Emmis Communications Reports 1st Q Results

Net Revenues up 4.1% to $142.4 million

Indianapolis…Emmis Communications Corporation (NASDAQ: EMMS) today announced results for its first fiscal quarter ending May 31, 2003.

“Emmis’ performance continues to be the best in the industry – in both radio and television,” Jeff Smulyan, Chairman and CEO of Emmis, said. “We are encouraged by the first quarter numbers, and with such strong performance indicators, there is certainly cause for continuing optimism as we look to the second quarter. It is clear that the people of Emmis will set the standard and outperform our peers.”

For the first fiscal quarter, Emmis’ station operating income was $52.7 million, compared to $50.5 million for the same quarter of the prior year, an increase of 4.3%. Operating income was $28.5 million for the quarter, compared to $29.2 million for the same quarter of the prior year.

Net revenue for the quarter was $142.4 million, compared to $136.8 million for the same quarter of the prior year, an increase of 4.1%.

These results exceed the company’s previous guidance, as well as Wall Street consensus estimates for revenues and station operating income. Earnings per Share (EPS) for the quarter was $0.01, compared to a loss before accounting charge of $0.01 for the same quarter of the prior year.

Emmis has included supplemental pro forma net revenues and station operating expenses, excluding non-cash compensation, on its website, www.emmis.com. This information, which includes all station and magazine acquisitions and dispositions through July 1, 2003 (including the expected Austin acquisition), can be found under the Investor tab.

Emmis entered into various interest rate swap agreements in fiscal 2002, at a time when interest rates were substantially higher than they are today. Emmis has included a summary of these swap agreements under the Investor tab on its website. In addition, the company has provided a detailed calculation of its leverage ratios as of May 31, 2003, on its website.

International radio net revenues and station operating expenses for the quarter ended May 31, 2003, were $2.6 million and $2.5 million, respectively.

Later today the company expects to complete its acquisition of 50.1% of a six-station radio cluster in Austin, Texas for approximately $105 million. The radio stations involved are KLBJ-AM (590 News-Talk), KLBJ-FM (93.7 Rock), KGSR-FM (107.1 Adult Alternative), KROX-FM (101.5 Alternative), KEYI-FM (103.5 Oldies) and KXMG-FM (93.3 CHR). Emmis already owns Texas Monthly in the market.

During the company’s first quarter, Emmis announced it had completed the previously announced purchase of WBPG-TV, the WB affiliate in Mobile/Pensacola, giving Emmis a second station in the nation?s #63 market and growing Emmis Television to 16 properties.

Also during the first quarter, Emmis’ Texas Monthly picked up a prestigious National Magazine Award from the American Society of Magazine Editors, while the city/regional magazines of Emmis Publishing picked up a total of 32 honors in the City and Regional Magazine Association?s annual award contest.

Subsequent to the first quarter end, Emmis announced the sale of Portland, Oregon-based Mira Mobile Television, a remote production facilities for sports, corporate, and entertainment clients throughout the western United States, to an ownership group for $4 million. Emmis acquired Mira Mobile in October 2000 in connection with the purchase of certain television assets from Lee Enterprises, Inc.

2nd Quarter Guidance

Quarter Ended 08.31.03
Net Revenues:
Domestic Radio*   75,000
International Radio   4,400
     Total Radio   79,400
Television   57,000
Publishing   18,300
     Total net revenues   154,700
 
Station Operating Expenses, excluding non-cash compensation:
Domestic Radio*   38,500
Foreign Radio   3,300
     Total Radio   41,800
Television   36,800
Publishing   16,600
     Total station expenses, excluding non-cash compensation:   95,200
 
Corporate Expenses   6,000
 
Included in the above domestic radio guidance is approximately $4.3 million in net revenues and $2.5 million in station operating expenses, excluding non-cash compensation, relating to the Austin transaction, assuming the completion of the transaction on July 1, 2003.    

*Included in the above domestic radio guidance is approximately $4.3 million in net revenues and $2.5 million in station operating expenses, excluding non-cash compensation, relating to the Austin transaction, assuming the completion of the transaction on July 1, 2003.

Emmis will host a conference call regarding this information on Tuesday, July 1, 2003 at 9 a.m. Eastern at 1.773.756.4619, with a replay available until Tuesday, July 8 by calling 1.402.220.3459, or listen on-line by logging on to www.emmis.com.

Note: Financial schedule available under the Investors Tab/Quarterly Earnings.