Sinclair Reports Third Quarter 2013 Financial Results

            Sinclair Reports Third Quarter 2013 Financial Results

- EARNS $0.36 DILUTED EARNINGS PER SHARE

- DECLARES $0.15 QUARTERLY DIVIDEND PER SHARE

PR Newswire

BALTIMORE, Nov. 6, 2013

BALTIMORE, Nov. 6, 2013 /PRNewswire/ --Sinclair Broadcast Group, Inc.
(Nasdaq: SBGI), the "Company" or "Sinclair," today reported financial results
for the three months and nine months ended September 30, 2013.

(Logo: http://photos.prnewswire.com/prnh/20100119/PH39783LOGO )

"Our third quarter 2013 results showed an increase of 11.0% in net broadcast
revenues on a same station basis, excluding political revenues, which was
driven by growth in our retransmission revenues and core business," commented
David Smith, President and CEO of Sinclair. "We are pleased with our solid
third quarter results and expect to continue to grow our revenue share and
provide additional value to our shareholders through our station acquisitions
and the synergies and efficiencies of scale that we are creating as we
continue to consolidate. Including all pending station acquisitions, we are
the largest and one of the most diversified TV broadcasters in the country and
have been the most active TV broadcasting consolidator with over $3.0 billion
in assets purchased and announced. Television continues to be the preferred
medium for advertisers and consumers top choice for news and entertainment.
As we look ahead, we are beginning to assess other possible avenues for
growth after the industry consolidates, including enhancing our original
content offerings and distribution, the pursuit of strategic partnerships and
monetizing spectrum holdings, all with the intent of creating additional value
for our shareholders."

Three Months Ended September 30, 2013 Financial Results:

  oNet broadcast revenues from continuing operations increased 34.7% to
    $303.0 million, versus $225.0 million in the prior year period.
  oOperating income decreased 7.1% to $72.8 million, due to non-cash
    depreciation and amortization as a result of acquisitions and a one-time
    cash charge of $4.3 million of severance costs related to the Fisher
    acquisition, compared to operating income of $78.4 million in the prior
    year period.
  oNet income attributable to the Company was $36.3 million compared to net
    income of $26.2 million in the prior year period.
  oDiluted earnings per common share were $0.36 compared to $0.32 in the
    prior year period. 

Nine-Months Ended September 30, 2013 Financial Results:

  oNet broadcast revenues from continuing operations increased 31.8% to
    $835.2 million, versus $633.5 million in the prior year period.
  oOperating income increased 5.0% to $220.8 million, versus $210.2 million
    in the prior year period.
  oNet income attributable to the Company was $71.2 million, which includes
    $16.3 million of loss on the extinguishment of debt, versus net income of
    $85.7 million in the prior year period.
  oDiluted earnings per common share were $0.78 compared to $1.05 in the
    prior year period. 

Three Months Ended September 30, 2013 Operating Highlights:

  oPolitical revenues were $2.7 million versus $27.8 million in the third
    quarter of 2012.
  oLocal net broadcast revenues, which include local time sales,
    retransmission revenues, and other broadcast revenues, were up 53.3%,
    while national net broadcast revenues, which include national time sales
    and other national broadcast revenues, were down 7.0% versus the third
    quarter of 2012.

       oExcluding political revenues, local net broadcast revenues increased
         55.8% and national net broadcast revenues increased 40.0% versus the
         third quarter of 2012.
       oOn a same station basis, excluding political revenues, local net
         broadcast revenues were up 14.0%, while national net broadcast
         revenues were up 0.7%, versus the third quarter of 2012.
       oFastest growing advertising categories, on a same station basis,
         included automotive, which was up 9.3%, services, grocery, media,
         furniture, and home products. Categories that declined were
         telecommunications and paid programming. 

Recent Corporate Developments

  oOn August 8, 2013, the Company closed on its previously announced purchase
    of Fisher Communications, Inc. for $373.2 million, less approximately
    $25.0 million of working capital.
  oIn September, the Company entered into a definitive merger agreement to
    acquire the assets of eight television stations owned by New Age Media for
    $90.0 million. The transaction is expected to close during the first
    quarter of 2014, subject to the approval of the FCC and customary closing
    conditions.
  oOn September 30, 2013, the Company closed on its previously announced
    purchase of certain stock and assets of the Sioux City, IA television
    stations owned by TTBG, LLC and closed on the Fresno/Visalia, CA and
    Omaha, NE stations on October 1, 2013 for a total purchase price of
    $115.35 million. The Company will provide sales and other services to two
    stations.
  oOn October 1, 2013, the Company closed on the purchase of KDBC (FOX) in El
    Paso, Texas for $21.0 million.
  oOn October 31, 2013, the Company closed on the purchase of the non-license
    assets of WPFO (FOX) in Portland, Maine for $13.6 million and will provide
    sales and other services to the station.
  oOn September 27, 2013, the Company announced the passing of its long-time
    Board Member, the Honorable Judge Basil A. Thomas. 

