Business Wire | Nov 2, 2021 07:00AM EDT

Nexstar Media Group Reports Record Third Quarter Net Revenue of $1,157.0 Million

Nov. 02, 2021

IRVING, Texas--(BUSINESS WIRE)--Nov. 02, 2021--Nexstar Media Group, Inc. (NASDAQ: NXST) ("Nexstar" or "the Company") today reported financial results for the third quarter ended September 30, 2021 as summarized below:

Summary 2021 Third Quarter Highlights

Three Months Ended Nine Months Ended September 30, September 30,

($ in 2021 2020 Change 2021 2020 Change thousands)

CoreAdvertising $ 432,696 $ 381,929 +13.3 % $ 1,267,868 $ 1,097,548 +15.5 %Revenue

Political ) )Advertising 12,387 132,387 (90.6 % 26,306 209,294 (87.4 %Revenue

TotalTelevision $ 445,083 $ 514,316 (13.5 ) $ 1,294,174 $ 1,306,842 (1.0 )Advertising % %Revenue



Distribution 618,855 538,376 +14.9 % 1,857,039 1,624,636 +14.3 %Fee Revenue

Digital 81,076 55,231 +46.8 % 220,887 158,332 +39.5 %Revenue

Other 11,998 10,280 +16.7 % 30,433 34,848 (12.7 )Revenue %

Net Revenue $ 1,157,012 $ 1,118,203 +3.5 % $ 3,402,533 $ 3,124,658 +8.9 %



Income from $ 277,379 $ 343,597 (19.3 ) $ 850,627 $ 844,865 +0.7 %Operations %



Net income $ 169,157 $ 189,313 (10.6 ) $ 568,108 $ 445,148 +27.6 % %



AdjustedEBITDABefore )Transaction $ 413,098 $ 460,874 (10.4 % $ 1,405,354 $ 1,324,328 +6.1 %and OtherOne-TimeExpenses^(1)

Adjusted 410,447 443,588 (7.5 ) 1,400,614 1,294,160 +8.2 %EBITDA^(1) %

AdjustedEBITDA 35.5 % 39.7 % 41.2 % 41.4 % Margin^(2)



Free CashFlow BeforeTransaction $ 254,375 $ 223,186 +14.0 % $ 921,129 $ 853,980 +7.9 %and OtherOne-TimeExpenses^(1)

Free Cash 251,724 219,005 +14.9 % 916,389 836,917 +9.5 %Flow^(1)

The contribution from Nexstar's 31.3% ownership stake in TV Food Network and other investments is included in the Condensed Consolidated Statements of Operations under caption "Income from equity method investments, net" while revenue from NewsNation (formerly WGN America) is included in core advertising revenue and distribution fee revenue.

The contribution from Nexstar's 31.3% ownership stake in TV Food Network andother investments is included in the Condensed Consolidated Statements ofOperations under caption "Income from equity method investments, net" whilerevenue from NewsNation (formerly WGN America) is included in core advertisingrevenue and distribution fee revenue.

(1) Definitions and disclosures regarding non-GAAP financial information including reconciliations are included at the end of the press release. Effective November 1, 2020, the Company combined its broadcast and digital operations and no longer reports broadcast cash flow. However, investors can calculate a comparable metric for the combined broadcast and digital operations by adding back corporate expense to Adjusted EBITDA.

(2) Adjusted EBITDA margin is Adjusted EBITDA as a percentage of net revenue.

CEO Comment

Perry A. Sook, Chairman and Chief Executive Officer of Nexstar Media Group, Inc. commented, "Nexstar's strong third quarter financial results once again exceeded consensus expectations and highlight growing momentum across our broadcast, digital and networks platforms. With pandemic-related challenges largely behind us, we are beginning to actualize the value of the scaled platform we have created. We acquired The Hill which has synergies across multiple business and functional lines, including leveraging our salesforce to drive revenue, using content from The Hill on NewsNation, and increasing our overall digital audience. Our presence in ~80% of the states where sports betting is legal or expected to be legal enabled us to generate significant revenue from gaming/sports betting advertising which is now a top 5 category for us and led us to partner with SportsGrid to launch its network in a number of our markets. We also launched our second owned and operated multicast network, Rewind TV, to nearly 50 million homes primarily in the Nexstar portfolio.

