Salem Media Group, Inc. Annual report pursuant to Section 13 and 15(d)

Broadcast Licenses (Tables)

Broadcast Licenses (Tables)

12 Months Ended

Dec. 31, 2022

Indefinite-lived Intangible Assets [Line Items]

Schedule of Changes in Broadcasting Licenses

The following table presents the changes in broadcasting licenses that include acquisitions and divestitures of radio stations and FM translators as described in Note 3 – Recent Transactions and impairments as described below.


	Year Ended December 31,
	2021			2022
	(Dollars in thousands)
Balance, beginning of period before cumulative loss on impairment	$	434,209		$	434,444
Accumulated loss on impairment		(114,436	)		(114,436	)

Balance, beginning of period after cumulative loss on impairment		319,773			320,008

Acquisitions of radio station and FM Translators		235			514
Disposition of radio stations and FM translators		—			(2,763	)
Loss on impairment		—			(13,985	)

Balance, end of period after cumulative loss on impairment	$	320,008		$	303,774


	Year Ended December 31,
	2021			2022
	(Dollars in thousands)
Balance, end of period before cumulative loss on impairment	$	434,444		$	429,890
Accumulated loss on impairment		(114,436	)		(126,116	)

Balance, end of period after cumulative loss on impairment	$	320,008		$	303,774

Schedule Of Carrying Value and Fair Value of Broadcast Licenses

The table below presents the percentage within a range by which our latest

start-up

income estimated fair value exceeds the current period carrying value:


	Geographic Market Clusters as of December 31, 2022 Percentage Range by Which Latest Estimated Fair Value Exceeds 2022 Carrying Value
	≤ 25%		>26%-50%		>51% to 75%		> +than 76%
Number of accounting units		13		2		1		1
Broadcast license carrying value (in thousands)		186,366		7,692		24,580		6,092

The table below shows the percentage within a range by which our prior year estimated fair value exceeded the carrying value of our broadcasting licenses for these twelve market clusters:


	Geographic Market Clusters as of December 31, 2022 Tested due to SOI Multiple or length of time from prior valuation – Percentage Range by Which 2021 Estimated Fair Value Exceeds 2021 Carrying Value
	≤ 25%		>26%-50%		>51% to 75%		> +than 76%
Number of accounting units		—		1		4		7
Broadcast license carrying value (in thousands)		—		7,004		52,489		21,552

Schedule of Estimates and Assumptions Used in the Start - Up Income Valuation for Broadcast Licenses

The assumptions used reflect those of a hypothetical market participant and not necessarily the actual or projected results of Salem. The key estimates and assumptions used in the

start-up

income valuation for the broadcast licenses tested in each period were as

follows:


Broadcast Licenses	December 31, 2021	June 30, 2022	September 30, 2022	December 31, 2022
Risk-adjusted discount rate	8.5%	9.5%	9.5%	9.5%
Operating profit margin ranges	3.9% - 30.9%	3.9% - 30.9%	3.9% - 30.9%	3.9% - 30.4%
Long-term revenue growth rates	0.4% - 0.7%	0.4% - 0.7%	0.4% - 0.7%	0.4% - 0.8%

Schedule of Interim Impairment Testing Under Start-Up Income Approach

The table below presents the results of our annual impairment testing under the

start-up

income approach:


Market Cluster	Estimated Excess Fair Value December 31, 2022
Boston, MA		5.4	%
Chicago, IL		1.7	%
Cleveland, OH		0.1	%
Columbus, OH		(22.6	)%
Dallas, TX		6.9	%
Denver, CO		882.2	%
Detroit, MI		51.9	%
Greenville, SC		0.2	%
Honolulu, HI		6.4	%
Houston, TX		2278.3	%
Little Rock, AR		3.7	%
Los Angeles, CA		38.0	%
Nashville, TN		453.0	%
New York, NY		3.1	%
Orlando FL		15.6	%
Philadelphia, PA		29.9	%
Phoenix, AZ		48.7	%
Pittsburgh, PA		198.4	%
Portland, OR		(2.1	)%
Sacramento, CA		0.8	%
San Antonio, TX		254.3	%
San Francisco, CA		(6.3	)%
Seattle, WA		903.6	%
Tampa, FL		7.2	%
Washington, D.C.		165.1	%