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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the Quarterly Period ended June 30, 2010
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from                      to
 Commission file number 1-11588
 Saga Communications, Inc.
 (Exact name of registrant as specified in its charter)
 Delaware(State or other jurisdiction of 
incorporation or organization)
    
    38-3042953(I.R.S. Employer
Identification No.)73 Kercheval Avenue 
Grosse Pointe Farms, Michigan(Address of principal executive offices)
    
    48236(Zip Code)
 (313) 886-7070  (Registrants telephone number, including area code)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller Reporting Company þ(Do not check if a smaller reporting company)
 o þ




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##### 



INDEX
 PagePART I. FINANCIAL INFORMATION
    
    
    3Item 1. Financial Statements (Unaudited)
    
    
    3Condensed consolidated balance sheets  June 30, 2010 and December 31, 2009
    
    
    3Condensed consolidated statements of income  Three and six months ended June 30, 2010
and 2009
    
    
    4Condensed consolidated statements of cash flows Six months ended June 30, 2010 and 2009
    
    
    5Notes to unaudited condensed consolidated financial statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    12Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    23Item 4. Controls and Procedures
    
    
    24PART II OTHER INFORMATION
    
    
    24Item 1. Legal Proceedings
    
    
    24Item 6. Exhibits
    
    
    24Signatures
    
    
    25EX-31.1EX-31.2EX-32
  2




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PART I  FINANCIAL INFORMATION
 
 Item 1.Financial Statements
 SAGA COMMUNICATIONS, INC.
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 June 30,
    
    
    December 31,2010
    
    
    2009(Unaudited)
    
    
    (Note)(In thousands)AssetsCurrent assets:Cash and cash equivalents
    
    $
    16,047
    
    
    $
    12,899Short-term investments
    
    
    2,005
    
    
    
    Accounts receivable, net
    
    
    19,536
    
    
    
    19,096Prepaid expenses and other current assets
    
    
    1,693
    
    
    
    2,345Barter transactions
    
    
    2,009
    
    
    
    1,681Deferred income taxes
    
    
    831
    
    
    
    873Total current assets
    
    
    42,121
    
    
    
    36,894Property and equipment
    
    
    157,733
    
    
    
    158,011Less accumulated depreciation
    
    
    90,403
    
    
    
    88,795Net property and equipment
    
    
    67,330
    
    
    
    69,216Other assets:Broadcast licenses, net
    
    
    90,552
    
    
    
    90,552Other intangibles, deferred costs and investments, net
    
    
    6,402
    
    
    
    5,689Total other assets
    
    
    96,954
    
    
    
    96,241$
    206,405
    
    
    $
    202,351Liabilities and stockholders equityCurrent liabilities:Accounts payable
    
    $
    1,498
    
    
    $
    1,345Payroll and payroll taxes
    
    
    6,686
    
    
    
    5,494Other accrued expenses
    
    
    3,894
    
    
    
    3,422Barter transactions
    
    
    2,071
    
    
    
    1,802Current portion of long-term debt
    
    
    17,278
    
    
    
    17,078Total current liabilities
    
    
    31,427
    
    
    
    29,141Deferred income taxes
    
    
    4,062
    
    
    
    1,907Long-term debt
    
    
    96,300
    
    
    
    104,000Other liabilities
    
    
    3,061
    
    
    
    3,210Stockholders equityCommon stock
    
    
    53
    
    
    
    53Additional paid-in capital
    
    
    49,899
    
    
    
    49,371Retained earnings
    
    
    50,076
    
    
    
    43,064Treasury stock
    
    
    (28,473
    )
    
    
    (28,395
    )Total stockholders equity
    
    
    71,555
    
    
    
    64,093$
    206,405
    
    
    $
    202,351
 
 Note: The balance sheet at December 31, 2009 has been derived from the audited financial statements
at that date but does not include all of the information and footnotes required by accounting
principles generally accepted in the United States for complete financial statements.
  3




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SAGA COMMUNICATIONS, INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF INCOME
 Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009(Unaudited)(In thousands, except per share data)Net operating revenue
    
    $
    32,887
    
    
    $
    31,637
    
    
    $
    60,874
    
    
    $
    57,761Station operating expense
    
    
    23,157
    
    
    
    23,295
    
    
    
    45,717
    
    
    
    47,235Corporate general and administrative
    
    
    1,897
    
    
    
    2,158
    
    
    
    3,779
    
    
    
    4,225Operating income
    
    
    7,833
    
    
    
