Television group Nexstar has added 18 stations since it last reported second quarter financials, and the new additions have produced huge gains in net income and all other major metrics, despite the standard off-year loss of political income. And there are already announced acquisitions in the pipeline waiting for closing.
Here are the key numbers:
Net revenue was up 42% to $126.2M, despite a 69.5% drop in political from $6M to $1.8M. Local was up 40.9% to $66.7M and national was up 51.8% to $28.6M
Broadcast cash flow was up 25.6% to $49.8M; and adjusted EBITDA was up 24.3% to $42.9M.
Nexstar chief Perry Sook stated, “During the second quarter, the successful integration of recently acquired stations combined with ongoing initiatives to leverage our targeted localism, content and advertiser relationships drove a 42.0% rise in net revenue, more than offsetting the $4.2 million year-over-year decline in political advertising revenue. Excluding political advertising revenue and including results from our recent acquisitions, second quarter station revenue grew 48.4%, reflecting core television ad revenue growth, a significant rise in retransmission consent revenues and our 26th consecutive quarter of e-Media revenue increases. Nexstar’s ongoing revenue diversification is reflected in the growth in total second quarter retransmission fee and e-Media revenue which rose 65.3% to $32.6 million, and accounted for 26% of 2013 second quarter net revenue, compared to 22% of net revenue in the year-ago period and 17% of net revenue in the 2011 second quarter.”
Sook said that expenses incurred with all of its strategic growth initiatives subdued its profit results to an extent.
Discussing recent acquisitions, Sook said, “Consistent with our long-term strategic objective to target expansion opportunities through accretive transactions that expand our revenue, scale and operating base, during the second quarter Nexstar and Mission Broadcasting, Inc entered into a stock purchase agreement to acquire nineteen television stations and seven associated digital sub-channels in ten markets for $270 million from Communications Corporation of America and White Knight Broadcasting. When completed later this year, these stations will add seven duopolies to our operating base and the transaction will expand our geographic diversity and scale to 91 stations in 48 markets of which 33 will be duopoly markets.”
Sook said the plan for the immediate future is to continue to stay on top of costs while making strategic investments in further smart and accretive station buys.