"Our significant free cash flow and industry-leading scale affords us the flexibility to continue pursuing additional accretive organic and external growth opportunities, while having the financial capacity for further leverage reduction and return of capital initiatives. In the third quarter we allocated $80 million toward leverage reduction and $138 million toward accretive M&A, while repurchasing $144 million of our Class A common shares and returning $29 million to shareholders through our quarterly cash dividend. Through the nine months ended September 30, Nexstar allocated approximately $493 million toward share repurchases and dividends, a 29% increase over the total capital returned to shareholders for all of 2020, while maintaining leverage below 3.5x. Fourth quarter trends continue to improve, and we look forward to what we expect to be a record level of revenue with the return of political advertising in 2022. We remain confident in meeting or exceeding our recently updated pro forma average annual free cash flow guidance of approximately $1.33 billion during the 2021/2022 cycle.

"Third quarter net revenue of $1.16 billion was a new record, increasing 3.5% over the prior year reflecting double-digit year-over-year increases in core advertising, distribution and digital revenue, as we fully offset the cyclical $120 million year-over-year decline in political advertising. Nexstar's third quarter adjusted EBITDA was $410 million with a healthy 35.5% margin and we brought approximately 61% of every Adjusted EBITDA dollar to the free cash flow line.

"Nexstar's third quarter net revenue excluding political increased approximately 16%, reflecting our success in leveraging the multiplatform consumer reach and engagement of our content. Core television advertising revenue increased 13.3% year-over-year, with nine of our top ten advertising categories posting growth. In addition, Nexstar's local sales initiatives continue to deliver strong new business growth with our sales teams generating $34.8 million of third quarter new-to-television revenue, marking a 37% increase over the prior year and a 6% rise over the 2021 second quarter. Notably, excluding automotive, 2021 third quarter core television advertising revenue exceeded pro forma 2019 levels due, in part, to the significant growth of the gaming/sports betting category. Overall gaming/sports betting has become a top five category and is generally a #1 or #2 category in established gaming/sports betting markets. We expect these positive trends to continue in the fourth quarter and beyond.

"Third quarter 2021 distribution fee revenue rose 15% year-over-year to approximately $619 million, reflecting our renewal of distribution agreements in 2020 representing approximately 18% of our subscriber base and other increases and stable subscriber trends across our platform. Nexstar has solid visibility into our contractual distribution economics with over 85% of our Big Four affiliations contracted through December 31, 2022. We expect continued retransmission revenue growth reflecting contract renewals representing a mid-to-high single digit percentage of our subscribers in 2021 and approximately 60% of our subscribers in 2022.

"Third quarter 2021 total digital revenue increased 46.8% to approximately $81 million with digital profitability up substantially over the prior year period. Top-line growth was driven by strong year-over-year growth in our local digital advertising revenue and agency services business, combined with contributions from recent acquisitions. Nexstar's integrated content and audience development strategies continue to generate strong audience growth and engagement across our digital network of 120 local web sites and 284 local news and weather mobile apps.

"We continue to make progress in scaling NewsNation's content offerings with the launch of a major programming expansion at the end of September, including two new shows DAN ABRAMS LIVE, produced and hosted by veteran journalist and analyst Dan Abrams, and MORNING IN AMERICA, a live three-hour weekday morning news show hosted by award-winning former ABC News correspondent and anchor, Adrienne Bankert. Consistent with our long-term record of creating new value from acquisitions, in twelve months we substantially have transformed the former WGN America cable asset from a syndicated programming network into a profitable national news and entertainment network reaching 75 million U.S. television households and airing 13 hours of original news programming per day. Over the last year alone, consumer awareness of NewsNation has doubled and while there is still much work to be done, we have great confidence in our long-term growth strategy for the network and the complementary opportunities related to our acquisition of The Hill.

"In summary, as the largest local broadcast television company in America with a diverse portfolio of valuable and growing media assets, Nexstar continues to deliver growing cash flow. Our scale will enable us to monetize our assets in new ways that will be material to our bottom line, including using our platform to make accretive acquisitions. With our record of free cash flow growth, and over $1.3 billion of average annual free cash flow expected for the 2021/2022 cycle, we have the capacity to invest in growth while reducing leverage and returning capital to shareholders. Looking ahead, Nexstar expects 2022 to benefit from its growing multi-platform audience and industry-leading distribution, continued growth of the gaming/sports betting category and the upcoming 2022 mid-term elections where, due to our extensive footprint, Nexstar has historically garnered 12-15% of total U.S. broadcast political advertising spending. These factors contribute to our excellent visibility to deliver on or exceed our upsized free cash flow targets in the 2021/2022 cycle as well as facilitate continued near- and long-term enhancement of shareholder value."

