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CONFORMED
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 February, 2005 Commission File Number 1-12090
GRUPO RADIO CENTRO, S.A. de C.V.
(Translation of Registrant's name into English)
Constituyentes 1154, Piso 7
Col. Lomas Altas, Mexico 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-__.)
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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. de C.V.
(Registrant)
Date: February 25, 2005 By: /s/ Pedro Beltran Nasr
-------------------------
Name: Pedro Beltran Nasr
Title: Chief Financial Officer
GRUPO RADIO CENTRO REPORTS FOURTH QUARTER AND YEAR-END RESULTS FOR THE PERIOD
ENDED DECEMBER 31, 2004
MEXICO CITY, Feb. 25 /PRNewswire-FirstCall/ -- Grupo Radio Centro, S.A. de
C.V. (NYSE: RC) (BMV: RCENTRO-A) (the "Company"), Mexico's leading radio
broadcasting company, announced today its results of operations for the fourth
quarter and year ended December 31, 2004. All figures were prepared in
accordance with generally accepted accounting principles in Mexico and have been
restated in constant pesos as of December 31, 2004.
For the fourth quarter of 2004, broadcasting revenue was Ps. 185,035,000,
representing a decrease of 15.0% compared to Ps. 217,589,000 reported for the
same period of 2003. This decrease was mainly due to the loss of revenue that
had been generated in 2003 by broadcasting news programs provided by a third
party, revenue the Company ceased receiving after news broadcasts ended in the
first quarter of 2004.
The Company's broadcasting expenses (excluding depreciation, amortization
and corporate, general and administrative expenses) for the fourth quarter of
2004 were Ps. 90,827,000, representing a decrease of 30.7% compared to Ps.
131,069,000 reported for the same period of 2003. This decrease was mainly
attributable to lower production costs resulting from the cancellation at the
end of the first quarter of 2004 of news programming produced by a third party.
For the fourth quarter ended December 31, 2004, the Company reported
broadcasting income (i.e., broadcasting revenue minus broadcasting expenses,
excluding depreciation, amortization and corporate, general and administrative
expenses) of Ps. 94,208,000, representing an increase of 8.9% compared to
broadcasting income of Ps. 86,520,000 reported for the same period in 2003. This
increase was mainly attributable to the decrease in the Company's broadcasting
expenses as a result of the cancellation of news programs that a third party
formerly produced for the Company.
Depreciation and amortization for the fourth quarter of 2004 amounted to Ps.
27,025,000, a 15.1% decrease compared to Ps. 31,837,000 reported for the same
period of 2003. This reduction was mainly due to the goodwill write-off in
connection with a Company subsidiary during the fourth quarter of 2003.
For the fourth quarter of 2004, the Company's corporate, general and
administrative expenses were Ps. 6,752,000, compared to Ps. 22,339,000 reported
for the same period of 2003. This 69.8% decrease was due to the discontinuance
of expenses previously related to a news production contract that the Company
formerly had with a third party.
As a result of the decrease in expenses, which more than offset the decrease
in broadcasting revenues, the Company reported operating income of Ps.
60,431,000 for the fourth quarter of 2004, representing an 86.8% increase
compared to operating income of Ps. 32,344,000 reported for the same period of
2003.
In the fourth quarter of 2004, the Company reported comprehensive financing
income of Ps. 5,000, compared with a comprehensive financing cost of Ps.
7,822,000 reported for the fourth quarter of 2003. This result was primarily
attributable to (i) a gain in net monetary position of Ps. 8,497,000 for the
fourth quarter of 2004 compared to a loss of Ps. 1,882,000 for the same period
in 2003 and (ii) an increase in foreign currency exchange gain, net, to Ps.
2,929,000 for the fourth quarter of 2004 from Ps. 254,000 for the same period in
2003. The change with respect to net monetary position was due to higher net
monetary liabilities for the fourth quarter of 2004 that resulted from the
recording of a provision at the end of 2003 related to the Company's arbitration
proceeding. The increase in foreign currency exchange gain, net, was due
principally to the appreciation of the peso relative to the dollar. The factors
leading to the decrease in the Company's comprehensive financing cost were
partially offset by an increase in interest expense for the fourth quarter of
2004 due to the fact that the Company began recording interest relating to its
contingent liability provision in 2004.
