10.13.2009 02:30 PM
Sinclair Revises 3Q Expectations Upward
HUNT VALLEY, MD.: Sinclair
is predicting to finish the third quarter in better shape than it previously
expected. The broadcaster said it expects net broadcast revenues for the three
months ended Sept. 30, 2009 to come in at $136 million, down 9.4 percent from
In early August, Sinclair was shooting for $126.6 million, down 15.7 percent
“The third quarter’s better-than-expected results came from a variety of
categories, including the government’s extension of the Cash for Clunkers
program, higher political ad spending on health care and state-related issues,
higher retransmission revenues, as well as increased advertising spending
across many categories in August and September--a trend which appears to be
continuing into the fourth quarter.” said David Amy, executive vice president
and chief financial officer of Sinclair.
The company will provide more detailed 2009 guidance when it releases its final
third-quarter results Nov. 4, 2009.
Sinclair announced last week that it had reached deals to refinance its debt
and assist one of its operational partners with that company’s debt. Investor
rating service provider Moody’s responded by putting Sinclair (NASDAQ: SBGI) on
review for an upgrade.
Shares of Sinclair shot up nearly 14 percent on the revised 3Q expectation
announcement, opening at $3.72 and trading in mid-afternoon at $4.23.
-- Deborah D. McAdams
More on Sinclair:
October 12, 2009: “Moody’s Reviews
Sinclair for Upgrade”
Moody’s Investor Service placed Sinclair on review for a potential upgrade
after the broadcaster commenced a debt refinance and a new agreement with an
October 8, 2009: “Sinclair Commences
Sinclair also announced that it has entered into a Memorandum of
Understanding with Cunningham Broadcasting Corp., contingent upon the
refinancing of the notes. SBGI makes around $77 million a year from local
marketing agreements with Cunningham, which defaulted on a loan over the
August 5, 2009: “Sinclair
Reports Time Sales Dip in 2Q”
Sinclair Broadcast Group said today that time sales fell $1 million between the
first and second quarters, a reversal of the typical trend.
August 3, 2009: “Sinclair’s LMA Partner
Cunningham Broadcasting, a management partner of Sinclair Broadcast Group,
received an extension on its $33.5 million loan due July 31. The company now
has until Oct. 30, providing it makes $200,000 principal payments on each of
its term loans on the first business day of August, September and October.
July 15, 2009: “Analyst Deems Sinclair
“To be blunt, we think management is posturing. We believe that management is
painting the most dire scenario in a public forum as part of its negotiations
with convert holders. There are still 10 months before these converts can be
put to the company.”
July 14, 2009: “Sinclair Positions for
Sinclair Broadcasting group may have to file for bankruptcy if it can’t
renegotiate the terms of some of its debt. In a filing with the Securities and
Exchange Commission dated July 10, the company said it had $488.5 million due
over the next 18 months.
June 19, 2009 “Standard & Poor’s
“We believe that sluggish TV advertising in a nonelection, recession year will
cause Sinclair’s EBITDA to decline further and leverage to continue to rise,”
wrote Deborah Kinzer, an S&P credit analyst. “The negative rating outlook
reflects our concerns about the company’s deteriorating credit metrics and its
ability to refinance potential upcoming puts.”