The consolidated debt of Nexstar and Mission Broadcasting, Inc., an independently owned variable interest entity (collectively with Nexstar, the "Company") at September 30, 2021, was $7,546.3 million including senior secured debt of $4,764.3 million. The Company's first lien net leverage ratio at September 30, 2021 was 2.14x compared to a covenant of 4.25x. The Company's total net leverage ratio at September 30, 2021 was 3.42x.

The table below summarizes the Company's debt obligations (net of financing costs and discounts).

(1) Definitions and disclosures regarding non-GAAP financial informationincluding reconciliations are included at the end of the press release.Effective November 1, 2020, the Company combined its broadcast and digitaloperations and no longer reports broadcast cash flow. However, investors cancalculate a comparable metric for the combined broadcast and digital operationsby adding back corporate expense to Adjusted EBITDA.

(2) Adjusted EBITDA margin is Adjusted EBITDA as a percentage of net revenue.

CEO Comment

Perry A. Sook, Chairman and Chief Executive Officer of Nexstar Media Group, Inc. commented, "Nexstar's strong third quarter financial results once again exceeded consensus expectations and highlight growing momentum across our broadcast, digital and networks platforms. With pandemic-related challenges largely behind us, we are beginning to actualize the value of the scaled platform we have created. We acquired The Hill which has synergies across multiple business and functional lines, including leveraging our salesforce to drive revenue, using content from The Hill on NewsNation, and increasing our overall digital audience. Our presence in ~80% of the states where sports betting is legal or expected to be legal enabled us to generate significant revenue from gaming/sports betting advertising which is now a top 5 category for us and led us to partner with SportsGrid to launch its network in a number of our markets. We also launched our second owned and operated multicast network, Rewind TV, to nearly 50 million homes primarily in the Nexstar portfolio.

"Our significant free cash flow and industry-leading scale affords us the flexibility to continue pursuing additional accretive organic and external growth opportunities, while having the financial capacity for further leverage reduction and return of capital initiatives. In the third quarter we allocated $80 million toward leverage reduction and $138 million toward accretive M&A, while repurchasing $144 million of our Class A common shares and returning $29 million to shareholders through our quarterly cash dividend. Through the nine months ended September 30, Nexstar allocated approximately $493 million toward share repurchases and dividends, a 29% increase over the total capital returned to shareholders for all of 2020, while maintaining leverage below 3.5x. Fourth quarter trends continue to improve, and we look forward to what we expect to be a record level of revenue with the return of political advertising in 2022. We remain confident in meeting or exceeding our recently updated pro forma average annual free cash flow guidance of approximately $1.33 billion during the 2021/2022 cycle.

"Third quarter net revenue of $1.16 billion was a new record, increasing 3.5% over the prior year reflecting double-digit year-over-year increases in core advertising, distribution and digital revenue, as we fully offset the cyclical $120 million year-over-year decline in political advertising. Nexstar's third quarter adjusted EBITDA was $410 million with a healthy 35.5% margin and we brought approximately 61% of every Adjusted EBITDA dollar to the free cash flow line.

"Nexstar's third quarter net revenue excluding political increased approximately 16%, reflecting our success in leveraging the multiplatform consumer reach and engagement of our content. Core television advertising revenue increased 13.3% year-over-year, with nine of our top ten advertising categories posting growth. In addition, Nexstar's local sales initiatives continue to deliver strong new business growth with our sales teams generating $34.8 million of third quarter new-to-television revenue, marking a 37% increase over the prior year and a 6% rise over the 2021 second quarter. Notably, excluding automotive, 2021 third quarter core television advertising revenue exceeded pro forma 2019 levels due, in part, to the significant growth of the gaming/sports betting category. Overall gaming/sports betting has become a top five category and is generally a #1 or #2 category in established gaming/sports betting markets. We expect these positive trends to continue in the fourth quarter and beyond.

"Third quarter 2021 distribution fee revenue rose 15% year-over-year to approximately $619 million, reflecting our renewal of distribution agreements in 2020 representing approximately 18% of our subscriber base and other increases and stable subscriber trends across our platform. Nexstar has solid visibility into our contractual distribution economics with over 85% of our Big Four affiliations contracted through December 31, 2022. We expect continued retransmission revenue growth reflecting contract renewals representing a mid-to-high single digit percentage of our subscribers in 2021 and approximately 60% of our subscribers in 2022.

"Third quarter 2021 total digital revenue increased 46.8% to approximately $81 million with digital profitability up substantially over the prior year period. Top-line growth was driven by strong year-over-year growth in our local digital advertising revenue and agency services business, combined with contributions from recent acquisitions. Nexstar's integrated content and audience development strategies continue to generate strong audience growth and engagement across our digital network of 120 local web sites and 284 local news and weather mobile apps.

