Nexstar Media Group, Inc. (NASDAQ:NASDAQ:NXST) Q4 2020 Earnings Conference Call February 23, 2021 9:00 AM ETCompany ParticipantsJoseph Jaffoni - Investor RelationsPerry Sook - Founder,. Records show that a new political committee raised more than $2.2 million and spent more than $1.5 million in the past two weeks all of it, according to organizers, on behalf of Monique . Every donation we receive from users like you goes directly into promoting high-quality data analysis and investigative journalism that you can trust. But it is certainly a tailwind in core advertising revenue that auto is up and up double digits, and we see that continuing throughout the year. The linear television business is a fairly mature industry, and we wanted to be one of the leading consolidators, he explains. Sook has just returned from eight days on the road, on business in California and Arizona. The pressure to perform and remain at the top once you're there? Latest Company & Industry Overviews News and Updates. Tuesday, February 28, 2023 After flirting with bankruptcy in 2009, Sinclair was saved in part thanks to Citizens United and the ensuing influx of political ad spending. We got to get rid of all these regulations, give the little guy a chance to get ahead and stop all this government interference in our lives.. If it rained, staffers had to send a Jeep down the road to retrieve Sook. The remainder of our attributable free cash flow went to repay debt. This is extremely dangerous to a democracy.. Between the 2002 and 2018 cycles, Tribune gave generously to Michigan Republican Rep. Fred Upton, climbing from $1,000 in 2002, to $4,000 in 2008, then spiked again to $5,500 in 2012. And then what was your retrans revenue if you just exclude the CW, what was that percent change including the hit, unfortunately, for the blackouts? Okay. The format had just changed from big-band to country. However, political ideologies have influenced human society since the dawn of civilization as. So basically, auto under -- the way you're describing it. Tom Hanks Started a Veteran-Focused Coffee Brand Where to Buy It, Drug Prices Are Increasing in 2023, Won't Impact Most Consumers. Sure. So were launching this year, a three-hour, live, primetime newscast, seven nights a week, on WGN America. His name is Trump. The actions we have taken with FuboTV may or may not be representative of what we do elsewhere as other virtual contracts come up for the renewal in 2023. Ladies and gentlemen, since there are no further questions, I would like to turn the call back to Perry Sook for the closing remarks. That's job one." Today, broadcast television remains the only place for content creators, sports organizations, team owners and most importantly, advertisers to access local audiences at scale. Mr. Sook was named the 2009 Broadcaster of the Year by Broadcasting and Cable (B&C) and was among the honorees inducted into the B&C Hall of Fame in 2014. But that doesnt seem to be whats happening, Sook says. He is past Chairman of the CBS Affiliate Board.Mr. It seems like you're pretty much through with the reshaping process there. Nexstar is "immediately commencing a search" for Busch's successor, according to Perry Sook, Nexstar's CEO. Obviously, we spent a lot of time in front of local business owners and local advertisers. Lee Ann Gliha; Executive VP & CFO; Nexstar Media Group, Inc. Perry A. Sook; Founder, Chairman & CEO; Nexstar Media Group, Inc. Thomas E. Carter; President & COO; Nexstar Media Group, Inc. Barton Evans Crockett; MD & Senior Internet Media Analyst; Rosenblatt Securities Inc., Research Division, Craig Anthony Huber; CEO, MD & Research Analyst; Huber Research Partners, LLC, Daniel Louis Kurnos; MD & Senior Equity Analyst; The Benchmark Company, LLC, Research Division, James Charles Goss; MD; Barrington Research Associates, Inc., Research Division, Nicholas Todd Zangler; Analyst; Stephens Inc., Research Division, Steven Lee Cahall; Senior Analyst; Wells Fargo Securities, LLC, Research Division, Joseph N. Jaffoni; Founder & President; JCIR. [53] The sale was completed on January 31, 2017. I mean, we wouldn't rule any of it out. Yourcentralvalley.com, a Nexstar site affiliated with NBC covering Fresno, California, ran a story about Kevin McCarthys claims that California Democrats had fallen out of touch with voters. I think, again, if we had a sunset for 1.0, even if it was several years, hence, that would cause the set manufacturers to begin to build to that standard, lessen the backward compatibility problem with those that don't have sets -- compatible sets that need dongles or receivers and all of that has to be dealt with