Media General reported fourth quarter operating revenue of $110 million, up from $71.4 million in the previous year’s fourth quarter for a 54% increase. Media General and Young Broadcasting merged as of Nov. 12, an event George L. Mahoney, president and CEO, called a “renaissance” for both parties, and a major factor in the fourth quarter numbers.
“This business combination created a new, diversified broadcast and digital company with a strong balance sheet, generating robust cash flow,” he said. “Indeed, our year-end 2013 net leverage was 4.27x, based on our credit agreement, even better than we’d anticipated.”
The increased size of the company helped offset a relative lack of political revenue in the fourth quarter.
Total operating costs in the fourth quarter of 2013 were $100.3 million, compared with $49.4 million in the fourth quarter of 2012. Operating income was $9.7 million, compared with $22.1 million in the previous fourth quarter. “Both the acquisition activity and the relative absence of political revenues contributed to the decline,” said Media General.
Broadcast cash flow in the fourth quarter was $41.7 million, compared with $36.3 million in the fourth quarter of 2012.
Media General forecasts “robust” political revenues for 2014, while retransmission revenues are expected to increase by more than 40% in 2014, with digital revenues expected to go up by more than 20%.
“We expect a particularly strong year in 2014, when we benefit from advertising associated with the Winter Olympics and this year’s elections as well as growing revenue from the rising market for retransmission revenues,” said Mahoney. “Additionally, our digital and mobile platforms are providing new, accelerating opportunities to generate higher revenues.”