"We continue to make progress in scaling NewsNation's content offerings with the launch of a major programming expansion at the end of September, including two new shows DAN ABRAMS LIVE, produced and hosted by veteran journalist and analyst Dan Abrams, and MORNING IN AMERICA, a live three-hour weekday morning news show hosted by award-winning former ABC News correspondent and anchor, Adrienne Bankert. Consistent with our long-term record of creating new value from acquisitions, in twelve months we substantially have transformed the former WGN America cable asset from a syndicated programming network into a profitable national news and entertainment network reaching 75 million U.S. television households and airing 13 hours of original news programming per day. Over the last year alone, consumer awareness of NewsNation has doubled and while there is still much work to be done, we have great confidence in our long-term growth strategy for the network and the complementary opportunities related to our acquisition of The Hill.

"In summary, as the largest local broadcast television company in America with a diverse portfolio of valuable and growing media assets, Nexstar continues to deliver growing cash flow. Our scale will enable us to monetize our assets in new ways that will be material to our bottom line, including using our platform to make accretive acquisitions. With our record of free cash flow growth, and over $1.3 billion of average annual free cash flow expected for the 2021/2022 cycle, we have the capacity to invest in growth while reducing leverage and returning capital to shareholders. Looking ahead, Nexstar expects 2022 to benefit from its growing multi-platform audience and industry-leading distribution, continued growth of the gaming/sports betting category and the upcoming 2022 mid-term elections where, due to our extensive footprint, Nexstar has historically garnered 12-15% of total U.S. broadcast political advertising spending. These factors contribute to our excellent visibility to deliver on or exceed our upsized free cash flow targets in the 2021/2022 cycle as well as facilitate continued near- and long-term enhancement of shareholder value."

The consolidated debt of Nexstar and Mission Broadcasting, Inc., an independently owned variable interest entity (collectively with Nexstar, the "Company") at September 30, 2021, was $7,546.3 million including senior secured debt of $4,764.3 million. The Company's first lien net leverage ratio at September 30, 2021 was 2.14x compared to a covenant of 4.25x. The Company's total net leverage ratio at September 30, 2021 was 3.42x.

The table below summarizes the Company's debt obligations (net of financing costs and discounts).

($ in millions) September 30, 2021 December 31, 2020

Revolving Credit Facilities $ 61.5 $ 327.0

First Lien Term Loans 4,702.8 4,559.1

5.625% Senior Unsecured Notes due 1,790.4 1,791.02027

4.75% Senior Unsecured Notes due 2028 991.6 990.9

Total Funded Debt $ 7,546.3 $ 7,668.0



Unrestricted Cash $ 193.8 $ 152.7

Share Repurchase Authorization and Activity

The Company repurchased a total of 980,770 shares of its Class A common stock in the third quarter of 2021 at an average price of approximately $147.16 per share for a total cost of $144.3 million, which was funded by cash flow from operations. Reflecting all shares repurchased to date, Nexstar has approximately 41 million shares of Class A common stock outstanding (the only class of shares outstanding) and has approximately $771.8 million available under its share repurchase authorization.

Third Quarter Conference Call

Nexstar will host a conference call at 9:00 a.m. ET today. Senior management will discuss the financial results and host a question-and-answer session. The dial in number for the audio conference call is 334/777-6978, conference ID 8107569 (domestic and international callers). Participants can also listen to a live webcast of the call through the "Events and Presentations" section under "Investor Relations" on Nexstar's website at www.nexstar.tv. A webcast replay will be available for 90 days following the live event at www.nexstar.tv.

Definitions and Disclosures Regarding non-GAAP Financial Information

Adjusted EBITDA is calculated as net income, plus interest expense (net), loss on extinguishment of debt, income tax expense (benefit), depreciation, amortization of intangible assets and broadcast rights, (gain) loss on asset disposal, goodwill and intangible assets impairment, loss (income) on equity investments, distribution from equity investments and other expense (income), minus reimbursement from the FCC related to station repack and broadcast rights payments. We consider Adjusted EBITDA to be an indicator of our assets' operating performance and a measure of our ability to service debt. It is also used by management to identify the cash available for strategic acquisitions and investments, maintain capital assets and fund ongoing operations and working capital needs. We also believe that Adjusted EBITDA is useful to investors and lenders as a measure of valuation and ability to service debt.

Effective November 1, 2020, the Company combined its broadcast and digital operations and no longer reports broadcast cash flow. However, investors can calculate a comparable metric for the combined broadcast and digital operations by adding back corporate expense to Adjusted EBITDA.

