Good morning and welcome to Townsquare’s Fourth Quarter and Year End 2016 Conference Call. As a reminder, today’s call is being recorded and your participation implies consent to such recording. [Operator Instructions] With that, I would like to introduce the first speaker for today’s call, Claire Yenicay, Executive Vice President. Thank you. You may proceed.

Thank you, operator and good morning to everyone. Thank you for joining us today for Townsquare’s year end financial update. Also on the call today are Steven Price, our Chairman and CEO and Stuart Rosenstein, our CFO and Executive Vice President. Please note that during this call, we may make statements that provide information other than historical information, including statements relating to the company’s future prospects. These statements are considered forward-looking statements under the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties that could cause actual results to differ materially from those projections. These statements reflect the company’s beliefs based on current conditions, but are subject to certain risks and uncertainties that are detailed in the company’s annual report on Form 10-K filed with the SEC and we incorporate these by reference for this call. We may also discuss certain non-GAAP financial measures, including adjusted EBITDA and make certain pro forma adjustments. Such non-GAAP financial measures should be used in conjunction with all the information contained in the quarterly and year end reports available on our website. At this time, I would like to turn the call over to Steven Price.

Thank you, Claire. Good morning, everyone and thank you for joining us today. 2016 was another good year for our company. We grew revenue, EBITDA, net income and cash flow and we reduced net leverage by approximately half a turn to less than 5x meeting our year end goal. We reaped the benefits of having a diversified platform as we were able to deliver growth despite weathering some adverse conditions in our Entertainment segment. We made some strong additions to our corporate team and strengthened our local management teams in some of our largest markets. Net revenue for the year increased 3% over the prior year and approximately 2% excluding political and adjusted EBITDA increased 4.1% over the prior year. The fourth quarter marked the 12th consecutive quarter of positive organic revenue growth in our Local Marketing Solutions segment. This quarter, we posted revenue growth of 5.1% over the prior year period. For the full year, our Local Marketing Solutions net revenue increased 5.1% over the prior year on a pro forma basis. Our strong results were driven by the success of our local products and offerings, which offset a drag from our energy markets and national revenue. Looking forward, we feel optimistic about a turnaround in our energy markets, although it’s too soon to tell when that will begin to take hold. While the sentiment in these markets is positive, we haven’t yet seen that turn into revenue improvement. Operationally, we launched some new products in 2016, including individual mobile apps for our stations, with 100 already available today and the remainder being rolled out throughout 2017. We believe it is critical for our audience to have effortless mobile access to all of our stations’ content and our apps provide users the ability not just to listen to the…

Thank you, Steven and good morning everyone. As a reminder, our 2016 results discussed today are on a pro forma basis meaning they are pro forma for all material M&A activity as if they occurred at the beginning of the recording and comparison periods. We had no such transactions in 2016, so the transactions that are relevant to the pro forma results are the acquisition of NAME, which we acquired in September 1, 2015 and the divestiture of 43 of our towers, which was also completed on September 1, 2015. Therefore, there are no pro forma adjustments required in the fourth quarter results of this year. Please refer to the table that we have provided in our earnings release, which provide both GAAP and pro forma results as well as our non-GAAP performance measures. Unless otherwise stated, all of the financial results discussed will be on a pro forma basis for these completed acquisitions. For the quarter ended December 31, 2016, net revenue equaled $119.5 million, up approximately $6.5 million or up 5.8% from the same period of last year. Fourth quarter revenue fell within our previously issued guidance of $117 million to $121 million. For the year ended December 31, 2016, net revenue increased 3% or approximately $14.9 million over the prior year. Local Marketing Solutions net revenue increased by 5.1% in both the fourth quarter and the full year period. This represented an increase of approximately $4.4 million in the fourth quarter and $16.5 million for the full year. Political revenue increased $3.5 million to $5.3 million in the fourth quarter of 2016, slightly exceeding our expectations, but less than the amount booked in the fourth quarter of 2012, the last Presidential election year. For the year, political revenue was $9 million. Excluding political revenue, Local Marketing Solutions…

Thanks Stu and thank you, everyone who dialed in this morning. In summary, we continue to believe in our diversified local strategy and in the long-term trajectory of our business and we feel well positioned going into 2017 to achieve the guidance we laid out. As always, we will be focusing on balancing the proper mix of investments in growth for our business in order to build shareholder value. Today, we also released our annual shareholder letter, which I encourage you all to read. Please do not hesitate to call us with any questions or just to check in. And with that, we are now happy to open the line for questions. Operator, will you please open up the call?

