Greetings, and welcome to the Entravision Communications Corporation's third quarter 2021 earnings conference call. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Kimberly Esterkin of investor relations. Thank you. You may begin..

Thank you, operator. Good afternoon, everyone, and welcome to Entravision's 2021 third quarter earnings conference call. I hope everyone is staying healthy and safe. Joining me on the call today is Walter Ulloa, chairman and chief executive officer; and Chris Young, chief financial officer.

Before we begin, I must inform you that this conference call will contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ. Please refer to Entravision's SEC filings for a list of risks and uncertainties that could impact the actual results.

This call is the property of Entravision Communications Corporation. Any redistribution, retransmission or rebroadcast of this call in any form without the expressed written consent of Entravision Communications Corporation is strictly prohibited..

Thank you, Kimberly, and good afternoon, everyone. We appreciate you joining us for Entravision's third quarter 2021 earnings call. Entravision's business continues to perform very strongly, and the third quarter was no exception. We are proud to see growth across all of our core businesses with digital, in particular, our shining star.

Digital has comfortably become the vast majority of our revenue, representing 73% of total revenue in the third quarter as we evolve our business to become a global digital media powerhouse.

Speaking of evolving our digital business just today, we announced the acquisition of 365 Digital, a digital marketing solutions company headquartered in South Africa.

We are very excited about this acquisition, which marks our third digital acquisition within the last 13 months, and I'll speak more about our digital growth and strategy later on the call. But first, let's begin with the consolidated results for the third quarter. Net revenue for the third quarter totaled $199 million, up 216% year-over-year.

On a pro forma basis, including Cisneros Interactive and MediaDonuts in our prior year results, revenue increased 60% over the third quarter of 2020. Growth during the quarter was largely driven by our digital business, as well as the continued sequential and year-over-year improvements of our core television and audio businesses.

For the nine months ended September 30, revenue totaled $526.3 million, up 205% compared to the same period in 2020. Similar to the quarter, year-to-date revenues benefited from the continued sequential and year-over-year improvements of all three business segments with digital leading the way.

Adjusted EBITDA totaled $23.2 million for the third quarter, up 42% year-over-year. On a pro forma basis, accounting for Cisneros Interactive and MediaDonuts, adjusted EBITDA increased 17% year-over-year.

We have been able to maintain many of the cost reductions put in place at the beginning of the pandemic, while at the same time, improving top line results to help drive our incredibly strong EBITDA growth. Now, let's take a look at our segment performance.

Digital revenue totaled $146.1 million for the third quarter, more than 10 times higher than the $13.7 million generated in the prior year period. Digital revenue represented 73% of total revenue for the company in the third quarter.

Along with strong organic growth, the primary drivers of this improvement was our acquisition of a majority interest in Cisneros Interactive in the fourth quarter of 2020, which became wholly owned during the third quarter of 2021, and our acquisition of MediaDonuts at the beginning of the third quarter.

On a pro forma basis, our digital revenue increased 95% compared to the prior year period. As I just noted, at the end of August, we officially acquired the remaining 49% interest in Cisneros Interactive and now own 100% of the company.

Cisneros Interactive maintained sales partnerships with major technology platforms like Facebook, Spotify and Linkedin in Latin America. The business has been performing extremely well. And as a result, Entravision has become a dominant digital player in Latin America.

Our digital business is now focused on a combination of top tier global audience and media representations, programmatic technology and local digital solutions, such as El Boton, our digital audio app, which includes all of our radio broadcast shows, talents and podcasts that streamed over 3.5 million downloads per month during the third quarter.

Speaking of other digital solutions, additional growth drivers of digital revenue in the third quarter included Smadex, our global mobile programmatic user acquisition and Performance business unit headquartered in Barcelona, which grew its revenue of 56%, compared to the third quarter of 2020 and our US local market and solutions business, which was up 45% in Q3 2021 versus Q3 2020.

