UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

SAGA COMMUNICATIONS, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware		1-11588		38-3042953
(State or other jurisdiction		(Commission File Number)		(IRS Employer
of incorporation)				Identification No.)
73 Kercheval Avenue
Grosse Pointe Farms, MI				48236
(Address of Principal Executive Offices)				(Zip Code)

Registrant’s telephone number, including area code: (313) 886-7070

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 2.02. Results of Operations and Financial Condition.

     On May 9, 2007, Saga Communications, Inc. issued a press release announcing its financial results for the three months ended March 31, 2007. The press release, dated May 9, 2007, is attached as Exhibit 99.1 to this Form 8-K.

Item 9.01. Financial Statements and Exhibits.

     (c) Exhibits.

99.1

Press Release dated May 9, 2007.

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 hereunto duly authorized.

INDEX OF EXHIBITS

Exhibit No.		Description
99.1		Press Release dated May 9, 2007.

Exhibit 99.1

Saga Communications, Inc.
Reports 1st Quarter 2007 Results

Contact:
Samuel D. Bush
313/886-7070

Grosse Pointe Farms, MI — May 9, 2007 — Saga Communications, Inc. (NYSE-SGA) today reported net operating revenue for the three month period increased 2.2% from the comparable period in 2006 to $31.9 million, operating income decreased 20.7% to $3.6 million and station operating expense increased 5.2% to $26.0 million (station operating expense includes depreciation and amortization attributable to the stations). Net income decreased 52.0% to $740 thousand ($.04 per fully diluted share) for the quarter ended March 31, 2007 compared to $1.5 million ($.07 per fully diluted share) for 2006. Free cash flow decreased to $859 thousand for the quarter from $1.9 million for the comparable period last year. On a same station basis for the year, net operating revenue increased 2.0% to $31.8 million, operating income decreased 20.0% to $3.6 million and station operating expense increased 4.8% to $25.9 million.

For the quarter, even with a $284 thousand reduction in gross political revenue, the company’s net operating revenue increased $692 thousand. Station operating expenses increased $1.3 million for the quarter, $722 thousand of which was related to our decision to continue to invest in the future of our business with additional advertising and promotion expense as well as additional sales compensation expense. In addition, $165 thousand of the increase in station operating expense was due to an increase in our health care costs. Adjusted for these specific expense increases our overall station operating expenses increased 2%.

Capital expenditures in the first quarter of 2007 were approximately $2.4 million with approximately $923 thousand being spent as a result of acquisitions and $160 thousand was as a part of our ongoing HD Radio conversions. Capital expenditures in the first quarter of 2006 were approximately $2.0 million with approximately $400 thousand being spent as a result of acquisitions. We continue to expect our 2007 annual capital expenditures to be $10.0 million compared to $10.5 million in 2006.

The attached Selected Supplemental Financial Data table discloses “as reported,” “same station” and “pro forma” information by segment. The “as reported” amounts reflect our

historical financial results and include the results of operations for stations that we did not own for the entire comparable period. The “same station” amounts reflect only the results of operations for stations that we owned for the entire comparable period. The “pro forma” amounts assume the 2007 and 2006 acquisitions and dispositions occurred as of January 1, 2006.

Saga Communications utilizes certain financial measures that are not calculated in accordance with generally accepted accounting principles (GAAP) to assess its financial performance. Such non-GAAP measures include same station financial information and free cash flow. These non-GAAP measures are generally recognized by the broadcasting industry as measures of performance and are used by Saga to assess its financial performance including but not limited to evaluating individual station and market-level performance, evaluating overall operations and as a primary measure for incentive based compensation of executives and other members of management. Saga’s management believes these non-GAAP measures are used by analysts who report on the industry and by investors to provide meaningful comparisons between broadcasting groups, as well as an indicator of their market value. These measures are not measures of liquidity or of performance in accordance with GAAP, and should be viewed as a supplement to and not as a substitute for the results of operations presented on a GAAP basis including net operating revenue, operating income, and net income. Reconciliations for all of the non-GAAP financial measures to the most directly comparable GAAP measure are attached in the Selected Financial Data Non-GAAP Disclosures tables.

Saga Communications, Inc. is a broadcasting company whose business is devoted to acquiring, developing and operating broadcast properties. The Company owns or operates broadcast properties in 26 markets, including 59 FM and 30 AM radio stations, 3 state radio networks, 2 farm radio networks, 5 television stations and 4 low-power television stations. As previously disclosed, the Company has entered into agreements to acquire an FM station serving the Asheville, NC radio market and an AM station and a FM station serving the Courtland, NY radio market. The closing of this transaction is subject to receiving FCC approval. For additional information, contact us at (313) 886-7070 or visit our website at www.sagacommunications.com.

Saga’s first quarter 2007 results conference call will be on Wednesday, May 9 at 2:00 PM. The dial in number for domestic calls is 800/762-6568. For international callers the number is 480/248-5088. The call can be replayed for 7 days by calling domestically 800/475-6701 or internationally 320/365-3844 and referring to access code 872223. Thereafter, a transcript of the call will be available on our website.

