Tegna 3Q Broadcast Revenue Dips 2.4%

Tegna, the former broadcasting and digital arm of Gannett Co., today released third quarter earnings figures that included Broadcasting Segment revenues of $406.4 million, down 2.4% compared to $416.5 million in the third quarter of 2014.

The company said the drop “reflects the absence of $33.9 million of net political spending which more than offset significant increases in retransmission revenue and online revenue as well as higher core advertising.”

Broadcasting Segment revenue broken down by category:

• Core (local and national) was up 1% to $254.2 million
• Political was down 85% to $6 million
• Retrans increased 19% to $109 million
• Digital grew 13% to $29.4 million

Broadcasting Segment operating expenses were $247.9 million, an increase of 3.9% compared to the third quarter of 2014 due, in part, to higher reverse network compensation. Operating income totaled $158.6 million while adjusted EBITDA was $177.0 million.

Digital Segment operating revenues of $351.1 million were significantly higher in the third quarter, up 71.6% driven by the acquisition of and continued strong organic growth at Cars.com. On a pro forma basis, Digital Segment revenues grew 5.3%  reflecting a mid-20s percent increase in revenue at Cars.com.

Gracia Martore, president-CEO, said: “We are pleased that Tegna has capped off its first quarter following the close of our separation on such a strong footing, with company-wide revenue up nearly 20%. Tegna Media revenue continued its strong trajectory despite the absence of approximately $40 million in political spending in the third quarter of 2014 — which speaks to strong growth in retransmission revenue, online revenue and core advertising during the quarter.

“In Tegna Digital, revenue increased substantially to more than $350 million — an increase of 72% — as we continue to generate strong organic growth at Cars.com while shifting CareerBuilder’s focus toward higher-margin software as a service solutions. We expect that the momentum we’ve seen this past quarter puts us in a very strong position as we continue to execute Tegna’s more focused strategy going forward. Beyond this, we expect to see even greater impact as the nation’s political races begin to heat up into 2016.”

The company as a whole reported revenue growth of 19%, with non-GAAP earnings per share from continuing operations up 28% and a 22% increase in adjusted EBITDA.

Read the company’s report here.