Sinclair broadcast revenue increased 3.8% to $158.3 million in the first quarter ended March 31 and operating income was up slightly to $30.4 million due to an increase in auto and political ad spending, company officials said. Sinclair also plans to reinvest an additional $7 million this year and $20 million next year on transmitter building and tower projects to improve market signal coverage and lower building maintenance and electricity expenses, officials said.
Financials: Vivendi Universal Entertainment revenue increased 3% to $1.8 billion due to strong performance from its TV and Universal Pictures businesses, company executives said. TV revenue increased 15%, with ad revenue up 14%… Spanish Bcstg. System revenue grew 4.7% to $29.2 million in the first quarter ended March 31 and operating income increased 3.8% to $10.9 million. The growth was due to double-digit revenue increases in the company’s Miami and Chicago markets and strong performance from 2 L.A. FM stations, company executives said.
MARINA DEL REY, Cal. -- The FCC and Congress should replace the 85% “trigger” on DTV household penetration with a “hard” deadline for turning off analog TV service, James Sanduski, vp-mktg., Samsung Visual Display Products Group, told an HDTV Forum opening keynote session here Wed.
Sprint reported a consolidated net loss of $498 million in its 3rd quarter, reversing year-ago net income of $519 million, and said its consolidated net operating revenue dipped 1.2% to $6.7 billion. It said the results included a charge of $768 million due primarily to a write-down on special items related to a revaluation of the company’s MMDS spectrum that lowered the asset’s carrying value to $300 million. Previous year results for the same quarter included a net gain of $260 million from special items and net income of $42 million from a discontinued operation. The FON Group said it lost $433 million after having a profit of $526 million a year earlier, and net operating revenue fell 7.3% to $3.5 billion. In its Local Div., it said revenue declined 3.2% to $1.5 billion, despite gains in bundled service customers. FON said consumer bundle penetration increased 700 basis points to more than 31% and business bundle penetration 400 basis points to 26%. The group said its DSL subscribership grew 41,000 in the quarter to 264,000, while total access lines declined at a 2.2% annual rate, compared with 2.4% in the 2nd quarter. In its Global Market Div., Sprint said net operating revenue dropped 12% to $2 billion, driven by a 15% decline in voice revenue. “Consumer revenues continued to be impacted by product substitution and aggressive competition,” the group said. The PCS Group said it widened its net loss for the quarter to $65 million from a $7 million a year earlier, but said its net operating revenue grew 5.8% to $3.3 billion. It said it had 19.3 million customers at the end of the quarter after adding 184,000 postpaid retail users, 290,000 through its wholesale channels and 22,000 through its affiliates. It said its churn was 2.7% for the quarter, compared with 2.4% sequentially, but remained lower than 3.8% a year ago. For the full year, Sprint said it expected FON operating income adjusted for special items to be $1.85 billion to $1.90 billion, up from its earlier forecast of $1.80 billion to $1.85 billion. It said it expected capital expenditures of $1.7 billion, down $100 million from its previous forecast. The company confirmed its forecast for the PCS Group, saying it was expected to report full-year operating income adjusted for special items of $800-$900 million. It said it also anticipated the group would have gross customer additions “in the low- to mid-6 million range.” Sprint revised PCS full year free cash flow to $300 million, up from its estimated $200 million due to reduced working capital requirements.
GE and Vivendi Universal on Wed. signed a formal agreement creating NBC Universal, merging the French company’s Hollywood studio, cable networks and theme parks with NBC TV business. The new venture is expected to generate roughly $13 billion in annual revenue. The terms of the final deal were largely unchanged from a preliminary agreement reached in September, when the company entered into exclusive negotiations. It gives NBC more clout to compete with bigger rivals Viacom, Disney and Time Warner, the firms said. Vivendi shareholders benefit from reduced debt while keeping a 20% of the new company. GE will control 80% of the company, which will be led by Bob Wright, vice-chmn of GE and CEO of NBC. NBC will pay $3.8 billion cash for the Vivendi Universal assets, and assume $1.7 billion of Vivendi’s debt. The deal is subject to regulatory approvals in Washington, D.C., and Brussels, but GE and Vivendi said they expect the deal to be complete by the beginning of 2004.
Emmis Communications said it had $7.5 million in net income in the 2nd quarter ended Aug. 31, reversing a $6.8 million loss a year earlier. It attributed $10 million of the turnaround to a write-off on debt reduction last year. The company also sold nearly $1 million in assets in the 2nd quarter, with no such sales a year ago. Chmn. Jeff Smulyan said: “In radio, we outperformed our markets by 4.5%, while in television we outperformed our markets by 3.8%.”
Wholesale circuit-switched voice revenue will grow at a compound annual growth rate of 3.8%, reaching $12.8 billion by 2008, a study by Atlantic-ACM projected. “Most of the resurrected growth in this sector is being driven by aggressive and successful retail long distance service rollouts by the RBOCs,” said Atlantic-ACM Vp Taher Bouzayen: “As a result, wholesalers of traditional voice will experience channel growth.” For example, Bouzayen estimated AT&T’s wholesale voice revenue would grow at 12.6% annually, reaching $4.2 billion by 2008. WilTel, he said, is also “positioned for strong growth” in its wholesale voice business with revenue predicted to grow at 13.7% annually to $1.6 billion by 2008. “Major contracts -- with SBC in the case of WilTel and big wireless deals in the case of AT&T -- are at the center of each of these firms’ growth prospects,” Bouzayen said -- www.atlantic-acm.com/reports/.
Vivendi’s drawn-out effort to sell its U.S. film and TV assets surged forward Tues. with the announcement that it had signed an agreement with GE to enter into exclusive negotiations to merge those assets with GE’s NBC. The deal would create the world’s 6th-largest media company.
Long distance private line and data revenue will grow at 6% annually over the next 5 years, a study by Atlantic-ACM said. It predicted growth in data and fixed revenue in bundles would stem the 3.8% rate of revenue contraction for traditional voice services as the market began to stabilize in 2004. Overall, it said, the long distance voice and data market is expected to decline at a compound annual growth rate of 0.4% in 2002-2008. The report said the long distance industry contracted 14% to $81.4 billion in 2002. It said price depreciation and bundles were the major factors contributing to high near-term revenue shrinkage. “Although there was an increase in the total number of minutes in 2002, price depreciation drove a revenue decline,” said Atlantic- ACM Vp Taher Bouzayen: “The early stages of migration from stand-alone long distance products to bundles contributed to overall shrinkage.” The report also projected the market share of AT&T, MCI and Sprint, which together held 67.5% of the market in 2002, would decrease to 53.7% by 2008. “While small carriers will account for some of this displacement, the lion’s share will be captured by the RBOCs,” the report said.
Nextel reported 2nd-quarter net income of $309 million, more than double its $123 million a year ago, and said revenue jumped 19% to $2.6 billion. It said it added 591,000 subscribers in the quarter for a total of 11.7 million and its customer churn improved to 1.6%, “the best since 1998.” Nextel said its average revenue per user jumped $2 from the first quarter to $69, and total min. of use on the Nextel National Network grew 34% to 24.5 billion. Nextel CFO Paul Saleh said the company was “ahead of [its] expectations” and had revised its financial guidance for the full year. It said it expected to have a free cash flow of $600 million or more, up from $500 million, and operating income before depreciation and amortization of $3.9 billion or more, up from $3.8 billion. It also predicted it would add 1.9 million or more net subscribers, up from 1.7 million.