Grupo Radio Centro Reports First Quarter 2008 Results

MEXICO CITY, April 22 /PRNewswire-FirstCall/ -- Grupo Radio Centro, S.A.B. de C.V. (NYSE:RC)(NYSE:BMV:)(NYSE:RCENTRO-A) (the "Company"), one of Mexico's leading radio broadcasting companies, announced today its results of operations for the first quarter ended March 31, 2008. All figures were prepared in accordance with the Mexican Financial Reporting Standards ("MFRS") issued by the Mexican Board for Research and Development of Financial Information Standards.

First Quarter Results

Broadcasting revenue for the first quarter 2008 was Ps. 128,258,000, representing a slight decrease compared to the Ps. 128,534,000 reported in the same period of 2007. This decrease is attributable to lower advertising expenditures by the Company's clients during the first quarter 2008 compared to the first quarter 2007. This was a result of Holy Week taking place during the first quarter 2008, compared to 2007, when Holy Week fell during the second quarter.

The Company's broadcasting expenses (excluding depreciation, amortization and corporate, general and administrative expenses) for the first quarter 2008 totaled Ps. 103,981,000, a 5.4% decrease compared to the Ps. 109,969,000 reported in the first quarter 2007. This decrease was primarily attributable to lower sales commissions as well as lower advertising and promotion expenses during the first quarter 2008 compared to the first quarter 2007.

For the first quarter 2008, the Company reported broadcasting income (i.e., broadcasting revenue minus broadcasting expenses, excluding depreciation, amortization and corporate, general and administrative expenses) of Ps. 24,277,000, a 30.8% increase compared to the Ps. 18,565,000 reported in the first quarter 2007. This increase in broadcasting income was mainly attributable to the decrease in broadcasting expenses described above.

Depreciation and amortization expenses for the first quarter 2008 were Ps. 7,681,000, a 14.0% decrease compared to the Ps. 8,929,000 reported in the first quarter of 2007. This decrease was attributable to the Company no longer recording depreciation on certain assets after the fourth quarter 2006 due to the conclusion of their useful life.

For the first quarter 2008, the Company's corporate, general and administrative expenses were Ps. 3,495,000, a slight increase compared to the Ps. 3,439,000 reported in the first quarter 2007.

The Company reported operating income of Ps. 13,101,000 in the first quarter 2008, a 111.4% increase compared to the Ps. 6,197,000 reported in the first quarter 2007. This increase was mainly due to the decrease in broadcasting expenses during the first quarter 2008 compared to the first quarter 2007.

For the first quarter 2008, other expenses, net, were Ps. 11,823,000, a 7.7% increase compared to the Ps. 10,977,000 reported in the first quarter 2007. This increase is primarily attributable to the increase in expenses related to the company's listing on the Bolsa Mexicana de Valores (the Mexican Stock Exchange) and The New York Stock Exchange, as well as the inclusion of employee profit sharing expenses in this line item, as a result of a reclassification required by Bulletin D-3 ("Employee Benefits"), published by the Mexican Board for Research and Development of Financial Information Standards, which took effect in the fourth quarter 2007. Employee profit sharing expenses were previously recorded as a separate line item ("Provisions for income tax and employee profit sharing").

The Company's comprehensive financing cost for the first quarter 2008 was Ps. 137,000, compared to a comprehensive financing gain of Ps. 510,000 for the first quarter 2007. This variation was mainly attributable to a 57.4% decrease in interest income during the period, reflecting a decline in the Company's cash and temporary investments, primarily as a result of a dividend payment in March 2008.

For the first quarter of 2008, the Company reported income before income taxes of Ps. 1,141,000 compared to a loss before income taxes of Ps. 4,270,000 reported for the first quarter 2007, primarily a result of lower broadcasting expenses.

The Company recorded income taxes of Ps. 331,000 in the first quarter 2008, compared to a negative provision of Ps. 1,302,000 in the first quarter 2007, as a result of higher taxable income.

As a result of the foregoing, the Company's net income for the first quarter 2008 was Ps. 810,000, compared to net loss of Ps. 2,968,000 in the first quarter 2007.

Cessation of inflation accounting under MFRS

In accordance with MFRS inflation accounting rules, the Company's first quarter 2007 financial statements are expressed in constant pesos as of December 31, 2007. As a result of a change in MFRS, the Company will no longer use inflation accounting for periods beginning in 2008, unless the economic environment in which we operate qualifies as "inflationary," as defined by MFRS. Because the economic environment in the first quarter 2008 did not qualify as inflationary, the Company did not use inflation accounting to prepare the first quarter 2008 financial statements.

