2014

Television Company Belo Corp. (BLC) Reports Earnings for Second Quarter 2012

DALLAS, July 27, 2012 /PRNewswire/ -- Television company Belo Corp. (NYSE:  BLC) today reported net earnings per share of $0.24 in the second quarter of 2012 compared to net earnings per share of $0.17 in the second quarter of 2011.

Dunia A. Shive, Belo's president and Chief Executive Officer, said, "Second quarter total revenue increased 7 percent compared to the second quarter of 2011.  Political revenue totaled $9.5 million, with $5 million attributable to the Senate primary in Texas.  The Company also received meaningful political revenue in Charlotte, Norfolk and St. Louis.  Core spot revenue was up in many of the Company's markets in the second quarter of 2012, but was down slightly overall compared to last year due to softness in national spot in certain markets.  Third quarter total spot revenue is currently pacing up in the high-teens with strong core and political revenue.

"Combined station and corporate operating costs were 1 percent lower when compared to the second quarter of last year.  Our station adjusted EBITDA grew 23 percent compared to the second quarter of 2011 and our station adjusted EBITDA margin was 41 percent.

"During the second quarter, the Company opportunistically repurchased over 1 million shares in the open market at an average price of $5.81."

Second Quarter in Review

Operating Results

The Company generated total revenue of $178 million in the second quarter of 2012, which was $11 million, or 7 percent, higher than the second quarter of 2011.

Political revenue in the second quarter of 2012 totaled $9.5 million, an $8.3 million increase compared to the second quarter of 2011.  Total spot revenue, including political, was up 6 percent in the second quarter of 2012 compared to the second quarter of 2011.  Total spot revenue, excluding political, was down 0.5 percent with a 2.3 percent increase in local spot revenue and a 5.5 percent decrease in national spot revenue.

Other revenue, which is comprised primarily of Internet advertising, retransmission revenue, and barter and trade advertising, was up 12 percent in the second quarter of 2012 due primarily to double-digit increases in both Internet and retransmission revenue. 

Station salaries, wages and employee benefits increased $1.9 million, or 3.5 percent, during the second quarter of 2012 versus the second quarter of 2011 due primarily to annual merit increases for employees and higher accrued performance-based bonus expense.  Station programming and other operating costs were down $4.5 million, or 8.5 percent, in the second quarter of 2012 compared to the second quarter of 2011 due primarily to lower syndicated programming expense.

Corporate

Corporate operating costs of $8.6 million in the second quarter of 2012 were $1.9 million higher than the second quarter of 2011 due primarily to higher accrued performance-based bonus expense and investments in interactive initiatives. The Company's combined station and corporate operating costs were 1 percent lower compared to the second quarter of 2011.

Other Items

Belo's depreciation expense totaled $7.5 million in the second quarter of 2012, down from $7.7 million in the second quarter of 2011.

The Company's interest expense was $17.7 million in the second quarter of 2012 compared to $18.1 million in the second quarter of 2011.

Income tax expense increased $5.5 million in the second quarter of 2012 compared to the second quarter of 2011 due primarily to higher pre-tax earnings. 

Total debt at June 30, 2012 was $887 million and consisted entirely of fixed-rate debt. Of this amount, $176 million is due May 2013 and is therefore classified as current on the Company's June 30, 2012 balance sheet.  Also as of June 30, 2012, the Company had $126 million in cash and temporary cash investments and had nothing drawn on its $200 million revolving credit facility, which does not expire until August 2016.  The facility may be used, along with some level of cash, to retire the May 2013 notes. 

The Company's total leverage ratio, as defined in the Company's credit facility, was 3.9 times at June 30, 2012, and 3.4 times when including the Company's cash. Belo invested $6.9 million in capital expenditures in the second quarter of 2012.

Non-GAAP Financial Measures

A reconciliation of station adjusted EBITDA to earnings from operations and a reconciliation of net earnings to pro forma net earnings are set forth in an exhibit to this release.

