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2Q Network Financial Results a Mixed Bag

9 Aug, 2017 By: Doug McPherson


NEW YORK – Second-quarter financial results among major TV network groups proved to be mixed.

On the broadcast side, Sinclair Broadcast Group revenues inched up just 2 percent, with lower net income. Total revenues hit $679.3 million, but net income was down 9 percent to $46. million. Both results beat analysts’ expectations.

Sinclair, like other TV station groups, expectedly dipped in political advertising revenues after enjoying big results throughout 2016. In the second quarter, Sinclair pulled in $5.4 million versus $16.7 million in 2Q 2016.

Overall, media revenue in the second quarter – before barter deals – improved 4.2 percent to $631.8 million. Sinclair said second-quarter digital ad revenues gained 40 percent against the same period one year before.

Going forward, the company expects flat advertising revenues in the third quarter – due to the absence of $11 million in Olympic advertising revenue earned in 2016. Sinclair expects “core” advertising to be flat-to-low single-digit-percentage gains.

At Turner, overall second-quarter ad revenues dipped by 6 percent – or $80 million. The network group blamed losses on the absence of the final games of NCAA men’s basketball tournament (which appeared on CBS this year), two fewer NBA playoff games, and lower overall ratings at its networks. New business advertising growth at Turner’s international networks partially offset the losses.

Revenues at Turner grew 3 percent to $3.1 billion – with most of the gains coming from a 13-percent hike ($187 million) in subscription revenues. Turner also witnessed an 8-percent decline ($15 million) in content and other revenues.

Turner’s sister TV group – HBO – posted a 1-percent improvement in revenue to $1.5 billion. HBO enjoyed an 8-percent gain in subscription revenue, but a suffered through a 44-percent loss in content and other revenue deals.

While Warner Bros. revenues were up 12 percent to $3 billion due to higher theatrical and video game revenues, its TV revenues gained more slowly. Time Warner – which has an $85 billion deal to be acquired by AT&T in place – gained 5 percent to $7.3 billion in revenues with net income up 12 percent to $1.1 billion.

For Viacom, domestic U.S. ad revenue dropped 2 percent to $955 million in its latest quarterly earnings period, partly attributable to cutbacks on heavy advertising loads per hour, which historically have been some of the highest among TV network groups.

Viacom reported its fiscal third-quarter revenues were up 8 percent to $3.4 billion. Net income rose 57 percent to $680 million. Revenues for Viacom’s U.S. networks were flat at $2.04 billion. Offsetting the 2-percent advertising decline, domestic affiliate revenues were up 4 percent to $1.01 billion. International revenues grew 8 percent to $522 million – excluding currency exchange impact.

Finally, AMC Networks posted higher-than-expected advertising gains of 2.6 percent. Todd Juenger, a senior media analyst at Bernstein Research, told MediaPost News, that the picture at AMC “remains muddy going forward, due to signs of weakening demand across the industry and less original hours.”

Juenger added he was worried that the latest-quarter C3 ratings – the average minute commercial ratings plus three days of time-shifted viewing – were down 6 percent among all viewers, and 9 percent lower among the key 18-49 Nielsen demographic.


About the Author: Doug McPherson


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