Company Description

Grupo Radio Centro owns and/or operates 14 radio stations, of which 11 are 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. In addition to the Organizacion Radio Centro radio stations, the Company also operates Grupo RED radio stations and Organizacion Impulsora de Radio (OIR), a radio network that 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.B. DE C.V.
CONSOLIDATED UNAUDITED BALANCE SHEET
as of March 31, 2008 and 2007(1)
(figures in thousands of Mexican pesos ("Ps.")
and U.S. dollars ("U.S. $")(2)

March 31
2008 2007
U.S. $(2) Ps. Ps.
ASSETS
Current assets:
Cash and temporary
investments 6,250 66,849 146,113

Accounts receivable:
Broadcasting, net 14,482 154,903 192,285
Other 487 5,205 8,976
Income tax prepaid 319 3,413 0
15,288 163,521 201,261

Prepaid expenses 3,100 33,159 23,098
Total current assets 24,638 263,529 370,472

Property and equipment, net 44,318 474,035 480,134
Deferred charges, net 525 5,614 4,205
Excess of cost over book
value of subsidiaries 77,491 828,863 828,862
Other assets 303 3,239 3,380
Total assets 147,275 1,575,280 1,687,053

LIABILITIES
Current:
Advances from customers 10,775 115,253 119,835
Other accounts payable and
accrued expenses 6,542 69,969 58,916
Taxes payable 1,594 17,054 56,715
Total current
liabilities 18,911 202,276 235,466

Long-Term:
Deferred income tax 258 2,762 9,229
Reserve for labor
obligations 5,584 59,726 57,877
Total liabilities 24,753 264,764 302,572

STOCKHOLDERS' EQUITY
Capital stock 105,683 1,130,409 1,130,409
Retained (deficit) earnings 12,761 136,491 209,868
Provision for repurchase of
shares 4,099 43,839 43,839
Effect from labor obligations (85) (909) (309)
Minority interest 64 686 674
Total stockholders'
equity 122,522 1,310,516 1,384,481
Total liabilities and
stockholders' equity 147,275 1,575,280 1,687,053

(1) Amounts for the first quarter 2007 are expressed in
Mexican pesos with purchasing power as of December 31, 2007.
As a result of a change in MFRS for periods beginning in 2008,
we have not prepared 2008 amounts using inflation accounting or re- expressed 2007 amounts as of March 31, 2008.
(2) Peso amounts have been translated into U.S. dollars, solely for the
convenience of the reader, at the rate of Ps. 10.6962 per U.S.
dollar, the rate on March 31, 2008.

GRUPO RADIO CENTRO, S.A.B. DE C.V. CONSOLIDATED UNAUDITED STATEMENT OF INCOME

for the three-month periods ended March 31, 2008 and 2007(1)
(figures in thousands of Mexican pesos ("Ps.") and U.S. dollars
("U.S. $")(2), except per Share and per ADS amounts)

March 31
2008 2007
U.S.$(2) Ps. Ps.

Broadcasting revenue(3) 11,991 128,258 128,534
Broadcasting expenses, excluding
depreciation, amortization
and corporate, general and
administrative expenses 9,721 103,981 109,969
Broadcasting income 2,270 24,277 18,565

Depreciation and amortization 718 7,681 8,929
Corporate, general and administrative
expenses 327 3,495 3,439
Operating income 1,225 13,101 6,197

Other expenses, net (1,105) (11,823) (10,977)

Comprehensive financing income (cost):
Interest expense (82) (874) (528)
Interest income(3) 72 767 1,801
Gain (loss) on foreign currency
exchange, net (3) (30) 33
Gain (loss) on net monetary
position(4) - - (796)
(13) (137) 510

Income (loss) before income taxes 107 1,141 (4,270)

Income taxes 31 331 (1,302)
Net income (loss) 76 810 (2,968)

Net income (loss) applicable to:
Majority interest 75 801 (2,973)
Minority interest 1 9 5
76 810 (2,968)

Net income (loss) per Series A Share(5) 0.055 0.583 2.430
Net income (loss) per ADS(5) 0.491 5.247 21.871
Weighted average common shares
outstanding (000's)(5) 162,724 162,500

(1) Amounts for the first quarter 2007 are expressed in Mexican pesos
with purchasing power as of December 31, 2007. As a result of a
change in MFRS for periods beginning in 2008, we have not prepared
2008 amounts using inflation accounting or re-expressed 2007 amounts
as of March 31,2008.
(2) Peso amounts have been translated into U.S. dollars, solely for the
convenience of the reader, at the rate of Ps. 10.6962 per
U.S. dollar, the rate on March 31, 2008.
(3) 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
airtime 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 first quarter of 2008 and 2007 was
Ps. 555,000 and Ps. 799,000, respectively.
(4) As a result of a change in MFRS for periods beginning in 2008, we
will no longer use inflation accounting unless the economic
environment is "inflationary", as defined by MFRS. Since the
economic environment was not inflationary in the first quarter 2008,
we have not reported gain (loss) on net monetary position for this
period.
(5) 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.

IR Contacts In NY:
In Mexico: Maria Barona / Peter Majeski
Pedro Beltran / Alfredo Azpeitia i-advize Corporate Communications, Inc.
Grupo Radio Centro, S.A.B. de C.V. Tel: (212) 406-3690
aazpeitia@grc.com.mxgrc@i-advize.com

First Call Analyst:
FCMN Contact: mbarona@i-advize.com

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

CONTACT: IR Contacts, in Mexico, Pedro Beltran or Alfredo Azpeitia, both
of Grupo Radio Centro, S.A.B. de C.V., aazpeitia@grc.com.mx ; or in NY,
Maria Barona or Peter Majeski, both of i-advize Corporate Communications,
Inc., +1-212-406-3690, grc@i-advize.com

Web site: http://www.radiocentro.com.mx/

2008-04-22 20:03:19 0342656 PRNEWSWIRE