Balance Sheet and Cash Flow Highlights:

  oDebt on the balance sheet, net of $229.0 million in cash and cash
    equivalents, was $2,245.9 million at September 30, 2013 versus net debt of
    $1,898.4 million at June 30, 2013.
  oOn October 11, 2013, the Company's wholly-owned subsidiary, Sinclair
    Television Group ("STG"), closed on a $350.0 million, 6.375% Senior
    Unsecured Note due 2021.
  oOn October 23, 2013, the Company's wholly-owned subsidiary, STG, amended
    and upsized its Bank Credit Facility with an additional $57.5 million in
    revolving line of credit capacity, a $250 million incremental term loan B,
    and an incremental $200 million delayed draw term loan A.
  oOn October 12, 2013, the Company's wholly-owned subsidiary, STG, redeemed
    its $500 million, 9.25% Second Lien Notes due 2017 from the proceeds of
    the 6.375% Note and incremental bank credit facilities.
  oOn September 25, 2013, holders of $5.7 million original principal value of
    the Company's 4.875% Convertible Notes converted their Notes into
    approximately 338.6 thousand common shares pursuant to the indenture
    governing those notes.
  oOn October 24, 2013, holders of $5.4 million original principal value of
    the Company's 3.0% Convertible Notes converted their Notes, and the
    conversion was settled in $10.5 million cash pursuant to the indenture
    governing those Notes.
  oAs of September 30, 2013, 73.9 million Class A common shares and 26.3
    million Class B common shares were outstanding, for a total of 100.2
    million common shares outstanding.
  oIn September 2013, the Company paid a $0.15 per share quarterly cash
    dividend to its shareholders.
  oCapital expenditures in the third quarter 2013 were $11.6 million.
  oProgram contract payments for continuing operations were $21.7 million in
    the third quarter 2013.

Notes:

Presentation of financial information for the prior year has been reclassified
to conform with the presentation of generally accepted accounting principles
for the current year.

Outlook:

The term "Acquisition(s)" in this Outlook section refers to the inclusion of
the GoCom stations for the full year 2013; the COX stations beginning May 1,
2013; WUTB beginning June 1, 2013; the Fisher stations beginning August 8,
2013, the TTBG and El Paso stations beginning October 1, 2013, the Barrington
stations beginning December 1, 2013, the Portland ME station beginning
November 1, 2013. The Allbritton, New Age, and Peak Media stations are not
included in the Outlook section as they are not expected to close in 2013.
The term "same station basis" excludes the Acquisitions defined above for the
periods noted as well as the results of the Newport stations and KBTV for the
first 11 months of 2013.

"For the fourth quarter of 2013, we expect to see continued growth in core
local and national advertising," commented David Amy, Executive Vice President
and Chief Financial Officer. "While we expect our political revenues to
benefit from the implementation of the Affordable Care Act, the uncertainty
surrounding the government's computer enrollment issues has resulted in slower
than expected state spending on related advertising. Advertising in the
automotive sector, however, continues to be robust, growing 9.3% in the third
quarter over the same period last year, as sales of new cars hit their highest
levels since 2007. That momentum is carrying through to the fourth quarter
with auto advertising, on a same station basis, expected to grow by high
single digits over the fourth quarter last year."

The Company currently expects to achieve the following results for the fourth
quarter and year ending December 31, 2013, as follows:

Fourth Quarter 2013

  oNet broadcast revenues from continuing operations, before barter, are
    expected to be approximately $368.1 million to $372.1 million, up 28.2% to
    29.6% year-over-year. Embedded in these anticipated results are:

       oNet revenues of $116.7 million related to the Acquisitions.
       oApproximately $5.9 million in political revenues as compared to $54.1
         million in the fourth quarter 2012.
       oTotal same station net broadcast revenues are estimated to be down
         11.0% to 12.4% versus the same period in 2012 reflecting the absence
         of political as 2013 is a non-election year.
       oExcluding the Acquisitions and excluding political revenues, same
         station net broadcast revenues are estimated to be up 6.7% to 8.4%
         versus the fourth quarter of 2012.

