Stingray Group (RAY-A) Q4 2024 earnings summary

Executive summary

• Fiscal 2024 revenues rose 6.6% to $345.4M (CAD 345M), driven by strong growth in retail media advertising, FAST channels, and in-car audio entertainment.

• Adjusted EBITDA grew 10.3% to $125.9M, with margin improving to 36.4%, surpassing the 35% target.

• Q4 revenues reached $83.7M, up 6% year-over-year, with Q4 Adjusted EBITDA up 10.7% to $29.4M.

• Net loss of $46.3M in Q4 2024, compared to net income of $4.4M in Q4 2023, due to a one-time non-cash impairment charge of $56.1M on radio segment goodwill.

• Strategic digital segments, including retail media, streaming, and connected cars, are driving organic growth and global expansion.

Financial highlights

• Adjusted EBITDA margin for FY24 was 36.4%–36.5%, up from 35.2%.

• Adjusted net income for Q4 2024 was $15.4M, up from $14.7M in Q4 2023; full-year adjusted net income was $60.3M–$63.7M, up 9.3%–28.7%.

• Cash flow from operations in FY24 was $118.5M, up 36.3%–44% from FY23; adjusted free cash flow up 28.7%–36.3% to $82.0M–$86.9M.

• Strategic growth revenues (digital, FAST, advertising) now represent 61% of total revenue, up from 58% in FY23.

• Net debt to Pro Forma Adjusted EBITDA ratio at 2.76x at year-end, improved from 3.19x.

Outlook and guidance

• Targeting further deleveraging to a net debt to Pro Forma Adjusted EBITDA ratio of 2–2.5 in fiscal 2025.

• Maintaining Adjusted EBITDA margin objective above 35% for 2025, with continued focus on digital and streaming segments.

• Expecting continued strong growth in FAST channels, retail media, and in-car audio entertainment, with Q1 2025 off to a strong start.

• Radio revenues projected to grow 2%–4% in 2025, outperforming a flat industry.

• Continued investment in technology, content, and international expansion to drive future growth.