Including our recent acquisition of MediaDonuts, our digital segment now serves more than 1,400 clients each month in more than 30 countries, with campaigns running in over 120 countries. With the MediaDonuts addition, we are now becoming a successful digital player in Southeast Asia, particularly with Twitter and TikTok.

The integration of MediaDonuts is going well as most of the heavy lifting to integrate their back office has been completed. Now, let's turn to our television segment, which comprised roughly 18% of revenue for the third quarter.

Television revenue was $36.5 million for Q3, down 4% compared to the prior year period, primarily due to a decrease in political revenue, partially offset by increases in the local and national advertising revenue.

Excluding $4.9 million political spend in Q3 2020 related to the presidential election and $400,000 of political spend in Q3 2021 related to the California recall election, core television advertising increased 15% with national advertising revenue increasing 5% and local advertising revenue up 25% year-over-year.

When comparing Q3 2021, total television revenue with pre COVID Q3 2019 results, TV revenue finished flat in Q3 2021 versus Q3 2019. The auto category and in particular, new car sales, continues to face supply chain pressures related to the international supply of electronic chips.

While consumer demand for cars remain strong, the availability of new cars is being impacted by delays in production. And so, television, auto ad sales were down 9% in the third quarter as compared to the prior year period. Offsetting these declines, services were up 9%, and healthcare was up 1% in Q3 compared to the last year same period.

Retail, restaurants, travel and leisure, all also grew in the quarter, assisted by overall improving macro conditions and the rollout of the vaccine. Turning to our rating performance. Our Univision television affiliates built upon their market leadership in September 2021.

For adults 18 to 49 in early local news, our Univision television stations finished ahead of the Telemundo competition in 11 of 17 markets where we have head-to-head competition, plus three ties.

In late local news, we finished ahead of Telemundo competitors among adults 18 to 49 in nine markets, along the 17 markets where we have head-to-head competition, plus two ties.

The CONCACAF Gold Cup tournament rounded up the summary of soccer on our Univision and UniMas television stations, the final match between the United States and Mexico, national teams delivered impressive ratings.

The game ranked Number One or Number Two for the time period among all local broadcast stations in 13 of our markets among adults 18 to 49 and adults 25 to 54, outperforming the NBC Summer Olympics. Finally, let's turn to our audio segment, which comprised the remaining 9% of our third quarter revenue.

Audio revenue totaled $16.4 million for the third quarter, a sizable increase of 42% year-over-year. Local audio revenue increased 39% year-over-year, while national audio revenue was up 47% year-over-year.

Excluding political spend of $1.2 million in Q3 2020 related to the presidential election and $600,000 of political spend in Q3 2021 related to the California recall election, core radio revenue increased 54% versus the third quarter of 2020.

When comparing Q3 2021 total audio revenue with pre-COVID Q3 2019 results, audio revenue grew 11% in Q3 2021 versus Q3 2019. The execution across our radio business could not be stronger.

With the addition of our executive vice president of national sales, Chris Munoz in June of 2020, we reorganized our operations, streamlined our client base and positioned the radio segment for improved top and bottom line performance. This business was breakeven just two years ago, and we are now seeing record gross margins of 41%.

Now, let's look at more specifics of the radio segment's performance for the third quarter. In our Number One market for Los Angles radio cluster revenue increased 64%, compared to last year, while also updating our 2019 ad revenue performance by 23%.

For the first nine months of 2021, the Entravision Los Angeles radio cluster outperformed the total market by 24%, a remarkable achievement. In the 11 markers where we subscribe to Miller Kaplan data for total spot revenue, we outperformed the market by 10% in total revenue combined.

We outperformed the total market in seven of the 11 markets to which we subscribe to Miller Kaplan. In terms of advertising categories, we saw growth in nine of our top 10 categories. Services remained our largest category, representing 36% of total audio revenue. Services improved 37% year-over-year.

