Exhibit 99.1
LIN TV CORP. REPORTS THIRD QUARTER 2003 RESULTS
PROVIDENCE, RHODE ISLAND, October 30, 2003 – LIN TV Corp. (NYSE: TVL), the parent of LIN Television Corporation, today reported financial results for the three-month and nine-month periods ended September 30, 2003.
Net income for the third quarter was $6.1 million, or $0.12 per share, compared to net income of $5.9 million, or $0.12 per share, during the third quarter of 2002. Third quarter net revenues were $85.8 million, a decrease of 6.6% from net revenues of $91.8 million in the third quarter of 2002. More than 85% of the decline in net revenue is attributable to $5.3 million of non-returning political revenue from the third quarter of 2002. Operating expenses increased 2.4% during the third quarter, resulting in operating income of $20.7 million compared to $28.2 million for the third quarter of 2002. The same stations are included for both periods.
Other expenses decreased to $8.9 million in the third quarter of 2003 from $20.7 million in the third quarter of 2002, primarily due to the elimination of $12.2 million of interest expense as a result of the Company’s debt re-financings completed earlier in 2003. The Company received $1.6 million in cash distributions in the third quarter of 2003 from its joint venture with NBC versus $408,000 in the third quarter of 2002.
For the first nine months of 2003, net revenues increased 3.5% to $252.1 million from $243.5 million for the first nine months of 2002. Operating costs and expenses increased 14.2% during the first nine months of 2003, resulting in operating income of $57.3 million, a decrease from $72.9 million in the comparable period in 2002. The reported results reflect the acquisition of Sunrise Television Corp. in May 2002, the sale of the North Dakota stations in August 2002 and the sale of two Texas stations in June 2003. The North Dakota and Texas stations are reported as discontinued operations for all periods.
Capital expenditures were $4.8 million for the third quarter with a total of $15.0 million spent in the first nine months of 2003, compared to $26.1 million spent in the first nine months of 2002.
CEO Comment
Gary Chapman, LIN TV’s Chairman, President and Chief Executive Officer, said: “LIN TV’s stations continue to perform well in a slowly recovering advertising climate and against difficult comparisons due to the significant political revenues in the third quarter of 2002. Net political revenue was $1.1 million for the third quarter of 2003 compared to $6.4 million for the third quarter of 2002. Excluding this political revenue from both periods, net revenue for the quarter declined less than 1%. Trends improved during the quarter. Fourth quarter advertising time sales to date are currently pacing slightly ahead when compared to non-political revenue from the fourth
quarter of 2002 when we recorded $13.0 million in net political revenue. On the cost side, LIN continues to implement new cost saving technology and our reduced expense growth rate is evidence of our progress in that area.”
Balance Sheet
Total debt outstanding at September 30, 2003 was $710.7 million and cash and cash equivalent balances at quarter-end were $13.7 million. Net consolidated leverage as defined in the Company’s senior secured credit facility (total debt minus cash and cash equivalents divided by trailing four quarters of pro forma adjusted EBITDA of $139.7 million) at the end of the quarter was 5.0X.
LIN TV had 50.0 million common shares outstanding, and a fully diluted share count of 50.6 million common shares, at September 30, 2003.
Guidance
Based on current pacings for the fourth quarter of 2003, LIN TV believes that net revenue will decline between 9% and 14% due primarily to the small amount of political revenue estimated for the fourth quarter of 2003 compared to $13.0 million of net political revenue in the fourth quarter of 2002. With a continuing focus on expense control, LIN TV currently estimates that fourth-quarter station operating expenses will be flat resulting in operating income in the range of $23 million to $28 million. As a result, the Company expects that it will achieve operating income for the full year 2003 in the range of $81 million to $86 million.
Potential Station Sale
The Company is actively engaged in discussions with potential purchasers of its Flint, Michigan television station. Definitive terms have not yet been reached and there is no guarantee that a sale will be consummated.
