Gray 1Q Revenue Dips 1% To $69.7 Million

Gray Television Inc. today announced results from operations for the three month period ended March 31, reporting that revenue decreased 1% from the year-earlier quarter to $69.7 million from $70.5 million.

The company said that the decrease was primarily due to decreased national and political advertising revenue, partially offset by increased local and internet advertising revenue and retransmission consent revenue. Political advertising revenue decreased due to decreased advertising from political candidates and special interest groups in the “off year” of the two year election cycle.

Net advertising revenue associated with the broadcast of the 2011 Super Bowl on its one primary Fox-affiliated channel and four secondary Fox channels approximated $200,000, which was a decrease from its approximated $900,000 earned in 2010 in connection with the broadcast of the 2010 Super Bowl on its 17 CBS affiliates.

In addition, results in the first quarter of 2010 benefited from approximately $2.8 million of net revenue earned from the broadcast of the 2010 Winter Olympic Games on its NBC stations. There was no corresponding broadcast of Olympic Games during the first quarter of 2011.

Retransmission consent revenue increased due to the improved terms of Gray’s retransmission contracts compared to those of the first quarter of 2010.

Gray continued to earn base consulting revenue under its agreement with Young Broadcasting, Inc.; however, it did not record any incentive consulting revenue in the first quarter of 2011 based on its operating results.

The principal components of Gray’s revenue were:

• Local advertising revenue increased $300,000, or 1%, to $43.8 million.
• National advertising revenue decreased $1 million, or 7%, to $13.0 million.
• Internet advertising revenue increased $1.1 million, or 38%, to $4.2 million.
• Political advertising revenue decreased $1.4 million, or 50%, to $1.4 million.
• Retransmission advertising revenue increased $400,000, or 9%, to $5.0 million.
• Production and other revenue decreased $300,000, or 17%, to $1.6 million.
• Consulting revenue from the company’s agreement with Young Broadcasting was $600,000.

Gray’s five largest advertising categories by customer type, excluding political advertising, demonstrated the following changes during the first quarter of 2011 compared to the first quarter of 2010: automotive increased 3%; medical increased 5%; restaurant decreased 4%; communications decreased 1%; and furniture and appliances increased 7%.

Read the company’s report here.