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LIN TV Corp. Q1 2010 Earnings Call Transcript

LIN TV Corp. Q1 2010 Earnings Call Transcript

LIN TV Corp. (TVL)

Q1 2010 Earnings Call

April 22, 2010 9:00 AM EST


Vincent Sadusky – President and CEO

Scott Blumenthal – EVP, Television

Rich Schmaeling – CFO


Marci Ryvicker – Wells Fargo Securities

Jonathan Levine – Jefferies

Aaron Watts – Deutsche Bank

Barry Lucas – Gabelli & Co.

Paul Sweeney – Bloomberg Research

Edward Atorino – Benchmark

Bishop Cheen – Wells Fargo

Leo Cole (ph) – Citi

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Good morning, ladies and gentlemen, and welcome to LIN TV Corporation’s earnings call for the first quarter that ended March 31


, 2010. Today’s call is being recorded. Before we introduce the speakers, I will like a read brief legal statement from the company.

This conference call may include statements that constitute forward-looking statements, particularly in the area described as business outlook. But also including any other statements of future business prospects or financial results, including, but not limited to the use of words like believe, expect, estimate, project, or other similar expressions.

Forward-looking statements inherently involve risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements. Factors that could contribute to such differences include the risks detailed in the company's annual report on Form 10-K and other filings made with the Securities and Exchange Commission, which are available on the company's website

in the Investor Relations section or at

, which discussions are incorporated in this release by reference.

LIN TV Corporation undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise, unless otherwise required to by applicable law.

At this time, I will turn the call over to LIN TV Corporation’s President and Chief Executive Officer, Mr. Vincent Sadusky. Please go ahead, sir.

Vincent Sadusky

Thank you, operator. Good morning and welcome to our first quarter 2010 conference call. I will begin with a brief review of our results and highlight the progress we have made during the quarter. Scott Blumenthal, our Executive Vice President, Television will update you on our stations’ operations and Rich Schmaeling, our Chief Financial Officer will provide our financial results. We will close with our current business outlook and then we will take your questions.

We are pleased with our first quarter 2010 results. Net revenue increased 23% to $91.8 million, compared to $74.5 million for the same quarter in 2009. Our revenue growth was driven by a recovery in spending across most of our major advertising categories, especially automotive which was up 54% from the first quarter of 2009.

Political revenues were $3.4 million in the first quarter of 2010, compared to $500,000 for the same quarter in 2009. I expect political to be a strong growth category this year as a result of a large number of gubernatorial races, congressional races and contentious issues, as well as less restrictions on corporate and non-profit campaign advertising spending.

In addition to the increase in TV ad spending, the increase in revenues is also a result of our top performing local US newscasts and unique local programs. In the first quarter of 2010, we launched two new local shows Hampton Roads and Norfolk, and Indy Style in Indianapolis. We are pleased that advertisers are showing their support by investing their marketing budgets in our new programs.

Our additional business continues to deliver great results. In the first quarter of 2010, digital revenues which include Internet advertising revenues and retransmission consent fees increased by 47% to $13.2 million, compared to $8.9 million for the first quarter of 2009. If you drill down a little further, retransmission consent fees increased 16% and Internet advertising and other interactive revenues increased 151% in the first quarter of 2010 compared to the same quarter last year.

Internet advertising also includes incremental revenues from our acquisition of RMM in the fourth quarter of 2009. We delivered 734 million in advertising impressions, 205 million total user actions, and 28 million video views across our station websites in the first quarter of 2010. Time on site was an impressive 20 minutes and 21 seconds. And according to comScore's March 2010 data, 81% of LIN station websites ranked number one for time spent on site compared to all broadcast media competitors.

Mobile impressions which include iPhone and Blackberry applications in each of our markets were $42 million for the first quarter of 2010, a significant increase of a 195% compared to the first quarter of 2009. Also in the first quarter, we launched our proprietary local news and weather computer desktop widget, iPulse. We used Adobe AIR technology to develop custom widgets designed to further enhance the connection of users to our multi-screen local content. Since its launch, our iPulse widget has produced nearly 900,000 page views.

The growth of our digital business and our focus on being consumers’ and advertisers’ number one choice for unique innovative and relevant content on all platforms was a driving factor for our recent rebrand from LIN TV to LIN Media. LIN Media unifies all of our multimedia product offerings and reflects our commitment to watching local television and digital initiatives that engage audiences and provide innovative advertising solutions.

We are encouraged by the recent revenue trends and also our ability to sustain a lean cost structure. General operating expenses increased 4% to $66.1 million in the first quarter of 2010. General operating expenses without RMM which was acquired in the fourth quarter of 2009 actually decreased 2% to $62.2 million in the first quarter of 2010.

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