Sinclair Broadcast Revs Dip, Political Ad Slippage Blamed
- by Wayne Friedman , February 24, 2016
Sinclair
Broadcast Group, one of the largest U.S. TV station groups, posted weak financial results for the fourth quarter, largely due to slower political advertising revenue. Political advertising sank to $11.8 million in the fourth quarter of 2015 versus $80.3 million in the fourth quarter of 2014. Total revenues slipped 0.3% to $611.8 million, and net income was cut almost in half to $58.2 million from $95.4 million.
On Wednesday, early morning trading of Sinclair’s stock was hit hard -- down 7% to $28.38.
But Sinclair executives believe things will change in the coming months.
David Amy, EVP/COO, said in the company’s financial results fourth-quarter release: "We expect 2016 to be another record-breaking financial year, due to expected significant political advertising spending in the Presidential election year, growth in our digital sales offerings, and higher retransmission revenues on 60% subscriber renewals, of which we have already entered into agreements-in-principle on most.”
Recently, Sinclair entered into retrans deals with Mediacom, AT&T/DirecTV and Time Warner Cable.
Sinclair’s media revenues decreased 2.0% to $545.9 million versus $557.1 million in the fourth quarter of 2014. Digital revenues included in its media revenue results, climbed 33.1%.
In January 2016, Sinclair announced an agreement to purchase Tennis Channel for $350 million. Sinclair has said through current agreements with pay TV providers, it is increasing Tennis Channel U.S. subscriber base to 50 million homes from about 30 million homes.
