LIN TV post 2Q loss of $215.97M

PROVIDENCE – LIN TV Corp. (NYSE: TVL) today posted a second-quarter net loss of $215.97 million, or $4.26 per diluted common share, compared with the year-ago profit of $3.51 million, or 7 cents per share. The loss for the period ended June 30 came despite revenue that rose 1.92 percent to $103.70 million.

Results for the quarter just ended included a non-cash impairment charge of $269.97 million “relating to the company’s broadcast licenses and goodwill,” the media company said. LIN owns or operates 29 television stations, including WNAC Channel 64 (Fox) and WPRI Channel 12 (CBS).

President and CEO Vincent L. Sadusky cited a decline in the value of shares in LIN TV, and media companies in general, and the lagging U.S. economy:

“Based on U.S. economic forecasts – which currently anticipate continued weak market conditions going into 2009 – media stocks have traded down to levels that reflect earnings and cash-flow multiples at or near historic lows,” he said in a statement this morning. “As a result, we have recorded an intangible asset-impairment charge in second quarter.

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“However, we continue to see the fundamentals of the television broadcasting business as very sound,” Sadusky said. “And the digital strategy for our market-leading television stations should position us for additional revenue growth and margin expansion once the economy rebounds.”

He attributed the second-quarter revenue growth “to the successful implementation of our digital strategy, along with increased political advertising and new business development initiatives,” adding: “These company-wide efforts continue to help offset the impact of substantial general advertising marketplace declines.”

Political advertising sales surged to $8.1 million from the 2007 second quarter’s $1.0 million as the 2008 election season heated up.

Digital revenue – including Internet advertising and other interactive revenue, which rose 65 percent; and retransmission consent fees, which rose 122 percent – nearly doubled to $6.7 million from the year-ago $3.4 million.

Those gains were partly offset by a decline in core advertising revenue – national and local advertising excluding political ads – which fell 7 percent compared with a year ago. LIN cited “general economic pressure now impacting a number of local economies, primarily in the housing, automobile and retail segments.” Medical and health and beauty advertising increased while auto, retail, restaurant, media and telecommunications, service-sector and financial services advertising all declined, the company said.

Operating expenses were essentially flat at $69.68 million, an increase of 0.17 percent from the 2007 second quarter. Higher costs for employee compensation, contractual costs and the company’s investments in its Internet business were offset by lower sales-variable costs, lower benefits costs and savings from various cost-control initiatives, LIN said.

Among other second-quarter highlights:

• Traffic increased sharply at the company’s Web sites, which saw total page views in the second quarter rise 48 percent to 145.8 million, while unique visitors during the period rose 23 percent to 13.7 million, LIN said.

• LIN TV signed new retransmission consent agreements for both analog and high-definition (HD) digital channels with carriers Comcast Corp., DirecTV Inc. and Charter Communications Inc.

• The company implemented a new marketing and promotional partnership with DISH Network “that offers substantial incentives for consumers to switch to DISH if the company’s local stations are removed from a local cable system in any of [LIN TV’s] 17 markets.” (READ MORE)

• In April, WPRI Channel 12 – one of two LIN channels serving the Providence market – was named the regional News Station of the Year, for the fifth year in a row. (READ MORE) And in May, the channel was awarded a New England Emmy. (READ MORE)

LIN TV currently predicts its third-quarter net income will rise between 3.5 percent and 6.2 percent from the company’s year-ago $93.7 million, based on projected growth in digital and political revenue.

LIN TV Corp. (NYSE: TVL) owns or operates 29 television stations and Web sites in 17 mid-sized U.S. markets. Its stations include WNAC Channel 64 (Fox) and WPRI Channel 12 (CBS) in the Providence market; WWLP (NBC) in Springfield, Mass.; and WTNY (ABC) and WCTX (MyNetworkTV) in the Hartford-New Haven region. Additional information is available at www.lintv.com.

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