Free cash flow is calculated as net income, plus interest expense (net), loss on extinguishment of debt, income tax expense (benefit), depreciation, amortization of intangible assets and broadcast rights, (gain) loss on asset disposal, stock-based compensation expense, goodwill and intangible assets impairment, loss (income) on equity investments, distribution from equity investments and other expense (income), minus payments for broadcast rights, cash interest expense, capital expenditures, proceeds from disposals of property and equipment, and operating cash income tax payments. We consider Free Cash Flow to be an indicator of our assets' operating performance. In addition, this measure is useful to investors because it is frequently used by industry analysts, investors and lenders as a measure of valuation for broadcast companies, although their definitions of Free Cash Flow may differ from our definition.

For a reconciliation of these non-GAAP financial measurements to the GAAP financial results cited in this news announcement, please see the supplemental tables at the end of this release.

With respect to our forward-looking guidance, no reconciliation between a non-GAAP measure to the closest corresponding GAAP measure is included in this release because we are unable to quantify certain amounts that would be required to be included in the GAAP measure without unreasonable efforts and we believe such reconciliations would imply a degree of precision that would be confusing or misleading to investors. In particular, a reconciliation of forward-looking Free Cash Flow to the closest corresponding GAAP measure is not available without unreasonable efforts on a forward-looking basis due to the high variability, complexity and low visibility with respect to the charges excluded from these non-GAAP measures such as the measures and effects of stock-based compensation expense specific to equity compensation awards that are directly impacted by unpredictable fluctuations in our stock price and other non-recurring or unusual items such as impairment charges, transaction-related costs and gains or losses on sales of assets. We expect the variability of these items to have a significant, and potentially unpredictable, impact on our future GAAP financial results.

About Nexstar Media Group, Inc.

Nexstar Media Group, Inc. (NASDAQ: NXST) is a leading diversified media company that leverages localism to bring new services and value to consumers and advertisers through its traditional media, digital and mobile media platforms. Its wholly owned operating subsidiary, Nexstar Media Inc., consists of three divisions: Broadcasting, Digital, and Networks. The Broadcasting Division operates, programs, or provides sales and other services to 199 television stations and related digital multicast signals reaching 116 markets or approximately 39% of all U.S. television households (reflecting the FCC's UHF discount). The division's portfolio includes primary affiliates of NBC, CBS, ABC, FOX, MyNetworkTV and The CW. The Digital Division operates Best Reviews, The Hill, and 120 local websites and 284 mobile apps offering hyper-local content and verticals for consumers and advertisers, allowing audiences to choose where, when, and how they access content and creating new revenue opportunities for the company. The Networks Division operates NewsNation, formerly WGN America, a national news and entertainment cable network reaching 75 million television homes, multicast networks Antenna TV and Rewind TV, and WGN Radio in Chicago. Nexstar also owns a 31.3% ownership stake in TV Food Network, a top tier cable asset. For more information, please visit www.nexstar.tv.

Forward-Looking Statements

This communication includes forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events. Forward-looking statements include information preceded by, followed by, or that includes the words "guidance," "believes," "expects," "anticipates," "could," or similar expressions. For these statements, Nexstar claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The forward-looking statements contained in this communication, concerning, among other things, future financial performance, including changes in net revenue, cash flow and operating expenses, involve risks and uncertainties, and are subject to change based on various important factors, including the impact of changes in national and regional economies, the ability to service and refinance our outstanding debt, successful integration of acquired television stations and digital businesses (including achievement of synergies and cost reductions), pricing fluctuations in local and national advertising, future regulatory actions and conditions in the television stations' operating areas, competition from others in the broadcast television markets, volatility in programming costs, the effects of governmental regulation of broadcasting, industry consolidation, technological developments and major world news events. Nexstar undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this communication might not occur. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this release. For more details on factors that could affect these expectations, please see Nexstar's other filings with the Securities and Exchange Commission.

Nexstar Media Group, Inc.