    6,184
    
    
    
    11,378
    
    
    
    6,301Other expenses, net:Interest expense
    
    
    1,468
    
    
    
    1,430
    
    
    
    2,987
    
    
    
    2,203Other (income) expense, net
    
    
    185
    
    
    
    (28
    )
    
    
    (3,411
    )
    
    
    (32
    )Income before income tax
    
    
    6,180
    
    
    
    4,782
    
    
    
    11,802
    
    
    
    4,130Income tax provision
    
    
    2,485
    
    
    
    2,108
    
    
    
    4,790
    
    
    
    1,818Net income
    
    $
    3,695
    
    
    $
    2,674
    
    
    $
    7,012
    
    
    $
    2,312Earnings per shareBasic
    
    $
    .87
    
    
    $
    .63
    
    
    $
    1.66
    
    
    $
    .55Diluted
    
    $
    .87
    
    
    $
    .63
    
    
    $
    1.66
    
    
    $
    .55Weighted average common shares
    
    
    4,236
    
    
    
    4,226
    
    
    
    4,229
    
    
    
    4,192Weighted average common and common equivalent shares
    
    
    4,237
    
    
    
    4,227
    
    
    
    4,229
    
    
    
    4,193
  4




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SAGA COMMUNICATIONS, INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 Six  Months EndedJune 30,2010
    
    
    2009(Unaudited)(In thousands)Cash flows from operating activities:Cash provided by operating activities
    
    $
    12,826
    
    
    $
    12,001Cash flows from investing activities:Acquisition of property and equipment
    
    
    (2,146
    )
    
    
    (2,574
    )Proceeds from license downgrade
    
    
    3,561
    
    
    
    Purchases of short-term investments
    
    
    (2005
    )
    
    
    Other investing activities
    
    
    (7
    )
    
    
    302Net cash used in investing activities
    
    
    (597
    )
    
    
    (2,272
    )Cash flows from financing activities:Payments on long-term debt
    
    
    (7,500
    )
    
    
    (2,000
    )Payments for debt issuance costs
    
    
    (1,503
    )
    
    
    (967
    )Purchase of shares held in treasury
    
    
    (78
    )
    
    
    (20
    )Other financing activities
    
    
    
    
    
    
    2Net cash used in financing activities
    
    
    (9,081
    )
    
    
    (2,985
    )Net increase in cash and cash equivalents
    
    
    3,148
    
    
    
    6,744Cash and cash equivalents, beginning of period
    
    
    12,899
    
    
    
    6,992Cash and cash equivalents, end of period
    
    $
    16,047
    
    
    $
    13,736
  5




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SAGA COMMUNICATIONS, INC.
 
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 1. Summary of Significant Accounting Policies
 Basis of Presentation
     Earnings Per Share Information
  Three Months Ended June 30,
    
    
    Six Months Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009(In thousands, except per share data)Numerator:Net income available to common stockholders
    
    $
    3,695
    
    
    $
    2,674
    
    
    $
    7,012
    
    
    $
    2,312Denominator:Denominator for basic earnings per
share-weighted average shares
    
    
    4,236
    
    
    
    4,226
    
    
    
    4,229
    
    
    
    4,192Effect of dilutive securities:Common stock equivalents
    
    
    1
    
    
    
    1
    
    
    
    
    
    
    
    1Denominator for diluted earnings per share
 adjusted weighted-average shares and
assumed conversions
    
    
    4,237
    
    
    
    4,227
    
    
    
    4,229
    
    
    
    4,193Basic earnings per share
    
    $
    0.87
    
    
    $
    .63
    
    
    $
    1.66
    
    
    $
    .55Diluted earnings per share
    
    $
    0.87
    
    
    $
    .63
    
    
    $
    1.66
    
    
    $
    .55
  6




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SAGA COMMUNICATIONS, INC.
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)
 Change in Accounting Estimate
  Fair Value of Financial Instruments
  Income Taxes
  Time Brokerage Agreements
  2. Recent Accounting Pronouncements
   7




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SAGA COMMUNICATIONS, INC.
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)
 3. Intangible Assets
 st
  4. Common Stock and Treasury Stock
  Common Stock IssuedClass A
    
    
    Class B(Shares in thousands)Balance, January 1, 2009
    
    
    4,770
    
    
    
    600Exercised options
    
    
    2
    
    
    
    Conversion of shares
    
    
    1
    
    
    
    (1
    )Forfeiture of restricted stock.
    
