Wednesday, Sinclair Broadcast Group, Inc. (SBGI), a television broadcasting company, reported a surge in profit for the second quarter, yet fell short of analysts' forecast. Revenues fell short of the internal forecast of 3.6% to 4.9% growth due to the current economic conditions and their impact on advertising spending levels, Sinclair noted.
Net income for the second quarter surged to $13.3 million from $2.2 million in the prior-year quarter. Earnings per share rose to $0.15 from $0.03 last year. On average, four analysts surveyed by First Call/Thomson Financial expected the company to earn $0.18 per share for the quarter.
Total revenues for the quarter rose to $193.6 million from $178.3 million in the prior year period, and almost in line with four analysts' consensus estimate of $193.7 million for the quarter.
Net broadcast revenues from continuing operations were $163.7 million for the three months ended June 30, 2008, an increase of 2.8% versus the prior year period result of $159.2 million.
Commenting on the quarter, David Smith, president and chief executive officer, said,"We are anticipating continued economic weakness for the remainder of 2008 and into 2009, which we expect to result in a slowdown in advertising spending levels. In response, we are reviewing our operating expenses and capital expenditures for potential savings or deferrals, as well as evaluating our sales incentive plans to increase the top line."
For the six-month period net income was $29.7 million compared with a net loss of $0.2 million in the prior-year period. Earnings per share were $0.34 compared to breakeven in the prior year period. Net broadcast revenues from continuing operations were $324.6 million, compared with $307.5 million in the corresponding period last year.
Looking ahead, the company expects dividends paid on the Class A and Class B common shares to be about $17.5 million in the third quarter and $67.5 million for the year.
SBGI is currently down $0.46 or 6.27% and trades at $6.88.
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