Sinclair Group's revenue rises 13.1% Broadcast cash flow up 19.1% in the quarter

net loss is $99,000


October 31, 1997|By Suzanne Wooton | Suzanne Wooton,SUN STAFF

Sinclair Broadcast Group Inc. reported yesterday that its total revenue for the third quarter jumped 13.1 percent, from $110.3 million to $124.7 million.

In addition, the Baltimore-based company said its broadcast cash flow -- a critical measure of the industry's financial health -- grew by 19.1 percent to $57.3 million in the third quarter, after considering lags in the timing of program contract payments relating to the company's 1996 acquisitions.

Sinclair owns or operates 28 television stations, including channels 45 and 54 in Baltimore, and 34 radio stations.

After-tax cash flow rose 100 percent to $21.3 million during the third quarter over the same period a year ago.

The record increases stemmed largely from growth in television and radio revenue and the company's acquisitions. But even before considering its new stations, revenue was up 8 percent over a year ago, according to John Reidy, media analyst for Smith Barney in New York.

"We think that was a good number," he said. "On balance, the television performance, which is what it's all about, was exceptional."

The broadcasting cash flow gain was particularly impressive, Reidy said, reflecting good cost control and managing programming costs. "We think it's a harbinger of more good times to come," he added.

With the Winter Olympics and widespread political races slated for next year, the financial picture looks good for the television industry, Reidy said. Sinclair's stations are spread over most of the networks.

The company reported a net loss of $99,000 in the third quarter compared with a loss of $3.3 million in the corresponding period in 1996, and a loss of 1 cent per common share versus a loss of 10 cents in the third quarter of 1996.

Net income, however, is considered a far less accurate indication of Sinclair's performance because that figure is skewed by high levels of depreciation and amortization associated with the acquisition of stations.

David Amy, Sinclair's chief financial officer, said the company's local sales efforts continued to be strong in the quarter, while national advertising bounced back from a first half slump.

The company sliced its total debt in the third quarter to $939 million from $1.176 billion after issuing 4.3 million shares of Class A common stock at $36.50 per share and 3.5 million shares of 6 percent convertible exchangeable preferred stock at $50 per share.

The net proceeds from those transactions were $151.6 million and $167.5 million, respectively.

Pub Date: 10/31/97

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