BALTIMORE ( TheStreet) -- Sinclair Broadcast Group ( SBGI) shares are up after declaring a special dividend of 43 cents per share in its third quarter financial report.

Despite posting a moderate earnings decline for the quarter, Sinclair announced a special dividend of 43 cents per share, or approximately $34.5 million, on all outstanding stock, payable on December 15, 2010 to holders of record on December 1, 2010.

Sinclair shares are up more than 2% today and trading above $8.

The company saw earnings fall during the third quarter, as an increase in total revenue was offset by higher expenses. For the quarter ended September 30, the company saw earnings fall 4.4% to $14.3 million, or 18 cents per diluted share, compared with earnings of $14.9 million, or 19 cents per diluted share, in the same period a year ago. Earnings came in slightly below analyst estimates of 21 cents a share.

Revenue was up 16.4% to $186.5 million from $160.1 million during the quarter but was offset by an increase in costs. Total operating expenses were up 4.8% to $130.4 million from $124.4 million, while expenses related to debt and financing more than doubled to $36.7 million from $16.6 million.

Revenue gains were attributed to political revenue, which spiked to $9.8 million from $1.9 million in the third quarter 2009.

"Political advertising of $9.8 million in the third quarter came in higher than expected and that trend has continued in the fourth quarter where we expect $26.8 million in political revenues," president and CEO David Smith said.

Management expects political revenue to be a record high $41.9 million for the year. Smith said that the core business will likely grow in 2011 due to expected strong gains driven by the Super Bowl on the 20 Fox affiliates the company owns.

Revenue related to the company's local broadcast segment was up 11.9% while national broadcast revenue gained 30%.

"On a year-over-year comparison basis, fourth quarter of 2009 is when we saw that the advertising recession bottomed out and business began to improve, and so we are expecting a smaller percentage growth rate in fourth quarter of this year than in prior quarters of this year." EVP and CFO David Amy said. "This is not a reflection or implication that advertising spending has slowed."

For the first nine months of the year, the company swung to a profit of $43.1 million, or 54 cents per share, compared with a loss of $67.9 million, or 85 cents, in the same period a year ago. Revenue rose 14.5% to $541.6 million from $473.1 million.

"We are pleased to once again be able to distribute a portion of our cash flow and return value to our shareholders," Smith said, referring to the company's special dividend announcement. "Our objective is to once again become a regularly paying dividend company, as well as have the ability to repurchase shares, if warranted."

-- Written by Theresa McCabe in Boston.

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