Nexstar In Q3: BCF, Net Revenue Slip On Digital Dip


When it comes to the key drivers for Nexstar Media Group, the nation’s No. 1 owner of TV stations looks solid: local revenue and national revenue were both up by double-digits in the third quarter.

Retransmission fee revenue climbed by nearly 4%, while a deal with Fox Corporation designed to lower its leverage are all positives for Nexstar.

Unfortunately, the company’s Q3 report is full of declines. They’re all tied to Tribune Media acquisition costs.

On an adjusted basis, Nexstar saw earnings before interest (EBITDA) of $143.53 million (61 cents per share), compared to $256.46 million ($2.12 per share) in Q3 2019. This missed the Zacks Consensus Estimate of $1.52 per share.

However, investors seemed nonplussed on Wednesday, as its revenue decline to $663.6 million, off from $693 million, surpassed the Zacks Consensus Estimate by 0.93%.

The overall results reflect the legacy Nexstar Broadcasting and Digital operations (less twelve days of results from eight Nexstar station divestitures) and 12 days of results from the Tribune Media stations, net of divestitures.

Local Revenue and National Revenue, as stated above, each grew significantly.

The problem: The loss of political dollars was felt.

Meanwhile, the all-too controversial Retransmission Fee revenue increased by 3.7%, reaching $294.8 million.

That’s certainly to raise the ire of ATVA and ACA Connects, as Nexstar is earning more from retrans fees than from its advertising, ex-political.

Broadcast Cash Flow declined by 28.1%, to $202.65 million.

“Our active third quarter and recent strategic initiatives have positioned Nexstar for its next free cash flow growth cycle and significant near-term leverage reduction,” said company founder and President/CEO Perry Sook.

As of 3:30pm Eastern, NXST was up 2.6% to $99.52.