Securities
and Exchange Commission
Washington,
D.C. 20549
FORM
6-K
Report
of
Foreign Issuer
Pursuant
To Rule 13a-16 or 15d-16
of
The
Securities Exchange Act of 1934
|
For
the month of October, 2007
|
Commission
File Number 1-12090
|
GRUPO
RADIO CENTRO, S.A.B. de C.V.
(Translation
of Registrant’s name into English)
Constituyentes
1154, Piso 7
Col.
Lomas Altas, México D.F. 11954
(Address
of principal office)
(Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F.)
(Check
One) Form
20-F
X
Form
40-F
___
(Indicate
by check mark whether the registrant by furnishing the information contained
in
this Form is also thereby furnishing information to the Commission pursuant
to
Rule 12g3-2(b) under the Securities Exchange Act of 1934.)
(Check
One) Yes
___
No
X
(If
“Yes”
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b). 82-__ .)
For
Immediate Release
October
23, 2007
Grupo
Radio Centro Reports Results for Third Quarter and First Nine Months of 2007
Mexico
City, October 23, 2007 - Grupo Radio Centro, S.A.B. de C.V. (NYSE: RC, BMV:
RCENTRO-A) (the “Company”), one of Mexico’s leading radio broadcasting
companies, announced today its results of operations for the third quarter
and
nine months ended September 30, 2007. All figures were prepared in accordance
with the Mexican Financial Reporting Standards (“MFRS”) issued by the Mexican
Board for Research and Development of Financial Information Standards and have
been restated in constant pesos as of September 30, 2007.
Third
Quarter Results
Broadcasting
revenue for the third quarter of 2007 was Ps. 177,282,000, representing a
decrease of 7.3% compared to Ps. 191,239,000 reported for the third quarter
of 2006. This decrease was mainly attributable to lower advertising expenditures
by the Company’s clients, who purchased less airtime in the third quarter of
2007 compared to the third quarter of 2006.
The
Company’s broadcasting expenses (excluding depreciation, amortization and
corporate, general and administrative expenses) for the third quarter of 2007
were Ps. 104,301,000, representing a decrease of 15.4% compared to
Ps. 123,359,000 reported for the third quarter of 2006. This decrease was
primarily due to (i) the decrease in the allowance for doubtful accounts in
the
third quarter of 2007 compared to the third quarter of 2006 when the Company
had
a larger-than-usual reserve in connection with receivables that the Company
ultimately sold in December 2006, (ii) a lower provision for severance payments
to Company employees in accordance with Bulletin D-3 “Labor
Obligations” under
MFRS, and (iii) lower sales commissions paid to the Company’s sales force as a
result of the reduction in broadcasting revenue in the third quarter of 2007
compared to the third quarter of 2006.
For
the
third quarter of 2007, the Company reported broadcasting income (i.e.,
broadcasting revenue minus broadcasting expenses, excluding depreciation,
amortization and corporate, general and administrative expenses) of
Ps. 72,981,000, an increase of 7.5% compared to Ps. 67,880,000
reported for the third quarter of 2006. This
increase in broadcasting income was mainly attributable to the decrease in
broadcasting expenses
described above.
Depreciation
and amortization expenses for the third quarter of 2007 were Ps. 8,342,000,
a 12.1% decrease compared to Ps. 9,495,000 reported for the third quarter
of 2006. Depreciation and amortization expenses were lower in the third quarter
of 2007 than in the third quarter of 2006 primarily due to the Company no longer
recording depreciation on certain broadcasting equipment, the useful lives
of
which ended subsequent to the fourth quarter of 2006.
The
Company’s corporate, general and administrative expenses were Ps. 2,784,000
for the third quarter of 2007, a 4.0% increase compared to Ps. 2,677,000
reported for the third quarter of 2006.
Grupo
Radio Centro, S.A.B. de C.V.
Third
Quarter and Nine Months Results
The
Company reported operating income of Ps. 61,855,000 for the third quarter
of 2007, an increase of 11.0% compared to operating income of
Ps. 55,708,000 reported in the third quarter of 2006. This increase was due
to lower broadcasting expenses during the third quarter of 2007 compared to
the
third quarter of 2006.
The
Company’s comprehensive financing cost for the third quarter of 2007 was
Ps. 3,096,000, compared to a comprehensive financing cost of
Ps. 393,000 reported for the third quarter of 2006. This unfavorable change
was mainly due to a significant increase in the loss on net monetary position,
from Ps. 290,000 in the third quarter of 2006 to Ps. 2,830,000 in the third
quarter of 2007 due to a higher level of monetary assets relative to monetary
liabilities during the third quarter of 2007.