    
    (2
    )
    
    
    Balance, December 31, 2009
    
    
    4,771
    
    
    
    599Conversion of shares
    
    
    1
    
    
    
    (1
    )Balance, June 30, 2010
    
    
    4,772
    
    
    
    598
  5. Stock-Based Compensation
 2005 Incentive Compensation Plan
  Stock-Based Compensation
  8




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SAGA COMMUNICATIONS, INC.
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)
  Weighted AverageRemaining
    
    
    AggregateNumber of
    
    
    Weighted Average
    
    
    Contractual Term
    
    
    IntrinsicOptions
    
    
    Exercise Price
    
    
    (Years)
    
    
    ValueOutstanding at January 1, 2010
    
    
    388,469
    
    
    $
    54.56
    
    
    
    4.2
    
    
    $
    Granted
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    Expired
    
    
    (40,712
    )
    
    
    66.97Forfeited
    
    
    (320
    )
    
    
    37.25Outstanding at June 30, 2010
    
    
    347,437
    
    
    $
    53.12
    
    
    
    4.2
    
    
    $
    Exercisable at June 30, 2010
    
    
    308,957
    
    
    $
    55.16
    
    
    
    3.9
    
    
    $
    
  Weighted AverageNumber of
    
    
    Grant Date FairOptions
    
    
    ValueNon-vested at January 1, 2010
    
    
    80,453
    
    
    $
    19.74Granted
    
    
    
    
    
    
    Vested
    
    
    (41,653
    )
    
    
    20.88Forfeited/canceled
    
    
    (320
    )
    
    
    18.81Non-vested at June 30, 2010
    
    
    38,480
    
    
    $
    18.51The following summarizes the restricted stock transactions for the six months ended June 30,
2010:WeightedAverageGrant DateShares
    
    
    Fair ValueOutstanding at January 1, 2010
    
    
    37,368
    
    
    $
    31.45Granted
    
    
    
    
    
    
    Vested
    
    
    (14,097
    )
    
    
    35.92Forfeited
    
    
    (212
    )
    
    
    28.47Non-vested and outstanding at June 30, 2010
    
    
    23,059
    
    
    $
    28.74
  9




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SAGA COMMUNICATIONS, INC.
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)
 6. Long-Term Debt
  June 30,
    
    
    December 31,2010
    
    
    2009(In thousands)Credit Agreement:Reducing revolver facility
    
    $
    112,500
    
    
    $
    120,000Secured debt of affiliate
    
    
    1,078
    
    
    
    1,078113,578
    
    
    
    121,078Amounts payable within one year
    
    
    17,278
    
    
    
    17,078$
    96,300
    
    
    $
    104,000
      10




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SAGA COMMUNICATIONS, INC.
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)
 7. Segment Information
   CorporateRadio
    
    
    Television
    
    
    and Other
    
    
    Consolidated(In thousands)Three Months Ended June 30, 2010:Net operating revenue
    
    $
    28,661
    
    
    $
    4,226
    
    
    $
    
    
    
    $
    32,887Station operating expense
    
    
    19,827
    
    
    
    3,330
    
    
    
    
    
    
    
    23,157Corporate general and administrative
    
    
    
    
    
    
    
    
    
    
    1,897
    
    
    
    1,897Operating income (loss)
    
    $
    8,834
    
    
    $
    896
    
    
    $
    (1,897
    )
    
    $
    7,833Depreciation and amortization
    
    $
    1,444
    
    
    $
    409
    
    
    $
    54
    
    
    $
    1,907
 CorporateRadio
    
    
    Television
    
    
    and Other
    
    
    Consolidated(In thousands)Three Months Ended June 30, 2009:Net operating revenue
    
    $
    27,530
    
    
    $
    4,107
    
    
    $
    
    
    
    $
    31,637Station operating expense
    
    
    19,694
    
    
    
    3,601
    
    
    
    
    
    
    
    23,295Corporate general and administrative
    
    
    
    
    
    
    
    
    
    
    2,158
    
    
    
    2,158Operating income (loss)
    
    $
    7,836
    
    
    $
    506
    
    
    $
    (2,158
    )
    
    $
    6,184Depreciation and amortization
    
    $
    1,516
    
    
    $
    664
    
    
    $
    48
    
    
    $
    2,228
 CorporateRadio
    
    
    Television
    
    
    and Other
    
    
    Consolidated(In thousands)Six Months Ended June 30, 2010:Net operating revenue
    
    $
    52,805
    
    
    $
    8,069
    
    
    $
    
    
    
