The largest Hispanic-owned media company serving Spanish-speaking consumers across the U.S. has completed the sale of its three television stations in Puerto Rico, earning $5.7 million of immediately available funds.
Word of the deal’s closing came concurrent with the release by Spanish Broadcasting System (SBS) of its Q2 2025 financial results.
As the Memorial Day holiday began, SBS entered into an asset sale agreement that would deliver to Word of God Fellowship, Inc., three broadcast TV stations serving Puerto Rico: WVOZ-TV, WTCV-DT and WVEO-DT.
The transaction came as the company founded and led by Chairman and President/CEO Raúl Alarcón Jr. and Chief Revenue Officer Gene Bryan reevaluated the video content arm of SBS, deciding not to sell all of its Mega TV operation in one deal. SBS originally had a deal in place to sell Mega TV and SBS’s Hialeah, Fla., operations center to VOZ Media, the conservative-leaning online Spanish-language news and political commentary offering that sought to become the FOX News of hispanohablantes. The $62 million deal was never consummated, as VOZ Media didn’t have the funds on hand to complete the transaction. The fallout of the failed deal, which saw SBS in September 2023 terminate its agreements with VOZ, included the departures of former President/COO Albert Rodriguez and Chief Financial Officer José Molina.
The cash infusion from the sale of WVOZ, WTCV and WVEO was likely welcomed, with the August 15 deal set to impact the Q3 2025 results for SBS.
In Q2, SBS didn’t fare so well when comparing the result to the same period in 2024. Net revenue declined to $34.44 million, from $40.01 million. The good news: operating expenses were largely unchanged, coming in at $32.09 million.
But, the second quarter of 2025 saw SBS take a $2.925 million non-cash impairment charge as it paid $148,000 in “severance expense.”
Those one-time expenses led operating income to fall to $2.35 million, from $7.97 million, as SBS’s net loss widened to $4.44 million (-$0.48 per share) from $346,000 (-$0.04).
Of the $34.44 million in net revenue, TV attributed $1.2 million to the total.
A CRITICAL DEADLINE IS COMING
With SBS coming off a disappointing quarter, all eyes are now on $310 million aggregate principal amount of 9.75% Senior Secured Notes due 2026. They mature on March 1 of next year. SBS can’t meet its obligations as of today.
“We do not have sufficient cash on hand to generate sufficient funds from operations to repay the Notes,” SBS said in an SEC filing distributed on Friday.
However, SBS’s management believes that “it will ultimately be able to obtain financing in adequate amounts and on acceptable terms necessary to operate the business and redeem, repurchase or refinance our Notes.”
There is no firm commitment in place, and SBS’s confidence can’t overcome its “inability to conclude that it is probable” that a finance agreement will come within six months “raises substantial doubt” about SBS’s ability to continue as a going concern.
Meanwhile, there is a $4.5 million outstanding balance on its senior secured asset-based revolving credit line due October 27, 2025. That balance, with interest at 7.35%, is expected to be paid down with proceeds from the Puerto Rico TV station sale.
How will SBS come up with more cash, in an environment where political ad dollars and tentpole events are the key drivers for broadcast TV as core advertising struggles persist in a digital and streaming universe that continues to expand?
“The company continues to pursue the sale of its real estate and its remaining television assets and expects the assets to be sold within one year,” SBS said.
This suggests that the remainder of Mega TV is now up for bids.
