• by David Goetzl  @dgoetzl, February 7, 2008

For apparently the first time, the Sinclair station group expressed optimism--albeit muted--about the prospects of the second-year MyNetworkTV. And it released improving results for its 17 affiliated stations.

Executives also said the Hollywood writers' strike impaired revenues at its nine ABC stations in the recently completed fourth quarter. Sales were up 12.1% (if off-year political revenues are stripped out); a year ago, sales climbed 25%.

Not counting political dollars, the MNTV stations--which include affiliates in markets such as Pittsburgh, Las Vegas and San Antonio--saw a 7% decline in sales in the fourth quarter. That was less than a year ago and "better than we had anticipated," said Steven Marks, COO of the television group, on a conference call to announce the fourth-quarter results.

At its nine CW stations, sales were up just 2.2%, excluding political dollars. That prompted an analyst to ask whether executives could envision the disbandment of MNTV and CW, both in their second season.

"I usually leave that up to the networks," Marks said. "But I don't see that right now. I think it's way too early in the game to even contemplate. MyNetwork is just starting up, and clearly, it's much better today than it was a year ago at this time. We're excited about that, and certainly going to see the benefits of it in 2008.

"[The CW] is a year into the game, going on two ... they're shoring up and they're clearly a better operation than they were as well."

CEO David Smith added that he couldn't foresee any abandonment with both Fox and CBS owning local stations that carry the networks, which need prime-time programming.

The company also said its 19 Fox stations garnered $4.9 million in revenue from the Super Bowl on Sunday--a lift compared to its intake from the game on its two CBS stations a year ago.

Overall, Sinclair posted net broadcast revenues from continuing operations of $165.7 million for the fourth quarter--down 2.1%--while operating income increased to $47 million from $38.2 million. One positive sign that Sinclair cited: The struggling auto category, which accounts for 21% of sales, increased 1.9%, which the company said could be a sign that the worst is over in that sector.

Smith was asked whether he foresaw DVRs posing a revenue threat over the next couple of years. He said he saw none. The company does receive compensation for DVR viewing that occurs in the three days after a live broadcast.

"I don't know that it's that big an issue ... the whole purpose of having a DVR is really for the convenience of the consumer to be able to sit down ... and watch it when they want," he said. "So I'm not concerned about the long-term effects."

Smith also said that advertisers may be using the DVR threat as a negotiating tactic to push to lower costs.