How Mega TV Drives SBS’s Net Revenue

By on Nov, 15 2016 with Comments 0

Call it the “little network that could.”

Mega TV, the SBS-owned Spanish-language television network found on flagship WSBS-22 in Miami; affiliates in Tampa and Orlando; across Puerto Rico; and on AT&T’s DirecTV and U-Verse, has found itself as the key revenue driver for a media company widely known for its radio stations across the nation’s biggest Hispanic markets.

SBS posted its Q3 2016 results on Monday, and Mega TV saw its revenues climb 23%, to $3.58 million.

Year-to-date, Mega TV’s revenue is up 11% year-to-year, to $10.5 million.

Unfortunately, the segment’s revenue is a fraction of that of SBS’s radio division, which continues to struggle on the revenue front.

Net revenue for Radio fell 4% in Q3, to $32.1 million, while year-to-date revenue for Radio is down 5%, to $92 million.

Overall, SBS saw its consolidated net revenue decline by 2% in Q3, to $35.6 million.

SBS shares fell 6.5%, to $2.90, on the news.

“During the third quarter, we continued to execute our multi-platform strategy aimed at growing our total audience share,” said Raúl Alarcón Jr., SBS’s Chairman/CEO and majority shareholder. “We further expanded our digital platform, particularly in mobile where we recently added a full video channel line-up to our LaMusica app. Today LaMusica is a robust video and audio platform that delivers a unique entertainment experience to users while offering advertisers opportunities to reach a highly engaged Hispanic millennial audience. The continued strengthening of our digital capabilities builds upon our leading station brands in the largest Hispanic media markets and strengthens our ability to deliver targeted multi-platform audiences to our advertising partners.”

Thus, the gamble on building a full-scale in-house production studio off the Palmetto Expressway seems to be paying off, as the radio properties lag.

“Our radio segment net revenue decreased by $1.4 million due to [lower] national, network, barter and internet revenue, which were partially offset by increases in local sales and special events,” Alarcón said. “Our local sales increased in our San Francisco, Miami, Los Angeles and Puerto Rico markets, while our national sales decreased in our New York, Chicago, San Francisco and Los Angeles markets.”

SBS’s special events revenue increased in its Los Angeles, San Francisco and Puerto Rico markets due to an increase in scheduled events, he added.

About The Author: Adam R Jacobson is a veteran radio industry journalist and advertising industry analyst with general, multicultural and Hispanic market expertise. From 1996 to 2006 he served as an editor at Radio & Records.

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