• by Erik Sass  @eriksass1, November 9, 2007

Clear Channel Communications, the nation's largest radio and outdoor advertising company, saw third-quarter profits increase 51% compared to the same period in 2006, to $279.7 million--largely on the strength of its booming outdoor business, the company reported Thursday. Also on Thursday, one of its main competitors in the outdoor market, Lamar Advertising, said profits dropped 14% in the third quarter.

Overall, Clear Channel's revenues rose 5% to $1.73 billion in the third quarter, missing analyst forecasts by about $40 million. Radio revenues slipped 1% to $882.2 million, while outdoor surged 14% to $817.5 million for the quarter. The radio results are slightly better than the industry as a whole--which saw revenues dip 1% in July, 1% in August, and 7% in September, for a total estimated dip of 3%.

Looking ahead to the fourth quarter, Clear Channel sees radio revenues trending down by about 4.7% compared to the same period in 2006, while outdoor is trending up about 7.7%. The company also provided an update on its ongoing divestiture of 448 radio stations in small and mid-sized markets. Altogether the company entered into agreements to sell 364 stations this year, but 187 of these deals were subsequently broken off. Clear Channel didn't give a reason for the termination of these deals.

The company did not hold a conference call about its third-quarter results because of the ongoing sale of the company to Thomas H. Lee Partners and Bain Capital Partners through a leveraged buyout. The deal, scheduled to close by the end of this year, will take Clear Channel Communications private at a price of $39.20 per share, with about 30% of the company's stock remaining in the hands of institutional shareholders.

Also on Thursday, one of Clear Channel Outdoor's main competitors, Lamar Advertising Company, said profits fell 14% in the third quarter --despite an 8% increase in revenue compared to the same period last year--to $314.3 million. The decrease in earnings was due in part to a significant increase in interest payments on debt. The company is also spending aggressively to roll out digital billboards, a key driver of revenue growth.