Thank you. We will now be conducting a question-and-answer session. In the interest of time we ask that you please limit yourself to one question and one follow-up and re-queue for any additional questions. [Operator Instructions] Our first question comes from the line of Leo Kulp with RBC Capital Markets. Please proceed with your question.

Okay. Good morning guys. Thanks for taking the question. So first, could you just talk a little bit about what you are seeing in the live events business, are you seeing any changes to the competitive environment in terms of fewer events. And then going forward, from a high level, how are you thinking about the growth profile of the business, is it a low single-digit grower or mid single-digit grower, can it be a high single-digit grower?

Thanks Leo. It’s a little early to say what we see in the environment for live events, because a lot of our live events are in the first quarter, during the second, third and some extent fourth quarter. But from what we have seen in terms of pacing and advanced ticket sales and all that stuff, it seems fine. I don’t see any real change in how people are reacting and what people are planning to do. In terms of growth, if you are thinking growth just in the live events business or overall, we don’t break out in our guidance segments. But if you are asking in general for the live event business, do we think that the growth profile could be low, high or single-digits, I would say yes. I don’t mean it would be strategic, but part of it depends on what events we do if we decided to add events, to test different events. So to some extent, we regulate that a little bit and we balance things. But we see that business as a definite grower and not as a drag. So we are still – the thesis that we had that’s excited about the event businesses and what we can do and the things we can do remains.

Got it. Thanks. And then on Townsquare Interactive, it looks like the growth – your growth in customers there is pretty strong, I know you don’t break it out, but can you talk about the growth profile there and then is that an area that you would look to augment with acquisitions?

Yes, so we haven’t made acquisitions in that area. We have built that organically, as you know. To the extent that we could find interesting acquisitions in that space, we would definitely look there. They tend to be not that many and the ones that are there tend to be expensive. So we have decided to build it organically. But it definitely has been a good, I don’t know, 30% kind of north grower. I mean – and we think that that’s a good – that’s what it was in about ‘16 in terms of subs if you do the math. Listen, our small to mid sized clients not only want to advertise with us, but they also want us to help them with their digital marketing solutions and Townsquare Interactive meets that and is continuing to roll out new products and we are quite bullish in that part of our business.

Got it. Thank you.

Thank you. Our next question comes from the line of Kyle Evans with Stephens. Please proceed with your question.

Hi. Thanks.

Hi Kyle.

Maybe a little commentary on what you are seeing in core radio ad sales so far in 2017? And then I have got a clear follow-up as well.

Okay. So remember, we have talked about it, we don’t break out – so we don’t really look just at radio sales. So we look at in one of our markets. So in Portland, Maine, what are we sell in – what suite of products are we selling to local advertisers and how much money can we get from the local advertiser, how much wallet share. And if they buy a radio ad or a mobile or a video or a digital ad or of course something else, we are happy. And that’s how our sales team is compensated based on sort of wallet share and total revenues and that’s how we think about it. So – and I think that’s probably a more relevant question, is what do we see in the local market. I would say like and I have seen the comments from lots of folks so far who released earnings, we are about the same in the sense that we don’t see any real – any huge difference. Obviously, there was a little bit of uncertainty around the election, which we have talked about on our last call. I think that’s the one. But I wouldn’t say it’s, my God, we are seeing the most unbelievable double digit, triple digit growing or well, this is a disaster, something is going on. I think it’s sort of a pretty nice stable feel. Okay, maybe still we are waiting to see what’s going to happen with the political environment and some of these other things, but it’s an environment where we think we can grow. But I wouldn’t see – say that we would see any real change compared to middle to end of last year.

Thanks. What is – when we look at the guide for the year, what are you thinking – how are you looking at NAME in ‘17 off of ‘16, are you looking – were you looking for that to be flat, up or how should we think about that in our model?