and the consumer issues have to come first and foremost. We continue to believe the investment case for Nexstar is very simple. Please go ahead, sir. And I think that other team owners have taken notice of that. Okay. And I would tell you, without it, wed be in worse shape than the newspaper business.. The FCC Chairman Lazarus served under, Julius Genachowski, was nominated to the position by Obama in March 2009. And 2022, we did 50 debates across our company, 3 of which we put on the national cable network to offer to all of America outside of the states in which they were being contested. With FCC approval, the company will own 171 stations to. To request permission for commercial use, please contactus. Yes. He focuses on revenue-generating activities, including advertising and distribution, as well as executive intrigue and merger and acquisition activity. But when it came time for the owner of the station to pay me my commission, he said, Well, we had a problem at the transmitter, and I had to buy a part. After a few weeks of excuses, I realized I was never going to get paid my commission. It all got Sook to thinking. Soon after they met,. Also down the road may be a streaming version of NewsNation. They gave another $17,600 to John Boehner and $7,900 to Paul Ryan. By June, that time period was down to 28,000 viewers and 5,000 in the demo. We also have begun to execute on our cost savings plan by reducing redundant functions at the network, and we've hired new top-tier executives with backgrounds at Fox, NBCUniversal, HBO, Pop TV and Google to lead our programming and distribution strategies. In March, NewsNation VP of News Jennifer Lyons resigned amid concerns the channel might take a right-wing turn because of low ratings. NewsNation launched officially in September 2020 with high hopes of securing solid viewership in a time of deep mistrust of the media. Jon has been business editor of Broadcasting+Cable since 2010. For cash taxes, we use a 26.5% tax rate when calculating our estimated tax benefit before onetime and other adjustments. Upton represents Michigans sixth congressional district in the Southeast of the state. (Bredeson was Blackburns opponent in the 2018 Tennessee Senate race.) And I think that the prior guidance was mid-teens. In 2014, the Hubbard Broadcasting gave the Super PAC $450,000, $300,000 from the company and $150,000 from individuals. With all of that said, let me now turn the call over to Tom Carter for the operational review. And they see the customer at the checkout counter or at the cash register, and they know that local consumers are spending and have factored in 7% mortgages and $3 and $4 gasoline into their daily lives. If you follow the decline in general network -- general entertainment network ratings, we couldn't have made the pivot at a better time. Thats job one.. Also Read: Despite Low Ratings, Nexstar Adding News to Mornings on NewsNation, When we launched NewsNation, 10% of the country knew what NewsNation was, Sook told analysts and investors. Or any difference in rates that you're achieving or anything else we need to think about? We have developed these audiences over decades by consistently providing top-rated local news, sports and entertainment content. Obviously, the simulcast requirement needs to sunset at some point and there needs to be a sunset of 1.0 and an endorsement of 3.0 as the new transmission standard. Category bright spots included Ohio where sports betting was legalized beginning of '23, and Missouri driven by spending in Kansas City for sports betting in Kansas, which was legalized in September of '22. Political Advertising Revenue 265.9 18.9 . The Nexstar CEO is proud to say, I want my commission salespeople to be the highest-paid people in town. Hed like to be paid more, too. Moving to distribution revenue. The resulting company will own over 200 television stations, giving it incredible access to American homes across the country through their local news programming. As the largest local broadcaster, Nexstar is important to both our network partners and our MVPD partners, which provides us with a very strong negotiating position. Overall, for the year, cash operating taxes were $334.1 million for Nexstar, excluding CW, implying a 25.5% pretax income rate and $321.9 million, including the tax benefit from the CW attributable tax deductible losses. I wondered what the next steps are. I'm wondering how auto is performing when you look back relative to those pre-COVID levels, are we bearing full normalization here? Certainly, sports is 1 avenue that has never been pursued there before. For those with a cable subscription