Gray Television (GTN) Q1 2011 Earnings Call May 09, 2011 11:00 am ET Executives Robert Prather - President, Chief Operating Officer, Director and Member of Executive Committee Hilton Howell - Vice Chairman, Chief Executive Officer and Member of Executive Committee James Ryan - Chief Financial Officer and Senior Vice President Analysts Barry Lucas - Gabelli & Co. Aaron Watts - Deutsche Bank Marci Ryvicker - Wells Fargo Securities, LLC Bishop Cheen - Wachovia Presentation Operator
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Even with these fairly large items this quarter, our core local, national and Internet sales, excluding political advertising actually increased this quarter over 2010 by approximately 1%. We believe these are quite strong results, especially given the overall uncertainty surrounding the health of the economy as a whole. We are also particularly proud this quarter that our Internet advertising revenue has increased by 38% to $4.2 million. We are very happy with this robust growth in our Internet sales and expect it to continue for the foreseeable future. With that, I will bring my brief comments to a close and turn it over to Bob Prather for more color on this quarter and then to Jim Ryan for more on our financials. Bob?Robert Prather Thanks, Hilton. Welcome, everybody. As Hilton mentioned here, we got a really good quarter this time. Frankly, last year, was an all-time record year for us, and we were a little concerned going this year. But I think I've talked a virtually all our GMs in the last 2 or 3 weeks and they all feel like business is better and they thought it was going to be this year. I think the only cloud on the horizon right now besides gas prices, which nobody's happy with, but I think the Toyota, Honda, the various Japanese car dealers are all having some serious problems with inventory because of the tsunami in Japan. We've seen some cancellations of some pretty sizable orders by Toyota especially. I think this is temporary. We all think, obviously, they will be back strong. Hopefully, sooner or later although I'm hearing it maybe literally most of this year where they're going to be pretty strapped. I think we're reasoning with one of our dealers, this is a pretty large dealer sold over 100 cars a month, we've got 9 cars for his the inventory for May. You can see that they're not going to be advertising a lot but I think the domestic guys are probably going to but jump in the. As they say, kick a man when he's down, they'll probably start advertising even stronger. But we'll get by, Now most of our other categories have been performing real well overall but our first quarter is better than we thought, second quarter is looking good. Our third quarter, we don't have much visibility than we used to, but we feel pretty good about is looking for the second and third quarter.
We spent a lot of time and mentioned on our last call with local HD. We're fast getting that installed and we'll have it in 20 over 20 of our stations by the end of this year. It's getting great reception everywhere we put it in. As I mentioned, we're also doing automations, studio automations the same time in all of these operations which we think is going to make us operate more efficiently and frankly, operate better in most cases. The computers are very reliable and they're very good about making sure the right program is on the right time.One thing we're doing in the new media area, we're really trying to integrate Twitter and Facebook into our newscast, both through our anchor people and through our own news directors making sure that we use these social media to make sure we're getting the word out. I think most of you know, Twitter was the first news source to getting information out on the Osama bin Laden killing, I think it was 5 or 6 hours before it was actually announced by the administration. I think this is something especially young people are more and more going to for their news sources and we got to be there and got to be in the front of their mind and our local news to make sure that we capture these people. Read the rest of this transcript for free on seekingalpha.com