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 July, 2012

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

 

July 17, 2012

 

Grupo Radio Centro Reports Second Quarter and First Half 2012 Results

 

Mexico City, July 17, 2012 - 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 second quarter and first half ended June 30, 2012. All figures were prepared in accordance with International Financial Reporting Standards (IFRS).

 

Second Quarter Results

 

The Company’s broadcasting revenue for the second quarter of 2012 totaled Ps. 235,834,000, a 2.3% increase compared to the Ps. 230,431,000 reported for the second quarter of 2011. This slight increase was mainly attributable to higher advertising expenditures by the Company’s clients in Mexico, who purchased more airtime during the second quarter of 2012 compared to the same period of 2011.

 

The Company’s broadcasting expenses (excluding depreciation, amortization and corporate expenses) for the second quarter of 2012 totaled Ps. 177,973,000, a 6.2% increase compared to the Ps. 167,542,000 reported for the second quarter of 2011. This increase was mainly due to (i) higher commissions paid to the Company’s sales force and to advertising agencies due to the increase in broadcasting revenue and (ii) higher expenses related to the radio station in Los Angeles, KXOS-FM.

 

The Company’s depreciation and amortization expenses for the second quarter of 2012 totaled Ps. 5,183,000, a 7.1% decrease compared to the Ps. 5,577,000 reported for the second quarter of 2011. This decrease was attributable to a reduction in the amount of depreciable assets.

 

The Company’s corporate expenses for the second quarter of 2012 totaled Ps. 3,779,000, the same amount reported for the second quarter of 2011.

 

The Company’s operating income for the second quarter of 2012 totaled Ps. 48,899,000, an 8.7% decrease compared to the Ps. 53,533,000 reported for the second quarter of 2011. This decrease was mainly due to the increase in broadcasting expenses described above.

 

The Company’s other expenses, net for the second quarter of 2012 totaled Ps. 29,336,000, an 81.3% increase compared to the Ps. 16,183,000 reported for the second quarter of 2011. This increase was mainly attributable to legal expenses incurred during the second quarter of 2012.

  

 

 

Grupo Radio Centro, S.A.B. de C.V.

Second Quarter 2012 Results

 

 

The Company’s finance costs for the second quarter of 2012 totaled Ps. 3,270,000, a 41.9% decrease compared to the Ps. 5,624,000 reported for the second quarter of 2011. This decrease was mainly attributable to a reduction in the interest expense paid under the Company’s loan with Banco Inbursa, S.A. as a result of the payment by the Company of a portion of the principal thereon.

 

The Company’s profit before income taxes for the second quarter of 2012 totaled Ps. 16,293,000, a 48.6% decrease compared to the Ps. 31,726,000 reported for the same period of 2011.

 

The Company’s income tax totaled Ps. 6,768,000 as a negative provision for the second quarter of 2012, a significant decrease compared to the Ps. 15,339,000 recorded in the second quarter of 2011. This decrease was mainly due to certain tax benefits obtained.

 

As a result of the foregoing, the Company’s profit in the second quarter of 2012 totaled Ps. 23,061,000, a 40.7% increase compared to the profit of Ps. 16,387,000 recorded for the second quarter of 2011.

 

First Half Results

 

The Company’s broadcasting revenue for the six months ended June 30, 2012 totaled Ps. 477,546,000, a 13.9% increase compared to the Ps. 419,197,000 reported for the same period of 2011. This increase was mainly attributable to higher advertising expenditures by the Company’s clients in Mexico, who purchased more airtime during the first half of 2012 compared to the same period of 2011.

 

The Company’s broadcasting expenses (excluding depreciation, amortization and corporate expenses) for the first six months of 2012 totaled Ps. 358,818,000, a 6.1% increase compared to the Ps. 338,198,000 reported for the same period of 2011. This increase was primarily due to (i) higher commissions paid to the Company’s sales force and to advertising agencies due to the increase in broadcasting revenue, (ii) higher expenses related to the Los Angeles radio station, KXOS-FM and (iii) an increase in production costs for talk shows programs.

