The renewed purchase of airtime by automobile manufacturers, the emerging economy and the presence of the up side of the two-year election/Olympics cycle are all fueling a return to black ink for television group Belo Corp., which adds that Q2 pacings are also looking good.
Belo President/CEO Dunia A. Shive commented, “Belo’s first quarter total revenue increase of 15.6 percent was highlighted by a strong resurgence in the Company’s spot advertising revenue, which grew more than 17 percent compared to the first quarter of 2009. While political, Olympics and Super Bowl revenue all contributed to the year-over-year spot revenue increase, improved advertising conditions in several of the Company’s largest categories were also factors, especially automotive which was up 45 percent. The Company’s station EBITDA of $57.5 million in the first quarter of 2010 was up 77 percent compared to the first quarter of 2009. The Company reduced its debt by $35 million during the quarter.”
Looking ahead, Shive noted that some expenses were going to be up, but was nevertheless feeling good about the prospects for the second quarter and the remainder of the year. Shive said, “We are optimistic that the advertising momentum we experienced in our core business in the first quarter of 2010 will continue in the second quarter. Total spot revenue in April is expected to finish up about 10 percent compared to April 2009 with little political revenue, and the months of May and June are currently pacing above that level. Based on these pacing trends, total spot advertising revenue could approach a mid-teen increase in the second quarter of 2010 compared to the second quarter of 2009. Within these estimates, the automotive category is currently pacing up more than 40 percent. We continue to expect robust political spending in 2010, most of which will come in the second half of the year.”
RBR-TVBR observation: Television’s even-odd boom-bust revenue roller-coaster is on its way to the top of the tracks, which will most likely make its recovery appear much more robust than radio, which has a far more muted even-odd effect. And after what broadcasters, any number at all that can be printed in black ink looks beautiful, and double-digit black numbers are absolutely gorgeous.
But these numbers are going up against some of the easiest comps in the history of broadcasting, so the rule going forward is to celebrate and let out a sigh of relief, but keep on working to make sure this is a true turnaround rather than a brief surfacing followed by more red ink.
