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Gray Posts Loss on $339 Million Impairment

ATLANTA: Revenues for Gray’s 36 TV stations ticked up in 2008 and 4Q08, but losses widened on impairment. Gray (NYSE: GTN) posted full-year revenues of $327 million, up 6 percent from 2007. Revenues for 4Q08 totaled $94.8 million, up 12 percent from the same period a year previous.

Net loss for the year and the quarter exceeded $200 million on a 4Q write-down of $338.7 million, including $240.1 million on TV licenses. Full-year net loss was $202 million compared to $23.2 million in 2007. For the fourth quarter, net loss was $206 million compared to a $1.5 million profit in 4Q07.

Political ads contributed around 29 percent of total revenues for 4Q at $27.4 million, up 942 percent from 4Q07. Internet advertising contributed $3.2 million. Local dished up $45 million, down 17 percent; and national contributed $16.1 million, down 24 percent.

Full year, political was up 521 percent to $48.5 million. Internet increased 25 percent to $11.9 million. Local fell 7 percent to $186.5 million; national, down 12 percent to $68.4 million.

Gray said the economy was a factor in diminishing local and national revenues, but so was programming. In 2008, Gray earned $130,000 on the Super Bowl broadcast on its six Fox stations, compared to about $750,000 on its 17 CBS stations for the 2007 game. The decrease was offset in part by $3.4 million generated by its 10 NBC affiliates during the 2008 Summer Olympics.

Retransmission contributed $3 million to revenues in 2008. The figure is projected to be between $15 million and $16 million for 2009.

In 1Q09, local and national, sans political, is expected to be down 15 and 25 percent respectively.

“While the decline is expected to be reflected in most advertising categories, the automotive advertising category is expected to be particularly challenged during the first quarter of 2009,” Gray said.

Gray finished 2008 with cash and equivalents of $30.6 million, up from $15.3 million at the end of 2007. Total debt was $800 million as of Dec. 31, 2008, compared to $925 million a year earlier. No dividends were declared fro 4Q08, and none is planned for 1Q09.