This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as “believes,” “expects,” “anticipates,” “guidance” and similar expressions are intended to identify forward-looking statements. Key risks, including risks associated with Saga’s ability to effectively integrate the stations it acquires and the impact of federal regulation on Saga’s business, are described in the reports Saga Communications, Inc. periodically files with

the U.S. Securities and Exchange Commission. Readers should note that these statements may be impacted by several factors, including national and local economic changes and changes in the radio and television broadcast industry in general, as well as Saga’s actual performance. Results may vary from those stated herein and Saga undertakes no obligation to update the information contained here.

Saga Communications, Inc.
Selected Consolidated Financial Data
For The Three Months Ended
March 31, 2007 and 2006
(amounts in 000’s except per share data)
(Unaudited)

		Three Months Ended
		March 31,
		2007				2006
Operating Results
Net operating revenue		$	31,883			$	31,191
Station operating expense			25,995				24,703
Corporate general and administrative			2,316				1,981
Operating income			3,572				4,507
Interest expense			2,297				2,277
Other expense (income), net			35				(355	)
Income before income tax			1,240				2,585
Income tax expense			500				1,060
Net income		$	740			$	1,525
Earnings per share
Basic		$	0.04			$	0.07
Diluted		$	0.04			$	0.07
Weighted average common shares			20,221				20,480
Weighted average common shares and common shares equivalents			20,242				20,503
Free Cash Flow
Net income		$	740			$	1,525
Plus: Depreciation and amortization:
Station			1,895				1,931
Corporate			47				48
Deferred tax provision			270				460
Non-cash compensation			286				230
Other expense (income), net			35				(355	)
Less: Capital expenditures			(2,414	)			(1,967	)
Free cash flow		$	859			$	1,872
Balance Sheet Data
Working capital		$	18,544			$	24,222
Net fixed assets			74,146				69,621
Net intangible assets and other assets			211,929				206,116
Total assets			318,564				312,061
Long term debt (including current portion of $0 and $0, respectively)			131,911				141,911
Stockholders’ equity			137,306				127,610

Saga Communications, Inc.
Selected Supplemental Financial Data
For the Three Months Ended
March 31, 2007 and 2006
(amounts in 000’s except per share data)
(Unaudited)

		As-Reported								Same Station								Pro Forma (1)
		Three Months Ended								Three Months Ended								Three Months Ended
		March 31,								March 31,								March 31,
		2007				2006				2007				2006				2007				2006
Consolidated
Net operating revenue		$	31,883			$	31,191			$	31,814			$	31,191			$	31,883			$	31,191
Station operating expense			25,995				24,703				25,894				24,703				25,995				24,703
Corporate general and administrative			2,316				1,981				2,316				1,981				2,316				1,981
Operating income			3,572				4,507			$	3,604			$	4,507				3,572				4,507
Interest expense			2,297				2,277												2,297				2,277
Other expense (income), net			35				(355	)											35				(355	)
Income tax expense			500				1,060												500				1,060
Net income		$	740			$	1,525											$	740			$	1,525
Earnings per share:
Basic		$	0.04			$	0.07											$	0.04			$	0.07
Diluted		$	0.04			$	0.07											$	0.04			$	0.07
		As-Reported								Same Station								Pro Forma (1)
		Three Months Ended								Three Months Ended								Three Months Ended
		March 31,								March 31,								March 31,
		2007				2006				2007				2006				2007				2006
Radio Segment
Net operating revenue		$	27,893			$	27,280			$	27,824			$	27,280			$	27,893			$	27,280
Station operating expense			22,513				21,415				22,412				21,415				22,513				21,415
Operating income		$	5,380			$	5,865			$	5,412			$	5,865			$	5,380			$	5,865
		As-Reported								Same Station								Pro Forma (1)
		Three Months Ended								Three Months Ended								Three Months Ended
		March 31,								March 31,								March 31,
		2007				2006				2007				2006				2007				2006
Television Segment
Net operating revenue		$	3,990			$	3,911			$	3,990			$	3,911			$	3,990			$	3,911
Station operating expense			3,482				3,288				3,482				3,288				3,482				3,288
Operating income		$	508			$	623			$	508			$	623			$	508			$	623
		As-Reported								Same Station								Pro Forma (1)
		Three Months Ended								Three Months Ended								Three Months Ended
		March 31,								March 31,								March 31,
		2007				2006				2007				2006				2007				2006
Depreciation and Amortization by Segment
Radio Segment		$	1,506			$	1,539			$	1,473			$	1,539			$	1,506			$	1,539
Television Segment			389				392				389				392				389				392
Corporate and Other			47				48				47				48				47				48
		$	1,942			$	1,979			$	1,909			$	1,979			$	1,942			$	1,979

Saga Communications, Inc.
Selected Supplemental Financial Data
Quarterly Proforma Information
March 31, 2007 and 2006
(amounts in 000’s except per share data)
(Unaudited)

