Gray Television sees modest core revenue growth in Q3


Gray Television had already provided a preliminary look at its Q2 financial results, so the full details on Monday (8/8) were no surprise, with revenues up 1% despite the lack of political this year. The attention now turns to Q3.

“Based on our current forecasts, we believe that our combined third quarter of 2011 local, national and internet revenue, excluding political revenue, will increase from the three-month period ended September 30, 2010 by approximately 2% to 3%,” the company said. With political included, though, that would be a decline of 13-14%

That guidance of $73.5-74.5 million in revenues is below the $75.8 million (down 11.2%) that analyst Marci Ryvicker at Wells Fargo Securities had been expecting, as she broke out the details for clients. “Local revenue is expected to be +1 (v. our -1%), national is expected to be -5% (v. our +5%), political is expected to be $3.6 – 3.9M (v. our $3.1M) and retrans revenue is expected to be in line at $5M. Expense growth (opex and corporate) is expected to be flat to +1% vs. our -4.3% forecast. As a result, management’s outlook for both SOI (we calculate $24.5 – 25.0M) and EBITDA (we calculate $20.6 – 21.1M) are below our current forecasts of $28.1M and $24.8M, respectively,” Ryvicker said of the Q3 outlook from Gray.

In line with its previous estimates, Gray reported that Q2 revenues were up 1% to $76.2 million. Broadcast cash flow decreased 9% to $26.7 million.

Local advertising (not including political) was up 4% to $47.8 million, while national fell 3% to $13.4 million. Political advertising fell 59% to $2.3 million.

The big gainers were Internet advertising, up 56% to $4.9 million, and retransmission consent fees, up 8% to $5.1 million.