MIAMI, Mar 11, 2015 (BUSINESS WIRE) — Hemisphere Media Group, Inc. HMTV, -1.27% (Hemisphere or the Company), the only publicly traded pure-play U.S. media company targeting the high growth Hispanic TV/cable networks business, today announced financial results for the fourth quarter and full year ended December 31, 2014.

Alan Sokol, CEO of Hemisphere, stated, “We are very pleased with both our financial and operational results in 2014, our first full year as a public company. We continued to execute on our strategic plan to drive growth and engagement across each of our networks during the fourth quarter and successfully achieved solid revenue and Adjusted EBITDA growth. We secured new launches on Cablevision of our recently acquired cable networks, and full national distribution on Cox Cable for Centroamerica TV, and successfully completed renewals of WAPA’s retransmission agreements which expired in 2014.

“In addition, WAPA strengthened its leadership position as Puerto Rico’s #1 network for the sixth consecutive year. Cinelatino’s transition to an ad-supported network remains on track for 2015. After a strong fourth quarter, we have significant momentum entering 2015 and are confident that we are ideally positioned to increase our retransmission/subscriber and advertising revenues, while continuing to pursue various strategic initiatives, including acquisitions and digital strategies to complement our core business.”

On April 1, 2014, Hemisphere closed on the acquisition of the assets of the Spanish-language television network business of Media World, LLC (the Cable Networks Acquisition), which is comprised of Pasiones, Centroamerica TV and TV Dominicana (the Acquired Cable Networks). Results for the Acquired Cable Networks are included in the Company’s consolidated statement of operations from the acquisition date, April 1, 2014, which affects the comparability of the Company’s quarterly and full year results. Comparability of the Company’s full year results are also affected by a full year of results for Cinelatino, which was acquired by the Company on April 4, 2013 (the “Transaction”).

Net revenues for the three months ended December 31, 2014 were $33.2 million, an increase of 28%, compared to net revenues of $25.9 million for the same period in 2013. Net revenues for the full year ended December 31, 2014 were $112.0 million, an increase of 30%, compared to net revenues of $86.0 million for the same period in 2013. These increases are primarily a result of the inclusion of the Acquired Cable Networks, the inclusion of a full year of results of Cinelatino, and growth in subscriber and retransmission fees across all of the Company’s networks. The fourth quarter results also benefited from growth in advertising revenue.

Operating expenses were $23.0 million for the three months ended December 31, 2014, an increase of 10% from operating expenses of $20.9 million in the year ago quarter. Operating expenses were $86.0 million for the full year ended December 31, 2014, an increase of 10% from operating expenses of $78.3 million in the year ago period. These increases in operating expenses were due primarily to the inclusion of the operating results of the Acquired Cable Networks, as well as the inclusion of Cinelatino’s operating expenses and corporate overhead for a full year. These increases were offset in part by a reduction in production costs as a result of the decision not to produce Idol Puerto Rico in 2014, a decline in stock compensation expense, and one-time charges comprised primarily of fees and expenses related to the Transaction and the Cable Networks Acquisition recorded in 2013.

Net income was $4.3 million for the three months ended December 31, 2014, an increase of $1.7 million compared to net income of $2.6 million for the same period in 2013, and $10.6 million for the full year ended December 31, 2014, an increase of $14.9 million compared to a net loss of $4.3 million for the same period.

Adjusted EBITDA increased $5.7 million, or 56%, to $16.0 million for the three months ended December 31, 2014, and increased $16.2 million, or 48%, to $50.0 million for the full year ended December 31, 2014. These increases were due to the inclusion of the operating results of the Acquired Cable Networks and Cinelatino and revenue growth at Hemisphere’s combined networks, offset in part by a full year of corporate overhead, which has increased as the Company expands its infrastructure to support the growth of its business.

The Company expects to build on the positive revenue momentum of the fourth quarter and plans to increase investment in its channels in 2015, resulting in projected Adjusted EBITDA growth in the low to mid-teens for 2015.

As of December 31, 2014, the Company had $221.8 million in debt and $142.0 million of cash. The Company’s leverage ratio was approximately 4.5 times, and net leverage ratio was approximately 1.6 times.

The following tables set forth the Company’s financial performance for the three months and year ended December 31, 2014 and 2013 and selected balance sheet data as of December 31, 2014 and 2013 ($ in thousands):