  oBarter and trade revenue are expected to be approximately $22.5 million.
  oBarter expense is expected to be approximately $20.0 million. Trade
    expense is included in television expenses (defined below).
  oStation production expenses and station selling, general and
    administrative expenses (together, "television expenses"), excluding
    barter expense of $20.0 million but including trade expense of $2.5
    million, are expected to be approximately $192.3 million, which assumes
    $66.3 million related to the acquisitions for the quarter. Trade expense
    has historically been forecasted with barter expense but is currently
    forecasted in television expenses.

       oExcluding the Acquisitions, same station television expenses are
         expected to be up approximately 2.8%.

  oProgram contract amortization expenses are expected to be approximately
    $23.6 million, which assumes $4.8 million related to the Acquisitions.
  oProgram contract payments are expected to be approximately $22.1 million,
    which assumes $2.9 million related to the Acquisitions.
  oCorporate overhead is expected to be approximately $11.5 million, which
    includes $0.8 million of stock-based compensation.
  oOther operating division revenues less other operating division expenses
    are expected to be $3.1 million of income, assuming current equity
    interests.
  oDepreciation on property and equipment is expected to be approximately
    $22.2 million, assuming the capital expenditure assumption below.
  oAmortization of acquired intangibles is expected to be approximately $20.8
    million. 
  oNet interest expense is expected to be approximately $40.9 million,
    assuming no changes in the current interest rate yield curve and changes
    in debt levels based on the assumptions discussed in this "Outlook"
    section and the recent redemptions and financings.
  oA current tax benefit from continuing operations is expected to be
    approximately $4.5 million, based on the assumptions discussed in this
    "Outlook" section, and an effective tax rate of approximately 45.3%.
  oCapital expenditures are expected to be approximately $17.2 million.

Full Year 2013

  oNet broadcast revenues from continuing operations, before barter, are
    expected to be approximately $1.203 billion to $1.207 billion, up 30.7% to
    31.1% year-over-year. Embedded in these anticipated results are:

       oNet revenues of $313.2 million related to the Acquisitions.
       oApproximately $11.0 million in political revenues as compared to
         $96.9 million in 2012.
       oTotal same station net broadcast revenues are estimated to be down
         2.1% to 2.5% versus the same period in 2012 reflecting the absence of
         political as 2013 is a non-election year.
       oExcluding the Acquisitions and political revenues, same station net
         broadcast revenues are estimated to be up 8.3% to 8.8% versus 2012.

  oBarter and trade revenue is expected to be approximately $83.4 million
  oBarter expense is expected to be approximately $73.5 million.
  oStation production expenses and station selling, general and
    administrative expenses (together, "television expenses"), excluding
    barter expense but including trade expense, are expected to be
    approximately $628.7 million, which assumes $174.3 million related to the
    acquisitions for the year. 

       oStock based compensation expense is expected to be $2.9 million. 
       oExcluding the acquisitions, same station television expenses are
         expected to be up approximately 8.2%.

  oProgram contract amortization expense is expected to be approximately
    $80.4 million, which assumes $14.1 million related to the Acquisitions.
  oProgram contract payments are expected to be approximately $88.7 million,
    which assumes $9.7 million related to the Acquisitions.
  oCorporate overhead is expected to be approximately $50.3 million, which
    includes certain one-time costs associated with the acquisitions;
    additions to certain corporate functions as a result of the acquisition
    growth; and corporate overhead acquired in the fourth quarter of 2013, the
    synergies of which are not expected to be realized until early 2014.

       oStock-based compensation expense is expected to be approximately $7.0
         million.

  oOther operating division revenues less other operating division expenses
    are expected to be $9.0 million of income, assuming current equity
    interests.
  oDepreciation on property and equipment is expected to be approximately
    $69.3 million, assuming the capital expenditure assumption below.
  oAmortization of acquired intangibles is expected to be approximately $69.5
    million. 
  oNet interest expense is expected to be approximately $163.8 million
    (approximately $154.1 million on a cash basis), assuming no changes in the
    current interest rate yield curve and changes in debt levels based on the
    assumptions discussed in this "Outlook" section.
  oThe current tax provision from continuing operations is expected to be
    approximately $12.8 million based on the assumptions discussed in this
    "Outlook" section, and an effective tax rate of approximately 31.3%. The
    Company expects to pay cash taxes of $20.0 million for the year.
  oCapital expenditures are expected to be $45.9 million, which assumes $12.3
    million related to the Acquisitions.

