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SCRIPPS (E.W.) CO. (NEW) Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: May 8, 2012 09:36PM
SCRIPPS (E.W.) CO. (NEW) (SSP) filed Quarterly Report for the period ended 2012-03-31. Ew Scripps Co has a market cap of $504 million; its shares were traded at around $8.765 with and P/S ratio of 0.7.
Highlight of Business Operations:The company also expects to benefit in the coming years from renewal of retransmission consent agreements. For the past four years, Scripps has received payment for many of its broadcast signals from Scripps Networks Interactive, Inc.(SNI), which negotiated our retransmission consent agreements until we spun it off in 2008. As these contracts expire, we will have the opportunity to renegotiate new contracts with the cable and satellite operators at a time when we expect market rates to be significantly higher than the rates we receive from SNI. Retransmission revenue grew 35% in 2011. Agreements with our two largest cable television operators, Time Warner and Comcast, expire in December 2015 and December 2019, respectively.
Television time sales excluding the impact of the acquired stations increased by $6.1 million or 9.9%. Revenues were bolstered by strong local time sales as well as $4.0 million of incremental political advertising in 2012 compared to 2011. The demand for national advertising on local network affiliates was weak, particularly in retail and communication services.
Retransmission revenues increased 37% or $1.5 million excluding the impact of the acquisition. We renewed certain agreements at higher rates and experienced rate increases built into our continuing agreements. Prior to the spin-off of SNI, the rights to retransmit our broadcast signals were included as consideration in negotiations between cable and satellite system operators and the Companys cable networks. SNI pays us fixed fees for the use of our retransmission rights. As the retransmission contracts negotiated by SNI expire, we will negotiate standalone retransmission consent agreements with the cable and satellite system operators. Agreements with our two largest cable television operators, Time Warner and Comcast, expire in December 2015 and December 2019, respectively.
Cash flow from operating activities in the first three months of 2012 increased $28 million compared to the first three months of 2011. Stronger segment profit in the 2012 quarter and strong collections of accounts receivable led to most of the improvement.
Stocks Discussed: SSP,