12.08.2010 01:00 PM
Media General Expects 4Q Boom for TV Stations
NEW YORK: Media General executives are expecting a fiercely
fine fourth quarter for its TV stations, and a substantially improved 2010 thanks in large part to
the sacrifices of employees.
Operating profit for the first nine months alone for the stations was up 57 percent over last
year, company executives said at the UBS Global Media & Communications
Conference this week. Political helped, as it did for every other media company
with TV stations.
“We believe the fourth quarter of this year will equal or exceed the trend that
we’ve seen in the first three quarters of this year," John A. Schauss,
Media General executive vice president and chief financial officer, said at the
Schauss was not specific about expected 4Q results for the 18 stations. Guidance for the fourth
quarter issued in late October was for total revenues to be up between 6 to 8
percent from 2009, with broadcast revenues up as much as 26 percent. Media
General reported $75 million in broadcast revenues for 3Q10, up 18 percent over
last year. The Media General TV stations raked in $41.5 million in political
advertising revenues as of Nov. 2. Of that, $24 million came in the fourth
quarter. The company has 18 TV stations as well as several print and digital
Its 2010 fortunes have come at a cost to staff and operations. The company last
year shuttered it’s 30-year-old Washington, D.C. bureau that was staffed by six
journalists. Nearly one-third of Media General’s total workforce was cut. The
remaining staff were subjected to 15 unpaid furlough days. Matching (401)k
contributions were suspended in April 2009 and have remained so through 2010.
Media General said it expects salaries to increase a whopping 3 percent in
2011, “including a 2 percent merit pool.” There will also be a “phase-in” of the
401(k) match. Corporate expense is expected to rise 4 percent, due mainly to salary
increases and the 401(k) match.
Meanwhile, traffic on Media General’s Web sites has increased. Local online
revenues will end 2010 up by 24 percent. Total digital media revenues are on
target to come in at $44 million, up 5 percent from last year, and accounting
for 7.5 percent of total ad revenues.
Mobile DTV was also launched at Media General’s Tampa, Fla., and Columbus, Ohio
TV stations, with more to come. Reid Ashe, Media General’s executive vice
president and chief operating officer, indicated that the company intends to
offer subscription mobile DTV services sometime in the future.
The company said it expects retransmission fees in 2010 to be about $19 million,
and are expected to increase 5 to 6 percent next year. Most of the company’s major
agreements do not expire until 2012, Ashe said.
Capex for 2011 is projected at $25 million to $29 million, compared with about $26
million in 2010. The company also plans to make a $20 million contribution to its
retirement plan in 2011.
-- Deborah D. McAdams