    $
    60,874Station operating expense
    
    
    39,050
    
    
    
    6,667
    
    
    
    
    
    
    
    45,717Corporate general and administrative
    
    
    
    
    
    
    
    
    
    
    3,779
    
    
    
    3,779Operating income (loss)
    
    $
    13,755
    
    
    $
    1,402
    
    
    $
    (3,779
    )
    
    $
    11,378Depreciation and amortization
    
    $
    2,865
    
    
    $
    833
    
    
    $
    106
    
    
    $
    3,804Total assets
    
    $
    154,157
    
    
    $
    26,357
    
    
    $
    25,891
    
    
    $
    206,405
 CorporateRadio
    
    
    Television
    
    
    and Other
    
    
    Consolidated(In thousands)Six Months Ended June 30, 2009:Net operating revenue
    
    $
    50,227
    
    
    $
    7,534
    
    
    $
    
    
    
    $
    57,761Station operating expense
    
    
    40,011
    
    
    
    7,224
    
    
    
    
    
    
    
    47,235Corporate general and administrative
    
    
    
    
    
    
    
    
    
    
    4,225
    
    
    
    4,225Operating income (loss)
    
    $
    10,216
    
    
    $
    310
    
    
    $
    (4,225
    )
    
    $
    6,301Depreciation and amortization
    
    $
    3,047
    
    
    $
    1,330
    
    
    $
    109
    
    
    $
    4,486Total assets
    
    $
    176,136
    
    
    $
    30,032
    
    
    $
    17,814
    
    
    $
    223,982
 11




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Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of
Operations
 Results of Operations
   General
  Radio Segment
      12




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® ® ®
 13




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Percentage of Consolidated
    
    
    Percentage of ConsolidatedNet Operating Revenue for
    
    
    Net Operating Revenuethe Six Months Ended
    
    
    for the Years EndedJune 30,
    
    
    December 31,2010
    
    
    2009
    
    
    2009
    
    
    2008Market:Bellingham, Washington
    
    
    5%
    
    
    
    5%
    
    
    
    5%
    
    
    
    5%Des Moines, Iowa
    
    
    6%
    
    
    
    7%
    
    
    
    7%
    
    
    
    7%Manchester, New Hampshire
    
    
    6%
    
    
    
    5%
    
    
    
    5%
    
    
    
    6%Milwaukee, Wisconsin
    
    
    13%
    
    
    
    14%
    
    
    
    13%
    
    
    
    14%
   Percentage of Consolidated
    
    
    Percentage of ConsolidatedStation Operating Income (*)
    
    
    Station Operating Income(*)for the Six Months Ended
    
    
    for the Years EndedJune 30,
    
    
    December 31,2010
    
    
    2009
    
    
    2009
    
    
    2008Market:Bellingham, Washington
    
    
    6%
    
    
    
    7%
    
    
    
    7%
    
    
    
    7%Des Moines, Iowa
    
    
    5%
    
    
    
    7%
    
    
    
    7%
    
    
    
    4%Manchester, New Hampshire
    
    
    8%
    
    
    
    8%
    
    
    
    7%
    
    
    
    11%Milwaukee, Wisconsin
    
    
    19%
    
    
    
    22%
    
    
    
    20%
    
    
    
    20%
 
 *
    
    Operating income (excluding non-cash impairment charge) plus corporate general and
administrative expenses, depreciation and amortization, less gain on asset exchange. 14




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Television Segment
          15




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Three Months Ended June 30, 2010 Compared to Three Months Ended June 30, 2009
 Results of Operations
  Consolidated Results of Operations
 Three Months EndedJune 30,
    
    
    $ Increase
    
    
    % Increase2010
    
    
    2009
    
    
    (Decrease)
    
    
    (Decrease)(In thousands, except percentages and per share information)Net operating revenue
    
    $
    32,887
    
    
    $
    31,637
    
    
    $
    1,250
    
    
    
    4.0
    %Station operating expense
    
    
    23,157
    
    
    
    23,295
    
    
    
    (138
    )
    
    
    (0.6
    )%Corporate G&A
    
    
    1,897
    
    
    
    2,158
    
    
    
    (261
    )
    
    
    (12.1
    )%Operating income
    
    
    7,833
    
    
    
    6,184
    
    
    
    1,649
    
    
    
    26.7
    %Interest expense
    
    
    1,468
    
    
    