And healthcare, our fifth largest category, was up 52% as compared to the prior year period. Other ad categories, we saw growth included restaurants, which improved 44%; retail, which improved 32%, and travel and leisure, which improved 712% all on a year-over-year basis.

The other category saw an increase of 19%, compared to the third quarter of 2020 based on increased audio ad spending by local car dealerships, despite the supply chain issues I discussed earlier.

Looking at our radio division ratings performance for summer 2021 among Spanish language radio stations, the Erazno y La Chokolata show is ranked Number One in eight of our nine markets released for summer among Hispanic adults 18 to 49 and Hispanic adults 25 to 54, including ties.

Across our nine O&O stations, the Erazno y La Chokolata a show reached more than 522,000 Hispanic adults 18 to 49. In summary, Entravision had another fantastic quarter, positioning us well for the final three months of the year.

Before speaking further, I will turn the call over to Chris Young, our CFO, to discuss our third quarter 2021 financial performance and our fourth quarter 2021 pacings.

Chris?.

Thanks, Walter, and good afternoon, everyone. As Walter discussed revenue for the third quarter 2021 totaled $199 million, an increase of 216% from the third quarter of 2020. When comparing on a pro forma basis and including Cisneros Interactive and MediaDonuts revenue in our 2020 results, revenue increased 60% over the prior year period.

For our digital division, revenue totaled $146.1 million, up over 10 fold over last year. When compared on a pro forma basis, including Cisneros Interactive and MediaDonuts revenue in our 2020 results, digital revenue increased 95% over the prior year period. For our TV division, total revenue was $36.5 million, down 4% year-over-year.

Excluding political, core ad and spectrum related revenue was up 15% year-over-year. Retransmission revenue for the quarter totaled $9.1 million, which was flat year-over-year. Lastly, for our audio division, revenue totaled $16.4 million, up 42% over the prior year period excluding political, core audio revenue was up 54% over Q3 of last year.

Now, let's turn to expenses. Direct operating expenses totaled $28.6 million for Q3 of 2021, up 18% from $24.2 million in Q3 of 2020. And excluding the Cisneros and MediaDonuts acquisitions, direct expenses were up 6% over the prior year period.

SG&A expenses were $14.5 million for the quarter, an increase of 47%, compared to $9.9 million in the year-ago period. Excluding the Cisneros and MediaDonuts acquisitions related SG&A, SG&A expenses were up 12% compared to the prior year quarter.

Finally, corporate expenses increased by 15% to total $7.3 million for the quarter, compared to $6.3 million in the same quarter of last year. The primary drivers of corporate expense increases were salaries and noncash comp expenses. During the third quarter, our share buyback remained on hold.

We also maintained our dividend at $0.025 per share and continue to eliminate expenses at the operating and corporate levels deemed secondary to serving our core businesses. We will continue to evaluate our buyback and at end each quarter, which will be at the discretion of our board of directors.

Consolidated adjusted EBITDA totaled $23.2 million for the third quarter, compared to $16.4 million in the third quarter of last year. On a pro forma basis, accounting for the Cisneros Interactive and MediaDonuts acquisitions, adjusted EBITDA was up 17% year-over-year.

Entravision's portion of Cisneros Interactive adjusted EBITDA represented a $4.8 million contribution to our total EBITDA in the third quarter, which represented 51% ownership through the end of August and 100% ownership starting September 1.

Going forward, 100% of Cisneros Interactive's adjusted EBITDA will be attributed to Entravision as defined in our earnings release, was up approximately 112% to $22.4 million in the quarter, compared to $10.6 million in the prior year period.

Strong free cash flow remains a cornerstone of our business, and we expect this high free cash flow conversion rate to continue for the foreseeable future. Earnings per share for the third quarter of 2021 were $0.14, compared to $0.11 per share in the same period last year.

Cash free for income taxes was $0.5 million for the third quarter, compared to $5.1 million in the same quarter of last year. Net cash interest expense was $1.5 million for the third quarter, compared to $1.3 million in the same quarter of last year.

