Tribune Media Reports Political Ad Revenue Jumped 90%

Tribune Media said Friday that it swung to a better-than-expected third-quarter profit, driven by strong political advertising momentum ahead of the midterm elections that shows no sign of slowing down.

According to The Hollywood Reporter, Tribune Media CEO Peter Kern told analysts during a morning call that the 2020 presidential campaign, while a long way off, has already made the company's stations group a potential election ad winner going forward as the political cycle shows no sign of taking a holiday.

During the third quarter, political advertising revenue jumped 90 percent to $42.5 million. "These unprecedented numbers suggest we may be seeing a fundamental shift in spending patterns in this category. Not only have the numbers grown significantly, but we may be seeing the start of an always-on political cycle," Kern argued.

Political parties and PACs spending record dollars during the recent midterm elections produced record advertising numbers for Tribune in recent financial quarters, compared to the 2014 mid-terms. And now that 2020 campaign TV ads have already appeared in Iowa, Kern said the next presidential election bodes well for his political ad revenues during the next two years.

During the latest quarter, earnings from continuing operations of $54.1 million, or 61 cents per share, compared to a loss from continuing operations of $18.7 million in the third quarter of 2017, or a loss of 21 cents per share. In the latest period, the company recorded an income tax benefit of $24 million, or 27 cents per share, due to tax reform.

Quarterly operating profit came in at $37.1 million, compared with an operating loss of $29.5 million for the third quarter of 2017. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), another profitability metric, rose 14 percent to $136.8 million.

Third-quarter revenue rose 11 percent to $498 million. Retransmission revenue climbed 12 percent, while carriage fee revenue rose 30 percent.

Sinclair Broadcast Group's $3.9 billion planned takeover of Tribune Media, which would have created a local TV giant reaching nearly two-thirds of U.S. TV households, was scrapped this summer after a series of developments that cast doubt over the transaction.