Earnings: Weak Radio Weighs on Emmis
By Jonathan Hemingway -- Broadcasting & Cable, 7/10/2007 3:15:00 AM
Weak radio results, particularly in the key New York and Los Angeles markets, were a drag on Emmis Communications’ revenue in its fiscal first quarter.
The company reported net revenue for the quarter ended May 31 of $87.3m, a 3% decrease from $89.8m the same quarter a year ago. Radio net revenue slid 5.5% in the quarter while publishing net revenue was up 6%.
"Our results were in line with guidance for the quarter," Emmis Chairman and CEO Jeff Smulyan said in a statement. The company expected a decrease in radio revenues in the mid to high single digits.
"As expected, weakness in our radio division persisted," Smulyan stated, "and we will continue to face challenges as we look for the changes we've implemented in our largest markets to gain momentum."
Emmis expects net revenue from radio operations to decrease again nexy quarter in the mid- to high single digit range on a percentage basis. Radio operating expenses are expected to increase in the mid- to high single digits.
Operating income for the first quarter was $12.1m compared to $16.1m in the same quarter a year ago.
Station operating income for Q1 was $23.1m, down from $27.3m in Q1 2006.
Diluted net loss per share from continuing operations was $0.07, flat from the same quarter in 2006.
Emmis owns 23 radio stations in seven markets in the U.S. Seven of those stations are in the three largest markets in the country; New York, Los Angeles and Chicago. The company also has five stations in Europe.
Emmis sold off many of its television station assets over the past year and a half. With the completed sale of KGMB-TV in Honolulu in the first quarter for $40m, the company had sold 15 of 16 stations for proceeds of $1.18bn. It still owns Fox affiliate WVUE-TV in New Orleans.
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