    1,430
    
    
    
    38
    
    
    
    2.7
    %Other  (income) expense, net
    
    
    185
    
    
    
    (28
    )
    
    
    213
    
    
    
    N/MIncome taxes
    
    
    2,485
    
    
    
    2,108
    
    
    
    377
    
    
    
    17.9
    %Net income
    
    $
    3,695
    
    
    $
    2,674
    
    
    $
    1,021
    
    
    
    38.2
    %Earnings per share (basic and diluted)
    
    $
    .87
    
    
    $
    .63
    
    
    $
    .24
    
    
    
    38.1
    %Radio Broadcasting SegmentThree Months EndedJune 30,
    
    
    $ Increase
    
    
    % Increase2010
    
    
    2009
    
    
    (Decrease)
    
    
    (Decrease)(In thousands, except percentages)Net operating revenue
    
    $
    28,661
    
    
    $
    27,530
    
    
    $
    1,131
    
    
    
    4.1
    %Station operating expense
    
    
    19,827
    
    
    
    19,694
    
    
    
    133
    
    
    
    0.7
    %Operating income
    
    $
    8,834
    
    
    $
    7,836
    
    
    $
    998
    
    
    
    12.7
    %
 Television Broadcasting Segment
 Three Months EndedJune 30,
    
    
    $ Increase
    
    
    % Increase2010
    
    
    2009
    
    
    (Decrease)
    
    
    (Decrease)(In thousands, except percentages)Net operating revenue
    
    $
    4,226
    
    
    $
    4,107
    
    
    $
    119
    
    
    
    2.9
    %Station operating expense
    
    
    3,330
    
    
    
    3,601
    
    
    
    (271
    )
    
    
    (7.5
    )%Operating income
    
    $
    896
    
    
    $
    506
    
    
    $
    390
    
    
    
    77.2
    %
 
 N/M = Not Meaningful 16




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Reconciliation of segment operating income to consolidated operating income:
 CorporateRadio
    
    
    Television
    
    
    and Other
    
    
    Consolidated(In thousands)Three Months Ended June 30, 2010:Net operating revenue
    
    $
    28,661
    
    
    $
    4,226
    
    
    $
    
    
    
    $
    32,887Station operating expense
    
    
    19,827
    
    
    
    3,330
    
    
    
    
    
    
    
    23,157Corporate general and administrative
    
    
    
    
    
    
    
    
    
    
    1,897
    
    
    
    1,897Operating income (loss)
    
    $
    8,834
    
    
    $
    896
    
    
    $
    (1,897
    )
    
    $
    7,833
 CorporateRadio
    
    
    Television
    
    
    and Other
    
    
    Consolidated(In thousands)Three Months Ended June 30, 2009:Net operating revenue
    
    $
    27,530
    
    
    $
    4,107
    
    
    $
    
    
    
    $
    31,637Station operating expense
    
    
    19,694
    
    
    
    3,601
    
    
    
    
    
    
    
    23,295Corporate general and administrative
    
    
    
    
    
    
    
    
    
    
    2,158
    
    
    
    2,158Operating income (loss)
    
    $
    7,836
    
    
    $
    506
    
    
    $
    (2,158
    )
    
    $
    6,184
 Consolidated
     17




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##### Table of Contents



Radio Segment
    Television Segment
    18




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##### Table of Contents



Six Months Ended June 30, 2010 Compared to Six Months Ended June 30, 2009
 Results of Operations
  Consolidated Results of Operations
 Six Months EndedJune 30,
    
    
    $ Increase
    
    
    % Increase2010
    
    
    2009
    
    
    (Decrease)
    
    
    (Decrease)(In thousands, except percentages and per share information)Net operating revenue
    
    $
    60,874
    
    
    $
    57,761
    
    
    $
    3,113
    
    
    
    5.4
    %Station operating expense
    
    
    45,717
    
    
    
    47,235
    
    
    
    (1,518
    )
    
    
    (3.2
    )%Corporate G&A
    
    
    3,779
    
    
    
    4,225
    
    
    
    (446
    )
    
    
    (10.6
    )%Operating income
    
    
    11,378
    
    
    
    6,301
    
    
    
    5,077
    
    
    
    80.6
    %Interest expense
    
    
    2,987
    
    
    
    2,203
    
    
    
    784
    
    
    
    35.6
    %Other (income) expense, net
    
    
    (3,411
    )
    
    
    (32
    )
    
    
    (3,379
    )
    
