Radio One's Finance Chief To Depart By Year's End

By Anita Huslin
Washington Post Staff Writer
August 7, 2007


Scott Royster is stepping down as Radio One's finance chief as the firm's stock options and poor financial performance are being investigated.

Radio One, the Lanham company that bills itself as the largest African American radio broadcaster, announced yesterday that its longtime chief financial officer would leave by the end of the year.

Scott Royster, who joined Radio One in 1996, helped take the company public eight years ago and expand it from a small local broadcasting operation to one with more than 70 stations across the country.

"There is no sort of animosity here. He's been a valuable member of the team," said Alfred C. Liggins III, Radio One's chief executive. "But where the company is at today, his skill sets could probably be maximized in a different kind of role than what we need at present."

Royster declined to comment beyond a statement issued by the company, in which he said, "as CFO I have been closely involved in the company's strategy to acquire assets, diversify its portfolio and raise capital. . . . I am happy to assist the company over the next few months to ensure a smooth transition."

His departure comes as Radio One has been under intense scrutiny by Wall Street analysts and Washington regulators for its poor financial performance and problems with its stock options program. The company also had to restate seven years of its financial results.

In the past two years, Radio One's stock has lost about two-thirds of its value, and last week the company reported another quarter of declining returns. Liggins this year announced plans to sell 10 stations in underperforming markets to reduce the company's significant debt and focus on boosting the profitability of stations in strategically important markets, such as Los Angeles.

"It's a far-flung enterprise that now is going to be less focused on getting bigger through acquisitions and more focused on how do you make the operational organization more efficient," Liggins said. "And that's a different skill set than a financially oriented skill set."

Liggins said he would launch a search for a new chief financial officer who would focus on working with general managers, regional managers, programmers and other staff focused on the company's radio operations.

He has also indicated that he wants to expand the company's TV One cable operations as well as its Internet and print outlets. "I would like to see half terrestrial radio, half cable and online, in which I would include print," he said in a conference call last week. "It would probably take us five years to do that."

Analysts have increasingly questioned the company's performance and strategy, including its continued losses in Los Angeles, the country's most lucrative radio market. Hispanic and Internet radio and new technology such as digital music players have also made it difficult for the Radio One station to gain ground in Los Angeles and other markets, company officials said.

Liggins yesterday dismissed any notion that the company his mother started 27 years ago with the purchase of one station might go private, as other radio companies such as Clear Channel Communications, Univision, Emmis Communications and Cumulus have considered doing or have done to reduce shareholder pressure.

"Right now we're just focused on our operations -- getting through some of the operational challenges we have," Liggins said. Radio One's stock fell 81 cents yesterday, closing at $4.05 a share.

Could it be that some of their troubles are their growth plan being a little TOO ambitious?

Maybe Liggins, himself, should consider stepping down!

Radio has been carrying way too much debt. And Liggins, and his mother, have never shied away from taking advantage of their stock options and cashing out.

I've love a bunch of money on Radio One.