Entravision’s net revenue dropped to $57.8 million in the quarter, from $58.5 million in Q3 2012, a decrease of $700K or 1%. Of the overall decrease, $1.2 million was from the television segment and was blamed on political ad comps, partially offset by increases in local ad revenue and retransmission fee dollars. This decrease also offset by a $500K increase (3%) in the radio segment, which saw an increase in local ad revenue, even though political ad comps were down as well.
Operating expenses increased to $34.0 million, from $32.9 million in Q3 2012. That increase was given to an increase in salary expense and expenses associated with the increase in local ad revenue.
YTD, net revenue increased to $163.8 million vs. last year–an increase of $4.3 million. Of the overall increase, $2.8 million was generated by the television side via increases in local and national ad revenue, and retransmission consent money, partially offset by a decrease in political ad dollars. $1.5 million of the overall increase was generated the radio segment and was primarily attributable to increases in local and national ad revenue.
Local television revenues increased 16% in the quarter, while national TV revenues declined 21%. Excluding retransmission and the impact of political ad sales, core TV revenues increased 8% compared to Q3 last year. Core local television revenue grew 16%, while core national revenue decreased 1% during the quarter.
Said Walter Ulloa, Entravision CEO, on the call: “Overall, our television revenue performance continues to outperform the broader television industry. The Television Advertising Bureau currently estimates that the core television industry fell 5% in the third quarter compared to core growth of 8% at our television stations. We have now significantly exceeded the industry’s core growth projections for 8 consecutive quarters. A key contributor to our core television performance was the automotive category, which finished the quarter up 19% compared to last year. Automotive spending growth at our TV stations has now posted double-digit increases in 14 consecutive quarters. Importantly, the growth in automotive continues to be broad-based. We saw growth in 6 of our top 8 auto brands during the third quarter. 97.5% of our automotive television revenue is generated from our top 8 automotive brands, and Ford and Chrysler Group were the only 2 automotive brands where ad spending with Entravision television was down year to year.”
During the third quarter, Ulloa said they added 28 new television advertisers who invested $10,000 or more with their television properties. New television clients included Franklin D. Azar and Associates, WellPoint, Nevada Health Link, Aetna and Dick’s Sporting Goods.
Moving over to the radio division, Ulloa mentioned Entravision’s station group once again outperformed the broader radio industry, which Miller Kaplan estimates grew 2% during Q3 in the 12 markets where they subscribe.
“Local revenue, which represents 69% of our total radio revenue, increased 10% during the quarter, while national revenue, which represents 31%, declined 10% due to reduced political advertising compared to the prior year quarter. Net political revenue in the third quarter was $39,000 compared to $540,000 in the third quarter of last year,” he said.
Revenues at Entravision Solutions Audio Network increased 34% during the quarter and are up 18% YTD. “This revenue growth is attributable to the strong interest we are securing from major advertisers as they seek effective ways to target Latinos across our markets. This increase is supported by the robust year-over-year growth in network advertising. During the third quarter, we had a total of 32 Entravision Solutions Network advertisers compared to just 19 during the same period last year. Our top 3 advertisers were Mars, JCPenney, Walmart and Sears,” said Ulloa. “Our radio division continues to generate balanced growth across key advertising categories. We recorded revenue growth in 7 of our top 10 categories in the third quarter. The auto category, which is our second largest category in the quarter, ended with revenue up 8%…In addition to automotive, our strong growth categories in the third quarter were services, which is our top category for the quarter. It increased 6%. This increase was a result of Farmer Insurance increasing their spending by 155%. Travel and leisure increased 5%. Retail saw a 27% increase. We saw increased revenue in the telecom category of 12%, and the health care category was up 14% in the third quarter. Fast food, restaurants, media and product brand names were down in the quarter. We added 34 new radio advertisers who spent more than $10,000 during the third quarter, which resulted in approximately $800,000 in revenue.”