The results reflect the impact of $34 million and $1.3 million of one-time transaction expenses incurred in the quarter from Nexstar’s acquisition of Tribune Media that closed on Sept. 19.
The revenue numbers break down to:
- Local revenue of $208,338,000, a 10% increase.
- National revenue of $81,875,000, up 14.3%.
- Retransmission consent revenue of $294,808,000, a 3.7% rise.
- Political revenue of $10,899,000, down 84.5%.
- Digital revenue of $58,137,000, down 16.1%.
- Trade and barter/other revenue of $9,518,000, up 16.2%.
- Third quarter net income came in as a loss of $5,178,000, a drop of 105.2% from $99,828,000 a year ago.
"Collectively, these actions reduced leverage at closing to levels significantly below prior expectations. Yesterday, we announced a purchase and sale agreements with Fox Television Stations which will position Nexstar as a broadcast and digital leader in the fast growing Charlotte market and add to our already strong presence in the Carolinas. The Fox transaction furthers that leverage reduction effort and these transactions reduced our pro forma net leverage ratio at September 30, 2019 to 4.3 times. With our expanded and diversified operating base, expectations for significant 2020 political spending, and the benefit of recent and soon-to-be completed distribution agreement renewals, we remain confident in generating record levels of free cash flow next year and reducing the Company’s total net leverage ratio to below 4.0x at December 31, 2020.
“On the operating front, we worked quickly to optimize our platform and leverage our increased scale with the expansion of Nexstar’s news bureaus, local news and other programming in several markets. We also named proven broadcasting industry executives from Tribune to drive growth at WGN America and through content acquisition; from our distribution revenue streams; and to oversee communications, media relations, employee communication and the company’s intranet and public facing corporate website. In addition, we appointed operating leaders to oversee broadcast and digital in key markets including Dallas, Fresno, Des Moines, Tampa and Spartanburg and elevated members of the Nexstar operating, sales and finance teams to new roles to acknowledge their ongoing contributions to Nexstar’s growth.
“At the time of the Tribune closing, we raised our anticipated first year transaction operating synergies target to approximately $185 million from approximately $160 million and the Tribune Media integration and synergy realization plans are proceeding on schedule. Taken together, these developments are reflected in our pro-forma average annual free cash flow guidance for the 2019/2020 cycle of approximately $1.02 billion which represents nearly 60% accretion relative to the legacy Nexstar operations. Given the Tribune acquisition was a cash transaction, our outstanding share count remains at approximately 46.1 million and we remain focused on the disciplined management of our share base and capital structure as another means of enhancing shareholder value.