About LIN TV
LIN TV operates 24 television stations in 14 markets, two of which are LMAs. LIN’s stations are:
| Market | Station | DMA | Channel | Network | ||||||||
| Indianapolis | WISH-TV | 25 | 8 | CBS | ||||||||
| WIIH-CA | 17 | Univision | ||||||||||
| New Haven | WTNH-TV | 27 | 8 | ABC | ||||||||
| WCTX-TV | 59 | UPN | ||||||||||
| Grand Rapids | WOOD-TV | 38 | 8 | NBC | ||||||||
| WOTV-TV | 41 | ABC | ||||||||||
| WXSP-CA | LPs | UPN | ||||||||||
| Norfolk | WAVY-TV | 41 | 10 | NBC | ||||||||
| WVBT-TV | 43 | Fox | ||||||||||
| Buffalo | WIVB-TV | 44 | 4 | CBS | ||||||||
| WNLO-TV | 23 | UPN | ||||||||||
| Providence | WPRI-TV | 48 | 12 | CBS | ||||||||
| WNAC-TV | 64 | Fox (LMA) | ||||||||||
| Austin | KXAN-TV | 54 | 36 | NBC | ||||||||
| KNVA-TV | 54 | WB (LMA) | ||||||||||
| KBVO-CA | LP’s | Telefutura | ||||||||||
| Dayton | WDTN-TV | 59 | 2 | ABC | ||||||||
| Market | Station | DMA | Channel | Network | ||||||||
| Flint | WEYI-TV | 64 | 25 | NBC | ||||||||
| Toledo | WUPW-TV | 69 | 36 | Fox | ||||||||
| Fort Wayne | WANE-TV | 105 | 15 | CBS | ||||||||
| Springfield | WWLP-TV | 106 | 22 | NBC | ||||||||
| Lafayette | WLFI-TV | 189 | 18 | CBS | ||||||||
| San Juan | WAPA-TV | NA | 4 | Independent | ||||||||
| WJPX-TV | 24 | Independent | ||||||||||
LIN TV also owns approximately 20% of KXAS-TV in Dallas, Texas and KNSD-TV in San Diego, California through a joint venture with NBC, and is a 50% non-voting investor in Banks Broadcasting, Inc., which owns KWCV-TV in Wichita, Kansas and KNIN-TV in Boise, Idaho. Finally, LIN is a one-third owner of WAND-TV, the ABC affiliate in Decatur, Illinois, which it manages pursuant to a management services agreement.
Financial information and overviews of LIN TV’s stations are available on the Company’s website at www.lintv.com.
Conference Call
LIN TV will hold a conference call to discuss its 2003 third-quarter results TODAY, Thursday, October 30, 2003, at 10:00 am ET. To participate in the call, please call (888)-695-0612 (U.S. callers) or (719)-457-2663 (international callers) approximately 10 minutes prior to the scheduled start of the call and reference 371073. The call can also be accessed via the investor relations section of the company’s website at www.lintv.com (listen-only).
If you are unable to participate in the live call, a taped replay will be available from 1:00 pm ET today until Thursday, November 6, 2003 at midnight ET. The replay can be accessed by dialing (888)-203-1112 (U.S. callers) or (719) 457-0820 (international callers), and using passcode 371073. The replay can also be accessed at the company’s website from 1:00 pm today until midnight on November 6, 2003.
Safe Harbor Statement
This press release may include statements that may constitute “forward-looking statements,” including estimates of future business prospects or financial results, statements made under the heading “Guidance” above and statements containing the words “believe,” “estimate,” “project,” “expect,” or similar expressions. Forward-looking statements inherently involve risks and uncertainties, including, among other factors, general economic conditions, demand for advertising, geopolitical events, competition for audience and programming, government regulations and new technologies, that could cause actual results of LIN TV to differ materially from the forward-looking statements. Factors that could contribute to such differences include the risks detailed in the Company’s registration statements and periodic reports filed with the Securities and Exchange Commission. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revision or changes after the date of this release.
| Contacts: | Investors: | Media: | ||
| Deborah R. Jacobson | Mark Semer | |||
| LIN TV Corp. | Kekst and Company | |||
| (401) 457-9403 | (212) 521-4802 |
LIN TV CORP.