During
the third quarter of 2007, other expenses, net were Ps. 11,717,000, a 37.7%
decrease compared to Ps. 18,811,000 reported for the third quarter of 2006.
This decrease was mainly attributable to lower
legal expenses during the third quarter of 2007 compared to the third quarter
of
2006.
In
the
third quarter of 2007, the Company reported income before extraordinary items
and provisions for income tax and employee profit sharing of
Ps. 47,042,000, a 28.9% increase compared to Ps. 36,504,000 reported
for the third quarter of 2006, mainly as a result of the decrease in
broadcasting expenses and other expenses described above. For the third quarter
of 2006, the Company recorded extraordinary income of
Ps.
3,847,000 as a result of the inflation adjustment to the extraordinary income
that was recorded in June 2006 in connection with the reversal of the provision
for the contingent liability relating to the Infored arbitration.
For
the
third quarter of 2007, the Company reported income before provisions for income
tax and employee profit sharing of Ps. 47,042,000, compared to
Ps. 40,351,000 for the third quarter of 2006.
The
Company recorded provisions for income tax and employee profit sharing of
Ps.14,682,000 for the third quarter of 2007, compared to Ps. 8,652,000 for
the third quarter of 2006. This increase in provisions was primarily due to
higher taxable income for the third quarter of 2007 compared to the third
quarter of 2006.
As
a
result of the foregoing, the Company’s net income for the third quarter of 2007
was Ps. 32,360,000, compared to net income of Ps. 31,699,000 in the
third quarter of 2006.
Nine
Months Results
For
the
nine months ended September 30, 2007, broadcasting revenue was
Ps. 447,800,000, representing a 27.7% decrease compared to
Ps. 619,627,000 reported for the same period of 2006. The decrease in
broadcasting revenue was mainly attributable to a decrease in advertising
expenditures by political parties, which purchased more airtime in 2006 in
connection with the July 2006 presidential and congressional
elections.
The
Company’s broadcasting expenses (excluding depreciation, amortization and
corporate, general and administrative expenses) for the nine months ended
September 30, 2007 were Ps. 312,071,000, a 12.1% decrease compared to
Ps. 355,016,000 reported for the same period of 2006. This decrease was
primarily due to the decrease in allowance for doubtful accounts, the decrease
in sales commissions
to
the
Company’s general sales force as a result of the decrease in broadcasting
revenue, and a lower provision for severance payments to Company employees
during the nine months ended September 30, 2007 compared to the same period
of
2006.
Grupo
Radio Centro, S.A.B. de C.V.
Third
Quarter and Nine Months Results
Broadcasting
income (i.e., broadcasting revenue minus broadcasting expenses, excluding
depreciation, amortization and corporate, general and administrative expenses)
for the nine months ended September 30, 2007 was Ps. 135,729,000,
representing a decrease of 48.7% compared to Ps. 264,611,000 reported for
the same period of 2006. This decrease was mainly attributable to the decrease
in broadcasting revenue described above.
Depreciation
and amortization expenses for the nine months ended September 30, 2007 were
Ps. 25,636,000, a decrease of 8.2% compared to Ps. 27,917,000 reported
for the same period of 2006. This decrease was attributable to the Company
no
longer recording depreciation on certain broadcasting equipment, the useful
lives of which ended subsequent to the fourth quarter of 2006.
The
Company’s corporate, general and administrative expenses for the nine months
ended September 30, 2007 were Ps. 9,858,000, a slight decrease compared to
Ps. 9,916,000 reported for the same period of 2006.
As
a
result of the foregoing, the Company reported operating income of
Ps. 100,235,000 for the nine months ended September 30, 2007, a 55.8%
decrease compared to Ps. 226,778,000 reported for the same period of
2006.
The
Company’s comprehensive financing cost for the nine months ended September 30,
2007 was Ps. 5,105,000, a 37.0% decrease compared to Ps. 8,104,000
reported for the same period of 2006. This favorable change was mainly due
to a
decrease in interest expense for the nine months ended September 30, 2007
compared to the same period of 2006 as a result of the Company no longer
recording interest on bank debt after paying off the remaining balance of its
bank debt in May 2006. The favorable effect of this decrease was partially
offset by a loss on net monetary position of Ps. 3,604,000 for the nine months
ended September 30, 2007, compared to a gain on net monetary position of Ps.