Cash capital expenditures for the third quarter totaled $1.4 million, compared to $2.1 million in the prior year period. With year-to-date capital expenditures of $4.3 million, capital expenditures for the year are expected to be approximately $6.5 million. Turning to our balance sheet, which remains very strong.

Cash and marketable securities as of September 30, 2021, totaled $182.9 million. Total debt was $213 million. Net of $75 million of cash and marketable securities on the books, our total leverage as defined in our credit agreement was 1.6 times as of the end of the third quarter.

Net of total accessible cash and marketable securities on the books, our total net leverage was 0.3 times. Turning now to our pacings for the fourth quarter of 2021. As of today, revenue from our digital business is pacing at a plus 64% over the prior year period.

Factoring in Cisneros and MediaDonuts revenue generated in the fourth quarter of last year, our digital business on a pro forma basis is pacing at a plus 36%. Our TV business is pacing at a minus 24% over the prior year period, with core TV advertising, excluding $11.1 million in political in the prior year, pacing at a minus 2%.

Lastly, our audio business is pacing at a minus 6% with core audio, excluding $3 million in political generated in the prior year period, pacing at a plus 15%. All in, our total revenue, compared to last year is pacing at a plus 32%.

All in, excluding $14.1 million in political generated in last year, our total revenue is pacing at a plus 43% versus the prior year period.

Pro forma our Cisneros and MediaDonuts acquisitions in the prior year's results, our total revenue is currently pacing at a plus 17% over last year, excluding political revenue last year, our core pro forma revenue is pacing at a plus26% over last year. With that, I'll turn the call back over to Walter.

Walter?.

Thank you, Chris. Those who have been following us know that Entravision has been building this digital growth strategy for some time. We are particularly proud to welcome MediaDonuts in early July and to acquire the remaining 49% of Cisneros Interactive this past August.

Today, we announced the acquisition of 365 Digital, bringing the Entravision into Africa. This is our third digital acquisition within a 13 month period and our digital operations now have a presence on five continents.

This acquisition further positions Entravision as a global digital marketing powerhouse, serving platforms, brands and local businesses with sophisticated advertising solutions.

365 Digital, which is headquartered in Cape Town, South Africa maintains exclusive sales representations with TikTok, one of the world's top mobile video user generated and advertising platforms; Trident, a global digital audio streaming and podcast marketplace; and Anzu, a sophisticated and advanced in game advertising platform.

365 Digital also offers end-to-end digital publisher solutions for Premier South African publishers, including a proprietary digital ad network.

We plan to leverage 365 Digital local and regional access to brands and agencies, operating expertise in existing unique commercial representations to scale Entravision's digital business model and suite of services across Africa.

The magic of these businesses, Cisneros Interactive MediaDonuts and 365 Digital, is we were able to apply their models across geographies while efficiently leveraging our resources, platforms, talent and governance protocols.

Moreover, we can rapidly deploy our sales and operation and service standards where little or no prior sales presence exists to expand Entravision's digital footprint with local digital advertisers worldwide.

Part of our vision is to become a critical partner to global technology platforms, such as Facebook, Twitter, Spotify, TikTok, Linkedin and others.

Cisneros Interactive, for example, has grown its prominence in digital and sales for Facebook in Latin America, while MediaDonuts is a leading advertising partner for Twitter and TikTok throughout the Southeast Asia region.

While Facebook, Twitter and TikTok are well established within the United States from a digital advertising perspective, they are just getting started in many international locations. Entravision has a first mover advantage in these emerging economies.

Sub-Saharan Africa, our newest addition geographically is an extreme attractive target market with nearly $500 million digitally connective to consumers and one of the fastest growing digital marketplaces globally.

Our 365 Digital's business model as filing management to seamlessly with Entravision's culture, vision and passion, and we are all excited to see the success we can achieve together. In summary, it's easy to see that the Entravision of today has evolved significantly.

