Total revenue in the quarter rose 123% to $1.61 billion, just shy of Wall Street analysts’ consensus estimate for $1.65 billion. Earnings per share reached $1.35 on a diluted basis.
Comparisons between the current-year first quarter, which ended March 31, and last year’s are complicated by the acquisition of 21 regional sports networks formerly controlled by Fox. Sinclair led a consortium of investors in that deal and also took a 20% stake in YES, joining the New York Yankees, Amazon and private equity investors in operating that network. It also teamed with the Chicago Cubs to launch the Marquee Sports Network in February, weeks before the pandemic would send Major League Baseball and other sports leagues to the sidelines.
Excluding the RSNs, media revenues rose 17%, boosted by political advertising and higher retransmission revenue. Media revenue fell short of the low end of company guidance by $31 million, Sinclair said, due in part to the impact of COVID-19 on some ad revenue.
CEO Chris Ripley said the company had withdrawn financial guidance for 2020 due to the uncertainty of the period. Its stations and sports networks are seeing advertising soften, though, and the outlook for the return of sports — especially baseball, the bedrock of the RSN model — is uncertain. Still, Ripley said in the company’s earnings release, “We are confident that our diversified revenue streams, content, and delivery platforms will allow us to see our company through the pandemic’s effects and that we will be able to meet our liquidity needs.”
Overall, Sinclair, first-quarter operations did not experience “significant disruptions” from COVID-19. In the second quarter, though, it expects the effect to “intensify.”
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