1,037,000 reported for the same period of 2006
due to a
higher level of monetary assets relative to monetary liabilities during the
nine
months ended September 30, 2007.
Other
expenses, net for the nine months ended September 30, 2007 were
Ps. 31,654,000, a 26.5% decrease compared to Ps. 43,047,000 reported
for the same period of 2006. This decrease was mainly attributed to lower
legal expenses during the nine months ended September 30, 2007 compared to
the
same period of 2006.
For
the
nine months ended September 30, 2007, the Company had income before
extraordinary items and provisions for income tax and employee profit sharing
of
Ps. 63,476,000, a 63.9% decrease compared to Ps. 175,627,000 reported
for the same period of 2006, mainly as a result of the decrease in broadcasting
revenue described above.
For
the
nine months ended September 30, 2007, the Company reported income before
provisions for income tax and employee profit sharing of Ps. 63,476,000,
compared to Ps. 435,790,000 reported for the same period of 2006. In
addition to higher broadcasting revenue, the 2006 period benefited from
extraordinary income of Ps. 260,163,000, resulting from the cancellation in
June
2006 of a provision for the contingent liability relating to the Infored
arbitration.
Grupo
Radio Centro, S.A.B. de C.V.
Third
Quarter and Nine Months Results
The
Company recorded provisions for income tax and employee profit sharing of
Ps. 18,393,000 for the nine months ended September 30, 2007, compared to
Ps. 47,644,000 for the same period of 2006. This decrease was due to lower
taxable income for 2007.
As
a
result of the foregoing, the Company reported net income of Ps. 45,083,000
for the nine months ended September 30, 2007, compared to net income of
Ps. 388,146,000 for the same period of 2006.
Company
Description
Grupo
Radio Centro owns and/or operates 14 radio stations. Of these 14 radio stations,
Grupo Radio Centro operates 11 in Mexico City. The Company’s principal
activities are the production and broadcasting of musical and entertainment
programs, talk shows, news and special events programs. Revenue is primarily
derived from the sale of commercial airtime. In
addition to the
Organización Radio Centro radio stations, the
Company also operates Grupo RED radio stations and Organización
Impulsora de Radio (OIR),
a radio
network
that
acts as
the national sales representative for, and provides programming to,
Grupo
Radio Centro-affiliated radio stations.
Note
on Forward Looking Statements
This
release may contain projections or other forward-looking statements related
to
Grupo Radio Centro that involve risks and uncertainties. Readers are cautioned
that these statements are only predictions and may differ materially from actual
future results or events. Readers are referred to the documents filed by Grupo
Radio Centro with the United States Securities and Exchange Commission,
specifically the most recent filing on Form 20-F, which identifies important
risk factors that could cause actual results to differ from those contained
in
the forward-looking statements. All forward-looking statements are based on
information available to Grupo Radio Centro on the date hereof, and Grupo Radio
Centro assumes no obligation to update such statements.
RI
Contacts
|
In
México:
|
In
NY:
|
|
Pedro
Beltrán / Alfredo Azpeitia
|
Maria
Barona / Peter Majeski
|
|
Grupo
Radio Centro, S.A.B. de C.V.
|
i-advize
Corporate Communications, Inc.
|
|
Tel:
(5255) 5728-4800 Ext. 7018
|
Tel:
(212) 406-3690
|
|
aazpeitia@grc.com.mx
|
grc@i-advize.com.mx
|
Grupo
Radio Centro, S.A.B. de C.V.
Third
Quarter and Nine Months Results
GRUPO
RADIO CENTRO, S.A.B. DE C.V.
CONSOLIDATED
UNAUDITED BALANCE SHEETS
as
of September 30, 2007 and 2006
in
Mexican Pesos ("Ps.") with purchasing power as of September 30,
2007
(figures
in thousands of Ps. and U.S. dollars ("U.S. $")(1)
|
September
30,
|
||||||||||
|
2007
|
2006
|
|||||||||
|
U.S.
