Gray Television’s Q4 revenue was $126.6 million, topping the previous Q4 record of $114.6 million set in 2010. Needless to say, political advertising was the biggest shot in the arm, with retransmission consent income and Internet ad revenue moving revenue up a whopping 50% in the quarter.
In Q4, revenue increased $41.9 million, or 50%; for the year, revenue is up 32% to $404.8 million. The previous FY record was $346.1 million in 2010.
A significant portion of retrans consent contracts expired in 2011, and Gray was able to renew substantially all of these contracts under terms more favorable to Gray in the quarter.
Internet ad revenue increased due to increased spending by advertisers in an improving economic environment. National and local ad revenue decreased, in part, due to an increased portion of available time being sold for political advertising revenue rather than local and national advertising.
Broken down, local advertising revenue decreased $0.4 million, or 1%, to $50.4 million. National ad revenue decreased $1.0 million, or 6%, to $15.1 million. Internet advertising revenue increased $0.8 million, or 14%, to $6.6 million. Political advertising revenue increased $38.8 million, or 853%, to $43.4 million.
Retransmission consent revenue increased $3.5 million, or 71%, to $8.5 million.
Gray’s five largest nonpolitical advertising categories on a combined local and national basis by customer type for Q4 demonstrated the following changes, compared to Q4 of 2011: automotive increased 10%; medical decreased 7%; restaurant decreased 5%; furniture and appliances increased 10%; and communications decreased 7%.
For the year, Gray said political ad revenue reflected increased spend from political candidates and special interest groups during the “on year” of the two-year political advertising cycle. “Our political advertising revenue also increased due to additional advertising related to a special election to recall the Governor of Wisconsin, where we have three television stations. Retransmission consent revenue increased primarily due to the improved terms of our retransmission contracts.”
Local and national revenue increased due to increased spend by advertisers in a gradually improving economic environment and their airing of the 2012 Summer Olympics. During the year, Gray earned $4.0 million of revenue from local and national advertisers and $1.1 million of revenue from political advertisers during the broadcast of the 2012 Summer Olympics on our ten primary NBC stations.
Specifically, local and national ad revenue was positively influenced by the broadcast of the 2012 Super Bowl on their 10 primary NBC channels, earning the company some $0.8 million, an increase of $0.6 million compared to the broadcast of the 2011 Super Bowl on its then-one primary FOX-affiliated channel and then-four secondary digital FOX-affiliated channels, which earned $0.2 million. For FY 2012, local ad revenue increased $4.3 million, or 2%, to $191.3 million. National ad revenue increased $0.4 million, or 1%, to $56.8 million. Internet ad revenue increased $4.9 million, or 24%, to $25.0 million. Political ad revenue increased $72.5 million, or 537%, to $86.0 million. Retransmission consent revenue increased $13.5 million, or 67%, to $33.8 million.
On 7/30/09, Gray was awarded a contract to manage seven Young Broadcasting stations. Through December 31, 2012 Gray will earn $2.2 million and an opportunity to earn additional fes if certain performance targets are exceeded. The Young-owned stations managed by Gray include:
WKRN-TV Nashville, TN
WTEN Albany, NY and translator WCDC-TV in Adams, MA
WRIC-TV Richmond, VA
WBAY-TV Green Bay, WI
KWQC-TV Davenport, IA
KELO-TV Sioux Falls, SD and its translators throughout South Dakota
KLFY Lafayette, LA