Overview of Saga Communications’ Financial Performance

Saga Communications, Inc. is a media company primarily engaged in acquiring, developing and operating broadcast properties, including opportunities complementary to its core radio business such as digital, e-commerce and non-traditional revenue initiatives. The company’s financial performance for the three and six months ended June 30, 2026 is summarized as follows:

Three Months Ended June 30, 2026 Compared to Three Months Ended June 30, 2025

• Net operating revenue decreased by 6.5% to $26.4 million, primarily due to decreases in gross national and local revenue, partially offset by increases in political and digital revenue.
• Station operating expenses increased by 5.4% to $23.4 million, mainly due to higher digital service, compensation, and tower lease expenses.
• Operating income decreased by 55.8% to $0.6 million, primarily from the decline in revenue and increase in expenses.
• Net income decreased by 14.9% to $1.0 million, mainly due to the lower operating income, partially offset by higher interest income and lower income tax expense.

Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025

• Net operating revenue decreased by 6.0% to $49.3 million, primarily due to decreases in gross national, local and non-spot revenue, partially offset by an increase in digital revenue.
• Station operating expenses increased by 2.8% to $45.4 million, mainly due to higher digital service, tower lease, legal and utility expenses.
• Operating loss was $2.6 million compared to $0.9 million in the prior year, primarily from the decline in revenue and increase in expenses.
• Net loss was $1.4 million compared to $0.4 million in the prior year, mainly due to the higher operating loss, partially offset by higher interest income and lower income tax expense.

Key Strengths and Weaknesses

Strengths:

• Diversified portfolio of radio stations across small to midsize markets
• Expanding digital advertising services to complement core radio business
• Ability to generate cash flow from operations to fund capital expenditures and dividends

Weaknesses:

• Reliance on advertising revenue, which can be volatile and impacted by economic conditions
• Concentration of revenue in top five markets, which could adversely impact results if any of those markets underperform
• Termination of credit facility reduces available liquidity sources for future growth or capital allocation initiatives

Outlook and Future Prospects

Saga Communications expects the radio broadcasting industry and advertising market to continue evolving, with increased competition from digital media platforms. The company is focused on executing its digital strategy to provide integrated advertising solutions and measurable outcomes for clients. However, the termination of its credit facility may limit the company’s financial flexibility going forward. Overall, Saga’s future prospects will depend on its ability to adapt to industry changes, maintain strong operating performance in its core markets, and effectively manage its capital allocation priorities.