Station acquisitions drive up broadcasting revenue, but even on a same-station basis the gains are strong, helped by political, retrans and digital.
Gannett Co. released fourth quarter and full year earnings today that include Broadcasting Segment revenues 117% percent higher compared to the fourth quarter last year at a highest ever $495.3 million.
The increase was fueled by the expansion of the TV station portfolio (Belo and London Broadcasting stations), as well as significant increases in politically related advertising and retransmission revenues.
On a pro forma basis, Broadcasting Segment revenues were up 25% percent compared to the fourth quarter in 2013. Substantially higher retransmission revenue that totaled $94.3 million, a 56.3% increase, as well as $92.4 million of political advertising drove the increase.
Pro forma digital revenues in the Broadcasting Segment were 16.5% higher reflecting primarily growth in digital marketing services products.
Core ad revenue was $276 million, up 63% from a year ago (or 7% on a pro forma basis).
Digital Segment operating revenues totaled a record $345.4 million, an increase of 76.6 percent compared to the fourth quarter of 2013. The substantial increase reflects primarily the impact of the Classified Ventures acquisition and strong results at Cars.com. Revenues on a pro forma basis in the Digital Segment were up 9.7% driven in large part by revenue growth of 24.8% at Cars.com and 3.8% at CareerBuilder. The revenue increase at Cars.com reflects principally new affiliation agreements as of Oct. 1 that resulted in higher wholesale rates charged to its affiliate newspaper and broadcasting markets as well as rate and unit growth in direct markets. A significant increase in its digital software-as-a-service products drove the revenue increase at CareerBuilder.
Publishing Segment revenues in the quarter totaled $885.5 million, down 6.2%. Publishing Segment revenues on a pro forma basis declined 5.9% reflecting primarily softer display advertising partially offset by an increase in digital marketing solutions revenue and digital advertising.
The company as a whole reported operating revenues in the fourth quarter were up 24.3% compared to the fourth quarter of 2013 and totaled $1.7 billion. The substantial increase was driven by record revenues in the Broadcasting and Digital Segments.
Gracia Martore, president and chief executive officer, said: “Our strong fourth quarter results cap a milestone year for Gannett — reflecting our bold strategy and continued focus on reshaping and reinventing the company to accelerate growth in today’s multi-platform media landscape. Based on our strong operating performance and balance sheet strength, we are resuming our share buyback program, well ahead of the timeline we had previously anticipated. Our broader and more diverse footprint drove record revenue in Broadcasting for the fourth consecutive quarter and resulted in our highest political revenues ever in a non-presidential election year. We also posted record-breaking Digital Segment revenues, driven by our full ownership of Cars.com, which had a terrific quarter, as well as continued growth at CareerBuilder.
“On the Publishing side, we continue to innovate and find ways to deepen our connections with our audiences and advertisers through initiatives like USA Today local content editions, which have delighted customers and substantially exceeded our revenue expectations. Even as we achieved this tremendous revenue growth, we remain committed to operating as efficiently as possible, which has continued to improve profitability, including a 57% increase in adjusted EBITDA as compared to the fourth quarter last year.”
Read the company’s report here.