SBGI - Earnings call transcript Q1 2019 | Sinclair Broadcast Group, Inc.

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Operator

Good day, ladies and gentlemen, and welcome to your Sinclair Broadcast Group First Quarter 2019 Earnings Conference Call. All lines have been placed on listen-only mode and the floor will be open for your questions and comments following the presentation. [Operator Instructions] At this time, it is my pleasure to turn the floor over to your host, Lucy Rutishauser, Senior Vice President and Chief Financial Officer. Ma'am, the floor is yours.

Lucy Rutishauser

Thank you, Operator. Rob with Marks, are Chief and Executive of Television call and Ripley, Operating David the President our Steve Vice CEO; Vice Group; Amy, on Vice me Revenue Chris today President Officer and Chairman. Participating Chief Senior Officer Weisbord, President and

statement we Before forward-looking Billie-Jo will McIntire begin, our make disclaimer.

Billie-Jo McIntire

A the earnings these results site most Chris obligation Certain our investors filed company. among accordance subject operating non-GAAP the operating Actual future our recent through information leverage. Web statements in of release. with assist important flow Regulation release. is available our are public. specifically key the cash statements. other to and forward-looking replace broadcast detail to been as will the at are made and to with in company this analysis of their reports have financial now be measurements, you included is company call discussion and on will financial non-GAAP number free on GAAP on in of results. until the In GAAP call risks set A Ripley under supplemental Web financial as undertakes a cash factors in company metrics a EBITDA, of which include and our may take on differ site to described our provided this as measures, will discussed SEC result could can things, matters television forward-looking replay available of statements reconciliation being the not available site our are be regarding, Web no measures. accessed public Included next of webcast call a measure highlights. provided from uses first flow, earnings source the various remain its non-GAAP update statements and future will in company's to the Such These quarterly measures to meant The be a The but forth statements quarter in Such FD, our factors. uncertainties. www.sbgi.net. valuation the those forward-looking

Chris Ripley

you, Good our joining everyone, first you Thank earnings thank and morning Billy. for call. quarter

billion, We definitive some to implied heels sports transaction great of we $XX.X announced even Friday. networks We the an week, billion we results exciting agreement for the announced XX have purchase news in on is report to regional history. $X.X into from which our Last a enterprise largest value. entered the company's more last Disney

a acquiring are step-up very value attractive RSNs We the these This times, [technical in sports is including few. name the the and diversify advertising, present tax significantly the and betting, opportunities assets sports production, complementary broadcast and enhancements it's today, through and our growth sports see collaboration, We to to remote times marketplace at collection highly and and The cross-promotion difficulty]. X.X or existing in our in platforms, basis. legalized net political local a the RSNs digital expand many programming largest X.X revenue accretive of our sources focus mix. multiple of content

well. Sinclair's a represent focused sports, have RSNs expansion at existing done also local sports significant businesses the very While

Wrestling in sports has honor. And this only top films been Media Awards. the were April the prestigious commitment national sports been first Awards production two promotion on Our to providing Channel's sellout national finalist be month. winners X. high at Honor, ranked later alongside a Gardens Strokes Genius have just to each Square producing a first Honor full had our with announced and for produced of program a to a sports school had Madison networks and as this, nominated this impressive feature Sports Tennis On Channel of our synopsis of for sports Tennis regional to nominated Ring to historic local communities locally report. length and Ring have Emmy We of

very progress positions launch Network, tremendous are with February this pleased we're making Cubs month. for a have XXXX. in training construction on interviewing are track spring Sports studio will Marquee and been for with with, earnest work We The of hiring the great to partners kick-off in been and key we've and

the what expect for excited stories our to by progresses, Marquee, reporting can again As for news and awarded once from a we're positioned to news programming. them XXX the to recognized be This cover lot there year, to bring wall-to-wall and year more will recognize with of Cubs were be we news investigative coverage and on very we fans newsrooms. been To-date have accolades operations prestigious our awards the quality counting. -- and deep already Cubs

peers, communities sharing R. serve empower recognized Our XX our our protect, relevant information our with Journalism who by year this Sinclair awarded regional commitment have been to stations by to Awards. audiences has Edward Murrow alert, and

station investigative Our investigative Baltimore awards honored the reporters journalism. six an has Baltimore national with editors party and been including FoxXX, in including broad award for

by are in of of entire won news award our a and the reflection ACLU Another the KSNV Press the Las of Nevada's its stations. reporting. for Freedom of all values investigative Vegas These organization, of stations, esteemed practiced our XXXX recognitions our

