This is an accounting item – I’ll try not to make your head explode.
Citadel (ABC Radio) announced its earnings today for April-June 2009. There was no good news other than their lenders don’t want to take over the company – yet.
The stock is selling for $.05 a share on the OTCBB and for the quarter, Citadel lost $2.88 per share in the three months – most of that was due to writing down the value of their FCC licenses again in the middle of the year by $933 million.
You now have a company with total assets (assuming the new valuations of the FCC licenses are “real”) of $1.4 billion, and long term debt of $2.0 billion. Citadel violated the terms of its original loan agreement in the beginning of the year, and the loan is now is callable at any time in full (but the banks don’t really want to own radio stations). For now, the banks have relaxed the requirements, but they just get that much worse next year.
The numbers would be even worse, except the company figures it “made” $229 million in future income tax savings they won’t have to pay. This is the GM “trap”. If your company loses money, the income tax losses cannot be offset against future income for more than a few (3?) years. Unless your company “turns around” and starts making income, those future income tax savings are not real. At the point you concede that, you get clobbered again by having to write off the theoretical future income tax savings. That’s a bit part of what pushed GM over the edge in 2008 and into bankruptcy.
What? LOL What put them out of buisness was the world wide recesion caused by Reagan’s (Deregulation) Next Bush and his Chronies (Bankers and what not) They Spending all our money on the wrong war (Special intrest) instead of Afganistan for 8 Years …………………If the mortgage issue was regulated this would not have happened ! but then a chain reaction hit the auto industry and that caused the failures………..man it looks like you are spewing Right wing Fear topics. It may be true what you say but it did not cause this depresion the banker’s and politicians DID (Bankers/Politicians hmmmmmmm) Na that would never happen ! from where you stand !
The deregulation of the radio business occured in 1996, which was 7 years after Reagan was no longer President. Bill Clinton became President in January, 1993. I promise not to confuse you with any more facts.