Unaudited Condensed Consolidated Statements of Operations
(In thousands, except per share information)
| Three months ended September 30, | Nine Months ended September 30, | |||||||||||||||||
| 2003 | 2002 | 2003 | 2002 | |||||||||||||||
| Net revenues | $ | 85,769 | $ | 91,812 | $ | 252,101 | $ | 243,503 | ||||||||||
| Operating costs and expenses: | ||||||||||||||||||
| Direct operating | 25,591 | 26,085 | 75,581 | 69,389 | ||||||||||||||
| Selling, general and administrative | 22,447 | 20,527 | 67,047 | 56,981 | ||||||||||||||
| Amortization of program rights | 5,784 | 5,576 | 16,489 | 15,710 | ||||||||||||||
| Corporate | 3,695 | 2,978 | 11,797 | 7,396 | ||||||||||||||
| Restructuring charge | — | 931 | 102 | 931 | ||||||||||||||
| Depreciation and amortization of intangible assets | 7,564 | 7,479 | 23,805 | 20,205 | ||||||||||||||
| Operating income | 20,688 | 28,236 | 57,280 | 72,891 | ||||||||||||||
| Other (income) expense: | ||||||||||||||||||
| Interest expense | 12,428 | 24,619 | 48,182 | 72,691 | ||||||||||||||
| Investment income | (174 | ) | (874 | ) | (924 | ) | (2,396 | ) | ||||||||||
| Share of income in equity investments | (736 | ) | (155 | ) | (2,140 | ) | (4,209 | ) | ||||||||||
| Loss (gain) on disposition of property and equipment | 6 | (47 | ) | 954 | (168 | ) | ||||||||||||
| Gain on derivative instruments | (2,490 | ) | (2,854 | ) | (7,250 | ) | (5,036 | ) | ||||||||||
| Gain on redemption of investment in Southwest Sports Group | — | — | — | (3,819 | ) | |||||||||||||
| Fee on termination of Hicks Muse agreements | — | — | — | 16,000 | ||||||||||||||
| Loss on impairment of investment | — | — | 250 | 2,750 | ||||||||||||||
| Loss on extinguishment of debt | — | — | 53,105 | 2,457 | ||||||||||||||
| Other, net | (86 | ) | 35 | (451 | ) | 31 | ||||||||||||
| Total other expense, net | 8,948 | 20,724 | 91,726 | 78,301 | ||||||||||||||
| Income (loss) from continuing operations before provision for income taxes and cumulative effect of change in accounting principle | 11,740 | 7,512 | (34,446 | ) | (5,410 | ) | ||||||||||||
| Provision for income taxes | 5,669 | 2,319 | 10,943 | 24,767 | ||||||||||||||
| Income (loss) from continuing operations before cumulative effective of change in accounting principle | 6,071 | 5,193 | (45,389 | ) | (30,177 | ) | ||||||||||||
| Discontinued operations: | ||||||||||||||||||
| Loss from discontinued operations, net of tax benefit of $141 and $18 for the three and nine months ended September 30, 2002 | — | 261 | — | 34 | ||||||||||||||
| (Gain) loss on sale of discontinued operations, net of tax benefit of $0 for the nine months ended September 30, 2003 and net of tax provision of $425 for the three and nine months ended September 30, 2002 | — | (982 | ) | 652 | (982 | ) | ||||||||||||
| Cumulative effect of change in accounting principle, net of tax benefit of $16,525 | — | — | — | 30,689 | ||||||||||||||
| Net income (loss) | $ | 6,071 | $ | 5,914 | $ | (46,041 | ) | $ | (59,918 | ) | ||||||||
Basic and diluted income (loss) per common share: | ||||||||||||||||||
| Income (loss) from continuing operations before cumulative effect of change in accounting principle | $ | 0.12 | $ | 0.10 | $ | (0.91 | ) | $ | (0.77 | ) | ||||||||
| Loss from discontinued operations, net of tax | — | (0.01 | ) | — | — | |||||||||||||
| Gain (loss) on sale of discontinued operations, net of tax | — | 0.02 | (0.01 | ) | 0.03 | |||||||||||||
| Cumulative effect of change in accounting principle, net of tax | — | — | — | (0.78 | ) | |||||||||||||
| Net income (loss) | 0.12 | 0.12 | (0.92 | ) | (1.53 | ) | ||||||||||||
| Weighted — average number of common shares outstanding used in calculating basic income (loss) per common share | 50,021 | 49,847 | 49,955 | 39,099 | ||||||||||||||
| Weighted — average number of common shares outstanding used in calculating diluted income (loss) per common share | 50,557 | 50,463 | 49,955 | 39,099 | ||||||||||||||
LIN TV CORP.
