Radio operator Beasley Broadcasting Group Inc. was flat in eight of 11 markets, but the three that picked up steam raised the Q2 2010 net revenue for the entire group by 5.6%, to $1.3M. On a same-station basis, the gains were even better, amounting to a 6.6% gain.
BBGI credited its operations in Las Vegas, Philadelphia and Ft. Myers-Naples with fueling the flow of black ink.
Operating income was up $1.8M, a gain of 46.4%, which the company credited to cost containment initiatives which brought overall operating expenditures down 2.6%. Second quarter station operating income was also up $1.8M, or 26.5% to $8.5M.
Chairman/CEO George G. Beasley commented, “The radio industry and Beasley Broadcast Group are continuing to see a rebound in advertising spending and the 6.6% rise in second quarter same-station net revenue was the Company’s best comparison since late 2007. The significant growth in second quarter SOI, operating income and net income again highlights the value of the Company’s streamlined cost structure and the significant operating leverage in our model.”
Beasley continued, “Key Beasley clusters in Philadelphia, Las Vegas, Ft. Myers, Augusta and the Coastal Carolinas exceeded results from a year ago and operating results also benefited from growth in national revenue, reversing a trend from recent periods. In addition, the Company continued to drive strong interactive revenue growth with second quarter revenue from these sources rising approximately 19% from 2009 second quarter levels. Reflecting station level expense management disciplines, the Company generated second quarter SOI margins of 34.0%, a significant rise from 28.4% in the comparable period last year.”
Beasley said that the company would continue to stay on top of expenses, and was looking forward to a shot in the arm from the upcoming political season in the second half of 2010.
Bruce Beasley said increases in a number of advertising categories were part of the improved performance, citing retail, health care, banking, auto and “other” as business drivers. He added that the group feels it has room for improvement in many markets, room it will spare no effort to take advantage of.
In response to a question from analyst Jim Boyle, Caroline Beasley noted that the economic recovery is not straight up, rather starts and stops, and will likely continue in cycles. Referring specifically to conditions in Florida and Nevada, she said both are having employment problems, but radio revenue also picked up in both, and both should be fertile political advertising locales. Bruce Beasley added that pricing in the larger Beasley markets is starting to improve, and political will help that.
Caroline Beasley also shed a bit of light on the group’s political fortunes thus far in 2010. She said that $300K came in during Q2, with about 2/3 of that in Las Vegas. So far only $40K on the books for Q3, again mostly in Las Vegas.