Sinclair 1Q Total Revenue Down 40%

Sinclair Broadcast Group this morning reported that its first quarter 2023 total revenue decreased 40% to $773 million versus $1,288 million in the prior year period. Media revenues also decreased 40% to $766 million versus $1,275 million in the same period a year ago. Excluding Diamond Sports Group (DSG), total revenues decreased 7% from $831 million in the prior year period and media revenues decreased 6% from $818 million.

Total advertising revenues of $309 million decreased 17% versus $371 million in the prior year period. Excluding DSG, total advertising revenues decreased 6% from $328 million in the prior year period.

Core advertising revenues, which excludes political revenues, were down 14% in the first quarter to $306 million versus $354 million in the prior year period. Excluding DSG, core advertising revenues decreased 2% from $311 million in the prior year period.

Distribution revenues of $426 million decreased versus $873 million in the same period a year ago. Excluding DSG, distribution revenues decreased 3% from $440 million in the prior year period.

Operating income of $21 million, including non-recurring costs for transaction and transition services, COVID, legal, and regulatory costs of $6 million, declined versus an operating income of $3,466 million in the prior year period, which included adjustments of $6 million and a $3,357 million gain on asset dispositions relating to deconsolidating DSG’s net liability. Operating income, when excluding the adjustments, was $27 million compared to an operating income, excluding adjustments and gain on deconsolidation, of $115 million for the same prior year period. Excluding DSG, operating income, excluding adjustments, decreased 77% from $117 million in the prior year period.

Net income attributable to the company was $185 million versus net income of $2,587 million in the prior year period. Excluding adjustments, the company had net income of $189 million. Net loss from DSG in the first two months of 2022 was $94 million.

Adjusted EBITDA decreased 53% to $120 million from $254 million in the prior year period. Adjusted EBITDA from DSG in the first two months of 2022 was $54 million.

Diluted earnings per common share was $2.64 as compared to diluted earnings per common share of $35.84 in the prior year period. On a diluted share basis, the impact of adjustments was $(0.07), and the impact of adjustments and gain on deconsolidation in the prior year period was $35.54.

Chris Ripley, president-CEO, said: “Sinclair is seeing a solid start to 2023, meeting or beating guidance on all key financial metrics. Nonetheless, we remain cautious for the full year on expectations for a weaker economy. As we continue our evolution from a traditional broadcast company to a diversified content and data distributor, we have begun the process of reorganizing our company structure to increase transactional flexibility and transparency around the sum-of-the-parts and to unlock value for our organization. Our end goal is to create an even more efficient company, designed to use the breadth of our assets to identify and accelerate growth.”

Ripley continued: “This year, we are allocating capital towards technology that will transform our operational workflow, both strengthening our returns on investment and improving operational outcomes. At the same time, the last few months have presented an opportunity to allocate capital to buying back our shares.”

Read the company’s report here.

Also today, Sinclair declared a quarterly cash dividend of $0.25 per share on the company’s Class A and Class B common stock. The dividend is payable on June 15 to the holders of record at the close of business on May 30.