Sinclair: Political To Come ‘Hand Over Fist’ In 2020
Coming off a strong political advertising year, Sinclair can’t wait for the next one — 2020.
“We like our chances on political dollars,” said Sinclair EVP Steven Marks on the group’s fourth-quarter call with analysts today. “You just look what goes on every day. [Watching politics has] become the best TV show on the planet.
“Every other day there is somebody joining the race. It really bodes well for local broadcasters. There is going to be quite a robust fourth quarter [this year] and in 2020 we are not going to be able to get out of the way of the money. It’s going to be literally hand over fist.”
He said there are “strong indications” that the 2020 spending will exceed the group’s record take in 2012 ($266 million) and far surpass that of 2014 ($155 million), 2016 ($206 million) and 2018 ($255 million). All the number are pro forma for comparison.
CFO Lucy Rutishauser added that the group may pick up as much as $32 million this year ahead of the early primaries in 2020. “Remember, we are in all of the big swing states in a big way as well as we’re in a lot of state capitals.”
Sinclair reported strong overall growth for the fourth quarter and for the full year on the strength of that $255 million in political and continued growth of net retrans in “the low teens percentage.”
But core advertising continues to be a drag on Sinclair just as it has been for other groups.
Marks acknowledged that core was “clearly down” in 2018, but said it improved during the course of the year and was “impressively up” in the fourth quarter.
Some of that momentum has carried over to this year, he said. Core is “flattish” in the first quarter, but will likely be up for the entire year with auto among the “plus” categories.
To boost auto, Marks said that Sinclair has begun hiring auto salesman to sell auto advertising. “We are having these people call on the automotive business…. We are speaking the language [of auto] better today than we have ever spoken the language and we are bearing the results.”
Sinclair’s No. 2 ad category (behind auto), goods and services, is “up really big in the first quarter and driving our numbers, Marks added. “It’s on a roll, and a very impressive roll.”
Sinclair employees take note: The company said it is cutting costs by $20 million this year. CEO Chris Ripley said the savings will come by “ramping down non-performing initiatives and implementing other operating efficiencies.”