Scripps: Core Rebound Better Than Expected

Brian Lawlor, president of local media, said: “Core advertising began to turn around almost immediately after Election Day. “In addition, sports betting has emerged as a material contributor to our travel and leisure category.”

While the fourth quarter that E.W. Scripps Co. reported this morning was strongly boosted by political revenues, new CFO Jason Combs told analysts on the company’s conference call that core advertising came in better than expected. Excluding recently divested WPIX New York, core was down 8% in the quarter to $170 million. That was a major improvement over the company’s guidance of being down in the mid-teens.

“We did see significant displacement from political ads from Oct. 1 to Nov. 3. But after Election Day, we saw core climbing back and we’ve had an acceleration of momentum since the start of the year. For the first quarter of the year, our best view right now is that core will be about flat from the first quarter of 2020 on an adjusted, combined basis,” Combs said. That adjustment includes acquisitions as well as the WPIX sale.

Brian Lawlor, president of local media, provided more detail: “Core advertising began to turn around almost immediately after Election Day. Services were up high-single-digits in both November and December. And home improvement was up high-singles in November and nearly 20% in December. Auto was down only low single digits in December — and some subcategories, like foreign factory, showing year-to-year growth.”

That momentum has continued, he said, in the current quarter. “Services and home improvement remain up, and auto is down only low-single-digits, despite new production problems due to chip supplies,” Lawlor said.

“In addition, sports betting has emerged as a material contributor to our travel and leisure category. That category has been decimated by the pandemic’s impact on live sporting events, concerts, travel, cruises and even casino attendance. The emergence of sports betting has helped rebound the travel and leisure category, pushing the first quarter positive compared to last year,” he explained.

“Sports betting is already legal in seven states where Scripps owns stations, with more coming this year. As states make sports betting available to their citizens, the industry is using local broadcasting stations as a primary means for getting out their message,” Lawlor said. He noted that excluding sports betting, the travel and leisure category is down about 45% this quarter, so he’s looking forward to the return of live events that have traditionally driven ad spending.


Political spending won’t be nearly as significant in this off-year, but Lawlor noted that there will be a gubernatorial race in Virginia and issues on the ballot in some states. “With 18 Senate races up next year, and a 50-50 Senate, I think you’re going to see some early spending in the races that are considered to be tight or toss-up. We think it’s going to get an early start in the back half of the year,” he said.

Is there another new revenue stream waiting in the wings for local television? One analyst wanted to know whether the just-enacted Australian model of making online giants like Google and Facebook pay for news content come to this country.

“I do expect that this will eventually move to the U.S., where the FAANGs (tech giants) end up paying their fair share to the news creators. I do expect that local broadcast stations like ours will be at the table developing those relationships. I think you’ll see us at Scripps playing an active role in those conversation,” said Scripps President-CEO Adam Symson.

Comments (0)

Leave a Reply

More News