Sinclair Conference Call:

The senior management of Sinclair will hold a conference call to discuss its
third quarter 2013 results on Wednesday, November 6, 2013, at 9:30 a.m. ET.
After the call, an audio replay will be available at www.sbgi.netunder
"Investor Information/Earnings Webcast." The press and the public will be
welcome on the call in a listen-only mode. The dial-in number is (877)
407-8033.

"Discontinued Operations" accounting has been adopted in the financial
statements for all periods presented in this press release for the sale of
WLAJ-TV, our ABC affiliate in Lansing, Michigan which closed in March 2013,
and for the sale of WLWC-TV, our CW affiliate in the Providence, RI/New
Bedford, MA market which closed in April 2013. Therefore, the related results
from operations, net of related income taxes, have been reclassified from
income from continuing operations and reflected as net income from
discontinued operations. Prior current year amounts have been reclassified to
conform to current year GAAP presentation.

About Sinclair:

On a pro forma basis assuming consummation of all announced transactions,
Sinclair Broadcast Group, Inc., the largest and one of the most diversified
television broadcasting companies, will own and operate, program or provide
sales services to 163 television stations in 77 markets. Sinclair's
television group will reach approximately 38.7% of U.S. television households
(24.3% based on the FCC's calculation with the UHF discount) and will be
affiliated with all major networks. Sinclair's television portfolio will
include 39 FOX, 29 ABC, 26 CBS, 25 CW, 22 MNT, 15 NBC, 5 Univision, one Azteca
and one independent station. Sinclair owns equity interests in broadcast
transmission-related companies and various non-broadcast related companies.
The Company regularly uses its website as a key source of Company information
which can be accessed at www.sbgi.net.

Forward-Looking Statements:

The matters discussed in this news release, particularly those in the section
labeled "Outlook," include forward-looking statements regarding, among other
things, future operating results. When used in this news release, the words
"outlook," "intends to," "believes," "anticipates," "expects," "achieves,"
"estimates," and similar expressions are intended to identify forward-looking
statements. Such statements are subject to a number of risks and
uncertainties. Actual results in the future could differ materially and
adversely from those described in the forward-looking statements as a result
of various important factors, including, but not limited to, the impact of
changes in national and regional economies, the volatility in the U.S. and
global economies and financial credit markets which impact our ability to
forecast, our ability to integrate acquired businesses and maximize operating
synergies, our ability to obtain necessary governmental approvals and
financing for announced acquisitions, successful execution of outsourcing
agreements, pricing and demand fluctuations in local and national advertising,
volatility in programming costs, the market's acceptance of new programming
and performance of, the CW Television Network and MyNetworkTV programming, our
news share strategy, our local sales initiatives, the execution of
retransmission consent agreements, our ability to identify and consummate
investments in attractive non-television assets and to achieve anticipated
returns on those investments once consummated, and any other risk factors set
forth in the Company's most recent reports on Form 10-Q, Form 10-K and Form
8-K, as filed with the Securities and Exchange Commission. There can be no
assurances that the assumptions and other factors referred to in this release
will occur. The Company undertakes no obligation to publicly release the
result of any revisions to these forward-looking statements except as required
by law.







Sinclair Broadcast Group, Inc. and Subsidiaries

Preliminary Unaudited Consolidated Statements of Operations

(in thousands, except per share data)


