Sinclair Media Revenue Up 27% In 2Q

Sinclair Broadcast Group this morning reported that its second quarter 2021 total revenue increased 26% to $1,612 million as compared to 2Q 2020. Media revenues increased 27% to $1,600 million versus $1,260 million in the year-ago quarter.

Total advertising revenues of $491 million increased 109% versus $235 million in the prior year period, due to the general recovery of the advertising market from the pandemic and the resumption of professional sports games compared with none being played in the prior year quarter. The gains were partially offset by the absence of political revenues, as 2021 is a non-political year.

Core advertising revenues, which excludes political revenues, in the second quarter of $486 million were up 125% versus $216 million in the second quarter of 2020, due to the same factors that drove total advertising revenue gains.

Distribution revenues were $1,078 million versus $1,010 million, with the increase driven mainly by the absence of accruals for distributor rebates tied to minimum game guarantees. The gains were partially offset by dropped carriage of the company’s RSNs and subscriber churn.

Operating loss was $178 million, included adjustments of $35 million versus operating income of $492 million in the prior year period, which included $9 million of adjustments. Operating loss, when excluding the adjustments decreased to $143 million from operating income of $501 million for the same prior-year period.

Net loss was $332 million versus net income of $252 million in the prior-year period. Excluding adjustments, the company had net loss of $303 million.

Adjusted EBITDA, which excludes adjustments, increased 70% to $433 million from $254 million in the prior-year period.

Chris Ripley, president-CEO, said: “Results for the quarter were solid, as we outperformed our expectations amid the continued recovery in the core advertising market, as well as timing of expenses and our ongoing cost control efforts.

“As we progress through the year, we have been making great strides in a number of areas, including planning our direct-to-consumer local sports service expected to launch next year, the debut of gamification elements in conjunction with Bally Sports in some of our sports programming, and the evolution of our digital agency Compulse into an omni-channel marketing technology platform for local agencies and media companies. All of these areas, along with our achievements with ATSC 3.0 and our upcoming expansion of The National Desk, our news show for a national audience with a local perspective, are expected to be important components of our company’s strategy in the years ahead.”

Ripley continued, “We believe the full value of Sinclair is not reflected in the Company’s current stock price. There are numerous assets, apart from our broadcasting and regional sports networks businesses, that we believe have appreciable value. These include our warrants and options in Bally’s Corp., our licensed broadcast spectrum, the remaining tax benefit that came as a result of our RSN purchase in 2019, and our investments in non-core businesses and equity stakes, that we believe have a market value well in excess of book value. Together, we believe these assets alone are worth more per share than where the Company’s stock is currently trading.”

Ripley concluded, “Moving forward, we remain confident that our multi-pronged approach to growing our business through emphasizing multi-channel content, marketing services, data distribution, and gamification and community, along with our valuable and diversified asset base, will continue to move us toward our goal of becoming a top next generation media company.”

Read the company’s report here.

Also this morning, Sinclair’s board of directors 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 Sept. 15 to the holders of record at the close of business on Sept. 1.