That Q2 result includes political, which was up $2.2 million to $3.6 million, while local and national both fell. Q3 is expected to be better, with the Olympics and more political advertising, but CEO Dunia Shive says “Current economic conditions make it extremely difficult to provide specific guidance for the third quarter or the balance of the year at this time.”
Compared to Q1 results, the declines in local and national sales improved marginally, but Shive noted that the company can’t predict the duration of the current economic downturn and is continuing to focus on cost reductions. Q2 results were better than Wall Street analysts had expected, so Belo’s stock moved up on Friday.
No longer joined to the A.H. Belo newspaper group, the pure-play television company reported Q2 net revenues of $189 million, down 4.7% from a year ago. Total spot revenue, including political, was down 6.4%, with local off 5.9% and national 10%. The company noted that automotive was particularly weak, down 10%. In addition to the gain in political advertising, Belo noted that ad revenue associated with its websites increased 7.3% to $7.5 million. Q3 Internet revenues are pacing stronger, since Q2 had been impacted by the non-recurrence of a Q2 2007 online promotion.
Retransmission consent is also a growth line. Q2 retrans revenues were $7.6 million, a 36% boost from a eyar ago. Belo is projecting that retrans revenues will total $30 million this year.
Guidance for Q3 was limited. “Current economic conditions make it extremely difficult to provide specific guidance for the third quarter or the balance of the year at this time. Third quarter total revenue comparisons should improve from second quarter year-over-year comparisons due to political revenues and Olympic revenues in August at our four NBC-affiliated stations,” Shive said.
Like many of her fellow TV CEOs, Shive is disappointed by the value Wall Street has placed on her company’s stock. “We do not think it reflects an appropriate value for the great assets we operate. We’re obviously being impacted by a weak economy and some nervousness about the long-term aspects of the television sector. We think concerns about the television sector are overstated and do not give appropriate weight to the long-term opportunities of our industry,” she said in her quarterly call with analysts.