The unusual business model of religious specialist Salem Communications was not enough to entirely mitigate the effects of the current economy, leading to a -4.3% drop in total revenue to $45.4M for 3Q, a net broadcast drop of -6.9% to $47.4M, and same station operating income loss of -13.3% to $16.4%. All of these results were inferior to YTD percentages of -2.7% (to $165.9M), -5.1% and -10.6% respectively. The bright spot was non-broadcast income, up 17.3% for the quarter to $7.1M, and up 18.5% to $20.7M YTD.
RBR/TVBR observation: Sometimes Salem Communications is able to avoid red ink woes affecting groups with a standard operating model, because a significant portion of its broadcast income involves renting time to local clergy rather. This revenue stream minimizes the impact of an advertising slump on the group. But the problems running a business in America right now – any business – reach far beyond advertising alone..
