E.W. Scripps Sees Surge In Core Advertising

The E.W. Scripps Company on Friday reported second quarter same-station core advertising up 48%—giving Scripps President-CEO Adam Symson reason to claim bragging rights to “industry-leading results.”

CFO Jason Combs added that the local media division had topped its guidance and outpaced growth at its TV industry peers who have reported quarterly results. (The last of those peers, Tegna, is due to report next Monday.)

Brian Lawlor, president of local media credited “outstanding sales execution” for the company’s sales teams outperforming the rest of the industry.

“With a rise in consumer confidence and discretionary spending, we saw year-to-year [growth] in our 10 largest advertising categories. Our largest category, services, saw a 35% jump in year-to-year spending. Our automotive category was up 64%, compared to a big drop in Q2 of 2020, but also despite the chip shortages that are causing inventory issues. Our retail category was up 66% in Q2. And our fourth-largest category, travel & leisure, aided by both sports betting and Americans’ return to both travel and entertainment, was up more than 600%,” Lawler told analysts.

“In addition to a strong ad market, our core ad revenue is being bolstered by our success capturing new-to-TV advertisers,” Lawlor said. “Last quarter I told you we brought in over 800 new advertisers, while in this quarter we had over 1,000 new businesses advertising on our local stations.”

Lawlor was asked during Q&A for details on how those new advertisers are tallied. He explained that an advertiser is considered “new” for 12 months, and then becomes a regular advertiser.

“Typically, they’re pretty sticky,” he said, when asked about retention. Over 75% of the new advertisers continue advertising beyond that 12-month mark.

Much as Gray Television noted on Thursday, Scripps isn’t expecting auto to return to being local TV’s number one ad category.

“Services is 35% of our business,” Lawlor said. “It’s been a growing category, even when auto was healthy. Services replaced auto as our top category several years ago and just continues to build.

“Auto right now is about 15-17% of our business,” he continued. “In the past couple of years, it’s been about 20—and I think that’s where it settles back in when it hits momentum again. I don’t ever see an opportunity where auto has enough momentum, or enough dollars to get back to the strength of our services category.”

On the Scripps Networks side, following the assimilation of ION Media, President Lisa Knutson said the company’s upfront exceeded expectations. Scripps now has eight over-the-air (OTA) digital multicast networks, following the recent launches of TrueReal and Defy TV. That will grow to nine in October with the launch of an OTA version of the Newsy online network.

Scripps Networks posted a 23% revenue gain in the second quarter and has been producing a 45% profit margin.

Focusing on the company’s seamless digital-OTA strategy, Combs told Wall Street of the recent launch of the digital news site Florida 24. “Florida is a very important state for Scripps. We own six stations there,” he noted. The new ad-supported site incorporates content from the Scripps newsrooms in Tampa, Miami, Ft. Myers, West Palm Beach and Tallahassee, plus other sources.