So we are looking for it to grow. Now, we don’t break out individual line items. And that would – that hasn’t been our practice. It’s to give an overall guidance number. But we think NAME will grow. And the season hasn’t started yet. It starts in Miami in a couple of weeks if anyone is going to be at the Dade County Fair, it’s a terrific fair. But it’s still it’s early to say. But we feel good about the prospects for NAME. That hasn’t changed.

Okay. Thank you.

Okay. Thanks Kyle.

Thank you. Our next question comes from the line of Michael Kupinski with Noble Capital Markets. Please proceed with your question.

Thank you. Just have a couple of quick questions here. Just going back to what you stated about festivals, it seems like other mediums, including newspapers, have indicated efforts to grow non-traditional revenue, are these different types of events that you are seeing coming from them or are they – are you just not seeing competition in your markets from these mediums trying to get into this space?

So I haven’t heard any of our local or regional folks say they are seeing new events or increased competition from events done by broadcasters or newspaper companies, I haven’t heard that. That doesn’t mean it doesn’t exist in isolated situations, but I have not heard that from our local or regional folks.

Got it. And I recall that there was a prospect that you would be able to sell some additional towers. Can you give an update on the prospect of doing that?

Yes. I mean we sold many to most of our towers or certainly many or most of the ones that we could monetize at that time. So I think if we do sell any additional towers, I don’t think you will see anything candidly near the same level of purchase – of proceeds. And that’s not something – so the deal we cut with the folks that we sold to was that then they were going to try to – they had the right to go lease up the towers that we kept with some kind of a rev share, obviously, tilted in our favor and to the extent that they got significant rental income on those towers, it’s more likely that then we can go sell that to them and they are in that process now, but I don’t think you are going to see anything from us, etcetera, isolated ones we chose it. Mike by the way, happy birthday.

Thank you so much. I appreciate that. In light of the proposed CBS Entercom transaction, has there been any increased M&A activity or are you seeing anything on that front?

We haven’t seen – I assume you are talking about the small families or smaller groups. Yes, we haven’t seen that at all. We are hoping so, but we have not seen those people say, hey, now is a good time to sell or test the waters or capitulate on price. A lot of those folks you have talked to over the past couple of years, they are feeling pretty good, they are throwing off lots of free cash flow. They won high prices and that’s not something that we are in a position to go do. So while that may change, we haven’t seen that change yet.

Got it. And just on another front, are there any states that you think might be susceptible to an ad tax, any thoughts on the potential impact on your business if you are seeing them in any particular state that might affect you?

To be candid, we haven’t spent a lot of time looking at that issue state-by-state. So I couldn’t really give you a coherent – an answer. I really couldn’t give you an answer on that.

Okay, alright, that’s all I have. Thank you.

Thank you. Our next question comes from the line of Barry Lucas with Gabelli & Company. Please proceed with your question.

Hi good morning Steve, a couple of items. I want to come back to Mike’s question on M&A, you have amended and extended the – or amended the credit agreement, you have got the revolver capacity, as you look around the landscape to some of your more stressed peers, shall we say, what do you think the opportunities might be out of either Cumulus or iHeart [ph] or…?

Alright. Well, I should probably ask you. I would say today, probably not a great opportunity for us in part because of the leverage levels. So if they sold assets and both of them have nice assets that potentially would be interesting to us, if they sold it, those assets, at levels that we could pay, it wouldn’t be deleveraging for them. So I think then they would look at it is a leveraging transaction and not really create an equity value for them. So I am not sure we haven’t seen either of those two companies be willing to entertain serious discussions with us. Now that could change, but we haven’t seen that.

Okay. And as far as your own balance sheet target levels, where you might get more aggressive? Do you have – do you feel you have to get the leverage down into the 4s or?

Yes. I mean, we have said that our near-term target was on a net basis 5x and a mid-term will get down to 4, in the low 4s. But even if we get down to those levels, I don’t think we are going to be so aggressive as to – what do – what we think of as overpaying for assets. So, I mean might we be a little more aggressive? Maybe, but I don’t think our goal will be to get down to and I am making this up, get down to 4x just so we can lever back up to 6x. That’s sort of not the way we are thinking about capital allocation today.

Great. Last there for me, as long as you are wanted to speak about or speak to the local markets, you have some energy markets in North and South Dakota and Texas, and what are you seeing in those communities?