Condensed Consolidated Statements of Operations

(in thousands, except per share amounts, unaudited)

Three Months Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

Net revenue $ 1,157,012 $ 1,118,203 $ 3,402,533 $ 3,124,658



Operatingexpenses (income):

Corporate 46,836 39,699 132,259 128,572 expenses

Directoperating 476,778 420,929 1,384,190 1,276,452 expenses, netof trade

Selling,general andadministrative 211,358 186,845 611,882 509,599 expenses,excludingcorporate

Trade expense 3,278 2,162 7,583 8,337

Depreciation ofproperty and 41,354 36,611 120,726 107,787 equipment

Amortization ofintangible 75,730 69,265 223,229 209,360 assets

Amortization ofbroadcast 29,884 31,968 92,418 104,916 rights

Reimbursementfrom the FCC (5,585 ) (12,873 ) (17,926 ) (51,347 )related tostation repack

Gain ondisposal of - - (2,455 ) (7,025 )stations, net

Change in theestimated fairvalue ofcontingent - - - 3,933 consideration

attributable toa past merger

Gain onrelinquishment - - - (10,791 )of spectrum

Total operating 879,633 774,606 2,551,906 2,279,793 expenses

Income from 277,379 343,597 850,627 844,865 operations

Income fromequity method 20,783 15,861 77,707 41,351 investments,net

Interest (70,377 ) (77,265 ) (212,557 ) (260,800 )expense, net

Loss on debt (856 ) (37,371 ) (1,908 ) (44,848 )extinguishment

Pension andotherpostretirement 17,657 10,761 52,972 32,285 plans credit,net

Unrealized(loss) gain onan equity (2,162 ) - 5,695 - investmentmeasured atfair value

Loss onwrite-off of an (7,000 ) - (7,000 ) - equityinvestment

Other expenses, (414 ) (1,093 ) (1,090 ) (778 )net

Income before 235,010 254,490 764,446 612,075 income taxes

Income tax (65,853 ) (65,177 ) (196,338 ) (166,927 )expense

Net income 169,157 189,313 568,108 445,148

Net lossattributable to 407 1,371 2,467 2,046 noncontrollinginterests

Net incomeattributable to $ 169,564 $ 190,684 $ 570,575 $ 447,194 Nexstar



Net income percommon shareattributable to Nexstar MediaGroup, Inc.:

Basic $ 4.07 $ 4.24 $ 13.42 $ 9.87

Diluted $ 3.90 $ 4.08 $ 12.84 $ 9.50



Weightedaverage numberof common sharesoutstanding:

Basic 41,676 44,979 42,520 45,313

Diluted 43,476 46,737 44,422 47,064

Nexstar Media Group, Inc.

Reconciliation of Adjusted EBITDA (Non-GAAP Measures)

(in thousands, unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

Adjusted EBITDA:

2021

2020

2021

2020

Net income

$

169,157

$

189,313

$

568,108

$

445,148

Add (Less):

Interest expense, net

70,377

77,265

212,557

260,800

Loss on extinguishment of debt

856

37,371

1,908

44,848

Income tax expense

65,853

65,177

196,338

166,927

Depreciation of property and equipment

41,354

36,611

120,726

107,787

Amortization of intangible assets

75,730

69,265

223,229

209,360

Amortization of broadcast rights

29,884

31,968

92,418

104,916

Amortization of right-of-use assets attributable to favorable leases

153

153

457

457

Gain on asset disposal, net

(358

)

(286

)

(8,796

)

(1,094

)

(Gain) loss on operating lease terminations, net

-

(61

)

15

163

Change in the estimated fair value of contingent consideration

attributable to a past merger

-

-

-

3,933

Gain on relinquishment of spectrum

-

-

-

(10,791

)

Corporate one-time transaction expenses

2,651

17,286

4,740

30,168

Right-of-use asset impairment

-

868

-

868

Income from equity method investments, net

(20,783

)

(15,861

)

(77,707

)

(41,351

)

Distributions from equity method investments

15,006

9,905

222,389

206,997

Unrealized loss (gain) on an equity investment measured at fair value

2,162

-

(5,695

)

-

Loss on write-off of an equity investment

7,000

-

7,000

-

Other expenses, net

414

1,093

1,090

778

Gain on disposal of stations and business units, net

-

-

(2,455

)

(7,025

)

Reimbursement from the FCC related to station repack

(5,585

)

(12,873

)

(17,926

)

(51,347

)

Payments for broadcast rights

(40,773

)

(46,320

)

(133,042

)

(147,214

)

Adjusted EBITDA before transaction and other one-time expenses

413,098

460,874

1,405,354

1,324,328

Margin %

35.7

%

41.2

%

41.3

%

42.4

%

Less: Corporate one-time transaction expenses

(2,651

)

(17,286

)

(4,740

)

(30,168

)

Adjusted EBITDA

$

410,447

$

443,588

$

1,400,614

$

1,294,160

Margin %

35.5

%

39.7

%

41.2

%

41.4

%

Nexstar Media Group, Inc.