 

The Company’s depreciation and amortization expenses for the first six months of 2012 totaled Ps. 10,451,000, a 6.6% decrease compared to the Ps. 11,188,000 reported for the same period of 2011. This decrease was due to a reduction in the amount of depreciable assets in the first half of 2012 compared to the same period of 2011.

 

The Company’s corporate expenses for the first six months of 2012 totaled Ps. 7,557,000, the same amount reported for the same period of 2011.

 

The Company’s operating income for the first six months of 2012 totaled Ps. 100,720,000, a 61.8% increase compared to the Ps. 62,254,000 reported for the same period of 2011.

 

The Company’s other expenses, net for the first six months of 2012 totaled Ps. 43,705,000, a 40.1% increase compared to the Ps. 31,203,000 reported for the same period of 2011. This increase was mainly attributable to legal expenses in the first half of 2012 compared to the same period of 2011.

 

The Company’s finance costs for the first six months of 2012 totaled Ps. 7,173,000, a decrease of 30.9% compared to the Ps. 10,384,000 reported for the same period of 2011. This decrease was mainly attributable to a reduction in the interest expense paid under the Company’s loan with Banco Inbursa, S.A. as a result of the payment by the Company of a portion of the principal thereon.

 

 

 

Grupo Radio Centro, S.A.B. de C.V.

Second Quarter 2012 Results

 

 

The Company’s profit before income tax for the first six months of 2012 totaled Ps. 49,842,000, a 141.2% increase compared to the profit before income tax of Ps. 20,667,000 reported for the same period of 2011. This increase was mainly due to the aforementioned increase in broadcasting revenue.

 

For the first six months of 2012, the Company’s income tax totaled Ps. 2,518,000 as a negative provision, a significant decrease compared to the income tax of Ps. 21,576,000 recorded for the same period of 2011. This decrease was mainly the result of certain tax benefits obtained.

 

As a result of the foregoing, the Company’s profit in the first six months of 2012 totaled Ps. 52,360,000, compared to a net loss of Ps. 909,000 for the same period of 2011.

 

 

 

  

Company Description

 

Grupo Radio Centro owns and/or operates 15 radio stations. Of these 15 radio stations, 12 are located in Mexico City, two AM stations in Guadalajara and Monterrey, and one FM station in Los Angeles. 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 127 Grupo Radio Centro-affiliated radio stations throughout Mexico.

 

 

 

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.

 

IR Contacts
In México:	In NY:
Pedro Beltrán / Alfredo Azpeitia	Maria Barona / Peter Majeski
Grupo Radio Centro, S.A. de C.V.	i-advize Corporate Communications, Inc.
Tel: (5255) 5728-4800 Ext. 4910	Tel: (212) 406-3690
aazpeitia@grc.com.mx	grc@i-advize.com.mx

 

 

 

Grupo Radio Centro, S.A.B. de C.V.

Second Quarter 2012 Results

 

 

GRUPO RADIO CENTRO, S.A.B. DE C.V.
CONSOLIDATED UNAUDITED BALANCE SHEETS
as of June 30, 2012 and 2011
(figures in thousands of Mexican pesos ("Ps.") and U.S. dollars ("U.S. $") (1)
		June 30,
		2012								2011
		U.S. $(1)				Ps.				Ps.
ASSETS
Current assets:
Cash and cash equivalents			5,447				74,373				124,397
Accounts receivable:
Broadcasting receivables - Net			19,975				272,714				302,733
Other receivables			980				13,382				7,504
			20,955				286,096				310,237
Prepaid expenses			4,039				55,150				28,209
Deferred taxes			288				3,934				0
Total current assets			30,729				419,553				462,843
Property and equipment			35,579				485,761				431,246
Deferred charges, net			200				2,725				4,330
Goodwill			60,709				828,863				828,863
Other assets			268				3,653				3,416
Total assets			127,485				1,740,555				1,730,698
LIABILITIES
Current liabilities:
Current portion of long-term debt			2,970				40,554				40,871
Deferred revenue			2,106				28,757				122,562
Accounts payable and accrued expenses			4,753				64,895				68,164
Taxes payable			2,698				36,838				59,149
Total current liabilities			12,527				171,044				290,746
Non-current liabilities:
Long-term debt			2,197				30,000				70,000
Employee benefits			5,748				78,472				61,136
Deferred taxes			0				0				20,258
Total liabilities			20,472				279,516				442,140
STOCKHOLDERS' EQUITY
Common stock			77,636				1,059,962				1,059,962
Retained earnings			26,828				366,285				196,185
Reserve for repurchase of shares			2,197				29,989				29,989
Other comprehensive income			336				4,590				2,105
Equity attributable to owners of the Company			106,997				1,460,826				1,288,241
Non-controlling Interest			16				213				317
Total equity			107,013				1,461,039				1,288,558
Total liabilities and Stockholders' equity			127,485				1,740,555				1,730,698

