Sinclair 3Q Media Revenue Comes In Flat

Sinclair Broadcast Group this morning reported that its third quarter 2021 total revenue decreased 0.3% to $1,535 million versus $1,539 million in 3Q 2020. Media revenues increased 0.5% to $1,526 million versus $1,519 million in the year-ago quarter.

Total advertising revenues of $446 million decreased 11% versus $500 million in the prior year period, due to the absence of political revenues, as 2021 is a non-political year.

Third quarter core advertising revenues, which excludes political revenues, were $434 million, up 11% versus $391 million in 3Q 2020, due to a recovery from depressed levels in the same period a year ago caused by the pandemic.

Distribution revenues were $1,053 million versus $1,003 million, due primarily to a significant decrease of distributor rebates tied to minimum game guarantees that were in the prior period’s results. The gains were partially offset by dropped carriage of the company’s RSNs and subscriber churn.

Operating income of $73 million, included adjustments of $27 million, versus an operating loss of $4,216 million in the prior year period, which included a $4,264 million impairment taken on the Local Sports segment relating to goodwill and definite-lived intangible assets, and $13 million of adjustments. Operating income, when excluding adjustments, increased to $100 million compared to operating income of $61 million for the same prior-year period when excluding the Aadjustments and impairment.

Net income attributable to the company was $19 million versus a net loss of $3,256 million in the prior-year period. Excluding adjustments, the company had net income of $39 million.

Adjusted EBITDA, which excludes adjustments, decreased 39% to $451 million from $736 million in the prior-year period.

Chris Ripley, president-CEO, said: “As the economy emerges from the pandemic, our advertising recovery continues to be strong, with our core advertising, excluding auto, growing versus 2019 across both our broadcast and sports segments.”

“The continuing headwinds from auto component shortages, which in the near-term has reduced automotive advertising revenue, has been mostly offset by higher services and sports betting advertising demand, trends we expect to continue throughout the remainder of the year and into next year. 2022 should benefit from the recent moderation of subscriber declines, as well as further recovery from the pandemic and robust political advertising due to the mid-term election cycle, which should favorably affect overall advertising demand and rates.”

Ripley continued, “Our focus remains on growth opportunities in the broadcast, news and sports areas. New programming, the implementation of gamification elements across our platforms, the ramping up of activities around a ‘Direct to Consumer’ product and the utilization of the ATSC 3.0 technology will all be key initiatives as we move into the next year.”

Ripley concluded, “We are grateful for the patience and understanding of our customers, partners, and employees as we deal with the challenge of the recent cyberattack on our company. Our employees’ quick response and creative workarounds have helped us restore a significant portion of our systems. As we work to complete our investigation, we will look for opportunities to enhance our existing security measures.”

Read the company’s report here.

Also today, Sinclair declared a quarterly cash dividend of $0.20 per share on the company’s Class A and Class B common stock. The dividend is payable on Dec. 15 to the holders of record at the close of business on Dec. 1.