With Simplified Capital Structure and a Clear Path Forward, North America's Leading Audio Entertainment Company is Well-Positioned to Continue its Transformation
SiriusXM Updates Free Cash Flow Guidance to Reflect the Impact of the Closing of the Liberty Media Transaction
Company Confirms Quarterly Dividend and Announces $1.166 Billion Stock Repurchase Authorization
NEW YORK, Sept. 10, 2024 /PRNewswire/ -- Sirius XM Holdings Inc. (NASDAQ:SIRI) today kicked off a new chapter as an independent public company with a simplified capital structure and strategy for continued success following the closing of its transaction with Liberty Media.
"Today SiriusXM embarks on a new phase in our journey as an independent public company, building on our leading position in audio entertainment," said Jennifer Witz, Chief Executive Officer of SiriusXM. "We've created a strong and profitable business, anchored by a subscription service that fosters deep and loyal connections with our listeners and a growing digital audio advertising platform which extends our reach to fans around the world, and we are excited about the future as we look to expand and strengthen both platforms."
"As we look ahead, we remain committed to three key objectives: enhancing subscriber value with a focus on content, technology and pricing; growing our advertising offerings to both engage new listeners and deliver effective results for advertisers; and driving efficiency across the organization to continue our strong track record of financial performance. We look forward to building upon SiriusXM's twenty-year history as the audio platform of choice for millions of North Americans in their vehicles, at home, and on the go, with the goal of creating long-term value for our stockholders."
Financial UpdateSiriusXM reiterated its full-year 2024 revenue and adjusted EBITDA guidance. As the company has stated in past earnings releases, the company planned to update its free cash flow guidance for transaction impacts. The company estimates these costs to be approximately $200 million and include transaction costs, incremental interest expense related to the debt assumed and incurred in connection with the Liberty Media transaction, and cash outflows at Liberty Sirius XM Holdings Inc. prior to the closing.
"As we enter our next phase as an independent company, we expect SiriusXM to continue delivering solid, profitable results," said Thomas Barry, Chief Financial Officer of SiriusXM. "After completing the transaction, which had the effect of reducing our outstanding common stock by approximately 12% before giving effect to the 1 for 10 adjustment, our capital allocation priorities are consistent: investing in our business, focusing in the near- to mid-term on reducing debt to return to our long-term target leverage, and continuing our capital return posture. In connection with our first day as an independent company, we have reiterated our revenue and adjusted EBITDA guidance and incorporated the impact of the transaction in our updated free cash flow guidance."
The company's 2024 financial guidance is as follows:
Total revenue of approximately $8.75 billion,
Adjusted EBITDA of approximately $2.7 billion, and
Free cash flow of approximately $1.0 billion.
The company's $200 million change to its free cash flow guidance reflects approximately $70 million associated with closing costs and go-forward incremental interest and approximately $130 million associated with historical, year-to-date cash outflows at Liberty Sirius XM Holdings Inc. prior to the closing of the transaction.
Adjusted EBITDA and free cash flow are non-GAAP financial measures. The company has not provided a reconciliation of adjusted EBITDA to projected net income (loss) or free cash flow to net cash provided by operating activities because full-year net income (loss) and net cash provided by operating activities will include special items that have not occurred and are difficult to predict with reasonable certainty prior to year-end. Due to this uncertainty, the company cannot reconcile adjusted EBITDA and free cash flow to their comparable GAAP measures without unreasonable effort.
Capital Return ProgramSiriusXM plans to continue its recurring dividend, which adjusted for the 1 for 10 change in the Liberty Media transaction exchange ratio would be approximately 27 cents per quarter.
Upon completion of the Liberty Media transaction, the Board of SiriusXM authorized a $1.166 billion common stock repurchase program. The $1.166 billion common stock repurchase program is a continuation of the stock repurchase program of the former SiriusXM.
This newly authorized amount represents the amount that remained available under former SiriusXM's $18 billion stock repurchase program that began in December 2012. Shares of common stock may be purchased from time to time on the open market and in privately negotiated transactions, including in accelerated stock repurchase transactions. SiriusXM expects to fund any repurchases through cash on hand, future cash flow from operations and borrowings under its revolving credit facility.
The timing and amount of any shares repurchased will be determined based on SiriusXM's evaluation of market conditions and other factors and the program may be discontinued or suspended at any time. Repurchases will be made in compliance with all SEC rules and other legal requirements and may be ...