    
    N/MIncome taxes
    
    
    4,790
    
    
    
    1,818
    
    
    
    2,972
    
    
    
    163.5
    %Net income
    
    $
    7,012
    
    
    $
    2,312
    
    
    $
    4,700
    
    
    
    203.3
    %Earnings per share (basic and diluted)
    
    $
    1.66
    
    
    $
    .55
    
    
    $
    1.11
    
    
    
    201.8
    %
 Radio Broadcasting Segment
 Six Months EndedJune 30,
    
    
    $ Increase
    
    
    % Increase2010
    
    
    2009
    
    
    (Decrease)
    
    
    (Decrease)(In thousands, except percentages)Net operating revenue
    
    $
    52,805
    
    
    $
    50,227
    
    
    $
    2,578
    
    
    
    5.1
    %Station operating expense
    
    
    39,050
    
    
    
    40,011
    
    
    
    (961
    )
    
    
    (2.4
    )%Operating income
    
    $
    13,755
    
    
    $
    10,216
    
    
    $
    3,539
    
    
    
    34.6
    %
 Television Broadcasting Segment
 Six Months EndedJune 30,
    
    
    $ Increase
    
    
    % Increase2010
    
    
    2009
    
    
    (Decrease)
    
    
    (Decrease)(In thousands, except percentages)Net operating revenue
    
    $
    8,069
    
    
    $
    7,534
    
    
    $
    535
    
    
    
    7.1
    %Station operating expense
    
    
    6,667
    
    
    
    7,224
    
    
    
    (557
    )
    
    
    (7.7
    )%Operating income
    
    $
    1,402
    
    
    $
    310
    
    
    $
    1,092
    
    
    
    352.3
    %
 
 N/M = Not Meaningful 19




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##### Table of Contents



Reconciliation of segment operating income to consolidated operating income:
 CorporateRadio
    
    
    Television
    
    
    and Other
    
    
    Consolidated(In thousands)Six Months Ended June 30, 2010:Net operating revenue
    
    $
    52,805
    
    
    $
    8,069
    
    
    $
    
    
    
    $
    60,874Station operating expense
    
    
    39,050
    
    
    
    6,667
    
    
    
    
    
    
    
    45,717Corporate general and administrative
    
    
    
    
    
    
    
    
    
    
    3,779
    
    
    
    3,779Operating income (loss)
    
    $
    13,755
    
    
    $
    1,402
    
    
    $
    (3,779
    )
    
    $
    11,378
 CorporateRadio
    
    
    Television
    
    
    and Other
    
    
    Consolidated(In thousands)Six Months Ended June 30, 2009:Net operating revenue
    
    $
    50,227
    
    
    $
    7,534
    
    
    $
    
    
    
    $
    57,761Station operating expense
    
    
    40,011
    
    
    
    7,224
    
    
    
    
    
    
    
    47,235Corporate general and administrative
    
    
    
    
    
    
    
    
    
    
    4,225
    
    
    
    4,225Operating income (loss)
    
    $
    10,216
    
    
    $
    310
    
    
    $
    (4,225
    )
    
    $
    6,301
 Consolidated
     20




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##### Table of Contents



Radio Segment
    Television Segment
    21




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##### Table of Contents



Forward-Looking Statements
   Liquidity and Capital Resources
 Debt Arrangements and Debt Service Requirements
       22




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##### Table of Contents



Sources and Uses of Cash
   Summary Disclosures About Contractual Obligations and Commercial Commitments
   Critical Accounting Policies and Estimates
  Inflation
  
 Item 3.Quantitative and Qualitative Disclosures about Market Risk
  23




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##### Table of Contents



Item 4.Controls and Procedures
  
 PART II  OTHER INFORMATION
 
 Item 1.Legal Proceedings
  
 Item 6.Exhibits
 31.1
    
    Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the
Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.
 31.2
    
    Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the
Securities Exchange Act1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
 32
    
    Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C.
Section 1350 and Rule 13-14(b) of the Securities Exchange Act of 1934, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
 24




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##### Table of Contents



SIGNATURES
  SAGA COMMUNICATIONS, INCDate: August 16, 2010
    /s/ SAMUEL D. BUSHSamuel D. BushSenior Vice President, Chief Financial Officer and
Treasurer (Principal Financial Officer)Date: August 16, 2010
    /s/ CATHERINE A. BOBINSKICatherine A. BobinskiVice President, Corporate Controller and Chief
Accounting Officer (Principal Accounting Officer) 25