		Pro Forma (1)								Pro Forma (1)				Pro Forma (1)				Pro Forma (1)
		Three Months Ended								Three Months Ended				Three Months Ended				Three Months Ended
		March 31,								June 30,				September 30,				December 31,
		2007				2006				2006				2006				2006
Consolidated
Net operating revenue		$	31,883			$	31,191			$	37,745			$	35,791			$	38,219
Station operating expense			25,995				24,703				26,369				25,761				27,563
Corporate general and administrative			2,316				1,981				2,499				2,225				2,165
Other operating income			—				—				—				—				(312	)
Operating income			3,572				4,507				8,877				7,805				8,803
Interest expense			2,297				2,277				2,355				2,375				2,372
Other expense (income), net			35				(355	)			(215	)			(75	)			145
Income tax expense			500				1,060				2,749				2,241				2,615
Net income		$	740			$	1,525			$	3,988			$	3,264			$	3,671
Earnings per share:
Basic		$	0.04			$	0.07			$	0.19			$	0.16			$	0.18
Diluted		$	0.04			$	0.07			$	0.19			$	0.16			$	0.18

		Pro Forma (1)								Pro Forma (1)				Pro Forma (1)				Pro Forma (1)
		Three Months Ended								Three Months Ended				Three Months Ended				Three Months Ended
		March 31,								June 30,				September 30,				December 31,
		2007				2006				2006				2006				2006
Radio Segment
Net operating revenue		$	27,893			$	27,280			$	33,418			$	31,402			$	33,174
Station operating expense			22,513				21,415				22,960				22,300				23,952
Other operating income			—				—				—				—				(312	)
Operating income		$	5,380			$	5,865			$	10,458			$	9,102			$	9,534

		Pro Forma (1)								Pro Forma (1)				Pro Forma (1)				Pro Forma (1)
		Three Months Ended								Three Months Ended				Three Months Ended				Three Months Ended
		March 31,								June 30,				September 30,				December 31,
		2007				2006				2006				2006				2006
Television Segment
Net operating revenue		$	3,990			$	3,911			$	4,327			$	4,389			$	5,045
Station operating expense			3,482				3,288				3,409				3,461				3,611
Operating income		$	508			$	623			$	918			$	928			$	1,434

		Pro Forma (1)								Pro Forma (1)				Pro Forma (1)				Pro Forma (1)
		Three Months Ended								Three Months Ended				Three Months Ended				Three Months Ended
		March 31,								June 30,				September 30,				December 31,
		2007				2006				2006				2006				2006
Depreciation and Amortization by Segment
Radio Segment		$	1,506			$	1,539			$	1,536			$	1,494			$	1,719
Television Segment			389				392				414				409				458
Corporate and Other			47				48				48				48				50
		$	1,942			$	1,979			$	1,998			$	1,951			$	2,227

Saga Communications, Inc.
Selected Financial Data Non-GAAP Disclosures
For the Three Months Ended
March 31, 2007 and 2006
(amounts in 000’s)
(Unaudited)

Reconciliation of As-Reported (Historical) Information to Same Station Operating Income

						Adjustment												Adjustment
		As-Reported				For Acquisitions				Same Station				As-Reported				For Acquisitions				Same Station
		Three Months				and Dispositions				Three Months				Three Months				and Dispositions				Three Months
		Ended				Not Included in				Ended				Ended				Not Included in				Ended
		March 31,				Entire Comparable				March 31,				March 31,				Entire Comparable				March 31,
		2007				Period				2007				2006				Period				2006
Consolidated
Net operating revenue		$	31,883			$	(69	)		$	31,814			$	31,191				—			$	31,191
Station operating expense			25,995				(101	)			25,894				24,703				—				24,703
Corporate general and administrative			2,316				—				2,316				1,981				—				1,981
Operating income		$	3,572			$	32			$	3,604			$	4,507				—			$	4,507

						Adjustment												Adjustment
		As-Reported				For Acquisitions				Same Station				As-Reported				For Acquisitions				Same Station
		Three Months				and Dispositions				Three Months				Three Months				and Dispositions				Three Months
		Ended				Not Included in				Ended				Ended				Not Included in				Ended
		March 31,				Entire Comparable				March 31,				March 31,				Entire Comparable				March 31,
		2007				Period				2007				2006				Period				2006
Radio Segment
Net operating revenue		$	27,893			$	(69	)		$	27,824			$	27,280				—			$	27,280
Station operating expense			22,513				(101	)			22,412				21,415				—				21,415
Operating income		$	5,380			$	32			$	5,412			$	5,865				—			$	5,865

						Adjustment												Adjustment
		As-Reported				For Acquisitions				Same Station				As-Reported				For Acquisitions				Same Station
		Three Months				and Dispositions				Three Months				Three Months				and Dispositions				Three Months
		Ended				Not Included in				Ended				Ended				Not Included in				Ended
		March 31,				Entire Comparable				March 31,				March 31,				Entire Comparable				March 31,
		2007				Period				2007				2006				Period				2006
Television Segment
Net operating revenue		$	3,990				—			$	3,990			$	3,911				—			$	3,911
Station operating expense			3,482				—				3,482				3,288				—				3,288
Operating income		$	508				—			$	508			$	623				—			$	623