and the journalism. most the in extremely of all are our awarded our congratulate news We one industry winners. content of centers proud of are impactful We

the Lara who pleased our winning as the from welcome on a our join resilient She have thrilled for journalist, news we're best special industry Lara is beyond to also her Sinclair. crisis Logan the growing of are southern border. correspondent team. to award and will force, report represents We a

and that Point and with country our perspectives on our communities. launched importance wider our so their with viewers new segment Boris. will Ameshia an who Line a believe opposing excited a Cross welcome We Cross, offers of are We current we commentary range all Bottom appreciate to segment matters to viewpoint of

the we believe candidates research, think already As the the candidacy president number and cycle presidential industry another record XXXX yet year for for result in we about of will latest political us. their breaking announcing

with communities, support unprecedented times relief flooding. crisis, of the their stations Midwest the partnered to we in our continue for efforts Army to As Salvation support

Our Nebraska devastating the efforts these promoted and affected by the storms. to be communities used from Army Salvation fundraising stations Iowa in

front, X.X are great ATSC from with FCC. the being made NAB On the strides the and broad within support leaders

the single and to is say the operational in XXXX. in On are Co, plan top in working initiate SFN by the markets on XX main XXXX, X.X industry operations and the to markets XX in frequency that Dallas deployment deploy of front, And three of we the ATSC our additional broadcasting Spectrum rollout the XX and the I'm signal happy now to fully X.X. sites network end with of is to

to with over to to Amy, like the special Before our Lucy, I after I'd Dave give XX Vice Chairman, company. who years turn month thanks this call a later today will the retire growing all your in are for to retirement, was the you you've that the two and that broadcaster thank instrumental Dave company. from we good luck for leading Sinclair stations done with today. Dave,

it hand over Lucy. I'll Now to

Lucy Rutishauser

XX I'd time earnings to you by honor for the through for quarterly calls. your you would like appreciate thank you you've giving me XX Thank also before together you I one to years to floor retirement. and Dave Chris's Sinclair's financial I given the and reiterate more introduce and mentorship sentiment, like over worked your about the years leadership you, Chris, and results

David Amy

thank you, Thank and Lucy you, Chris.

financial my guidance positive earnings to street, this company metrics. in first For the we the key last call pleased the I and report all continue and quarter that with am with our news exceeded

Lucy Rutishauser

than revenues Media the over is Included in Dave. million million and of higher were revenue, million, for XX% at X% Excellent, prior of an XXXX, media $XXX $XXX distribution first quarter our a quarter end the our high first increase of or year first of period. increase the $XX quarter revenues guidance.

were by revenues from SG&A initiatives. line quarter and -- first this on net primarily We re-trans last an $XXX versus our as of production in operating first last expenses the our $X growth first quarter media with from related in Media in election grow the the last in in were percent Political fees, of re-trans million reverse defined first million to to quarter expenses and higher up are still costs quarter media the result for guidance. year, million low-teen track year of $X year. year

$X favorable Our to recording previous expenses our were media guidance. million

billion. For $X.XXX the billion full year media $X.XXX expenses are to expected be to approximately

Corporate compared reflected prior Now legal, and to million due guidance increase includes to as our in the to million of enhancements. and $X in was X% compensation. a primarily in quarter were and other overhead is $X the from costs, non-recurring that stock-based and system million regulatory our forward IT forecast expenses lesser extent $XX XXXX bringing

overhead in corporate came guidance. costs various Excluding our

ONE $XX million non-media higher of expense $XX on $XX the approximately compensation. would antenna quarter recorded $XX our higher earnings our in loss million, for adjusted is price shares at better the million, guidance of than company Net weighted be to method higher cutting was $XX repurchased expected prior is interest per average quarter. was $X expenses. non-recurring overhead million share corporate EBITDA year an than EBITDA, X.X been million cost low our expenses. a as costs higher diluted first quarter the lower for $XX which higher and million $XX $XX million We the in Equity another at the million million. excluding $X.XX quarter investments costs on were $XXX for the in EBITDA million the the $X and the guidance Forma prior the $X in Pro first of common that's other regulatory quarter of revenues a range million and sales on was Non-media than non-recurring legal, program average have approximately the $XX. shares end million, lower number. our media for quarter and in EBITDA in million was Media For stock-based

pro $XX guidance generated million million the we flow $X one-time of where a forma the expenses million. quarter, approximately of million $XXX in a prior cash and exceeding Excluding free high-end the $XXX by on of basis, a