For the fourth quarter of 2004, other expenses, net, were Ps. 10,249,000,
compared to Ps. 15,360,000 reported for the same period in 2003. This 33.3%
decrease was attributable to the recognition of income that resulted from the
reappraisal of certain real estate assets of the Company.
The Company reported income before extraordinary item and provisions for
income tax and employee profit sharing of Ps. 50,187,000 for the fourth quarter
of 2004, compared to Ps. 9,162,000 reported for the same period of 2003. The
Company reported income before provisions for income tax and employee profit
sharing of Ps. 50,187,000 for the fourth quarter of 2004, in contrast to a loss
of Ps. 349,228,000 for the same period of 2003. The loss in the fourth quarter
of 2003 was attributable to the Ps. 358,390,000 extraordinary item charge
related to the arbitration.
For the fourth quarter of 2004, the Company recorded provisions for income
tax and employee profit sharing of Ps. 19,529,000, compared to a reduction in
provisions of Ps. 40,071,000 for the same period of 2003.
As a result of the foregoing, the Company's net income for the fourth
quarter of 2004 was Ps. 30,658,000, compared to a net loss of Ps. 309,157,000
reported for same period of 2003.
Twelve-Month Results
For the year ended December 31, 2004, broadcasting revenue was Ps.
551,608,000, a 36.4% decrease compared to Ps. 867,913,000 reported for 2003.
This decrease was mainly attributable to a decline in political party
advertising expenditures following the July 2003 congressional elections, as
well as the termination of a former news program at the end of the first quarter
of 2004.
The Company's broadcasting expenses (excluding depreciation, amortization
and corporate, general and administrative expenses) for 2004 were Ps.
386,528,000, a 25.6% decrease compared to Ps. 519,216,000 reported for the year
ended December 31, 2003. This decrease was primarily attributable to lower
production costs for news programming, which a third party produced for the
Company until the end of the first quarter of 2004.
Broadcasting income (i.e., broadcasting revenue minus broadcasting expenses,
excluding depreciation, amortization and corporate, general and administrative
expenses) for 2004 was Ps. 165,080,000, representing a decrease of 52.7% from
the Ps. 348,697,000 reported for the year ended December 31, 2003. This decrease
was primarily attributable to the decrease in broadcasting revenue resulting
from the decrease in political advertising in 2004 compared to 2003.
Depreciation and amortization for 2004 was Ps. 97,873,000, a decrease of
18.0% compared to Ps. 119,291,000 reported for the year ended December 31, 2003.
This decrease was mainly due to the goodwill write-off in connection with a
Company subsidiary during 2003.
The Company's corporate, general and administrative expenses for 2004 were
Ps. 21,406,000, a decrease of 66.2% compared to Ps. 63,307,000 reported for
2003. This decrease occurred primarily because the Company paid lower fees
during 2004 to a third party after it ceased producing news programs for the
Company.
For 2004, the Company reported operating income of Ps. 45,801,000 compared
to operating income of Ps. 166,099,000 reported for 2003. Lower political
revenues for 2004 contributed to this 72.4% decrease.
The Company's comprehensive financing cost for 2004 was Ps. 18,177,000, a
decrease of 47.5% from the comprehensive financing cost of Ps. 34,606,000
reported for 2003. This result was primarily attributable to (i) a gain in net
monetary position of Ps. 15,475,000 for 2004 compared to a loss of Ps. 326,000
for 2003 due to higher net monetary liabilities for 2004 and (ii) a decrease in
foreign currency exchange loss, net, which fell to Ps. 2,533,000 for 2004 from
Ps. 6,798,000 for 2003. The factors leading to the decrease in the Company's
comprehensive financing cost were partially offset by an increase in interest
expense for 2004.
Other expenses, net, for the year ended December 31, 2004 were Ps.
