Media investment bank M.C. Alcamo & Co. has been crunching the numbers and reports that the US television broadcast industry grew revenues 12.1% in Q1. The report, based on data reported by the publicly traded TV groups, found that the sector’s profitability margin improved from 34% in Q2 of 2009 to 39% in Q2 of this year.
“A strong advertising recovery, coupled with industry-wide productivity advances, powered revenue and margin gains at virtually all firms,” said Michael Alcamo, the firm’s president. “Despite a sluggish consumer recovery, corporate ad budgets are up sharply and are fueling industry growth. Industry-wide margin expansion reflected two factors. First, revenue was up nearly 17% on the strength of major ad categories. This was magnified by technical innovation and tight control over expense growth. The two dynamics led to + 34% EBITDA growth industry-wide, and margin expansion to 39%.”
Importantly, Alcamo noted, at two broadcasters — Sinclair and LIN – increases in net operating income was fueled by both revenue increases as well as expense reductions.
“We expect continued revenue and profit growth in 2010. First, fully digital transmission commenced in mid-June 2009, thus, lower levels of electricity costs will be incorporated into the expense base starting with the third quarter. Secondly, the full impact of political advertising will be felt in the latter two quarters of 2010,” Alcamo said.
Fisher Communications led the field in revenue growth, up 27.7% in Q2. The seven pure-play broadcasters in the group posted aggregate quarterly revenue growth of +16.7%. Eight integrated media firms posted broadcast revenue growth of + 9.0%. Together, the fourteen companies recorded Q2 2010 revenue growth of $178 million, or + 12.1%.
Company by company results are detailed in the pdf attachment on this page.