package, NewsNation might be included in the subscription offerings, and NewsNations channel finder can locate the correct channel. Looking ahead, excluding the impact of the CW affiliate fees, given our recent contract resets, we expect distribution revenues to be up high single to low double digits for 2023, depending on the outcome of our partners' ongoing negotiations with multiple -- with a couple of MVPDs on which they are currently dark and inclusive of our projections for subscriber attrition. These are results driven professionals who share our excitement and our vision for the network and we continue to expect to achieve profitability by 2025. Do we know enough yet to know if it's a buyer's market? Our promotional campaign will kick off in earnest in the month of April. And we've seen a lot of our competitors in the media industry with broadcast assets take notice suddenly remembering the lion's share of their revenue and profit come from that tried and true effective and profitable broadcast media. does my dad have a mental illness quiz; disadvantages of multimodal learning style. For additional details on these risks and uncertainties, please see Nexstar's annual report on Form 10-K for the year ended December 31, 2021, as filed with the Securities and Exchange Commission and Nexstar subsequent public filings with the SEC. Perry Sook Political Campaign Contributions 2020 Election Cycle. At the CW level, on the programming front, while we are locked into most programming for the '22, '23 broadcast season, we've already taken action to improve and diversify our content to better align with audiences through our exclusive multiyear broadcast rights agreement with LIV Golf. Early in 2021, news broke that Bill Shine, a former co-president of Fox News, had consulted from the beginning on the creation of NewsNation. Mr. Sook, 30, who is from Texas, was then a Broadway performer and is now a sportscaster. Your comments about (inaudible) drawing attention to the CW. He found the perfect candidate for such an arrangement just down the road in Wilkes-Barre, in the form of WBRE-TV. Positively impacting this revenue category in the quarter was the inclusion of the CW-affiliate fees as well as growth in the virtual MVPD revenue and MVPD rate resets and annual rate escalators. So it will be a record year. And so I think it's an iterative process. For example, former President Donald Trump tweeted a good luck message (when his Twitter account was still active) to Compton for the networks launch and later gave an interview in which anchor Joe Donlon didnt challenge his false statements. CapEx for the full year, excluding CW, was $155 million, slightly higher than our expectation of $150 million due primarily to anticipated reimbursement and rebates that have not yet been booked. Our weatherboard was a map of the United States that you literally put color forms onyou know, like the rubber things that stick. Since NewsNation brands itself as being one that reports the facts in an unbiased manner, many viewers were hopeful when the network launched in 2020. So you'll see our net retrans margin increase. In 2008, Tribune gave $11,450 to then-Senator Barack Obama. Our ability to execute on these renewals just reinforces what we already know that broadcast matters. And in our recent distribution and renewal negotiations, our ownership of the CW positively impact the outcomes of those discussions by an amount that already effectively paid for the investment that we'll make in the network. As you know, there are a lot of moving pieces in these discussions with the networks, especially at CBS, where there is a linear agreement, vMVPD agreement and a Paramount Plus agreement, all of which are up later this year. We required modesty from women. Turning to the balance sheet. The lawyerly name belies the bare-knuckled drama involving Cox and 21 television stations in Texas, Arkansas, Louisiana, Kansas, and Missouri. DC NewsNation is found under the umbrella of Nexstar Inc.s Networks division. TV continues to be the gold standard for political advertisers with local TV and local cable TV together representing 70% of gross political ad spending. And then lastly, just on sports content. And most importantly, the affiliates as well as our own stations were thrilled. Core advertising revenue was $478 million (down 3.3 percent year over year), while political advertising revenue was $266 million (up 1,307 percent). Sinclairs name recognition spiked after a Deadspin compilation synchronizing the biased news must-run segment went viral, but Sinclair has been distributing corporate speech through local news