Automotive advertising improved in each month of Q3 for LIN Media, so while total revenues were down 3% to $100.8 million, that would have been a gain of over 7% excluding political, but including a gain of more than $6 million in Internet/retrans revenues. Core advertising revenue, excluding political, was essentially flat, but is now trending up in Q4 according to CEO Vince Sadusky (pictured).
Scott Blumenthal, Executive Vice President Television, told analysts that national, excluding political, was down 3% in Q3 to $28.4 million, but local increased 2% to $56.6 million. Political was $2.8 million, compared to $12.5 million in Q3 of 2010.
Blumenthal reported that categories were mixed, with five of the top ten categories up and five down. Automotive was down 3% for the total quarter, with domestic up 1%, foreign up 5%, but local dealer advertising down 13%.
But auto has been strengthening. The 3% decline for Q3 improved on an 8% decline in Q2 and Sadusky noted that auto improved in each month of Q3, with the final month, September, up slightly over a year ago. Core business is looking even better in Q4, with auto leading the way.
With core business pacing up in Q4, LIN is still working against huge political revenues of $28.2 million a year ago, so net revenues are expected to be down 10-13%, which would put them in a range of $109-113 million, down from Q4 2010 net revenues of $125.1 million.
Q3 EBITDA was $26.6 million, which was in line with expectations.
The quick analysis from Marci Ryvicker at Wells Fargo Securities: “Q3 results were in line, with core better than expected and political lower – which, to us, is a positive. Q4 guidance is lighter both in revenue and expenses although EBITDA is slightly lower for Q4 in general.” She calculates EBITDA from the guidance in arrange of $36.6-38.2 million.
RBR-TVBR observation: Television is still a pretty good business. Looking at the recent M&A activity, Sadusky says it’s just “more affirmation that we’re an incredibly valuable group.” Wall Street is certainly putting a lower value on TV stocks than the multiples in the private market for TV station assets.