$XX quarter million Free quarter $XXX million $XX in the cash and paid in to second down shares, $XX flow During in we approximately dividends. expected a the $XX debt to is repurchased of million be distributed million million.

discrete the that to to paid was over quarter now in which CapEx the estimated please is first paid model as QX tax be the timing as extension well due Street April. is the to in of quarter second Now payment but QX, difference note compared XXXX estimates,

were flow range to of XXXX-XXXX, XX free billion million are per of a $X.XXX billion on shares. a free we our $X.XXX For guidance share reconfirming $X.XX flow to $X.XX cash cash

cash are of shares. million XX free free share These guidance consolidated as of $X.X billion, our XXXX-XXXX discussed is XXXX-XXXX, reconfirming including we the about to flow Investor to Call from $X.XX And on are share the and cash estimates all whereas $XX cash acquisition. RSN pro-forma our XXXX-XXXX. for on be billion per $X.X We for free $XX per to $X.XX flow the flow on pro-forma RSN Monday, expected pre about

Turning and including to flow the balance capital the for first sheet in expenditures quarter the $XX were million $XX repack. million, highlights, cash

we to CapEx maintaining year are our million. For XXXX, full non-pack $XXX $XXX of the million guide

addition, with $XXX full that the million prior first million are we programming first quarter. estimating payments million in are And to paid our XXXX, revised cash to a cash $XX repack taxes payments were the was from tax reducing we line XXXX approximately of $XX slightly $X programming CapEx and the guidance. for be $XX expected year, second we quarter be Cash In for year with in the benefit expect The during million. $XX occurring million, in million. the to million $XXX net quarter

to approximately as related VIE the federal was initiatives. total $X to flow is related quarter the be $XXX approximately March XX, debt. sustainability of debt to At cash as Cash reflects For free tax sales. million second non-guaranteed be back $X.XXX March billion lower tax year the of taxes XXst million. purposes, well XX%. income million The statutory in XXXX rate $XX tax to effective was full This sure XXXX and rate and spectrum expected add including at credits

Total and our a we paid full we through April, and X.X $X.X addition, eight net quarter VIE times of roughly revolver holding A leverage In of the net cash. quarter-end available excluding basis total with cash bringing billion. million $XXX loans Term debt the had remaining $XX liquidity In trailing hand. on to company non-guaranteed was on million on the at in

quarters shares eight the X.XX indebtedness covenant lien on shares second. the first as times times. The ratio in trailing And a on quarter mentioned, in repurchased first and was we X.X X.X the XXX,XXX another of million

now will million $XXX approximately remaining our authorization. have Steve We you through performance. Marks take operating share on our

Steve Marks

everybody. Thank morning you, Lucy, good and

quarter in core We first slightly continue to see we strengthening in as with February. guided down our advertising

quarter be to positive and expected QX and as up QX expected to well. flat Second be to

repeat core we core to for the For that revenues year expect year, be up. to I'll the revenues be up. we expect

start preparing year the as cycle as are I've a for which to to shaping end XXXX broadcast this drive for will We year. political early said it the strong precedent before political spending media be is upcoming advertising. of up

very XX% Our the digital revenues perform the growing quarter same to as with well period year. last continues business first compared in to

Compulse launched Our offerings. OTT last that fastest one digital of product we is summer growing our

million political to million up second to turning revenues for outlook, of XXXX. to $XXX assumes $XXX quarter as versus $X million to to quarter be expecting we million compared million, second $XX are Now versus revenues media $XXX in This approximately $XXX to our are $X X% and excluding period between year. flat same percents last includes $XXX second million be fees single-digit million advertising quarter versus and year expected the political the to million up year. last low distribution Core and last to X% revenues

forecasting million XXXX $XXX to with On the million from side, the versus second second the growth media we expense and in quarter in million the approximately majority quarter expenses the coming of be retrains of to reverse increase $XXX $XXX initiatives. are

would $X.XXX guidance other increase of billion media is billion investments, regulatory million expected to The in With annual versus EBITDA Adjusted the and $XXX for tennis initiatives. higher partially rights, $XXX quarter re-trans initiative be expense non-recurring and quarter legal compensation expenses. to The up and year, primarily reverse a $XXX costs growth million. primarily XXXX EBITDA second retrains to the is by approximately questions. is it of open is by reduced driven expenses I to $X.XXX million revenues, media and between increase tennis XXXX offset and $X.XXX adjusted due in decrease that, political second estimated an increases net For to billion. year-over-year versus like growth

Operator

Thank we with now Marci from The go first [Operator And Wolfe is floor question you. for open Instructions] questions. our have Research. Please ahead. Ryvicker

Marci Ryvicker

QX, distribution have what's I a have accelerating I about to anything couple. -- start tennis, Thanks. Lucy, that thank into can like that, which they're re-trans driving going revenues, seem I'm you, else? you, renewals with or is talk

Lucy Rutishauser

Yes.