Each of our business segments, digital television and audio, combined together to create a company that is more than some of its individual parts.

Our digital business alone puts us up against a new set of competition that should strengthen our multiple from a shareholder perspective, expand our client base from a customer perspective and advance our in-house capabilities and talent from an associate perspective.

The future is bright, and we look forward to seeing Entravision continue its growth journey to become a well-oiled global marketing solutions machine powered by technology, benefiting from the continued expanding connected consumer base around the world.

As always, I would like to thank our entire team for their efforts and contributions to our strong performance to date. This concludes our prepared remarks. So I would like to thank you again for your continued support of Entravision. Chris and I will now open the call up to your questions.

Operator?.

Thank you. Ladies and gentlemen, we’ll now be conducting a question-and-answer session. Our first question comes from the line of Michael Kupinski with NOBLE Capital Markets. Please proceed with your question..

Thank you, and good morning. Couple of questions.

Regarding the pacings in Q4 for your TV and radio divisions, is there any way to quantify what the impact might be from the auto category itself, I mean, in terms of the drag in terms of your pacing data?.

Hey, Michael. So the big issue with auto, as you know, is the chip issue, and it's really impacting our TV business more so than the radio business. For TV, auto is pacing at a minus 28%, and that's our Number Two category. So that's a big deal. For radio, on the automotive side, the pace is at minus 19%, so not quite as bad, but bad.

The good news is, though, because we gave out the pace overall on a core basis, TVs at minus 2%, but on a core basis radio is at a plus 15%, which basically means that we've got our category that are stepping up and filling in the gaps. But that gives you the context on the automation..

And is the filling in of the gap, is that coming from like sports betting and so forth or just other services? Can you kind of give us a flavor of what the categories are that are strong?.

Sure. It's coming from services, insurance and legal, it's coming from government messaging, the COVID related pandemic type of messaging that's government funded and healthcare. Those are the big movers for both TV and radio that are offsetting it..

Got you.

And then, in terms of 365 Digital, is that included in your pacing data for digital in the fourth quarter?.

It is not. But Michael, this is an early stage kind of acquisition. So we're not going to disclose numbers for that acquisition, but they're not going to be material this year as far as the overall digital platform is concerned. So there's really nothing to model at this point..

And the balance sheet doesn't change meaningfully because of the acquisition either, right?.

That's correct..

Okay..

Yeah. If you look in the press release, the acquisition was slightly less than $2 million, not a big-ticket item, and that should put into context the P&L impact..

Yeah, thanks for that. I didn't get a chance to read through all that yet. In terms of your opportunities outside, this is, obviously, a great win for you guys in terms of this acquisition frenzy you've been on in building a great business here. The relationship with TikTok.

Obviously, you said it's a developmental business, but how strong is that relationship? Is it because it seems like your Latin American businesses don't represent TikTok. They represent more Facebook and so forth.

What are the opportunities for you to introduce Facebook in some of your Asian markets and now TikTok in some of your Latin American markets? How do you think that you're going to be able to integrate those? And is there an opportunity there?.

Michael, its Walter. We represent TikTok in Southeast Asia in three important countries. And now, with this acquisition, it will be four countries with South Africa. We think this further strengthens our relationship with TikTok. We believe that that's an important platform now and in the future.

And we expect it to grow certainly, as well as it has this year and into next year. As per Facebook, we don't – I can't really comment on that. We don't represent them in Southeast Asia. And basically, that's all I'll say. I mean, they're plans and strategies are very private. And certainly, they don't share them with us.

But we have a great relationship with Facebook. We expect that to continue..

Walter, is there another provider that has TIPO in your Latin American markets? I'm just wondering if there was an opportunity for you to pick up TikTok with Cisneros in Latin America..

