Looking ahead, Sinclair noted a trio of challenges as it works its way through an odd-numbered year. However, if the trio is set aside, it’s shaping up to be a good year.
Net revenue in the first quarter will rise despite a large drop in political revenue and a significant reduction in Super Bowl income. And of course, there are no Olympics this year.
Net revenue is expected to gain between 22.2% and 23.3%, totaling in the neighborhood of $460M.
Political will likely decrease from $6.1M to $1.6M. On the Super Bowl side, Sinclair did much better when Fox had it, raking in $7M. The NBC Super Bowl will reduce the income to $1.7M. The lack of Olympic revenue will punch another $3.7M into comps.
“We feel optimistic going into 2015 with first quarter core advertising revenues pacing flat to slightly up when excluding Super Bowl, Olympic and incremental political revenues,” commented David Amy, Executive Vice President and Chief Operating Officer. “Transition of the stations acquired in 2014 has been nearly seamless. Likewise, we successfully completed negotiations for new retransmission consent agreements with over 490 multichannel video programming distributors, including U-verse, FiOS, Armstrong Utilities, Atlantic Broadband, CableOne, CenturyLink, Wave Broadband and Wide Open West. The new retransmission consent agreements provided uninterrupted carriage of our stations to over 6.3 million unique subscribers, representing over 99.9% of subscribers covered by the expiring agreements. For 2015, we will be focused on launching our new digital content management system, expanding local and national news initiatives, as well as reaching consensus on the advanced technology of the Next Generation Broadcast Platform.”
The company noted that new closed captioning rules will add to its expense profile.
On the plus side, 80% of the company’s retransmission consent agreements will expire in 2015 or 2016, opening the door to a potential revenue increase.
Sinclair execs all bemoaned the current situation on Wall Street. It believes that it is severely undervalued and has no idea why, while internet companies that are bleeding money are doing well.
