

-

2,720

NM

Operating income

18,761

8,360

124%

Interest expense, net

(10,610)

(13,217)

(20)%

Loss on debt extinguishment

-

(4,716)

NM

Income (loss) before income taxes

8,151

(9,573)

NM

Income tax expense

(3,338)

(6,509)

(49)%

Net income (loss) before equity in net loss of nonconsolidated affiliates

4,813

(16,082)

NM

Equity in net loss of nonconsolidated affiliates, net of tax

(34)

(239)

(86)%

Net income (loss)

$        4,779

$    (16,321)

NM

(1)  Operating expenses and corporate expenses are defined on page 1.

Segment Results

The following represents selected unaudited segment information:

Three-Month Period

Ended June 30,

2010

2009

% Change

Net Revenue

Television

$ 34,819

$ 31,746

10%

Radio

18,612

16,950

10%

Total

$ 53,431

$ 48,696

10%

Operating Expenses (1)

Television

$ 18,904

$ 18,107

4%

Radio

12,193

11,539

6%

Total

$ 31,097

$ 29,646

5%

Corporate Expenses (1)

$   3,477

$   3,378

3%

Consolidated adjusted EBITDA (1)

$ 18,966

$ 16,323

16%

(1)  Operating expenses, Corporate expenses, and Consolidated adjusted EBITDA are defined on page 1.

(Financial Table Follows)

Entravision Communications Corporation

Consolidated Statements of Operations

(In thousands, except share and per share data)

(Unaudited)

Three-Month Period

Six-Month Period

Ended June 30,

Ended June 30,

2010

2009

2010

2009

Net revenue

$      53,431

$      48,696

$      96,504

$      90,411

Expenses:

Direct operating expenses (including related parties of $3,151, $2,004, $5,502 and $3,731)  (including non-cash stock-based compensation of $103, $164, $208 and $330)

22,162

20,799

42,930

42,660

Selling, general and administrative expenses (including non-cash stock-based compensation of $147, $207, $295 and $414)

8,935

8,847

17,991

18,799

Corporate expenses (including non-cash stock-based compensation of $286, $353, $492 and $759)

3,477

3,378

7,225

7,251

Depreciation and amortization (includes direct operating of $3,385, $3,843, $6,874 and $7,918; selling, general and administrative of $903, $1,068, $1,841 and $2,089; and corporate of $586, $280, $883 and $614) (including related parties of $846, $580, $1,426 and $1,160)

4,874

5,191

9,597

10,621

Impairment charge

-

2,720

-

2,720

39,448

40,935

77,743

82,051

Operating income

13,983

7,761

18,761

8,360

Interest expense (including related parties of $25, $29, $54 and $60)

(5,263)

(8,474)

(10,777)

(13,535)

Interest income

84

70

167

318

Loss on debt extinguishment

-

-

-

(4,716)

Income (loss) before income taxes

8,804

(643)

8,151

(9,573)

Income tax expense

(1,928)

(1,099)

(3,338)

(6,509)

Income (loss) before equity in net income (loss) of nonconsolidated affiliate

6,876

(1,742)

4,813

(16,082)

Equity in net income (loss) of nonconsolidated affiliate, net of tax

87

(85)

(34)

(239)

Net income (loss) applicable to common stockholders

$        6,963

$      (1,827)

$        4,779

$    (16,321)

Basic and diluted earnings per share:

Net income (loss) per share applicable to common stockholders,

basic and diluted

$          0.08

$        (0.02)

$          0.06

$        (0.19)

Weighted average common shares outstanding, basic

84,494,665

84,187,128

84,462,613

84,235,509

Weighted average common shares outstanding, diluted

85,373,021

84,187,128

85,278,162

84,235,509

Entravision Communications Corporation

Consolidated Statements of Cash Flows

(Unaudited; in thousands)

Three-Month Period

Six-Month Period

Ended June 30,

Ended June 30,

2010

2009

2010

2009

Cash flows from operating activities:

Net income (loss)

$   6,963

$ (1,827)

$   4,779

$ (16,321)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization

4,874

5,191

9,597

10,621

Impairment charge

-

2,720

-

2,720

Deferred income taxes

1,414

486

2,627

5,986

Amortization of debt issue costs

104

105

208

194

Amortization of syndication contracts

278

627

550

1,248

Payments on syndication contracts

(705)

(700)

(1,409)

(1,413)

Equity in net (income) loss of nonconsolidated affiliate

(87)

85

34

239

Non-cash stock-based compensation

536

724

995

1,503

Gain on sale of media properties and other assets

-

(2)

-

(102)

Non-cash expenses related to debt extinguishment

-

-

-

945

Change in fair value of interest rate swap agreements

(4,123)

(855)

(8,053)

(2,536)

Changes in assets and liabilities, net of effect of acquisitions and dispositions:

Increase in accounts receivable

(8,665)

(5,591)

(3,625)

(1,272)

Decrease in prepaid expenses and other assets

140

51

48

189

Increase in accounts payable, accrued expenses and other liabilities

3,339

2,905

3,451

2,102

Net cash provided by operating activities

4,068

3,919

9,202

4,103

Cash flows from investing activities:

Proceeds from sale of property and equipment and intangibles

-

14

-

114

Purchases of property and equipment and intangibles

(3,371)

(1,339)

(6,045)

(6,618)

Net cash used in investing activities

(3,371)

(1,325)

(6,045)