46,181,000, a 33.5% decrease compared to Ps. 69,407,000 reported for 2003. This
decrease is attributable to (i) the recognition of income in 2004 following the
reappraisal of certain real estate assets of the Company, (ii) severance
payments made during the first quarter of 2003 in connection with personnel
reductions and (iii) lower expenses in 2004 due to the termination of operations
in 2003 of certain Internet-related subsidiaries of the Company.
The Company reported a loss before extraordinary item and provisions for
income tax and employee profit sharing for 2004 of Ps. 18,557,000, in contrast
to income of Ps. 62,086,000 reported for 2003.
For 2004, the Company recorded provisions for income tax and employee profit
sharing of Ps. 19,727,000, compared to a reduction in provision for income tax
and employee profit sharing of Ps. 37,750,000 for 2003.
As a result of the foregoing, the Company had a net loss of Ps. 38,284,000
for the year ended December 31, 2004, compared to net loss of Ps. 258,554,000
for 2003.
Other Matters:
From December 31, 2003 to December 31, 2004, the Company decreased its
total bank debt from Ps. 238.2 million to Ps. 169.8 million as a result of
scheduled payments.
On November 11, 2004, the Company announced that Civil Judge 63 of the
Federal District Superior Tribunal of Justice set aside the arbitration award
that was issued on January 30, 2004, against Grupo Radio Centro by an
arbitration panel established under the rules of the International Chamber of
Commerce. This decision is subject to review, and other legal procedures that
have been or may be initiated by the parties under Mexican law.
Company Description:
Grupo Radio Centro owns and/or operates 14 radio stations, 11 of which are
located 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. The Company also operates besides Grupo RED and Organizacion
Radio Centro radio stations, Organizacion Impulsora de Radio (OIR), a radio
network, which 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.
GRUPO RADIO CENTRO, S.A. DE C.V. CONSOLIDATED AUDITED BALANCE SHEETS
as of December 31, 2004 and 2003
in Mexican Pesos ("Ps.") with purchasing power as of December 31, 2004
(figures in thousands of Ps. and U.S. dollars ("U.S.$")(1),
except per Share and per ADS amounts)
December 31
------------------------------------
2004
----------------------- 2003
U.S. $(1) Ps. Ps.
---------- ---------- ----------
ASSETS
Current assets:
Cash and temporary
investments 1,946 21,710 72,241
Accounts receivable:
Broadcasting, net 15,291 170,555 227,456
Other 424 4,726 4,151
Income tax recoverable 1,393 15,538 0
17,108 190,819 231,607
Guarantee deposit 52 576 7,274
Prepaid expenses 1,112 12,399 9,972
Total current assets 20,218 225,504 321,094
Long-term accounts
receivable 2,183 24,347 0
Property and equipment, net 43,836 488,950 494,283
Deferred charges, net 673 7,504 13,034
Guarantee deposit 0 0 606
Excess of cost over book
value of subsidiaries 65,926 735,341 801,646
Other assets 289 3,220 3,303
Total assets 133,125 1,484,866 1,633,966
LIABILITIES
Current:
Notes payable 5,076 56,618 59,557
Advances from customers 4,751 52,990 62,754
Other accounts payable
and accrued expenses 2,908 32,436 56,267
Taxes payable 1,722 19,209 27,403
Contingent liability 21,797 243,121 248,390
Total current
liabilities 36,254 404,374 454,371
Long-Term:
Deferred income tax 3,287 36,664 28,787
Notes payable 10,152 113,237 178,672
Reserve for labor
obligations 2,268 25,296 27,818
Total liabilities 51,961 579,571 689,648
STOCKHOLDERS' EQUITY
Capital stock 101,028 1,126,862 1,127,478
Retained (deficit) earnings (15,328) (170,974) (132,695)
Provision for repurchase of
shares 3,570 39,822 39,922
Accumulated effect of
deferred income tax (8,544) (95,300) (95,300)
Effect from labor
obligations (18) (200) (177)
Surplus on restatement of
capital 409 4,557 4,557
Minority interest 47 528 533
Total stockholders'
equity 81,164 905,295 944,318
Total liabilities and
stockholders' equity 133,125 1,484,866 1,633,966
(1) Peso amounts have been translated into U.S. dollars, solely for the
convenience of the reader, at the rate of Ps. 11.154 per U.S. dollar, the noon
buying rate for Mexican pesos on December 31, 2004, as published by the Federal
Reserve Bank of New York.
