Sinclair profit, cash flow rise in 2nd quarter Broadcasting

July 31, 1996|By Timothy J. Mullaney | Timothy J. Mullaney,SUN STAFF

Sinclair Broadcast Group Inc. said yesterday that it earned $3.05 million, or 10 cents a share, during the second quarter, a performance an analyst said was on target considering that savings from recent acquisitions have not yet taken effect.

The Baltimore-based owner or operator of 28 television stations, including Channel 45 -- the Fox affiliate in Baltimore -- and 34 radio stations saw its profit margins shrink considerably since the second quarter of last year, and most of its 37 percent gain in cash flow came from the sheer increase in size of the acquisition-minded firm since last year.

"The results were very much in line with Smith Barney's expectations overall," said John Reidy, media analyst for the investment firm. "It's in line with what we see in the broadcast industry, which had a very strong first half."

Reidy said the earnings picture for Sinclair is likely to brighten in quarters to come because of its recent acquisition of River City Broadcasting L. P. and a collection of other TV stations.

He said joint selling efforts and more efficient programming buying would be possible as the company grows, allowing Sinclair to boost both revenues and the percentage of sales it turns into profits.

"You don't have any merger benefits yet, and yet perfectly solid results," he said. "There are a lot of things to work with to make the comparisons more robust going forward."

The cash-flow picture, Sinclair said, is one of the brightest in its industry. Of Sinclair's $79 million in sales during the second quarter of the year, $40.5 million of it was operating profit -- or profit before interest, taxes and depreciation.

Pub Date: 7/31/96

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