(6,504)

Cash flows from financing activities:

Proceeds from issuance of common stock

69

-

219

202

Payments on long-term debt

(1,000)

-

(4,458)

(41,000)

Repurchase of Class A common stock

-

(532)

-

(1,075)

Payments of deferred debt and offering costs

(501)

-

(863)

(1,182)

Net cash used in financing activities

(1,432)

(532)

(5,102)

(43,055)

Net increase (decrease) in cash and cash equivalents

(735)

2,062

(1,945)

(45,456)

Cash and cash equivalents:

Beginning

26,456

16,776

27,666

64,294

Ending

$ 25,721

$ 18,838

$ 25,721

$  18,838

Entravision Communications Corporation

Reconciliation of Consolidated Adjusted EBITDA to
Cash Flows From Operating Activities

(Unaudited; in thousands)

The most directly comparable GAAP financial measure is operating cash flow. A reconciliation of this non-GAAP
measure to cash flows from operating activities for each of the periods presented is as follows:

Three-Month Period

Six-Month Period

Ended June 30,

Ended June 30,

2010

2009

2010

2009

Consolidated adjusted EBITDA (1)

$ 18,966

$ 16,323

$ 28,494

$ 23,039

Interest expense

(5,263)

(8,474)

(10,777)

(13,535)

Interest income

84

70

167

318

Loss on debt extinguishment

-

-

-

(4,716)

Income tax expense

(1,928)

(1,099)

(3,338)

(6,509)

Amortization of syndication contracts

(278)

(627)

(550)

(1,248)

Payments on syndication contracts

705

700

1,409

1,413

Non-cash stock-based compensation included in direct operating

expenses

(103)

(164)

(208)

(330)

Non-cash stock-based compensation included in selling, general

and administrative expenses

(147)

(207)

(295)

(414)

Non-cash stock-based compensation included in corporate expenses

(286)

(353)

(492)

(759)

Depreciation and amortization

(4,874)

(5,191)

(9,597)

(10,621)

Impairment charge

-

(2,720)

-

(2,720)

Equity in net income (loss) of nonconsolidated affiliates

87

(85)

(34)

(239)

Net income (loss)

6,963

(1,827)

4,779

(16,321)

Depreciation and amortization

4,874

5,191

9,597

10,621

Impairment charge

-

2,720

-

2,720

Deferred income taxes

1,414

486

2,627

5,986

Amortization of debt issue costs

104

105

208

194

Amortization of syndication contracts

278

627

550

1,248

Payments on syndication contracts

(705)

(700)

(1,409)

(1,413)

Equity in net (income) loss of nonconsolidated affiliate

(87)

85

34

239

Non-cash stock-based compensation

536

724

995

1,503

Gain on sale of media properties and other assets

-

(2)

-

(102)

Non-cash expenses related to debt extinguishment

-

-

-

945

Change in fair value of interest rate swap agreements

(4,123)

(855)

(8,053)

(2,536)

Changes in assets and liabilities, net of effect of acquisitions and dispositions:

Increase in accounts receivable

(8,665)

(5,591)

(3,625)

(1,272)

Decrease in prepaid expenses and other assets

140

51

48

189

Increase in accounts payable, accrued expenses and other liabilities

3,339

2,905

3,451

2,102

Cash flows from operating activities

$   4,068

$   3,919

$   9,202

$   4,103

(1)   Consolidated adjusted EBITDA is defined on page 1.

Entravision Communications Corporation

Reconciliation of Free Cash Flow to Net Income (Loss)

(Unaudited; in thousands)

The most directly comparable GAAP financial measure is net income (loss). A reconciliation of this non-GAAP measure to net income (loss) for each of the periods presented is as follows:

Three-Month Period

Six-Month Period

Ended June 30,

Ended June 30,

2010

2009

2010

2009

Consolidated adjusted EBITDA (1)

$ 18,966

$ 16,323

$ 28,494

$  23,039

Net interest expense (1)

9,197

9,154

18,454

15,559

Cash paid for income taxes

514

613

711

523

Capital expenditures (2)

2,121

1,339

4,795

2,839

Free cash flow (1)

7,134

5,217

4,534

4,118

Capital expenditures (2)

2,121

1,339

4,795

2,839

Non-cash interest expense relating to amortization of debt

finance costs and interest rate swap agreements

4,018

750

7,844

2,342

Loss on debt extinguishment

-

-

-

(4,716)

Non-cash income tax expense

(1,414)

(486)

(2,627)

(5,986)

Amortization of syndication contracts

(278)

(627)

(550)

(1,248)

Payments on syndication contracts

705

700

1,409

1,413

Non-cash stock-based compensation included in direct operating

expenses

(103)

(164)

(208)

(330)

Non-cash stock-based compensation included in selling, general

and administrative expenses

(147)

(207)

(295)

(414)

Non-cash stock-based compensation included in corporate expenses

(286)

(353)

(492)

(759)

Depreciation and amortization

(4,874)

(5,191)

(9,597)

(10,621)

Impairment charge

-

(2,720)

-

(2,720)

Equity in net income (loss) of nonconsolidated affiliates

87

(85)

(34)

(239)

Net income (loss)

$   6,963

$ (1,827)

$   4,779

$ (16,321)

(1)  Consolidated adjusted EBITDA, net interest expense and free cash flow are defined on page 1.

(2)  Capital expenditures is not part of the consolidated statement of operations.