• by Wayne Friedman , April 30, 2007

The stock market may have hit record heights, with improving financial results across the board for many companies, but some TV station groups seem to be lagging behind.

Hearst-Argyle Television witnessed 4% lower ad sales in the first quarter, delivering $148.2 million. Much of the drop was due to comparisons of stronger business a year ago, given the lucrative Winter Olympics and the Super Bowl. Hearst has 10 NBC affiliates, which aired the Olympics, and 12 ABC stations, which aired the Super Bowl.

The company attributes the revenue decline to the normal cyclical business of local television. In a year filled with Olympics and especially political advertising, stations witness far better sales. Last year, political ads grew to record numbers.

Hearst-Argyle is making small progress in the area of retransmission deals--revenue obtained from cable companies to carry Hearst's TV signals. Those revenues improved by 12% to $5.2 million. Even better, the company's digital revenue climbed 27% to $4 million during the period.

Overall, the company's net income picture sank in the first-quarter period to $4.2 million, from $13.01 million for the first quarter of 2006. Hearst similarly posted $13.07 million in net income in the first quarter of 2005.

Company revenue sank 2.6% to $169.3 million, due mainly to lower auto spending. Fickle automotive TV advertising has severely affected some station groups' financial results recently.

The market didn't take well to the news. In mid-day trading, the company's stock was off nearly 4% to $26.06 in active trading.