Reconciliation of Adjusted EBITDA (Non-GAAP Measures)

(in thousands, unaudited)

Three Months Ended Nine Months Ended September 30, September 30,

Adjusted EBITDA: 2021 2020 2021 2020

Net income $ 169,157 $ 189,313 $ 568,108 $ 445,148



Add (Less):

Interest expense, 70,377 77,265 212,557 260,800 net

Loss onextinguishment of 856 37,371 1,908 44,848 debt

Income tax expense 65,853 65,177 196,338 166,927

Depreciation ofproperty and 41,354 36,611 120,726 107,787 equipment

Amortization of 75,730 69,265 223,229 209,360 intangible assets

Amortization of 29,884 31,968 92,418 104,916 broadcast rights

Amortization ofright-of-use assets 153 153 457 457 attributable tofavorable leases

Gain on asset (358 ) (286 ) (8,796 ) (1,094 )disposal, net

(Gain) loss onoperating lease - (61 ) 15 163 terminations, net

Change in theestimated fairvalue of contingentconsideration - - - 3,933

attributable to apast merger

Gain onrelinquishment of - - - (10,791 )spectrum

Corporate one-timetransaction 2,651 17,286 4,740 30,168 expenses

Right-of-use asset - 868 - 868 impairment

Income from equitymethod investments, (20,783 ) (15,861 ) (77,707 ) (41,351 )net

Distributions fromequity method 15,006 9,905 222,389 206,997 investments

Unrealized loss(gain) on an equity 2,162 - (5,695 ) - investment measuredat fair value

Loss on write-offof an equity 7,000 - 7,000 - investment

Other expenses, net 414 1,093 1,090 778

Gain on disposal ofstations and - - (2,455 ) (7,025 )business units, net

Reimbursement fromthe FCC related to (5,585 ) (12,873 ) (17,926 ) (51,347 )station repack

Payments for (40,773 ) (46,320 ) (133,042 ) (147,214 )broadcast rights



Adjusted EBITDAbefore transaction 413,098 460,874 1,405,354 1,324,328 and other one-timeexpenses

Margin % 35.7 % 41.2 % 41.3 % 42.4 %



Less: Corporateone-time (2,651 ) (17,286 ) (4,740 ) (30,168 )transactionexpenses



Adjusted EBITDA $ 410,447 $ 443,588 $ 1,400,614 $ 1,294,160

Margin % 35.5 % 39.7 % 41.2 % 41.4 %

Nexstar Media Group, Inc.

Reconciliation of Free Cash Flow (Non-GAAP Measure)

(in thousands, unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

Free Cash Flow:

2021

2020

2021

2020

Net income

$

169,157

$

189,313

$

568,108

$

445,148

Add (Less):

Interest expense, net

70,377

77,265

212,557

260,800

Loss on extinguishment of debt

856

37,371

1,908

44,848

Income tax expense

65,853

65,177

196,338

166,927

Depreciation of property and equipment

41,354

36,611

120,726

107,787

Amortization of intangible assets

75,730

69,265

223,229

209,360

Amortization of broadcast rights

29,884

31,968

92,418

104,916

Amortization of right-of-use assets attributable to favorable leases

153

153

457

457

Gain on asset disposal, net

(358

)

(286

)

(8,796

)

(1,094

)

(Gain) loss on operating lease terminations, net

-

(61

)

15

163

Change in the estimated fair value of contingent consideration

attributable to a past merger

-

-

-

3,933

Gain on relinquishment of spectrum

-

-

-

(10,791

)

Stock-based compensation expense

12,302

12,483

34,323

35,917

Corporate one-time transaction expenses, including non-cash charges(1)

2,651

17,286

4,740

30,168

Right-of-use asset impairment

-

868

-

868

Income from equity method investments, net

(20,783

)

(15,861

)

(77,707

)

(41,351

)

Distributions from equity method investments

15,006

9,905

222,389

206,997

Gain on disposal of stations and business units, net

-

-

(2,455

)

(7,025

)

Unrealized loss (gain) on an equity investment measured at fair value

2,162

-

(5,695

)

-

Loss on write-off of an equity investment

7,000

-

7,000

-

Other expenses, net

414

1,093

1,090

778

Payments for broadcast rights

(40,773

)

(46,320

)

(133,042

)

(147,214

)

Cash interest expense

(66,586

)

(72,914

)

(201,354

)

(247,484

)

Capital expenditures, excluding station repack and CVR spectrum(2)

(36,271

)

(34,220

)

(97,338

)

(117,592

)

Capital expenditures related to station repack

(1,611

)

(19,388

)

(6,974

)

(49,286

)

Proceeds from disposal of assets

2,437

71

16,591

1,029

Operating cash income tax payments, net(3)

(74,579

)

(136,593

)

(247,399

)

(144,279

)

Free cash flow before transaction and other one-time expenses

254,375

223,186

921,129

853,980

Less:

Corporate one-time transaction expenses, excluding non-cash charges(4)

(2,651

)

(4,181

)

(4,740

)

(17,063

)

Free cash flow

$

251,724

$

219,005

$

916,389

$

836,917

Nexstar Media Group, Inc.

