Revenue Shows Spring in Its Step

Despite dour forecasts stemming from the awful winter, stations’ Q1 revenue reports are expected to be positive
Author:
Publish date:

That nasty winter of 2014 looked like it was going to chill more than noses, fingers and toes. With car dealers’ hot new models growing cold under blankets of snow, restaurants’ sidewalks covered with ice and no one wanting to leave their homes—or even their beds, for that matter—many feared similarly cold first-quarter revenue numbers.

“I was meeting with auto dealers in January and February, and they were crying the blues for obvious reasons—no foot traffic,” said Paul Ballinger, local sales manager at WBNS Columbus, where it’s been “by far” one of the worst winters in memory. “But they continued to hang in there.”

The dealers—and retailers, and restaurateurs— stuck with TV until the polar vortex let up its frigid grip. Ballinger was a bit surprised when the first quarter numbers came in: restaurant spending up 3%, retail up 4%, and automotive up 5%. “The weather affected February [revenue], but March bounced back,” he said. “Overall, it didn’t really affect us.”

Broadcasters were singing a bluer tune when forecasting the first quarter during their most recent earnings calls. “The frigid arctic temperatures and snowstorms have caused those businesses that rely on store traffic, such as retail, fast food and restaurants, to reduce their advertising spending,” David Amy, Sinclair executive VP and chief operating officer, said Feb. 12. “It is unclear at this point if they will redeploy those budgets later in the quarter or the year.”

It was the same story at Gray Television and others. Addressing investor questions March 11, James Ryan, Gray CFO and senior VP of finance, spoke of “softness” in the restaurant and department store categories. “A lot has to be [related to] the weather,” he explained.

Gold Standard

Yet a number of factors kept the local broadcast business robust. For starters, NBC affiliates enjoyed a Winter Olympics campaign out of Sochi that exceeded ratings expectations for many, while marketers prioritized having their spots in the high-profile, high-prestige TV event. “Advertisers just want to be in the Olympics,” said Chris Wilbur, general sales manager at WNCN Raleigh-Durham.

Second, much of the ad budget that was held back in the bone-chilling January and February months popped up later in the quarter. And while blizzards don’t necessarily inspire visits to the auto dealer to check out the 2014 Mini Cooper, severe weather, school closings and people fighting creeping cases of cabin fever can do wonders for TV ratings. The Columbus market got 50 inches of snow this past winter, says John Cardenas, president and general manager of WBNS, almost double the 27-inch norm. “It’s not so good for sales,” he said. “But it’s great for ratings.”

The national rep firms report positive first-quarter numbers as well. Business is up “a couple of points” year over year, said Katz Television Group president/ CEO Leo MacCourtney. “I had certainly thought weather might be an issue,” he added.

Petry Television, meanwhile, sees Q1 core up 2%-3%.

Several categories involved with outdoor weather felt some sort of chill this past winter. Brooke Spectorsky, president and general manager of WKYC Cleveland, felt for the poor window installers during the “horrendous” Cleveland winter. “You couldn’t replace windows when it’s 10 degrees outside and the wind is blowing, the snow is blowing,” he said.

But all that is, knock on wood, behind us. With much of the country enjoying favorable climes, TV business is robust. The sun, blue skies and 65 degrees in Columbus last week felt like summer for residents. “With the better weather comes more advertising,” said Cardenas.

No Excuses

Station groups are prepping for their first-quarter earnings calls. Gannett announces earnings April 23. Graham Holdings/Post-Newsweek reports May 2 and CBS reports May 8.

Yet not every broadcast chief was fearful of the foul weather when the Q1 forecasts came out earlier in the year. Asked about Mother Nature’s effect on 2014 business, Perry Sook, president and CEO of Nexstar, suggested keeping weather where it belongs— in the local news and out of earnings reports.

“Weather has not affected our operating and our ability to generate revenue,” Sook said. “In fact, that is not permitted as an excuse for not making your revenue budget in our company. If you’re not selling far enough out to take advantage of opportunities, then you are probably not managing your business correctly.”

GETTV PICKS UP 2 TOP 25 MARKETS WITH COX DEAL

A Cox Media Group trio, WAXN Charlotte, KIRO Seattle and KMYT Tulsa, added the Sony Pictures Television (SPT) movie network getTV to their dot-two channels April 1. Cox’s WTEV Jacksonville debuts the multicast channel this summer.

The network launched in February. GetTV has now struck deals covering 31 television markets, 18 of which are in the top 20, representing more than 48% of U.S. television households.

“Cox Media Group is excited to be adding the great programming of getTV to our portfolio of multicast stations in Tulsa, Seattle, Charlotte and soon in Jacksonville,” said Jane Williams, CMG’s executive VP of television. “Our viewers will be able to enjoy the best movies and biggest stars from the golden age of the silver screen.”

GetTV broadcasts classic Hollywood films produced from the 1930s through the 1960s.

“Cox Media Group is a wellrespected broadcaster and through this partnership we are able to substantially increase our footprint across the country,” said Superna Kalle, senior VP, U.S. networks, SPT and general manager of getTV, among other branded channels. “CMG’s vote of confidence at this early stage is extremely important to us as we bring getTV into more homes, allowing viewers to enjoy our channel’s timeless classics.”

That nasty winter of 2014 looked like it was going to chill more than noses, fingers and toes. With car dealers’ hot new models growing cold under blankets of snow, restaurants’ sidewalks covered with ice and no one wanting to leave their homes—or even their beds, for that matter—many feared similarly cold first-quarter revenue numbers.

Member Exclusive

Get Access to Our Exclusive Content

Related

0401_CovSt_Opener.jpg

Step on the Scale!

Our annual list of the 25 largest TV station groups—based on data from BIA/Kelsey—proves that with companies wholly focused on getting bigger, it’s never been more difficult to keep the local broadcast pecking order straight.