Outlook

Looking forward, Shive said, "Third quarter total spot revenue is currently pacing up in the high-teens.  We currently expect other revenue, which includes Internet and retransmission revenue, to be up in the low double-digits during the third quarter.  As a result, we currently expect the percentage growth in total revenue for the third quarter of 2012 to be up in the mid-to-high teens compared to the prior year, depending on the strength of political.  Combined station and corporate operating costs for the third quarter of 2012 are currently expected to be up about 6 percent compared to the prior year's quarter due primarily to higher variable costs associated with higher revenue."

A conference call to discuss this release and other matters of interest to shareholders and analysts will follow at 10:00 a.m. CDT this morning.  The conference call will be simultaneously webcast on Belo Corp.'s website (www.belo.com/invest).  Following the conclusion of the webcast, a replay of the conference call will be archived on Belo's website.  To access the listen-only conference lines, dial 1-800-553-5260.  A replay line will be open from 12:00 noon CDT on July 27 until 11:59 p.m. CDT on August 10.  To access the replay, dial 800-475-6701 or 320-365-3844.  The access code for the replay is 253026.

About Belo Corp.

Television company Belo Corp. (NYSE:   BLC) owns and operates 20 television stations (nine in the top 25 markets) and their associated websites.  Belo stations, which include affiliations with ABC, CBS, NBC, FOX, and the CW, reach more than 14 percent of U.S. television households in 15 highly-attractive markets.  Belo stations rank first or second in nearly all of their local markets.  Additional information is available at www.belo.com or by contacting Paul Fry, vice president/Investor Relations & Treasury Operations, at 214-977-4465.

Statements in this communication concerning Belo's business outlook or future economic performance, anticipated profitability, revenues, expenses, capital expenditures, dividends, investments, future financings, impairments, pension matters, and other financial and non-financial items that are not historical facts, are "forward-looking statements" as the term is defined under applicable federal securities laws. Forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those statements.         

Such risks, uncertainties and factors include, but are not limited to, uncertainties regarding changes in capital market conditions and prospects, and other factors such as changes in advertising demand, interest and discount rates and programming and production costs; changes in viewership patterns and demography, and actions by Nielsen and its competitors; changes in the network-affiliate business model for broadcast television; technological changes, and the development of new systems and devices to distribute and consume television and other audio-visual content; changes in the ability to secure, and in the terms of, carriage of Belo programming on cable, satellite, telecommunications and other program distribution methods; development of Internet commerce; industry cycles; changes in pricing or other actions by competitors and suppliers; Federal Communications Commission and other regulatory, tax and legal changes, including changes regarding spectrum; adoption of new accounting standards or changes in existing accounting standards by the Financial Accounting Standards Board or other accounting standard-setting bodies or authorities; the effects of Company acquisitions, dispositions, co-owned ventures, and investments; pension plan matters; general economic conditions; and significant armed conflict, as well as other risks detailed in Belo's other public disclosures and filings with the SEC including Belo's Annual Report on Form 10-K.

 

Belo Corp.

Consolidated Statements of Operations



Three months ended



Six months ended


June 30,



June 30,

In thousands, except per share amounts

2012



2011



2012



2011


(unaudited)



(unaudited)



(unaudited)



(unaudited)













Net Operating Revenues       


$

177,619


$

166,379


$

333,517


$

317,849


Operating Costs and Expenses














Station salaries, wages and employee benefits


56,437



54,525



112,136



108,361


Station programming and other operating costs


48,074



52,565



93,391



102,761


Corporate operating costs



8,550



6,692



16,282



12,991


Pension settlement charge and contribution













     reimbursements


-



-



-



20,466


Depreciation 




7,472



7,707



14,934



15,631



Total operating costs and expenses


120,533



121,489



236,743



260,210















Earnings from operations



57,086



44,890



96,774



57,639


Other Income and (Expense)














Interest expense



(17,714)



(18,050)



(35,376)



(36,033)


Other income, net



1,378



649



1,879



829



Total other income and (expense)


(16,336)



(17,401)



(33,497)



(35,204)


Earnings before income taxes



40,750



27,489



63,277



22,435

Income tax expense




14,917



9,402



23,152



8,662


Net earnings

25,833



18,087



40,125



13,773


Less:  Net (loss) attributable to noncontrolling interests


(98)



-



(98)



-


Net earnings attributable to Belo Corp.


