Tribune Media Third-Quarter Earnings Drop, Core Ad Revenue Rises 4.3 Percent
The company, led by CEO Peter Liguori, also benefited from higher carriage and retransmission revenue, but lower political ad revenue and higher programming expenses were drags on the bottom line.
Tribune Media, the entertainment company that was created by last year's split of Tribune Co., on Wednesday reported lower third-quarter earnings in line with Wall Street expectations as it reported higher retransmission consent and carriage fees, as well as growth in core advertising revenue.
The company, led by CEO Peter Liguori, posted a third-quarter profit of $27.9 million, or 29 cents per share. That compared with a year-ago profit of $38.0 million, or 38 cents per share.
Operating profits dropped 30 percent to $38.8 million. Adjusted earnings before interest, taxes, depreciation and amortization, another proiftability metric, fell 13 percent. Quarterly revenue rose 3 percent to $488.6 million, with core advertising revenue, which excludes political ads, up 4.3 percent. Including political, ad revenue was down 1 percent. Lower political ad revenue and increased programming expenses were drags on the bottom line.
Wall Street had, on average, expected earnings of $29.1 million on revenue of $503 million.
Tribune said local TV retransmission fees rose 20 percent in the third quarter, and WGN America recorded a 39 percent increase in carriage fees in the period "driven by an increase in rates and greater distribution."
"Our solid third-quarter results reflect the consistent focus we have on our long-term growth strategies," said Liguori. "We delivered growth across all our key revenue streams -- advertising, carriage fees and retransmission fees -- and converted WGN America to a basic cable network 18 months ahead of our initial schedule."
He added: "We see clear and compelling evidence that sports and news programming, especially in major markets, continues to accelerate the growth of our local station business. Our investment in high-quality original content is driving revenue growth now via increased carriage fees for WGN America and is expected to do so in the future through a series of distribution platforms."
The company has been doing more original series on WGN America, including Salem and Manhattan.
On an earnings conference call, Liguori lauded WGN America's growth, saying it was now in 11 percent more homes than a year ago. Having reached more than 80 million homes, it has grown subscribers year-to-date, while other sector players have lost subs, and the sub growth will accelerate next year, the CEO said.
He also lauded strong scatter ad market trends and said OTT service providers were interested in local news, meaning the company was looking forward to being part of OTT opportunities.