DES MOINES, IOWA: Revenue for Meredith’s TV and video production division was 20 percent higher than a year ago, the company said today. It’s local media unit generated $69 million for Meredith’s third fiscal quarter of 2010, compare to $57 million a year ago. Operating profit was $13 million compared to $1 million last year.
Meredith said non-political advertising revenues grew 16 percent, led by the automotive, professional services and retail categories. Revenues from retransmission fees rose nearly 15 percent in the third quarter.
Demand from the corporate sector drove up revenues at Meredith Video Studios, and its daily “Better” television show will be carried in more than 60 markets reaching nearly 50 percent of U.S. television households. TV stations in all 10 of Meredith’s television markets delivered growth, led by strong performances in Atlanta, Phoenix and Hartford, Conn.
“Our local media business delivered significantly improved results across the board, a reflection of improving market conditions and success at executing our performance improvement initiatives,” said Meredith Chairman, President and CEO Stephen Lacy.
Consolidated revenues across the media, marketing and magazine divisions totaled $353 million, up 5 percent. Earnings per share came in at 73 cents compared to 56 cents a year ago, and exceeding Meredith’s January prediction of 55 to 60 cents.
During 3Q10, Meredith reduced its debt by $35 million. Its total debt was $315 million at March 31, 2010, $65 million less than at the prior fiscal year end. Meredith's debt-to-EBITDA ratio was well under existing debt covenants at 1.4to 1.
Looking at the fourth quarter, Meredith expects advertising revenue to increase 7 to 8 percent over the prior year. Fourth-quarter EPS is expected to come in from 61 to 66 cents a share, and full 2010 EPS to be $2.13 to $2.18, excluding one-time items.
“While our advertising growth was encouraging, we are still well below historic levels established prior to the recession in both our national and local businesses,” Lacy said. “The marketplace remains very volatile on both a month-to-month and client-by-client basis.”
Shares of Meredith (NYSE: MDP) dropped nearly four percent today to $35.87.
-- Deborah D. McAdams
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