Young Takes $139 Million Write-Down on KRON
August 15, 2008
Young Broadcasting Inc. reported $37 million in second-quarter net revenue, a drop of 6.7 percent from the same quarter last year. Revenues for the first half of the year are down 4.4 percent from last year.
Young also assessed a write-down of $139.1 million on the license of its flagship KRON in San Francisco, the MyNetwork affiliate the station has been trying to sell. No other Young stations required such write-downs. Young categorized the KRON activity as a discontinued operation.
Although losses from continuing operations (those leaving out the KRON numbers) were about the same as last year’s Q2—about $11.9 million—the KRON write-down led to an overall net loss in the quarter of $153 million ($6.47 per share), compared to a net loss of $18 million (89 cents per share) in the second quarter of 2007.
Young Chairman Vincent Young sees recovery ahead.
“Unlike some on Wall Street that see trends continuing indefinitely on their current trajectories, I believe that television advertising revenues will recover in the near future and that YBI is well positioned to take advantage of this recovery,” he said. “Historically, advertising expenditures are among the first to be cut at the start of a recession. They are also among the first to return when the economy begins its recovery.”
He also said television advertising remains effective. “While enjoying dramatic growth, new media such as the Internet has not replicated the sheer household coverage of our industry’s delivery mechanisms,” he said. “Our company’s twin strategies of developing new customers and aggressively cutting operating costs should result in the creation of significant value.”
Young Broadcasting owns 10 television stations and the national television representation firm, Adam Young Inc.