Company reports increased local ad sales, lower overhead.
Young Broadcasting Inc. today announced strongly improved results for the first quarter ended March 31, 2006 as compared to the same period in 2005.
Station operation performance (SOP), increased by 61% during the first quarter to $8.6 million as compared to $5.4 million in 2005. Driving this increase was net revenue growth of 6.3% due to continued success in the company’s local advertising sales programs while expense reductions implemented in 2005 caused operating expenses to decline 1% compared to the first quarter of 2005. Additionally, corporate overhead declined 11.3% during the first quarter of 2006.
The company’s nine affiliate stations saw local advertising revenue increase by 8.4% in the first quarter as compared to the year earlier period. Total revenues for the affiliates, including national and political advertising, jumped 9.1% during the first quarter.
“This quarter is a confirmation of our strategic plan to increase local revenues through our thirrd leg sales initiative while reducing operating costs,” said Vincent Young, chairman of Young Broadcasting. He added: “We see our affiliates continuing to perform well throughout the year. We’re also encouraged by prospects at KRON which should benefit from a high level of political activity in California and its new affiliation with News Corp.’s My Network TV, which will launch on Sept. 5, 2006.”
Highlights of the first quarter of 2006 include the following, Young said:
- KRON-TV forms partnership with My Network TV with anticipated strong entertainment programming and expanded advertising opportunities.
- All the company’s network affiliates in the five markets that report total market revenues grew their share of revenue at a faster growth rate than the market as a whole; in some cases more than twice the market’s growth rate.
- All ABC affiliates have dramatically increased their household ratings over the past two years based upon the February 2006 ratings period—WKRN-TV +28%, WTEN-TV +44%, WRIC-TV +41%, WATE-TV +28%, WBAY-TV +38%.
- Despite competition from the Winter Olympics on NBC and American Idol on Fox, the company’s ABC affiliated stations increased their SOP by 47% in the first quarter of 2006 as compared with 2005.
- Operating expense declined 1% despite $1.5 million of additional programming costs resulting from the addition of Sex and the City in the fourth quarter of 2005 and several other shows at several stations.
- WLNS-TV Lansing, Mich., took over the day-to-day operations for WHTV-TV, the UPN affiliate serving Jackson and Lansing, as part of a previously announced agreement with Venture Technologies.
- The Radio Television News Directors Association honored WBAY-TV with five Edward R Murrow Awards for excellence in local broadcasting. KELO-TV and WATE-TV each received one Murrow Award.
- The Louisiana Association of Broadcasters bestowed the “Television Station of the Year” award on KLFY-TV Lafayette, La., for the fifth time in the last nine years.