$(1)
|
Ps.
|
Ps.
|
||||||||
|
ASSETS
|
||||||||||
|
Current
assets:
|
||||||||||
|
Cash
and temporary investments
|
5,637
|
61,585
|
116,041
|
|||||||
|
Accounts
receivable:
|
||||||||||
|
Broadcasting,
net
|
17,166
|
187,528
|
231,642
|
|||||||
|
Other
|
501
|
5,476
|
10,625
|
|||||||
|
17,667
|
193,004
|
242,267
|
||||||||
|
Prepaid
expenses
|
1,711
|
18,688
|
10,570
|
|||||||
|
Total
current assets
|
25,015
|
273,277
|
368,878
|
|||||||
|
Property
and equipment, net
|
42,337
|
462,501
|
483,572
|
|||||||
|
Deferred
charges, net
|
557
|
6,082
|
11,035
|
|||||||
|
Excess
of cost over book value of net assests of subsidiaries, net
|
74,906
|
818,296
|
818,167
|
|||||||
|
Other
assets
|
301
|
3,288
|
3,361
|
|||||||
|
Total
assets
|
143,116
|
1,563,444
|
1,685,013
|
|||||||
|
LIABILITIES
|
||||||||||
|
Current:
|
||||||||||
|
Advances
from customers
|
7,394
|
80,773
|
91,777
|
|||||||
|
Suppliers
and other accounts payable
|
4,974
|
54,333
|
47,850
|
|||||||
|
Taxes
payable
|
2,088
|
22,806
|
89,500
|
|||||||
|
Reduction
in Fixed Capital Stock Payable
|
0
|
0
|
52,298
|
|||||||
|
Total current liabilities
|
14,456
|
157,912
|
281,425
|
|||||||
|
Long-Term:
|
||||||||||
|
Reserve
for labor liabilities
|
5,084
|
55,542
|
57,373
|
|||||||
|
Deferred
taxes
|
568
|
6,206
|
20,433
|
|||||||
|
Total liabilities
|
20,108
|
219,660
|
359,231
|
|||||||
|
SHAREHOLDERS'
EQUITY
|
||||||||||
|
Capital
stock
|
102,157
|
1,115,996
|
1,113,632
|
|||||||
|
Cumulative
earnings
|
26,006
|
284,095
|
269,002
|
|||||||
|
Reserve
for repurchase of shares
|
3,962
|
43,281
|
42,697
|
|||||||
|
Cumulative
effect of deferred income taxes
|
(9,609
|
)
|
(104,967
|
)
|
(104,967
|
)
|
||||
|
Effects
from labor liabilities
|
(28
|
)
|
(310
|
)
|
(269
|
)
|
||||
|
Surplus
on restatement of capital
|
459
|
5,019
|
5,019
|
|||||||
|
Minority
interest
|
61
|
670
|
668
|
|||||||
|
Total shareholders' equity
|
123,008
|
1,343,784
|
1,325,782
|
|||||||
|
Total liabilities and stockholders' equity
|
143,116
|
1,563,444
|
1,685,013
|
|||||||
|
(1)
|
Peso
amounts have been translated into U.S. dollars, solely for the
convenience
of the reader, at the rate of Ps. 10.9243 per U.S. dollar, the
noon buying
rate for Mexican pesos on September 30,
2007.
|
Grupo
Radio Centro, S.A.B. de C.V.
Third
Quarter and Nine Months Results
GRUPO
RADIO CENTRO, S.A.B. DE C.V.
CONSOLIDATED
UNAUDITED STATEMENTS OF INCOME
for
the three-month and nine-month periods ended September 30, 2007 and 2006
expressed
in
Mexican Pesos ("Ps.") with purchasing power as of September 30,
2007
(figures
in thousands of Ps. and U.S. dollars ("U.S. $")(1),
except per Share and per ADS amounts)
|
3rd
Quarter
|
Accumulated
9 months
|
||||||||||||||||||
|
2007
|
2006
|
2007
|
2006
|
||||||||||||||||
|
U.S.$
(1)
|
Ps.
|
Ps.
|
U.S.$
(1)
|
Ps.
|
Ps.
