Belo Copes With Auto Ad Losses

Belo CFO Carey Hendrickson said the station group has experienced cancellations by auto advertisers related to the trouble in Japan, but not at an unanticipated level. That has "remained within our initial expectations" for the second quarter," he told investors Wednesday.

Since some auto marketers have had to deal with issues affecting the manufacturing chain, Belo had previously adjusted its expectation. It said it expected spot dollars in the second quarter -- excluding political dollars -- to be in the flat to low-single-digit percentage range, compared to the same period a year ahead.

Hendrickson did say that it is notable that "the disruption in automotive [spending] related to Japan is a temporary setback and a supply issue, not a demand issue." The company is optimistic that production for Toyota will return to a more normalized level in the third quarter.

"Certainly, we believe when there are cars to be sold they will turn to television to do it," he said.

Belo operates 20 stations in 15 markets, including the ABC station in Dallas, CBS stations in Houston and St. Louis and NBC stations in Seattle and Portland.

On potential acquisitions, Hendrickson said Belo would consider them primarily if they could generate a duopoly in a particular market, notably a chance to add to the CBS affiliate in Houston. In general, the acquisition market, he said, has a "disconnect" in what sellers are seeking and buyers looking to pay.

Sellers want to use prices based on performance this year and going forward. Buyers want to use costs based on performances during the past few rougher years.

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