Reconciliation of Free Cash Flow (Non-GAAP Measure)

(in thousands, unaudited)

Three Months Ended Nine Months Ended September 30, September 30,

Free Cash Flow: 2021 2020 2021 2020

Net income $ 169,157 $ 189,313 $ 568,108 $ 445,148



Add (Less):

Interest expense, 70,377 77,265 212,557 260,800 net

Loss onextinguishment of 856 37,371 1,908 44,848 debt

Income tax expense 65,853 65,177 196,338 166,927

Depreciation ofproperty and 41,354 36,611 120,726 107,787 equipment

Amortization of 75,730 69,265 223,229 209,360 intangible assets

Amortization of 29,884 31,968 92,418 104,916 broadcast rights

Amortization ofright-of-use assets 153 153 457 457 attributable tofavorable leases

Gain on asset (358 ) (286 ) (8,796 ) (1,094 )disposal, net

(Gain) loss onoperating lease - (61 ) 15 163 terminations, net

Change in theestimated fair valueof contingentconsideration - - - 3,933

attributable to apast merger

Gain onrelinquishment of - - - (10,791 )spectrum

Stock-based 12,302 12,483 34,323 35,917 compensation expense

Corporate one-timetransaction 2,651 17,286 4,740 30,168 expenses, includingnon-cash charges^(1)

Right-of-use asset - 868 - 868 impairment

Income from equitymethod investments, (20,783 ) (15,861 ) (77,707 ) (41,351 )net

Distributions fromequity method 15,006 9,905 222,389 206,997 investments

Gain on disposal ofstations and - - (2,455 ) (7,025 )business units, net

Unrealized loss(gain) on an equity 2,162 - (5,695 ) - investment measuredat fair value

Loss on write-off of 7,000 - 7,000 - an equity investment

Other expenses, net 414 1,093 1,090 778

Payments for (40,773 ) (46,320 ) (133,042 ) (147,214 )broadcast rights

Cash interest (66,586 ) (72,914 ) (201,354 ) (247,484 )expense

Capitalexpenditures,excluding station (36,271 ) (34,220 ) (97,338 ) (117,592 )repack and CVRspectrum^(2)

Capital expendituresrelated to station (1,611 ) (19,388 ) (6,974 ) (49,286 )repack

Proceeds from 2,437 71 16,591 1,029 disposal of assets

Operating cashincome tax payments, (74,579 ) (136,593 ) (247,399 ) (144,279 )net^(3)



Free cash flowbefore transaction 254,375 223,186 921,129 853,980 and other one-timeexpenses



Less:

Corporate one-timetransaction (2,651 ) (4,181 ) (4,740 ) (17,063 )expenses, excludingnon-cash charges^(4)



Free cash flow $ 251,724 $ 219,005 $ 916,389 $ 836,917

(1) Includes a $13.1 million provision for uncollectible amounts due from an entity for which Nexstar had a variable interest during the three and nine months ended September 30, 2020.

(2) During the three and nine months ended September 30, 2021 capital expenditures related to relinquishment of the CVR spectrum were $0.2 million and $0.7 million, respectively. During the three and nine months ended September 30, 2020 capital expenditures related to relinquishment of the CVR spectrum were $1.0 million and $3.3 million, respectively.

(3) Excludes $57.7 million in tax payments during Q3 2020 related to various sale of stations.

(4) Excludes a $13.1 million provision for uncollectible amounts due from an entity for which Nexstar had a variable interest during the three and nine months ended September 30, 2020.

View source version on businesswire.com: https://www.businesswire.com/news/home/20211102005692/en/

CONTACT: Investor Contacts: Thomas E. Carter President and Chief Operating Officer Nexstar Media Group, Inc. 972/373-8800

CONTACT: Lee Ann Gliha Executive Vice President and Chief Financial Officer Nexstar Media Group, Inc. 972/373-8800

CONTACT: Joseph Jaffoni or Jennifer Neuman JCIR 212/835-8500 or nxst@jcir.com

CONTACT: Media Contact: Gary Weitman EVP and Chief Communications Officer Nexstar Media Group, Inc. 972/373-8800 or gweitman@nexstar.tv