Journal Open To Adding To Its TV Roster

You know the deal market is on its way back when media group executives start talking about M&A during earnings conference calls.

Journal Communications executives Steve Smith, president-CEO and Andre Fernandez, EVP, primed the pump for possible broadcast division buys during this morning’s call.

“We will consider acquisition opportunities that allow us to gain scale,” Fernandez said early in the call, noting that the company had reduced debt-to-EBITDA leverage to under one-times EBITDA in the past year, giving it the flexibility to execute strategic acquisitions.

In response to a question from Barry Lucas of Gabelli, Smith expanded on the point: “Our preference is to grow in-market, to add stations in markets where we already have a presence,” he said. “That reduces risk and allows us to leverage our management.

“Where we have a strong radio cluster, we would sure like to add TV to that. We’re not averse to new markets. We have the flexibility to make a move when the opportunity presents itself.”

The company website says Journal Broadcast Group owns and runs 11 television stations and 33 radio stations in 12 states. TV stations include the company’s flagship WTMJ, the NBC affiliate in Milwaukee (DMA 35); KTNV, the ABC affiliate in Las Vegas (DMA 42), as well as stations in Fort Myers, Fla., Tucson, Ariz., Green Bay, Wis., Omaha, and smaller markets.

With publishing revenues likely to continue declining, the company’s focus is on growing broadcast and digital segments. It projects low to mid single-digit core revenue growth in the broadcast segment in the current quarter.

Late in the call, Smith tempered the M&A talk slightly:  “The bottom line on JRN is the discipline we’ve exhibited over last couple years. Although acquisitions are interesting to talk about … our goal is to make the plan in 2011 and continue to have a strong balance sheet so we’re open to growth.”