The final three months of 2017 resulted in mixed results for Christian and conservative-focused Salem Media Group.
The Camarillo, Calif.-based owner of radio stations and a publishing arm saw its net broadcast revenue fall to $50.7 million, from $52.2 million, in Q4. Digital media revenue was also down, leading to a consolidated net revenue loss.
But, net income was on the rise, and it is all thanks to the Tax Cuts and Jobs Act.
For Q4, total revenue decreased 4.9%, to $67.2 million from $70.7 million.
And, without a big tax benefit from the legislation passed in fall 2017, Salem would have swung to a net loss of $18,000, from net income of $1.42 million. Instead, a $22.38 tax benefit helped Salem achieve net income of $22.36 million (85 cents per diluted share), up from $2.97 million (11 cents) in Q4 2016.
Salem executives did not comment on the results ahead of a Thursday afternoon conference call with the financial community set for 2pm Pacific.
But, the company noted that the Q4 results include a $4.7 million net loss on the sale of WQVN-AM 1360 (formerly WKAT) in Miami, which was offset by a $400,000 gain of the sale of the tower site for WSPZ-AM in Chevy Chase, Md. Salem on Dec. 27, 2017 sold the WSPZ tower site for $1.9 million.
The WQVN sale was announced in December 2017, with Salem selling the property for a bargain price of $3.5 million. The buyer is already operating the facility via a LMA.
What’s Salem’s Q1 2018 outlook?
The company is projecting total revenue to decline between 1% and 3% over first quarter 2017 total revenue of $65 million.
Salem is also projecting operating expenses, excluding gains or losses on the sale or disposal of assets, stock-based compensation expense, changes in the estimated fair value of contingent earn-out consideration, impairments, depreciation expense and amortization expense to be between a 1% decline and a 2% increase compared to the first quarter of 2017 operating expenses, excluding gains or losses on the sale or disposal of assets, stock-based compensation expense, changes in the estimated fair value of contingent earn-out consideration, depreciation expense and amortization expense of $54.6 million.