Scripps 4Q Local Media Revenue Climbs 39%

The E.W. Scripps Co. this morning reported fourth quarter revenue from its Local Media division (its TV stations and local brands on all platforms) of $281 million, up 39% from the prior-year quarter.

Local Media broadcast time sales were up 51%, driven by political advertising revenue of $82 million. The political ad revenue caused some displacement of core advertising, contributing to its decline of 8.4%.

Retransmission revenue increased 23% to $77.9 million. The increase in retransmission revenues was due to contract renewals covering approximately 5 million subscribers as well as regular annual contractual rate increases.

Local Media segment expenses increased 16.4% to $183 million, primarily driven by increases in programming fees tied to network affiliation agreements and an $8.9 million non-cash write-off of its Pickler & Ben syndicated show.

Fourth quarter Local Media profit was $98.7 million, compared to $45.4 million in the year-ago quarter.

The company’s National Media division reported 4Q revenue of $85.5 million, up from $57.9 million in the prior-year period.

Expenses for the National Media group were $78.5 million, up from $55.3 million in the prior-year period. The increase is primarily driven by continued investment in Newsy and Stitcher.National Media profit was

National Media group profit was $7 million, compared to $2.7 million in the 2017 quarter.

For the company as a whole, total revenue was $368 million compared to $262 million in fourth-quarter 2017. Income from continuing operations was $36 million or 44 cents per share.

For the full year, company revenue was $1.2 billion, which compares to revenue of $877 million in 2017. Retransmission and carriage revenue increased $44.7 million. Political advertising was $140 million in 2018 compared to $8.7 million in 2017. Revenue from Katz for the year-to-date period of 2018 was $186 million compared to $41 million for the one quarter we owned Katz in 2017. Katz was acquired on Oct. 2, 2017.

Costs and expenses for segments, shared services and corporate were $1 billion, an increase of $218 million, primarily driven by higher network programming fees and the acquisition of Katz.

Commenting on the quarter’s results, Scripps President-CEO Adam Symson said: “Last year, the company made tremendous strides in its plan to improve short-term operating performance while positioning itself strategically for long-term growth. In terms of our five-point growth plan, we completed the reorganization of our company into consumer-focused Local and National Media divisions, reduced our corporate and division costs by more than $30 million, sold our 34 radio stations, and beat our financial results guidance across the board each quarter.

“We announced plans to acquire 18 television stations from Cordillera and Raycom, enhancing our durability and depth in key states and growing our reach to 21 percent of the United States. Upon the closing of the Cordillera transaction, we will own No.1 stations in a third of our local media markets.

“We maintained a balanced approach to allocating capital through the television station acquisitions and the addition of digital audio leader Triton to our portfolio of fast-growing National Media businesses combined with the initiation of a dividend and our accelerated share repurchase program.

“Looking ahead, we are focused on continuing to seek opportunities to bolster the durability and reach of our portfolio. Scripps also continues to grow its retransmission revenue and will benefit in less than a year from the reset of its Comcast contract on Dec. 31, 2019.

“We will continue to scale our national businesses by focusing on audience and revenue growth to drive greater future cash-flow contributions.

“Our management prioritizes near-term operating performance while maintaining our approach to long-term value creation. These were the goals of our plan, and we are pleased with our progress in executing it.”

Read the company’s report here.