Unaudited Condensed Consolidated Statements of Operations
(In thousands, except per share information)
Supplemental Financial Data: | ||||||||||||||||||||
| Debt outstanding | $ | 710,655 | $ | 902,004 | $ | 710,655 | $ | 902,004 | ||||||||||||
| Cash and cash equivalents | 13,678 | 121,982 | 13,678 | 121,982 | ||||||||||||||||
| Capital expenditures | 4,819 | 7,714 | 15,006 | 26,106 | ||||||||||||||||
| Capital distributions from equity investments | 1,630 | 408 | 4,890 | 1,019 | ||||||||||||||||
| Cash taxes | 931 | — | 5,048 | 353 | ||||||||||||||||
| Program rights payments (excludes TX station payments) | (6,451 | ) | (6,172 | ) | (17,693 | ) | (17,619 | ) | ||||||||||||
| Station non-cash items | 277 | — | 927 | — | ||||||||||||||||
| Interest Expense Components: | ||||||||||||||||||||
| Senior Credit Facility | $ | 2,141 | $ | 274 | $ | 5,360 | $ | 3,744 | ||||||||||||
| $300,000 8 3/8% Senior Subordinated Notes | — | 6,282 | 11,445 | 18,843 | ||||||||||||||||
| $325,000 10% Senior Discount Notes | — | — | 330 | — | ||||||||||||||||
| $100,000 10% Senior Discount Notes | — | — | 190 | — | ||||||||||||||||
| $210,000 8% Senior Notes | 4,200 | 4,200 | 12,600 | 12,600 | ||||||||||||||||
| $200,000 6 1/2 Senior Subordinated Notes | 3,250 | — | 5,056 | — | ||||||||||||||||
| $125,000 2.50 Exchangeable Senior Subordinated Debentures | 781 | — | 1,215 | — | ||||||||||||||||
| Other | — | 1,931 | — | 2,065 | ||||||||||||||||
| Cash interest expense | 10,372 | 12,687 | 36,196 | 37,252 | ||||||||||||||||
| Amortization of discount and deferred financing fees | 2,056 | 11,932 | 11,986 | 35,439 | ||||||||||||||||
| Total interest expense | $ | 12,428 | $ | 24,619 | $ | 48,182 | $ | 72,691 | ||||||||||||
LIN TV CORP.
Unaudited Adjusted Condensed Consolidated Statements of Operations
(In thousands)
| Three months ended September 30, | Nine Months ended September 30, | ||||||||||||||||
| 2003 | 2002 | 2003 | 2002 | ||||||||||||||
| Net revenues | $ | 85,769 | $ | 91,812 | $ | 252,101 | $ | 260,529 | |||||||||
| Operating costs and expenses: | |||||||||||||||||
| Direct operating | 25,591 | 26,085 | 75,581 | 74,492 | |||||||||||||
| Selling, general and administrative | 22,447 | 20,527 | 67,047 | 61,972 | |||||||||||||
| Amortization of program rights | 5,784 | 5,576 | 16,489 | 17,852 | |||||||||||||
| Corporate | 3,695 | 2,978 | 11,797 | 7,029 | |||||||||||||
| Restructuring charge | — | 931 | 102 | 931 | |||||||||||||
| Depreciation and amortization of intangible assets | 7,564 | 7,479 | 23,805 | 22,340 | |||||||||||||
| Operating income | 20,688 | 28,236 | 57,280 | 75,913 | |||||||||||||
Supplemental Financial Data: | |||||||||||||||||
| Capital distributions from equity investments | 1,630 | 408 | 4,890 | 1,019 | |||||||||||||
| Program rights payments | (6,451 | ) | (6,172 | ) | (17,693 | ) | (19,766 | ) | |||||||||
| Station non-cash items | 277 | — | 927 | — | |||||||||||||
Calculation of operating income: | |||||||||||||||||
| Operating income (actual) | $ | 20,688 | $ | 28,236 | $ | 57,280 | $ | 72,891 | |||||||||
| Adjustments to net revenues and operating expenses: | |||||||||||||||||
| Sunrise Merger (excluding North Dakota and Texas stations) | — | — | — | 2,655 | |||||||||||||
| HMTF Fees | — | — | — | 367 | |||||||||||||
| Operating income (adjusted) | 20,688 | 28,236 | 57,280 | 75,913 | |||||||||||||
| Note: | LIN TV reports adjusted results to reflect the acquisitions of the Sunrise television stations on May 2, 2002 and the disposition of KRBC-TV and KACB-TV on June 13, 2003 as if it had occurred on January 1, 2002. |
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