• by Wayne Friedman , August 8, 2024

Sinclair Inc., a major U.S. TV station group, posted a strong 11% second-quarter gain in advertising revenue to $343 million, largely due to growth in political ad spending for the Presidential election season.

The Benchmark Company estimates this will increase in its next two quarterly periods -- a 40.3% gain in the third quarter to $426.6 million and just under 50% in the fourth quarter to $542.5 million. Sinclair is expected to see a 27% hike in ad revenues for all of 2024 to $1.6 billion.

But Daniel Kurnos, media analyst for Benchmark, says the bigger news is what the company has hinted to come: “The big shocker [is] coming in the form of third quarter core [advertising guidance] for local, up 3% to 7%”, which is largely in a quarter where over $120 million in political spend is expected.”

Typically, political advertising commercials must be allowed to air and can push out regular year-in, year-out core brand advertisers. Kurnos says this is less of an issue for core brands, given there are alternatives to consider for advertising brands, like digital media.

Sinclair says core advertising during its second-quarter period was $303 million, “in line” with the prior-year period.

It expects continued strong political spending, with full-year results projected to see a 10% to 17% gain versus all the political spending for 2020 going to $385 million to $410 million.

The second-quarter distribution revenue inched up 4% to $435 million.

Total revenue (including advertising) grew 8% to $829 million. Net income was $17 million, reversing a $89 million net loss.

Sinclair's stock was 6% higher in early Thursday morning trading to $13.75.