Yes, and in Wyoming. So I’d say talking to our local folks, they feel like it’s going to get better, but they haven’t seen it in the numbers. It’s probably the simplest way – I mean, I can give you three paragraphs, but I would summarize that would be where we would come out. They feel like things are getting better. The sentiment seems to be better in those markets. Prices are going up. There is going to be hopefully – potentially more drill and the like, but they haven’t really seen that in a significant way in terms of the numbers.

Great. Thanks very much for that, Steve.

Okay. Thanks, Barry.

Thank you. [Operator Instructions] Our next question comes from the line of Jim Goss with Barrington Research Associates. Please proceed with your question.

Thank you. I was wondering to the extent that you mentioned the addition of the Arkansas State Fair, which is a fourth quarter event to NAME. Are there other such non-Q3 fairs that you think might be a possibility to target that may not have the professional management that you would bring to the table?

Potentially and we are trying. I mean, the folks – the team at NAME is pretty good at understanding the landscape of fairs, understanding what our geographic footprint is. So, if there was a first quarter fair, but it was in California then that might not be something that makes sense just in terms of getting the team and the equipment out there and then back. It has to route correctly. But yes, we think there are some additional opportunities and the team is focused on those.

The other area where you talked about expanding NAME was to take advantage some of the downtimes to have some individual events. I am just wondering if you have been able to reshape it at all or the characteristics are pretty much what you had bought in the first place?

It’s a combination. I mean, there is – they have a nice routing and nice units that know what they are doing. But as we said, we had tested using some of the downtime to do what we will call self-promoted fair last year. And I think that will continue this year. That’s our plan.

Okay. One other thing you mentioned, Steven, was the music festival area was somewhat challenging. I was wondering what the issue seems to be whether you think they are temporary in nature or something sustainable and how the MSG link might have impacted your efforts in that area?

Yes. So I didn’t – I don’t think I said that today. I think we have said that in the past that last year was challenging and it maybe – and that was really a result of two things. A lot of people starting festivals over the past few years and therefore making it a crowded space, which then does two things. One, it makes it crowded, so you have – people have choices and therefore you may get fewer attendees or you have to lower prices in order to attract them, number one. And number two, talent prices go up, because if you are making up a country music star, you have more choices. There are – and therefore, people bid it up. So – and the live nation and other folks who are in that space of being in a sense the sellers of talent have done a very nice job for them and their clients of doing that. And as that – and we think we saw it last year, as that, I would say, bubble cracks a little and there are fewer festivals, which there will be – we expect there will be this year versus last year then we are somewhat optimistic that those two dynamics will start to move in our favor. So, I don’t think it’s – when we look at it today, it’s not more challenging in ‘17 than it was in ‘16. In fact, we were a little more worried going into ‘16 about the festivals than we are this year, because we didn’t know as many were going to sort of close and it looked a little more ominous in terms of the competitive landscape, but we will see as it moves closer to summer.

Okay and maybe just one last. Okay, thank you.

Sure. Thank you.

And our next question comes from the line of Amy Yong with Macquarie Bank. Please proceed with your question.

Hi, this is Rachel for Amy. Could you please give us an update on the partnership with MSG? Have you realized any near-term venue opportunities or chances for sponsorship or ad cross-selling?

Yes. Actually, I do not think you also mentioned MSG, so I apologize I forgot to address. Listen, as we said last August and September when MSG made the investment, we are excited that they are a shareholder. We remain excited. We talk to them. We bounced off of them. They bounced off of us. So, all that’s positive. I don’t – we are not going to get into specifics how much it’s going to add to the bottom line this year or in the next few years for either us or them. I would say we are talking to them about a handful of projects. We hope some of them come to fruition. Maybe one or two of them this year come to fruition. I am not sure they are not going to have a material effect on our financials certainly in the near term, but there will be nice projects. And they have been helpful, helping us get through some issues. So all-in-all, I am pleased, although I don’t think you will see it significantly in our numbers.

Okay, thanks.

Okay, thank you.

Thank you. There are no further questions at this time. I would like to turn the call back over to Steven Price for closing remarks.

Great. Thank you everybody for joining us early on a Monday. We appreciate it. As you go through the earnings statement in the shareholder letter, if you have any questions, don’t hesitate to contact Claire, Stu, me or anyone else here. Thanks and have a great day.

This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation and have a wonderful day.