                             Three Months Ended        Nine Months Ended
                             September 30,             September 30,
                             2013         2012         2013          2012
REVENUES:
Station broadcast revenues,  $           $           $  835,223  $ 
net of agency commissions    303,028     225,023                   633,493
Revenues realized from       20,653       21,179       60,930        60,060
station barter arrangements
Other operating divisions    14,963       12,512       39,263        38,609
revenues
Total revenues               338,644      258,714      935,416       732,162
OPERATING EXPENSES:
Station production expenses  98,939       61,705       265,066       184,098
Station selling, general and 66,115       43,169       171,350       120,462
administrative expenses
Expenses recognized from     18,082       19,300       53,478        55,119
station barter arrangements
Amortization of program
contract costs and net       19,229       14,296       56,746        43,565
realizable
value adjustments
Other operating divisions    12,746       10,372       33,351        33,165
expenses
Depreciation of property and 17,408       12,626       47,108        34,031
equipment
Corporate general and        16,109       8,286        38,806        25,166
administrative expenses
Amortization of
definite-lived intangible    17,168       10,562       48,727        26,375
and other assets
Total operating expenses     265,796      180,316      714,632       521,981
Operating income             72,848       78,398       220,784       210,181
OTHER INCOME (EXPENSE):
Interest expense and
amortization of debt
discount and                (39,867)     (35,294)     (123,029)     (92,001)
deferred financing
costs
Loss from extinguishment of  —            —            (16,283)      (335)
debt
Income from equity and cost  1,571        1,919        115           8,343
method investments
Other income, net            488          547          1,427         1,733
Total other expense          (37,808)     (32,828)     (137,770)     (82,260)
Income from continuing
operations before income     35,040       45,570       83,014        127,921
taxes
INCOME TAX PROVISION         (4,489)      (19,093)     (22,992)      (42,185)
Income from continuing       30,551       26,477       60,022        85,736
operations
DISCONTINUED OPERATIONS:
Income (loss) from
discontinued operations,
includes income
tax benefit         6,100        (125)        11,558        (178)
(provision) of $6,107,
$(36), $10,806 and $(220),
respectively
NET INCOME                   36,651       26,352       71,580        85,558
Net (income) loss
attributable to the          (309)        (107)        (415)         106
noncontrolling interests
NET INCOME ATTRIBUTABLE TO   $          $          $           $  
SINCLAIR                    36,342      26,245      71,165       85,664
BROADCAST GROUP
Dividends declared per share $       $       $        $    
                             0.15         0.15         0.45          0.39
EARNINGS PER COMMON SHARE
ATTRIBUTABLE TO
SINCLAIR BROADCAST
GROUP:
Basic earnings per share     $       $        $         $    
from continuing operations   0.30         0.33        0.66         1.06
Basic earnings per share     $        $        $         $    
from discontinued operations 0.06        (0.00)       0.13         (0.00)
Basic earnings per share     $       $        $         $    
                             0.37         0.32        0.78         1.05
Diluted earnings per share   $       $        $         $    
from continuing operations   0.30         0.32        0.65         1.06
Diluted earnings per share   $        $        $         $    
from discontinued operations 0.06        (0.00)       0.13         (0.00)
Diluted earnings per share   $       $       $         $    
                             0.36         0.32         0.78          1.05
Weighted average common      99,473       81,081       99,982        80,990
shares outstanding
Weighted average common and
common equivalent shares     100,239      81,379       91,549        81,267
outstanding
AMOUNTS ATTRIBUTABLE TO
SINCLAIR BROADCAST
GROUP COMMON
SHAREHOLDERS:
Income from continuing       $         $         $           $  
operations, net of tax       30,242       26,370       59,607       85,842
Loss from discontinued       6,100        (125)        11,558        (178)
operations, net of tax
Net income                   $         $         $           $  
                             36,342       26,245       71,165       85,664









Preliminary Unaudited Consolidated Historical Selected Balance Sheet Data:

(In thousands)


                                           September 30,   December 31,

                                           2013            2012
Cash & cash equivalents                    $   228,994  $    22,865
Total current assets                       587,582         304,448
Total long term assets ^                   3,030,091       2,425,249
Total assets                               $  3,617,673   $  2,729,697
Current portion of debt                    18,893          49,326
Total current liabilities                  340,711         307,600
Long term portion of debt                  2,456,005       2,224,053
Total long term liabilities                2,860,724       2,522,150
Total liabilities                          3,201,435       2,829,750
Total stockholders' deficit                416,238         (100,053)
Total liabilities & stockholders' deficit  $  3,617,673  $  2,729,697









Unaudited Consolidated Historical Selected Statement of Cash Flows Data:

(In thousands)


                                          Three Months Ended Nine Months Ended

                                          September 30,      September 30,
                                          2013               2013
Net cash flow from operating activities   $    97,269     $   150,639
Net cash flow used in investing           (430,106)          (556,742)
activities
Net cash flow from financing activities   11,019             612,232
Net increase (decrease) in cash & cash    (321,818)          206,129
equivalents
Cash & cash equivalents, beginning of     550,812            22,865
period
Cash & cash equivalents, end of period    $  228,994       $  228,994



SOURCE Sinclair Broadcast Group, Inc.

Website: http://www.sbgi.net
Contact: David Amy, EVP & Chief Financial Officer, or Lucy Rutishauser,
VP-Corporate Finance & Treasurer, (410) 568-1500