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Perry SookThank you, Latif, and good morning, everyone. Thank you very much for joining us to review Nexstar's second quarter 2011 operating results. Tom Carter, our Chief Financial Officer, is also here with me this morning. Nexstar's strong operating and financial momentum continues in 2011 as reflected by our record second quarter revenue and EBITDA and our strong free cash flow. These are all-time second quarter records over our 15-year history, and they reflect our success in overcoming a negative $4.8 million year-over-year delta on political revenue as well as the auto industry disruptions caused by the earthquake in Japan. The ongoing advertising rebound in our markets and Nexstar's effectiveness in driving new-to-television local direct billings drove our seventh consecutive quarter of core television advertising revenue growth. Core being defined as local and national advertising. The 4.3% rise in core ad revenue growth and another period of double-digit increases in e-MEDIA and retransmission fee revenue more than replaced the record levels of political revenue we recorded in last year's Q2. At the same time, we continue to make tangible progress in streamlining our capital structure, reducing leverage, lowering our weighted average cost of debt and expanding our station base. Also, vertically integrating aspects of our e-MEDIA operations through the accretive acquisition of .Biz. We are excited about our 2 new CBS affiliates, which we recently added, as well as our acquisition, as I mentioned of Internet technology provider, GoLocal.Biz, both of these deals bringing Nexstar financial and strategic benefits which I will review in more detail in just a few minutes. Before we get deeper into our discussion this morning, I want to quickly address a piece of housekeeping with respect to the announcement on July 21, that our company's board of directors decided to explore and evaluate strategic alternatives intended to maximize shareholder value including a possible sale of the company. As we indicated on July 21, Nexstar does not intend to disclose developments with respect to the strategic review progress until such time as the Board has approved the transaction or otherwise, deems disclosure-appropriate. As such, we will not be making comments on this topic on the call today.
Moving back to our results, our revenue growth reflects the strength of our core local content and continued success in driving new local revenue, while developing distribution and digital extensions for our core content including new, online, text, mobile, and content, and applications. These factors position Nexstar to offset the cyclical impact of political advertising in the second quarter and political and Olympic revenue for the first half of 2011. Excluding political revenue from both periods, Nexstar's 2011 second quarter gross revenue rose 6.9% year-over-year, and rose 6.1% in the first half of 2011 versus the first half of 2010.Despite the recent macro uncertainty, positive core television advertising trends are continuing for Nexstar in the third quarter and we remain on track to continue growing all of our non-political revenue sources in the second half of 2011. Nexstar's 2011 second quarter net revenue increase of 1.3% was driven by the increase in core revenue, including our sixth consecutive quarter of auto advertising increases despite the impact of Japan's earthquake, as well as significant e-MEDIA and retransmission fee revenue growth. Total second quarter retransmission fee, mobile, and e-MEDIA and management fee revenue collectively rose 18.8% to $13.2 million. These higher margin revenue streams accounted for over 17.5% of 2011 second quarter net revenue, up from 14.9% a year ago. Looking deeper into the second quarter, gross local and national television ad growth of 4.3% to $62 million marks a quarterly sequential improvement over the 3.3% rise posted in Q1 of '11, and is also on top of the 13.6% growth recorded in last year's second quarter. Second quarter 2011 local revenue rose by 5.4%. National revenue was up 1.3%. Read the rest of this transcript for free on seekingalpha.com