There's a new company emerging, they've been around – they've been in the business for several years now, but they are now emerging as a less, and you'll probably be hearing more about them in the future. And we understand they are representing TikTok. And I don't know, a handful of Latin American countries..

Got you. And then, in terms of acquisition prospects, obviously, you've – are there other developed companies that are in this segment in the industry, particularly in Europe? I know that you might have an angle in terms of maybe acquiring one in that marketplace.

But where are you seeing the most opportunities for further M&A in the space?.

Well, Michael, we continue to search the globe for opportunities. We're, right now, in discussions with some potential opportunities as it relates to expanding our digital footprint. But we are looking at every continent in every country in the world to see what might lie there in terms of future opportunities..

And then, Walter, you're throwing off a lot of cash and you got a lot of cash on the balance sheet, what are the capital allocation thoughts at this point? It seemed like you could probably increase the dividend. You have the prospect of even doing kind of reinstating your share repurchase authorization.

What are your general thoughts on capital allocation here?.

Well, Michael, we certainly are pleased with the fact that we have about $183 million in cash equivalents and marketable securities on the balance sheet. We continue to hold that kind of cash with, certainly, the work we're doing at the present time as it relates to acquisitions.

When the pandemic was upon us, the fact that we had all that cash certainly was – helped us get through it. And I would say that the reason we've emerged from the pandemic in such a strong fashion is several factors, but that's certainly our ability to get through the pandemic with the existing cash was a big assist.

As far as the dividend is concerned, as you know, the initial reduction was primarily a response to the prevailing economic and pandemic crisis. We know that dividends are important to our shareholders.

We remain in a cash conservation mode to – given the uncertainty of the current environment, both economic and the pandemic, and we believe that reducing the pandemic independent of the dividend at this time is a prudent thing to do. That said, the board revisits the dividend each quarter, and we could certainly consider raising it in the future..

Got you. That’s all I have. Thank you..

Thank you, Michael..

Thank you, Michael..

Our next question comes from the line of James Dix with Industry Capital Research. Please proceed with your question..

Hey, Guys. Just a couple from me. I guess, first, just on the free cash flow conversion. It's certainly been impressive. This quarter, it really seemed to be almost the positive outlier. So I mean, Chris, you indicated you expect that free cash flow conversion of EBITDA to continue.

But should we expect some moderation as we model for next year, more in the range of 70% or something as opposed to the nearly the 90% plus we're seeing in this quarter? Just how should we be thinking about that conversion?.

Yeah. I think, it's safe to say it will moderate a little bit. The tax bill came in a little lighter in the third quarter than we were anticipating. So I look for that to tick up slightly. We talked about that earlier in the year. Look for that to pick up slightly. And then, CapEx has also come down a bit. Again, it's a chip related problem.

A lot of the equipment we wanted to buy isn't simply available. So you're talking about a CapEx line of about $6.5 million, compared to, at this point, two quarters ago, we were looking at $9 million. And we'll finish up at around $6.5 million.

And for next year, probably, it's early to talk about, but I would look for a more normalized year again, the chip issue gets worked out..

Okay.

So next year is more and more normalized as opposed to kind of a $2.5 million from this year to next?.

I think so. I don't model out 90% free cash flow conversion for next year. But I think that's it..

Okay, fair enough.

And then, just while on the topic of next year, roughly how much advertising should we be thinking about pulling out of TV just for the affiliation changes, which you are going to be having at the end of this year?.

Sure. So you're talking about Tampa, Washington and Orlando..

Exactly..

Those are affiliates that's going over to Univision on January 1. That represents about $20 million in revenue. And $10 million in cash flow. So that's the growth of what's coming down. We haven't yet announced what we are going to do with the stations as far as affiliations are concerned for programming.

But whatever we do there, we'll offset that number. So that's just the starting point of growth number..

Okay, great. And then, in terms of the acquisitions, so I gather, Walter, you don't want to talk about the multiple on that deal. I think, the press release simply just said that there was a certain multiple you're going to base on three years of cash flow.