stations for years. In March 2021, The New York Times reported that NewsNation hadn't lived up to expectations and was seeing low viewership. Are those negotiations coming up at all? Consistent with our capital allocation priorities and focus on enhancing shareholder value, in January, the Board of Directors increased Nexstar's quarterly cash dividend by 50% to $1.35 per share per quarter, substantially exceeding our historical compound annual dividend growth rate of 25%. Great. And obviously, with things like LIV Golf and other programming expansions, we're hoping to create more value so that we can ultimately extract more value as we go. Hubbard Broadcasting gave $350,000 to Freedom Partners Action Fund, a Koch-network Super PAC, in the 2016 election cycle. Since NewsNations launch, several incidents of conservative and/or pro-Trump bias have occurred. Perry A. Sook has over 43 years of professional experience in the television and radio broadcasting industries, covering all facets of the business, including ownership and M&A, management, sales, on-air talent, and news. Last quarter, you announced the Clippers deal. Okay. I think you'll see some higher profile programming there, certainly in the unscripted than you have seen historically. Thank you for signing up to Broadcasting & Cable. Or is it just like a national game on that national feed? Sook said this year when Hillary Clinton and Donald Trump square off in the November presidential election, Nexstar will earn about $100 million in political advertising revenue. If you don't have the local stations, I think that should tell you everything you need to know about the leverage in the discussions. Nexstar captured 13.8% of total political television dollars in line with prior years. So, Sook began by figuring out how to benefit financially by operating or managing stations. And again, we want to make the CW a -- I mean, it has a distribution on par with the big 4. * To subscribe, you must consent to Futures privacy policy. In a 2015 article on the announcement that then-Senator Mikulski would receive the presidential medal of freedom, the Fox45 site included a transcript of Mikulskis full reaction from the floor of the Senate. Want first access to OpenSecrets' investigations and data features? Thank you, Tom, and good morning, everyone. As such, Nexstar shares represent a solid investment opportunity for existing and potential shareholders as we are the largest broadcast company with top-tier operational performance in the sector but we trade at a very modest '23, '24 free cash flow yield. Boris Epshteyn, a former Trump staffer, has a recurring editorial segment. And we're working independently with Sinclair and with other companies to develop business applications that can be used today, given the capacity constraints in enhanced GPS and distributed power and some other use cases that are not very bandwidth-intensive. Just about any story is fair game, if a dollar sign can make its way into the article. Well, I can tell you that the number of inbound inquiries as well as discussions that are going on with team owners, the activity is frenetic around here. Perry A. Sook-- Chairman and Chief Executive Officer Thanks very much, everyone for joining us. Offsetting these factors were the impact of ours and our partner stations going dark on certain MVPDs during the quarter in connection with the contract renegotiations and the settlement of certain disputes impacting revenue in connection with these new contracts as well as continued MVPD subscriber attrition. You will receive a verification email shortly. A few additional notes on our 2023, 2024 free cash flow guidance before we open up for questions. Some of his other commitments include working on the board of directors for the following non-profits: the Broadcasters Foundation of America, the Television Bureau of Advertising, and as the television chairman for the National Association of Broadcasters, according to his Nexstar bio. Broadcasting+Cable is part of Future US Inc, an international media group and leading digital publisher. On Dec. 3, it was announced that Tribune Media would be acquired by Nexstar Media Group for over $4 billion. How do you see that kind of opportunity between both local stations and the CW? In the fourth quarter, the CW generated $66 million of revenue and $64 million of adjusted EBITDA losses in line with our expectations for the quarter. This concludes our conference call for today. If Sook can pull that off, he will have one hell of a story to tell. When you refer to Bay, who are you talking about? 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