Media General executives told bankers that the rest of 2008 looks bright for the company“s 23 TV stations.
"The broadcast division expects significant improvement in revenues," Executive Vice President and COO Reid Ashe said at a Deutsche Bank conference in New York this week. "We expect to generate approximately $45 million in political revenues in 2008."
Spending on the presidential race is expected to be "particularly strong" in Ohio, Florida and Virginia, he said.
"Summer Olympics advertising on our NBC stations is expected to generate revenues of approximately $13 million," he said.
Media General is also hammering out retrans deals, he said.
"We“ve signed cable retransmission agreements this year that provided compensation for two of our stations," Ashe said. "Many of our cable contracts expire on Dec. 31 of this year, others expire in 2009, and a few run into 2011. We will begin negotiations with some of these systems this summer. In the last round of negotiations, we were successful in obtaining full carriage for our secondary channels as well as some lucrative promotional trades."
The Richmond, Va., media company has cut around 750 jobs over the last year, many in the struggling newspaper division. Newspaper revenues for “08 are expected to be down between 8 percent and 10 percent compared to last year.
Online revenues are projected to increase around 40 percent, primarily on the strength of local growth. The Web division is expected to generate $3 million in profit for the year, compared to a loss of $3 million last year.
Debt at the end of 2008 is expected to be between $765 million and $770 million, compared with $898 million at the end of 2007.
Media General said it expects to beat the Street“s 2Q expectation with earnings of 6 cents to 10 cents a share, excluding 14 cents a share in severance costs. The Street has the company pegged at 6 cents excluding one-time items. Media General projected earning between $1.35 and $1.45 a share for the full year, compared to 94 cents projected by analysts.
The company“s share price has averaged around $14.40 in June trading.
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