Could you comment just more generally on where you think – where the multiples have been going over the past year? I think, you've said previously, they've been kicking up. Cisneros, you got for six times EBITDA.

Any sense as to where those multiples are at now in the market?.

Sure, James. And by the way, it's good to hear your voice. My sense is and Chris' sense is that the multiples for digital businesses, the ones that we are targeting are somewhere between eight and 10 times. And they have picked it up. They picked it up..

Yeah, okay. And then, just you have a couple – said you have some other digital deals on your plate.

Any sense of the timing as to when you could pull the trigger on those? Is that something we should be looking out over the next six months or so? Or is it something that could be more imminent than that?.

No, I can't give you a time line or it's – we're working on, like I said, we're looking all over the globe for digital opportunities that support and complement our existing businesses. As you know, we've got three lines of digital business.

One is our – what we call our local solutions, digital marketing and local solutions to our – to mid and small businesses in our broadcast markets, in some cases, even outside of our broadcast markets.

And then, we have our proprietary DSP platform, Smadex, and it's a transparent mobile media buying platform, which connects to international mobile ad exchanges and offers real time bidding for ad space, and that's a very important business for us, have huge growth in Q3. I think, it was plus 56%.

And all the people that support that business are based in Barcelona. And then, finally, we have our international rep business, where we represent the major, most important digital platforms in the world. So that rounds it out. So that's a pretty broad landscape in terms of looking for opportunities to support the existing businesses..

Okay.

And you're looking at all three of them?.

Absolutely..

Yeah, okay. And then, just on the fundamentals of the digital business at the moment, especially internationally. Facebook has talked about the impact of the changes, the apples making and causing a headwind on their platform.

Do you have a general sense that you're seeing a little bit less of that impact at Cisneros, in particular, just because the iOS platform has less penetration in those markets? I'm just curious as to what you're hearing up from them in terms of that dynamic and any potential headwind that could cause..

Well, certainly, the launch of iOS 15.2, has created a lot of controversy within the digital ad business. We have less exposure to that because of the low penetration of Apple phones in our particular territories and countries, Latin America.

I believe our – the Apple penetration is about 10% as it is in the other territories and countries where we now operate. But it is something we are going to have to work through. We haven't seen any, I'll call it, immediate impact, but it's something that we're well aware of, and we'll continue to monitor and make adjustments where we need to..

Okay. And then, one last one for me.

I heard from some that the traditional agencies and international markets may have made some cutbacks that is actually, to some extent, increase the demand from some clients for the type of the platform specific assistance that a rep firm could provide that Cisneros could provide in Latin America or MediaDonuts could provide in Asia.

Have you heard anything like that that's part of the opportunity that they're seeing, that they're stepping in for some services with some traditional agencies are providing less of?.

You're suggesting that the major, I'll call it, global agencies are providing more..

Yeah, the WPPs, the Omnicoms and their subsidiaries. In certain markets, they're cutting back their staffing to support some of the sales execution. That's providing an additional incentive for some potential clients to look for assistance from platforms like yours..

It's very possible and certainly is a good thing for our business. But I haven't heard – we have not heard it that specifically, but we do know that the digital app business is growing, it's the fastest growing sector in advertising and will continue that way for many years to come.

So no surprise that major advertising agencies may be reducing their staff within and looking to provide their clients more support from rep firms like ours..

Okay. Alright, great. That’s it for me..

Thank you, James..

Thanks James..

Ladies and gentlemen, there are no further questions at this time. I would now like to turn the floor back to Mr. Walter Ulloa. Thank you..

Thank you, operator. Certainly, it's a pleasure to speak to everyone, and thank you for joining all of us joining us today and for your support. We remain optimistic about the future of Entravision, and we look forward to sharing our progress with you on our fourth quarter earnings call in March of 2022. Thank you..

Thank you. Ladies and gentlemen, this concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation..