Gray TV Turns In 28% Rise In 3Q Revenue

Gray Television Inc. today announced results from operations for the three-month period ended Sept. 30 that included total revenue to $85.3 million, a 28% increase compared to the same quarter a year earlier.

Gray said the rise reflected increases in political, local, national and internet advertising revenue, retransmission consent revenue, production and other revenue and consulting revenue.

Local, national and internet advertising revenue increased due to increased spending by advertisers in an improving economic environment. Political advertising revenue increased due to increased advertising from political candidates and special interest groups in advance of elections in November 2010.

Retransmission revenue increased due to the improved terms of Gray’s retransmission contracts compared to those in effect during the three-month period ended Sept. 30, 2009. The company continued to earn consulting revenue from its agreement with Young Broadcasting Inc. This agreement was effective August 10, 2009, and the increase in revenue from the agreement was due to it being in place for only a portion of the year-ago quarter.

The principal components of Gray’s revenue were:

• Local advertising revenue increased $3.1 million, or 8%, to $44.3 million.
• National advertising revenue increased $1.5 million, or 12%, to $14.3 million.
• Internet advertising revenue increased $400,000, or 14%, to $3.3 million.
• Political advertising revenue increased $13.0 million, or 422%, to $16 million.
• Retransmission consent revenue increased $300,000, or 8%, to $4.7 million.
• Production and other revenue increased $300,000, or 17%, to $2 million.
• Consulting revenue from the agreement with Young Broadcasting increased $200,000, or 76% to $600,000.

Advertising revenue categories by customer type, excluding political advertising, demonstrating significant improvement during the three-month period ended September 30, 2010 compared to the three-month period ended September 30, 2009 were: automotive, increasing 26%; medical services, increasing 18%; communications, increasing 11%; and financial and insurance services, increasing 11%. Revenue categories reflecting period over period declines were: paid programming, decreasing 10%; restaurants, decreasing 10%; and home improvement, decreasing 4%.

Broadcast expenses (before depreciation, amortization and gain on disposal of assets) increased $3.6 million, or 8%, to $49.8 million. The increase was due primarily to an increase in payroll expense of $3.2 million and national sales representation expense of $900,000, partially offset by a decrease in employee benefit expense of $300,000.

Read the company’s report here.