Despite strong performances by its TV and website operations, the multimedia company posted a 6.8% decrease in revenues and a 58% drop in operating income.
Media General Inc., a multimedia provider of broadcast television, digital media and print products, today reported operating income in the second quarter of 2011 of $6.8 million, compared with $16.3 million in the second quarter last year. Interest expense of approximately $17 million in both years and non-cash tax expense in both years together produced a net loss in the second quarter of 2011 of $15.4 million, or 68 cents per share, compared with a net loss of $4.3 million, or 19 cents per share, last year.
Total revenues in the quarter decreased by $11.4 million, or 6.8%, to $154.8 million. Last year’s revenues included $7 million of political advertising spending, compared with $600,000 this year, and approximately $1 million of BP image advertising related to the Gulf of Mexico oil spill. Total operating costs were down 1.2% from last year, including approximately $1.6 million of severance expense in this year’s second quarter.
“Media General’s second-quarter results reflected the impact of a faltering economic recovery. Our broadcast television stations and website operations delivered relatively strong results, while our print operations, which are more immediately sensitive to economic shifts, and advertising services, were weaker,” said Marshall N. Morton, president-CEO.
“Our television stations did an excellent job of replacing a large portion of last year’s political revenues. Excluding political advertising in both years, broadcast revenues increased 6.6% in the second quarter. Local time sales grew 5.5 percent while national time sales increased 2.3 percent,” Morton said. “We have garnered political advocacy advertising in several markets already this year and we look for heightened activity in the second half of this year. We currently expect total political revenues for 2011 to be approximately $7 million. Automotive advertising, which weakened in the past few months, is expected to strengthen by the end of summer,” he added.
“Our local media websites generated an 18% increase in revenues, set a quarterly record with $8 million in revenues, and were profitable. Four of our five geographic markets generated double-digit percentage increases in revenues over the prior-year’s quarter.”
Read the company’s report here.