For the quarter, net income was $8.5 million or 10 cents per share. Unusual items added 2 cents per share. In the prior-year quarter, net income was $11.5 million or 14 cents per share. The 2017 quarter includes a $2.4 million non-cash charge to interest expense to write off deferred costs associated with our refinancing and $5.1 million of other income, primarily from the sale of our newspaper syndication business.
For the quarter, total revenue was $232 million compared to $228 million in second-quarter 2016.
• The company announced on Aug. 1 plans to acquire the Katz networks – four fast-growing, audience-targeted broadcast networks, for $302 million. Because Scripps was already a 5 percent owner in a portion of the business, the net purchase price is $292 million. Each network reaches more than 80 percent of U.S. television households and provides national advertising scale. The deal is expected to close Oct. 2.
• In June, the company exited the newspaper syndication business in a deal worth about $3 million with longtime partner Universal Uclick. Scripps sold the newspaper syndication rights for some popular comic strips and assigned other syndication rights to Universal Uclick for the comics in which Scripps owns the copyrights, including “Big Nate,” “Marmaduke” and “Nancy.”
• Retransmission revenue increased 24 percent to $66 million in the second quarter. For the year, retransmission revenue is expected to increase 20 percent and become about 35 percent of television division revenue.
• Digital revenue grew 27 percent in the second quarter, driven by growth at our industry-leading podcast company, Midroll, and our next-generation national news network, Newsy.
• In April, the company closed an offering of $400 million of new senior unsecured notes maturing in 2025. The notes have a coupon rate of 5.125 percent. Proceeds from the offering were used to repay a term loan, to pay related fees, and for general corporate purposes. Since this is a refinancing, the company did not significantly increase the total amount of debt outstanding.
Commenting on the second-quarter results, Scripps Chairman, President and CEO Rich Boehne said:
“Company founder Jonathan Katz is a creative and forward-looking entrepreneur who six years ago saw the opportunity for focused networks distributed over the air that could serve viewers in tandem with emerging over-the-top services.
“At the same time as we looked ahead to new ways of engaging television viewers, we said goodbye to our last ties to the newspaper business. For more than 100 years, newspaper comics were an important and valuable part of our company. Scripps brought many iconic strips to kitchen tables around the world. Although very small in recent years, the comics syndication business served us well for many years.
“In our largest business, broadcast television, we are anticipating the launch of our newest original program, Pickler & Ben, on Sept. 18. We partnered with country music star Faith Hill to produce the show, starring country singer Kellie Pickler and New York journalist Ben Aaron in a daily talk-show program. We have had good success with our original programming strategy, with RightThisMinute in its seventh season and The List in national syndication. This is another show that helps us build value, save money on syndicated costs and garner more advertising revenue.
“In our digital division, our next-generation national news network Newsy saw a 25 percent increase in views on the over-the-top platform, where it is distributed across all the major services. And our podcast company Midroll added several dozen new shows to its distribution and ad sales network, including the acclaimed podcast Welcome to Night Vale and the owned and operated show LeVar Burton Reads. Midroll now owns or represents more than 300 podcasts to a growing range of high-quality advertisers.”
Radio revenue was $17.2 million, down from $18.2 million in the 2016 quarter. Expenses were flat year-over-year. Segment profit in the radio division was $2.9 million in the second quarter, down from $3.9 million in the 2016 quarter.