HUNT VALLEY, MD.: Sinclair Broadcast Group declared a special dividend today on the expectation that its fortune will continue to improve.
“Given the expected 2010 results and our optimistic outlook for 2011, our board of directors has decided to declare and pay a special dividend in the amount of 43 [cents] per share,” said Sinclair’s chief David Smith in the company’s third-quarter results announcement.
Sinclair had been paying dividends since 2004, but halted them during the first quarter of 2009 because of the recession. Smith said Sinclair’s objective is to reinstate regular dividend payments. The special divided will total approximately $34.5 million, and be payable on all classes of common stock outstanding on Dec. 15, 2010 to holders of record as of Dec. 1, 2010.
Sinclair reported net income attributable to the parent company of $14.3 million on broadcast revenues of $158.8 million, compared to $14.9 million on revenues of $136.4 million a year ago. Operating income was $56.1 million versus $35.7 million. Diluted earnings per share were 18 cents versus 19 cents.
Per ad category, automotive spending was up 44 percent, while services rose 16 percent. Local broadcast and retransmission revenues rose nearly 12 percent; national was up 30 percent. Excluding political, both were up 10 and 14 percent respectively.
“Political advertising of $9.8 million in the third quarter came in higher than expected, and that trend has continued in the fourth quarter where we expect $26.8 million in political revenues,” Smith said. “For the year, political revenues are expected to be approximately $41.9 million, a record amount for us.”
Sinclair finished the quarter with cash and equivalents of $46.6 million versus $65.3 million as of June 30, 2010. Long-term debt was $1.22 billion versus $12.6 billion on June 30.
Fourth-quarter broadcast revenues are expected to be between $181.5 million to $185.5 million, up between 18 and 21 percent from a year earlier.
“Looking ahead to 2011, early indications are that the core business will be stronger than normal non-political years driven by the Super Bowl on the Fox network, of which we have 20 affiliates, and the continued economic recovery,” Smith said. “We believe that the core business in 2011 will grow versus 2010.”
Shares of Sinclair (NASDAQ: SBGI) rose slightly from around $7.85 yesterday to $7.95 today.
-- Deborah D. McAdams
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