The nation’s biggest television broadcaster Nexstar Media Group Wednesday reported net income dipped 26% on a 39% jump in revenue in the fourth quarter spurred by its acquisition of Tribune Broadcasting last fall. CEO Perry Sook said the combined company is focused on slashing debt and expanding local news and anticipated a wave of political advertising heading into elections.
Fourth-quarter net income was $114 million on revenue of $1.1 billion, as Sook called Nexstar “an unmatched platform that delivers exceptional local content to inform and entertain our viewers, while providing premium local advertising opportunities at scale for advertisers and political campaigns.”
“As the nation’s largest pure-play local broadcast television and digital media company, we now have truly national reach and coverage with Nexstar owned or operated stations reaching approximately 69 million U.S. television households. Our platform also benefits from the consistent and meaningful contributions from our 31.3% TV Food Network ownership stake and positive cash flow from our national cable network WGN America.”
Nexstar acquired Tribune Media Company for $4.1 billion in September.
Sook said the company expanded local news programming in the Portland and Sacramento markets, while launching a new state capitol news bureau in Missouri. It began preparations for the summer 2020 launch of the WGN America News Nation prime-time newscast, which will reach approximately 75 million U.S. TV households and will be complemented by an around-the-clock mobile news app called newsnationnow.
Nexstar has 5,400 journalists in 110 local newsrooms across the country including capitol news bureaus in 20 states. By leveraging their expertise and reallocating financial resources from WGN’s syndicated programming toward News Nation, “we intend to provide viewers with fact-based news and information without bias or opinion, while delivering attractive marketing solutions for national advertisers.”
Sook noted the company started to lower debt by selling two stations to Fox; completed new multi-year retransmission consent agreements representing approximately 70% of subscribers, entered new long-term network affiliation agreements with CBS, Fox and NBC and realigned its digital business
It reported $521 million in full year free cash flow before one-time expenses enabling us to invest in our broadcast and technology platform. And it allocated $45.1 million of cash from operations to buy back stock.
“With the continued sharing of best practices between the Nexstar and Tribune organizations coupled with key factors including the Super Bowl on Fox, Summer Olympics on NBC, double-digit distribution revenue growth and expected record levels of 2020 election cycle spending,” he said, Nexstar expects to generate pro-forma average annual free cash flow in excess of $1.175 billion for the 2020-2021 cycle.