 

(1)

Peso amounts have been translated into U.S. dollars, solely for the convenience of the reader, at the rate of Ps. 13.653 per U.S. dollar, the rate on June 30, 2012

 

  

 

Grupo Radio Centro, S.A.B. de C.V.

Second Quarter 2012 Results

 

 

GRUPO RADIO CENTRO, S.A.B. DE C.V.
CONSOLIDATED UNAUDITED STATEMENTS OF INCOME
for the three-month and six-month periods ended June 30, 2012 and 2011
(figures in thousands of Mexican pesos ("Ps.") and U.S. dollars ("U.S. $")(1), except per Share and per ADS amounts)
		2nd Quarter												Accumulated 6 months
		2012								2011				2012								2011
		U.S.$ (1)				Ps.				Ps.				U.S.$ (1)				Ps.				Ps.
Broadcasting revenue (2)			17,273				235,834				230,431				34,977				477,546				419,197
Broadcasting expenses, excluding depreciation, amortization and corporate expenses			13,035				177,973				167,542				26,281				358,818				338,198
Depreciation and amortization			380				5,183				5,577				765				10,451				11,188
Corporate expenses			277				3,779				3,779				554				7,557				7,557
Operating income			3,581				48,899				53,533				7,377				100,720				62,254
Other expenses, net			(2,149	)			(29,336	)			(16,183	)			(3,201	)			(43,705	)			(31,203	)
Finance costs:
Interest expense			(246	)			(3,357	)			(5,680	)			(511	)			(6,977	)			(10,371	)
Interest income (2)			7				92				41				9				125				2
Income (loss) on foreign currency exchange, net			0				(5	)			15				(24	)			(321	)			(15	)
Net finance costs			(239	)			(3,270	)			(5,624	)			(526	)			(7,173	)			(10,384	)
Profit before income taxes			1,193				16,293				31,726				3,650				49,842				20,667
Income tax expense			(496	)			(6,768	)			15,339				(184	)			(2,518	)			21,576
Profit (loss) for the period			1,689				23,061				16,387				3,834				52,360				(909	)
Profite (loss) applicable to:
Majority interest			1,689				23,064				16,386				3,834				52,360				(912	)
Minority interest			0				(3	)			1				0				0				3
			1,689				23,061				16,387				3,834				52,360				(909	)
Net income (loss) per Series A Share (3)															0.103				1.4058				0.5160
Net income (loss) per ADS (3)															0.927				12.6522				4.6440
Weighted average common shares outstanding (000's) (3)																			162,725				162,725

 

(1)

Peso amounts have been translated into U.S. dollars, solely for the convenience of the reader, at the rate of Ps. 13.653 per U.S. dollar, the rate on June 30, 2012

 

(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 second quarter of 2012 and 2011 was Ps. 1,224,000 and Ps. 562,000, respectively. Interest earned and treated as broadcasting revenue for the six months ended June 30, 2012 and 2011 was Ps. 2,338,000 and Ps. 1,023,000, 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: July 17, 2012	By:	/s/ Pedro Beltrán Nasr
		Name:  Pedro Beltrán Nasr
		Title:   Chief Financial Officer