1Q Revenue Climbs To $1.1B At Nexstar

Nexstar Media Group, Inc. today reported financial results for the first quarter ended March 31, 2020. The actual results reflect the Company’s legacy Nexstar Broadcasting and digital operations and full quarterly results from the Tribune Media stations which we acquired on September 19, 2019. First quarter 2020 revenue from WGN America, also acquired in the Tribune transaction, is included in core advertising revenue and distribution fee revenue. The contribution from Nexstar’s 31.3% ownership stake in TV Food Network and other investments acquired in the Tribune transaction is included in the full income statement, inluding Nexstar’s legacy broadcasting and digital operations.

Perry Sook

Perry A. Sook, Chairman, President and Chief Executive Officer of Nexstar Media Group commented, “Against the challenging economic environment driven by the onset in March of COVID-19 (“coronavirus”), Nexstar delivered record first quarter operating results with net revenue, profitability, and cash flow metrics all exceeding consensus expectations. Our strong first quarter financial results reflect healthy levels of core and digital advertising spending in January and February, robust political ad spending across several key markets, significant distribution revenue growth and a cash distribution from our 31% ownership stake in TV Food Network."

 "The broadcast industry experienced a rapid change in market conditions due to COVID-19, which resulted in a significant decline in commercial advertising revenue in the last three weeks of March and into the second quarter. Given our out-performance in the first quarter, Nexstar was on well on track to meet our 2020/2021 pro forma average annual free cash flow guidance of $1.175 billion. However, the precise depth and duration of COVID-19’s impact on our operations is uncertain as conditions continue to evolve. As a result, and notwithstanding the revenue visibility afforded by our distribution agreements and cash distribution from our TV Food Network ownership stake, we are withdrawing our free cash flow guidance for the 2020/2021 cycle at this time.

“In 2020, over 50% of our annual revenue is expected to be derived from contractual distribution fee and political advertising revenue, which we do not expect to be materially impacted by coronavirus.

“In the first quarter Nexstar took immediate actions to adapt our business to operate in the current environment and to preserve liquidity in order to best position the Company for long-term success as we return to normalized operations. On the operating front, we have implemented a range of cost-cutting initiatives which will result in operating expense savings of approximately $40 million in the second quarter of 2020. We are proceeding with our investment related to the summer 2020 launch of WGN America’s primetime national newscast, News Nation, and have prioritized capital expenditures to maintain maximum financial flexibility.

“In summary, while the coronavirus has presented serious challenges for the entire broadcast industry, Nexstar’s leading local broadcast platform is well positioned to withstand this environment due to several factors including continued growth of distribution revenue and what are projected to be record levels of political spending in 2020.