Revenue of $59.8 million drives significant gains in income, including $3 million in retrans revenue.
Nexstar Broadcasting Group Inc. today reported record first quarter financial results for the period ended March 31, 2006.
Net revenue for the quarter grew 12.2% to $59.8 million from $53.3 million in the first quarter of 2005. Income from operations for the three months ended March 31, totaled $6.1 million compared with $1.6 million in the quarter ended March 31, 2005.
The company recorded a basic and diluted net loss per share of $0.26 for the three months ended March 31, compared with a basic and diluted net loss per share of $0.45 in the first quarter of 2005.
Broadcast cash flow rose 24.5% to $19.8 million in the first quarter of 2006 from $15.9 million in the first quarter of 2005. EBITDA totaled $16.6 million for the first quarter of 2006, a 28.8% increase over the first quarter of 2005, while free cash flow(1) rose to $4.9 million in first quarter of 2006, a $4.7 million year-over-year increase.
Excluding political advertising, gross local and national advertising revenue for the 2006 first quarter increased 11.1%. First quarter 2006 political advertising revenue was approximately $1.8 million, compared to approximately $0.3 million in the first quarter of 2005. Nexstar also recorded approximately $3 million of total retransmission consent revenues in the quarter compared to the $500,000 recorded in the first quarter of 2005.
Perry A. Sook, chairman, president and CEO of Nexstar Broadcasting Group, said in a statement: “I’m delighted that Nexstar exceeded our first quarter guidance. We posted record first-quarter net revenue, income from operations, broadcast cash flow, EBITDA and free cash flow. Retransmission consent agreements contributed cash revenues of $2 million as well as approximately $1 million of ad spends. This revenue source will be a significant contributor to Nexstar’s results on a going forward basis.
“Strong organic cash flows enabled Nexstar to further address debt reduction, an important corporate priority. During the first quarter we made $4.9 million of principal payments against senior credit facilities.
“Nexstar’s focus on local sales and local news leadership in our mid-sized markets support our expectations for continued leading revenue share in most of the markets in which we operate.”
Sook continued: “Early in the second quarter, Nexstar announced its intention to sell KFTA-TV in Ft. Smith, Arkansas to Mission Broadcasting. Upon securing FCC approval and completion of the sale, the station will become the Fox affiliate serving the market. Nexstar’s KNWA-TV, which operates in the same DMA, will remain the NBC affiliate in the market and has agreed to enter into a joint sales and shared services agreement with Mission whereby KNWA will provide local news, sales and other non-programming services to KFTA. We believe this arrangement will prove to be attractive to viewers who will now be able to access a full-power Fox station and the market’s first prime time local newscast, while providing another choice for local advertisers to reach customers in the market.”
At March 31, 2006, the company’s total debt was approximately $644.5 million and cash balances were $11.8 million. As defined per the credit agreement, consolidated total debt was $528.5 million at March 31, 2006, net of cash on hand, which resulted in a leverage ratio of 7.8x, compared to a permitted leverage covenant of 8.0x under the company’s credit facilities.