CONSOLIDATED AUDITED STATEMENTS OF INCOME
for the three-month and twelve-month periods ended December 31, 2004 and 2003
expressed in Mexican Pesos ("Ps.") with purchasing power
as of December 31, 2004
(figures in thousands of Ps. and U.S. dollars ("U.S. $") (1),
except per Share and per ADS amounts)
4th Quarter Accumulated 12 months
------------------------------------ ------------------------------------
2004 2004
----------------------- 2003 ----------------------- 2003
U.S.$(1) Ps. Ps. U.S.$(1) Ps. Ps.
---------- ---------- ---------- ---------- ---------- ----------
Broadcasting
Revenue (2) 16,590 185,035 217,589 49,454 551,608 867,913
Broadcasting
expenses, excluding
depreciation,
amortization and
corporate
expenses 8,143 90,827 131,069 34,654 386,528 519,216
Broadcasting income 8,447 94,208 86,520 14,800 165,080 348,697
Depreciation and
amortization 2,423 27,025 31,837 8,775 97,873 119,291
Corporate general
and administrative
expenses 605 6,752 22,339 1,919 21,406 63,307
Operating income 5,419 60,431 32,344 4,106 45,801 166,099
EBITDA 7,841 87,456 64,181 12,881 143,674 285,390
Comprehensive
financing income
(cost):
Interest expense (1,037) (11,568) (6,369) (2,838) (31,678) (28,505)
Interest income
(2) 13 147 175 50 559 1,023
Gain (loss) on
foreign currency
exchange, net 264 2,929 254 (227) (2,533) (6,798)
Gain (loss) on net
monetary position 762 8,497 (1,882) 1,387 15,475 (326)
2 5 (7,822) (1,628) (18,177) (34,606)
Other expenses, net (919) (10,249) (15,360) (4,140) (46,181) (69,407)
Income (loss) before
extraordinary item
and provisions 4,502 50,187 9,162 (1,662) (18,557) 62,086
Extraordinary item 0 0 358,390 0 0 358,390
Income (loss) before
provisions 4,502 50,187 (349,228) (1,662) (18,557) (296,304)
Provisions for
income tax &
employee profit
sharing 1,751 19,529 (40,071) 1,769 19,727 (37,750)
Net income (loss) 2,751 30,658 (309,157) (3,431) (38,284) (258,554)
Net income (loss) applicable to:
Majority interest 2,750 30,644 (309,161) (3,431) (38,279) (258,559)
Minority interest 1 14 4 0 (5) 5
2,751 30,658 (309,157) (3,431) (38,284) (258,554)
Net (loss) income
per Series
A Share(3) (0.021) (0.235) (1.589)
Net (loss) income
per ADS (3) (0.189) (2.115) (14.301)
Weighted average
common shares
outstanding
(000's)(3) 162,560 162,705
(1) Peso amounts have been translated into U.S. dollars, solely for the
convenience of the reader, at the rate of Ps. 11.154 per U.S. dollar, the noon
buying rate for Mexican pesos on December 31, 2004, as published by the Federal
Reserve Bank of New York.
(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 airtime has been transmitted. Interest earned and
treated as broadcasting revenue for the fourth quarter of 2004 and 2003 was Ps.
959,000 and Ps. 791,000, respectively. Interest earned and treated as
broadcasting revenue for the twelve months ended December 31, 2004 and 2003 was
Ps. 2,816,000 and Ps. 1,552,000, 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.
SOURCE Grupo Radio Centro, S.A. de C.V.
-0- 02/25/2005
/CONTACT: Pedro Beltran or Alfredo Azpeitia, both of Grupo Radio Centro,
+011-5255-5728-4800, ext. 7018; or Maria Barona or Peter Majeski, both of i-
advize Corporate Communications, Inc., +1-212-406-3690, or grc@i-advize.com,
for Grupo Radio Centro/
/Web site: http://www.radiocentro.com.mx/