Operating income of $42.3 million increased more than 2.5 times from prior year
Net income was $17.6 million, or 62 cents per share
Broadcast Cash Flow totaled $50.4 million
RICHMOND, Va.- Media General, Inc. (NYSE: MEG), a broadcast television and digital media company, today reported fourth-quarter 2012 operating income of $42.3 million, more than 2.5 times greater than fourth-quarter 2011 operating income of $16.3 million. Net income in the fourth quarter was $17.6 million, or 62 cents per share, compared with a net loss of $3.3 million, or 15 cents per share, in the prior year.
George L. Mahoney, president and chief executive officer of Media General, said, "Media General had an exceptional fourth quarter, marked by 40% revenue growth. Record Political advertising was $30 million. Core Local and National advertising revenues, excluding Political, increased 4%. Media General was particularly well positioned to maximize Political advertising opportunities, with six of our stations located in four of the key battleground states. Broadcast cash flow in the fourth quarter was $50.4 million, with a margin of 46%," said Mr. Mahoney.
Starting with the full-year 2013, Media General's fiscal year will be a conventional calendar year (Jan. 1 - Dec. 31). Previously, the company's fiscal year ended on the last Sunday in December, a newspaper industry practice. Fiscal year 2012 began on December 26, 2011 and ended on December 31, 2012. Fiscal year 2011 began on December 27, 2010 and ended on December 25, 2011.
Total revenues in the fourth quarter of 2012 were $108.7 million compared with $77.9 million in the prior year. Local gross time sales increased 5.3% to $50.7 million. National gross time sales grew 1.4% to $25.2 million. The largest advertising category, automotive, increased 21%. Other key categories with strong growth in the quarter included entertainment, home improvement and furniture.
Cable and satellite retransmission fees rose 84.3% to $9.9 million, as a result of contract renewals in late 2011 that included higher rates. Digital revenues increased 18.8% to $2.7 million, driven primarily by Local advertising, which grew 16%.
Higher station operating costs in the fourth quarter reflected an increase in commissions from the strong revenue performance, higher NBC affiliate fees, a five-day furlough repayment in December 2012, and prior-year savings of nearly $2 million from a companywide furlough program.
Corporate expense of $101,000 in the fourth quarter compared with $9.6 million last year, and included two large non-recurring gains in the current quarter. The gains included a non-cash curtailment of more than $2 million resulting from former newspaper employees leaving the company's post-retirement plans, and a $5 million non-cash gain resulting from outsourcing disability coverage for substantially all Medicare eligible participants to a third party.
Total interest expense in the fourth quarter was $21 million, compared with $14.6 million last year. In the current quarter, cash interest paid was $16.7 million, non-cash interest expense was $2.6 million, and accrued but not paid cash interest was $1.7 million.
Noncash tax expense was $3.4 million in the fourth quarter, compared with $6.2 million in the prior year. The lower tax expense was primarily due to the absence of an intraperiod tax allocation made between continuing operations and Other Comprehensive Income that was recorded in the fourth quarter of last year.
EBITDA from continuing operations (income before interest, debt modification and extinguishment costs, taxes, and depreciation and amortization) was $48.1 million, compared with $23.8 million in the 2011 period.
Media General provides the non-GAAP financial metrics: Broadcast cash flow, EBITDA from continuing operations, After-tax cash flow from continuing operations, and Free cash flow. The company believes these metrics are alternative measures used in peer comparison and by lenders, investors, financial analysts and rating agencies to evaluate a company's ability to service its debt requirements and to estimate the value of the company. A reconciliation of these metrics to amounts on the GAAP statements has been included in this news release.
Conference Call and Webcast
The company will hold a conference call with financial analysts today at 2:30 p.m. ET. To dial in to the call, listeners may call 866-831-6234 about 10 minutes prior to the 2:30 p.m. start. The participant passcode is "Media General."
Listeners may also access a live webcast by logging on to www.mediageneral.com and clicking on the "Live Webcast" link on the homepage about 10 minutes in advance. A replay of the webcast will be available online at www.mediageneral.com beginning at 3:30 p.m. today. A telephone replay will also be available, beginning at 1:00 p.m. on February 1, 2013, and ending at 11:59 p.m. on February 8, 2013, by dialing 888-286-8010 or 617-801-6888 and using the passcode 57846918.
2012 Financial Statements
Media General will issue its 2012 audited financial statements, including footnotes, on its website www.mediageneral.com, following the close of the stock market today. A link to the statements will be posted prominently on the website's home page.
About Media General
Media General is a leading provider of news, information and entertainment across 18 network-affiliated broadcast television stations and their associated digital media and mobile platforms. The company's stations serve consumers and advertisers in strong local markets, primarily in the Southeast. Media General's network affiliates include eight NBC stations, eight CBS stations, one ABC station and one CW station. Six of the company's stations operate in the Top 40 markets in the United States. Media General's stations reach more than one-third of TV households in the Southeast and more than 8 percent of U.S. TV households. Media General entered the television business in 1955 when it launched WFLA-TV in Tampa, Florida, as an NBC affiliate. Today, WFLA is the company's largest TV station, operating in the 14th largest DMA in the United States.
Contact Media General
Additional information about Media General is available on its website www.mediageneral.com or by contacting Lou Anne J. Nabhan, Vice President-Corporate Communications, at (804) 887-5120 or firstname.lastname@example.org.