$

25,931


$

18,087


$

40,223


$

13,773



Net earnings per share - Basic


$

0.24


$

0.17


$

0.38


$

0.13


Net earnings per share - Diluted


$

0.24


$

0.17


$

0.38


$

0.13







Weighted average shares outstanding














Basic




103,774



103,626



103,854



103,515


Diluted




104,068



104,022



104,163



103,917

















Dividends declared per share 


$

-


$

0.05


$

0.08


$

0.05

 

Belo Corp.

Consolidated Condensed Balance Sheets









June 30,



December 31,

In thousands 




2012



2011







(unaudited)




Assets










Current assets










Cash and temporary cash investments

$

125,669


$

61,118



Accounts receivable, net



140,018



149,584



Income tax receivable



14



31,629



Other current assets



20,591



16,692


Total current assets



286,292



259,023












Property, plant and equipment, net



151,356



157,115


Intangible assets, net



725,399



725,399


Goodwill




423,873



423,873


Other assets




40,355



46,195











Total assets



$

1,627,275


$

1,611,605





















Liabilities and Shareholders' Equity








Current liabilities









Current portion of long-term debt

$

175,810


$

-



Accounts payable 



17,839



19,677



Accrued expenses



36,468



34,961



Short-term pension obligation



19,737



19,300



Accrued interest payable



10,106



10,378



Income taxes payable



5,814



12,922



Dividends payable



-



5,189



Deferred revenue



5,427



3,435


Total current liabilities



271,201



105,862












Long-term debt




711,638



887,003


Deferred income taxes



251,977



244,361


Pension obligation



83,968



93,012


Other liabilities




11,763



14,164


Total shareholders' equity



296,728



267,203











Total liabilities and shareholders' equity


$

1,627,275


$

1,611,605

 

Belo Corp.



Non-GAAP to GAAP Reconciliations









Station Adjusted EBITDA







Three months ended



Six months ended






June 30,



June 30,

In thousands (unaudited)



2012



2011





2012



2011








































Station Adjusted EBITDA (1)


$

73,108


$

59,289




$

127,990


$

106,727



Corporate operating costs



(8,550)



(6,692)





(16,282)



(12,991)



Depreciation




(7,472)



(7,707)





(14,934)



(15,631)



Pension settlement charge and contribution reimbursements



-



-





-



(20,466)



  Earnings from operations


$

57,086


$

44,890




$

96,774


$

57,639





















Note 1:

Belo's management uses Station Adjusted EBITDA as the primary measure of profitability to evaluate operating performance and to allocate capital resources and bonuses to eligible operating company employees.  Station Adjusted EBITDA represents the Company's earnings from operations before interest expense, income taxes, depreciation, amortization, impairment charges, pension settlement charge and contribution reimbursements, and corporate operating costs.  Other income (expense), net is not allocated to television station earnings from operations because it consists primarily of equity in earnings (losses) from investments in partnerships and joint ventures and other non-operating income (expense). 


























































Pro Forma Net Earnings
















In thousands, except per share amounts (unaudited)





















Six months ended



Six months ended






June 30, 2012



June 30, 2011


























Earnings



EPS





Earnings



EPS





















Net earnings attributable to Belo Corp.


$

40,223


$

0.38




$

13,773


$

0.13






















Pension settlement charge and contribution reimbursements, net of tax


-



-





13,323



0.13





















Pro forma net earnings attributable to Belo Corp.


$

40,223


$

0.38




$

27,096


$

0.26





















Note 2:

There were no pro forma adjustments for the three months ended June 30, 2012 or 2011.

SOURCE Belo Corp.



RELATED LINKS
http://www.belo.com

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.