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Sinclair Retransmission-Consent Deals Boost Q3 Revenue - Broadcasting & Cable

Sinclair Retransmission-Consent Deals Boost Q3 Revenue

TV-Station Operator Hard-Hit by Lower Political-Ad Revenue
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Television-station operator Sinclair Broadcast Group saw revenues rise in the third quarter as funds from retransmission-consent agreements outweighed lower advertising costs.

Total revenue in the third quarter rose 6% to $176.7 million while revenue from broadcasting operations fell less than 1% to $149.5 million versus the same period a year ago. According to the company, revenue from retransmission more than offset weak advertising sales. In the quarter, local sales were flat while national ad sales dropped 13.2% due to lower political revenue of $1.1 million versus $7.7 million in the same quarter last year.

Sinclair’s operating income was down 13.4% to $32.9 million while net income was $9.9 million versus $22.6 million in Q3 2006, which was inflated by an income-tax benefit.

For the fourth quarter, the company expects station broadcast operating revenues to be $160.4 million-$162 million versus $169.2 million in the same period a year ago. The company expects political revenues of $1.8 million in the coming quarter compared with $21.1 million in Q4 2006.

"As expected in nonelection years, we do not expect to have the level of political revenues that we experienced in the fourth quarter of 2006," executive vice president and chief financial officer David Amy said in a statement. "Unlike most other broadcasters, however, our ability to secure retransmission-consent-fee revenues will offset some of that shortfall. We are also seeing local sales momentum building on the MyNetworkTV stations in response to some of the network's program-lineup changes."

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