Sinclair Broadcast Group’s posted a big gain in profits after its acquisition of Tribune Media fell through, thank in part to big spending by candidates running in the mid-term elections.
Third quarter net income doubled to $63.9 million, or 62 cents a share, from $30.6 million a year ago, or 30 cents a share. The gains came despite costs associated with the aborted acquisition of Tribune, including $18 million in fees related to financing the deal.
Revenue increased 18.9% to $766.3 million.
In the quarter, media revenue rose 16% to $730 million. Political revenue were $70 million versus $7 million in the year ago quarter. Revenues from digital businesses increased 20% from a year ago, the company said.
In its earnings announcement, Sinclair said it reached carriage agreements with Altice USA and Dish Network that cover the company’s broadcast stations and its cable networks, including Tennis Channel. Tennis Channel also got carriage on Dish’s Sling TV streaming service.
Sinclair also increased its quarterly cash dividend per share on the Company’s Class A and Class B common stock to 20 cents from 18 cents.
“Third quarter results came in ahead of guidance in all key financial metrics, and we expect to close out this year ahead of revenue and cash flow expectations, further improving the strongest balance sheet in our company’s history,” said president and CEO Chris Ripley.
“We just finished what is the biggest mid-term political advertising year in our Company’s history with political advertising expected to be over 60% higher than the 2014 mid-term election cycle and over 20% higher than the 2016 presidential election year, based on our current portfolio,” Ripley said. “The strength of political reconfirms that television remains the dominant and premium platform for consumer messaging and building brand awareness, and this year has certainly given us good reason to expect that 2020 will be even stronger.”
For the fourth quarter, Sinclair is expecting revenues to be up between 20.5% and 22.2%, with political revenues of between $145 million and $148 million.
Sinclair also said it expected a gain of $14 million on the spectrum repack.