The local media, or television side of multimedia Meredith Corporation soared during the company’s fiscal Q2, with excellent results that would have been even better were it not for special charges related to recent acquisitions.
The company is awash in a sea of black ink.
In addition to its 17-station television group, Meredith owns and operates numerous magazines and related digital assets.
The company reported an overall revenue increase of 13% to $399M, bolstered by a 25% increase in advertising revenues. EPS was up 30% from $0.67 to $0.87.
Excluding $6M spent acquiring and assimilating new properties, and EPS would have increase 45%.
“We continued our strong momentum in the second quarter of fiscal 2015, again delivering higher cash flow and returns to our shareholders,” said Meredith Chairman and CEO Stephen M. Lacy. “Advertising trends strengthened, our recent acquisitions are performing above expectations, and our brands are stronger than ever with consumers across our media platforms and at retail.”
The television group brought home record profits, growing 64% to $60M, if the acquisition expenses are excluded. Revenues were up 50% to $157M and EBITDA grew to $70M.
“Our television expansion strategy is producing strong revenue and profit growth,” said Meredith Local Media Group President Paul Karpowicz. “We will continue to look for opportunities to strategically add to our broadcasting portfolio, as well as drive growth through increased advertising and retransmission revenues.”
Meredith offered the following television highlights:
* Total advertising revenues increased 58 percent to $125 million, an all-time quarterly record.
* Political advertising revenues were $29 million and totaled $42 million for the first half of fiscal 2015 – both record highs. In addition to contributions from newly acquired stations in St. Louis and Phoenix, Meredith’s existing stations in Phoenix, Hartford and Kansas City generated significant political dollars.
* Non-political advertising revenues grew 22 percent to $95 million, benefiting from the recent acquisitions and strong digital advertising revenue performance.
* Other revenues and operating expenses increased, due primarily to growth in retransmission revenues from cable and satellite television operators and higher programming fees paid to affiliated networks, along with contributions from recent acquisitions. Most of Meredith’s retransmission agreements with cable and satellite operators are scheduled for renegotiation in the next 24 months. Meanwhile, most of Meredith’s network affiliation agreements are in place into fiscal 2017 and beyond.
