UPDATED with executive comments on earnings call.
Univision executives said the Hispanic media giant is seeing steady improvement during the current third quarter as it looks to recover from spring’s COVID-19 doldrums.
Speaking to Wall Street analysts on the company’s second-quarter earnings call, CFO Peter Lori said advertising revenue for the third quarter was on track for a 15% year-over-year decline in the third quarter. That’s an improvement from the second quarter’s 40% plunge.
CEO Vince Sadusky said the flagship broadcast network’s recent ratings upswing, which has seen it beat English-language rivals in the 18-to-49-year-old demo this summer, is helping with upfronts ad negotiations. About 90% of the network’s traditional upfront advertisers are “fully engaged” in negotiations, he said, though some may delay purchase decisions until closer to the calendar-year upfront.
Univision has “the best viewership story in media,” Sadusky said, with modest gains in the 2019-20 broadcast season, compared with double-digit declines at other broadcast networks.
Asked about the company’s direct-to-consumer streaming plans, which have been back-burnered in the past couple of years, Sadusky deferred to his presumed successor, Wade Davis. The former Viacom CFO is leading a group of investors in the purchase of a majority stake in Univision. Sadusky said the sale is on track to close by the end of 2020.
“Wade has been very involved with [streaming] at Viacom and has a playbook that he’s developed,” Sadusky said. “Stay tuned on that front.”
PREVIOUSLY: Univision swung to a loss of $27.3 million in the second quarter compared with income of $92 million in the same period a year ago.
The main source of red ink was a 40% plunge in advertising, which reflected the extent of COVID-19’s onslaught, especially on sports broadcasts.
The privately held Hispanic media company’s total revenue fell 24% to $531 million. In its Media Networks division, ad revenue dropped to $210 million from $347.2 million a year ago.
The long-awaited sale of a majority stake of Univision, announced in February, is still pending. A consortium led by former Viacom CFO Wade Davis said it will buy 64% of the company for about $526 million. Mexico-based Grupo Televisa plans to retain the remaining 36%.
Vince Sadusky, who became CEO of Univision in 2018 and has led a “back to basics” streamlining and refocusing of its operations, said the worst is hopefully over as far as the pandemic. In the earnings release, he cited the return of major soccer programming as cause for optimism.
“While we are not immune to the economic fallout from COVID-19, with a solid pipeline of entertainment content, with Liga MX’s regular season now underway and with the UEFA Champions League Tournament about to begin, we hope to have turned a corner from the worst of the pandemic’s economic impact,” Sadusky said. “In addition, despite the economic headwinds, we have accessed the capital markets and our successful series of debt refinancings have strengthened our balance sheet and validated our optimism.”
Another positive sign, Sadusky noted, was the flagship broadcast network finishing No. 1 among U.S. TV viewers aged 18 to 34 in any language for 10 consecutive weeks during the quarter.