Media General 2Q Net Revenue Up 11.8%

Media General Inc.’s net operating revenue in the second quarter grew 11.8% to $154.1 million compared to $137.8 million in the second quarter of 2013.

Media General’s President-CEO George L. Mahoney said: “We’re pleased to report our second full quarter of results for the combined Media General and Young Broadcasting, which merged on Nov. 12, 2013. It was another outstanding quarter. As we promised when the Young transaction was announced, were generating meaningful incremental free cash flow and reducing debt.”

Local gross time sales increased 1.8% to $81.1 million compared to $79.7 million in the second quarter of 2013. National gross time sales decreased 12.9% to $35 million compared to $40.2 million a year ago and reflected declines in virtually all national advertising categories. Core advertising (local and national gross time sales combined) declined 3.1% year over year.

Political gross time sales of $9.3 million increased substantially compared to $1.5 million in the second quarter of 2013.

Retransmission revenues grew 49.1% to $35 million compared to $23.5 million in the second quarter of 2013.

Digital gross time sales rose 32.8% to $6.5 million compared to $4.9 million in the second quarter of 2013.

Total operating costs of $132.1 million compared to $124.7 million in the second quarter of 2013. Depreciation and amortization was $5.7 million higher this year due to the effects of purchase accounting resulting from the Young merger.

Merger-related expenses in the current year were $4.8 million compared to $11.6 million last year. Corporate severance expense this year was $4.5 million, related to a major restructuring announced in April and compared to a nominal amount last year.

Mahoney added: “Our revenue growth and expense management were the key drivers of our 20% increase in broadcast cash flow and our 39% increase in adjusted EBITDA. Free cash flow was nearly $23 million this year compared to a $5 million deficit in last years second quarter. Additionally of note in the quarter was significantly lower interest expense, which was $9.6 million this year compared to $21.6 million on a combined basis in the second quarter of last year.”