Sinclair sees record period for cash flow Acquisitions help bring key broadcast figure up 63% in third quarter

Earnings

October 30, 1998|By Kristine Henry | Kristine Henry,SUN STAFF

A spate of acquisitions brought Sinclair Broadcast Group Inc. record broadcast cash flow in the third quarter, the company reported yesterday.

For the three months that ended Sept. 30, the Baltimore-based company saw $93.6 million in broadcast cash flow -- a key industry yardstick -- up 63 percent from $57.3 million in last year's third quarter. Net broadcast revenue was $185 million, up 63.7 percent from last year's $113 million in the same period.

In July, Sinclair shares fell 5.2 percent to $22.8125 when it announced that the General Motors Corp. strike, which affected advertising, and a lackluster national advertising market would hurt the company in the third quarter.

"The company's station group met the revised levels of performance we had set out for it in July as the GM strike was ending," David B. Amy, chief financial officer, said in a statement yesterday.

The positive numbers, he said, were a result of Sinclair's aggressive acquisitions.

Sinclair purchased 12 television stations from Boston-based Sullivan Broadcast Holdings in July for $1 billion in cash. In the same month, Sinclair acquired nine television and eight radio stations from Max Media Properties LLC, based in Virginia Beach, Va., for $252 million in cash.

Total revenue for the quarter was $205 million, up 64 percent from last year's third-quarter revenue of $125 million.

Sinclair also reported a net loss of $2.17 million, compared with a loss of $99,000 in the same period last year. Net income is considered a less-accurate indication of the company's performance because it is skewed by high levels of depreciation and amortization associated with acquiring stations.

The company also announced yesterday that it has made a deal with Bay Television Inc. to program the company's Tampa, Fla., station, WTTA-TV, under a time brokerage agreement for 10 years beginning Jan. 1. Sinclair will share in the station's broadcast cash flow.

After all pending deals are completed, Sinclair will own or program 65 television stations in 42 markets -- including channels 45 and 54 in Baltimore -- and 51 radio stations in 10 markets. The company's television group, which includes ABC, CBS, FOX, NBC, WB and UPN affiliates, will reach about 26 percent of U.S. television households.

Sinclair shares closed at $12.5625 yesterday, down $1.3125.

Pub Date: 10/30/98

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