|
||||||||||||||
|
Broadcasting
revenue (2)
|
16,228
|
177,282
|
191,239
|
40,991
|
447,800
|
619,627
|
|||||||||||||
|
Broadcasting
expenses, excluding depreciation,
|
|||||||||||||||||||
|
amortization
and corporate, general and administrative expenses
|
9,548
|
104,301
|
123,359
|
28,567
|
312,071
|
355,016
|
|||||||||||||
|
Broadcasting
income
|
6,680
|
72,981
|
67,880
|
12,424
|
135,729
|
264,611
|
|||||||||||||
|
Depreciation
and amortization
|
764
|
8,342
|
9,495
|
2,347
|
25,636
|
27,917
|
|||||||||||||
|
Corporate,
general and administrative expenses
|
255
|
2,784
|
2,677
|
902
|
9,858
|
9,916
|
|||||||||||||
|
Operating
income
|
5,661
|
61,855
|
55,708
|
9,175
|
100,235
|
226,778
|
|||||||||||||
|
Comprehensive
financing cost:
|
|||||||||||||||||||
|
Interest
expense
|
(57
|
)
|
(625
|
)
|
(264
|
)
|
(182
|
)
|
(1,986
|
)
|
(9,845
|
)
|
|||||||
|
Interest
income (2)
|
32
|
353
|
154
|
44
|
478
|
664
|
|||||||||||||
|
Gain
on foreign currency exchange, net
|
1
|
6
|
7
|
1
|
7
|
40
|
|||||||||||||
|
Gain
(loss) on net monetary position
|
(259
|
)
|
(2,830
|
)
|
(290
|
)
|
(330
|
)
|
(3,604
|
)
|
1,037
|
||||||||
|
(283
|
)
|
(3,096
|
)
|
(393
|
)
|
(467
|
)
|
(5,105
|
)
|
(8,104
|
)
|
||||||||
|
Other
expenses, net
|
(1,073
|
)
|
(11,717
|
)
|
(18,811
|
)
|
(2,898
|
)
|
(31,654
|
)
|
(43,047
|
)
|
|||||||
|
Income
before extraordinary item and provisions:
|
4,305
|
47,042
|
36,504
|
5,810
|
63,476
|
175,627
|
|||||||||||||
|
Extraordinary
item
|
0
|
0
|
3,847
|
0
|
0
|
260,163
|
|||||||||||||
|
Income
before provisions
|
4,305
|
47,042
|
40,351
|
5,810
|
63,476
|
435,790
|
|||||||||||||
|
Provisions
for income tax & employee profit
|
|||||||||||||||||||
|
sharing
|
1,344
|
14,682
|
8,652
|
1,684
|
18,393
|
47,644
|
|||||||||||||
|
Net
income
|
2,961
|
32,360
|
31,699
|
4,126
|
45,083
|
388,146
|
|||||||||||||
|
Net
income applicable to:
|
|||||||||||||||||||
|
Majority
interest
|
2,961
|
32,359
|
31,721
|
4,125
|
45,073
|
388,074
|
|||||||||||||
|
Minority
interest
|
0
|
1
|
(22
|
)
|
1
|
10
|
72
|
||||||||||||
|
2,961
|
32,360
|
31,699
|
4,126
|
45,083
|
388,146
|
||||||||||||||
|
Net
income (loss) per Series A Share (3)
|
0.048
|
0.529
|
2.611
|
||||||||||||||||
|
Net
income (loss) per ADS (3)
|
0.432
|
4.764
|
23.500
|
||||||||||||||||
|
Weighted
average common shares outstanding (000's) (3)
|
162,704
|
162,725
|
|||||||||||||||||
|
(1)
|
Peso
amounts have been translated into U.S. dollars, solely for the
convenience
of the reader, at the rate of Ps. 10.9243 per U.S. dollar, the
noon buying
rate for Mexican pesos on September 30,
2007.
|
|
(2)
|
Broadcasting
revenue for a particular period includes (as a reclassification
of
interest income) interest earned on funds received by the Company
pursuant
to advance sales of commercial air time to the extent that the
underlying
funds were earned by the Company during the period in question.
Advances
from advertisers are recognized as broadcasting revenue only when
the
corresponding commercial air time has been transmitted. Interest
earned
and treated as broadcasting revenue for the third quarter of 2007
and 2006
was Ps. 532,000
and
Ps.
1,227,000,
respectively. Interest earned and treated as broadcasting revenue
for the
nine months ended September 30, 2007 and 2006 was Ps. 1,466,000
and Ps.
3,073,000, respectively.
|
| (3) |
Earnings
per share calculations are made for the last twelve months as of
the date
of the income statement, as required by the Mexican Stock
Exchange.
|
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned,
thereunto
duly authorized.
|
Grupo
Radio Centro, S.A.B. de C.V.
|
|
|
(Registrant)
|
|
|
Date:
October 26, 2007
|
By: /s/ Pedro Beltrán
Nasr
|
|
Name: Pedro Beltrán
Nasr
|
|
|
Title: Chief Financial
Officer
|