Tegna Sees Current Quarter In Positive Territory

For the current quarter, Tegna is expecting advertising and marketing services revenues to be up from a year ago, with total revenues (including retrans) up in the mid-single-digits.

Core advertising was down 6% in the fourth quarter for Tegna. But on the company’s quarterly conference call with analysts after this morning earnings release, Tegna EVP-CFO Victoria Harker said that was primarily due to displacement by record political revenues of $264 million, including $50 million from the Georgia Senate run-offs. She noted continuation of the sequential improvement in core seen each quarter since the pandemic began.

“To provide you with some further color on specific advertising category trends in the fourth quarter: As you’d expect, there was noise from political displacement among categories, specifically in October. That said, when looking at November and December trends, many categories are up over last year, including home improvement, services banking and financing, insurance and package goods. Automotive improved significantly, down year-over-year only low single digits relative to November and December. And notably, automotive is pacing positive — up mid-single-digits this quarter,” Harker told the analysts.

“Not surprisingly, categories which continue to struggle are retail, restaurants, entertainment and travel and tourism, given the ongoing impacts of the pandemic,” the CFO added. For the current quarter, Tegna is expecting advertising and marketing services revenues to be up from a year ago, with total revenues (including retrans) up in the mid-single-digits.

What about those lagging categories, asked one analyst.

“Restaurants have nowhere to go but up, for obvious reasons. Now, fast food has done pretty well,” said Tegna President-CEO Dave Lougee. Fast food, he said, is actually up this quarter, but that’s not the case for other restaurants.

Lougee noted a Wall Street Journal story on how people who’ve retained their jobs and have been working from home have been increasing their savings through the pandemic. ”We think that bodes very well for auto and retail, as well as restaurants. And then you have another big part of the population that’s likely about to get $1,400 checks. So, when you think about all that money — when the vaccines come around and we do open up this economy, which we’re also very optimistic about … we can imagine a pretty robust recovery in all of those categories,” he said.


Like other TV executives on this cycle of conference calls, Lougee noted the rapid growth of sports betting. “We’d said before the pandemic that it would be a growing, important local area over time. But given the pandemic, and the loss in cash revenues for states, we’ve seen an increased number of states moving on it,” he noted.

One analyst later want to know if sports betting has the potential to become a top-five category for local television.

“Yeah, I don’t have a hard time imagining that at all,” Lougee replied.

The CEO confirmed that the Premion connected TV and over-the-top sales business has turned profitable. The unit reported 2020 revenues up 40% to $145 million. One analyst asked for some detail on where Premion’s budgets are coming from.

“What we’re seeing is, certainly over time, more and more of the budgets are coming out of the digital budgets at the large agencies. Certainly there’s some TV budgets, too, but they’re not coming from ours. They’re not coming specifically out of Tegna spend. But, over time, it is absolutely shifting from TV to digital,” Lougee said.

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