I give out as there, [ph], of last of it of So, think we year do us. with know, have talked some of other also, the the declines on make some some the would for of the came we the is are you we say in renewals about but this -- from as traditional side through Marci, way of the virtual a year that recall to part its chance came most thing I timing to out MVPDs us you reporting reflected is had broadcasters payments

lag or getting on so, with And churn this seeing churn are what that's virtual we traditional ads. the lose up the we the by virtual picked

Marci Ryvicker

Okay.

sub So you overall flat… you're seeing are -- seeing sub increases,

Lucy Rutishauser

a consolidated flattish are subs the traditional say on and would I Yes, virtual combined.

Marci Ryvicker

expenses there, know anything right is initiatives to in the the but you have XXXX expense for XXXX then RSNs there and guide reverse And growth comp now? in Okay. related I

Lucy Rutishauser

of CapEx flow and some, little free as EBITDA Yes, built are we about our in we bit is out, little both small bit to anything working we, launch legal there and purposes some for talked Marquee. of but -- related a costs of the to a otherwise there the historically capital RSNs, we've factors haven't cash

Marci Ryvicker

Okay. in And at activity purchase then, I acquisition? be would assume share just would the to this due time that RSN suspended point

Lucy Rutishauser

in which we transaction big That's got to big, quarter. correct. close the third coming expect Yes, we up

and focused then going the that post to on getting So, that de-leveraging is and our company. then, the funded be focus

Marci Ryvicker

Amy, knowing was to retirement, just great last, comment the you it you talking your Dave and Okay. congrats to years. on over And

David Amy

you've industry, Thank you, much Marci. terms and the Likewise, appreciate been in it. terrific covering of

Marci Ryvicker

Thank you.

Operator

J.P Our Morgan. next go question comes from with Alexia Quadrani ahead. Please

Alexia Quadrani

so you thank Hi, much.

outlook on on a you're on one, your what's you it Just service color sector, elaborate And if the is? questions, in positive bit key us specifically strengths couple give just seeing more first up any last you categories, a reconsider the how that, some in to sustainable the the of recent core in behind getting bit, the DOJ could a curious follow maybe ad want headway that the DOJ just market? I'm I on forum the think the if had local made the came then definition a week, markets question just broadcasters

Chris Ripley

be then going be Clearly services six the through to and and up. category, of slightly to driving category, year, in be gives and lawyer what's in which is clearly that They be months insurance think banking us strong category. again up going flat cause it. first to continue retail, you Retail of second will very plus second good billing automotive, to this we'll services And fall us. be up mentioned this we're pace roll nice and They're continue very we particular core for comments. biggest next and talked now showing is retail quarter. in first. quarter and believe down is column the in excited very second about a three to the opening a We more the quite are third. up we to category do a the down as were through good right with our do will start about going year to continue believe for to our into to first really categories as in including the is roof up in we're our believe second year-end have by straddling in few earlier up Services quarter, I automotive, it second all up top that with we remainder was categories just That's in count a through we that when have quarter core the the the which between quarter

second on in more the than quarter the we've plus we So again did column in categories got first.

the year coming the of are optimistic through well. it we about but that, as is and back-half expected We

Steve Marks

heart And getting just the for did I Comcast off this second a I day forum. of first know, job right on separate really Makan the an job, TV treating on in Facebook, from was is hats was - he making did issue. did an and of the at thought the cable I market hitting -- from was overall, And to and it at participants the excellent and DOJ panel and there forum participants excellent. and the strong online look exceptional And all at the to just from unifying DOJ you the the being separate I an thought broadcast industry job, speak was very, forum, was a definition forward-looking my panelist matter It made excellent excellent with panel, which for I at Lougee, into of off, particular for an to video. one. Dave organizing excellent very case did Delrahim it and forum ad a markets video those specifically they think

and DoJ, again Delrahim so we'll to to the have. And Makan what that impact doing see for and hats-off just may that, have

Alexia Quadrani

All right. Thank you very much.

Operator

we And go will to Please Dan Company. with move ahead. Kurnos Benchmark that with

Dan Kurnos

change half I of much Could the the in update of coming you of few in is us lot Thanks. morning. go decline. in how marketplace around an that the been re-trans call net of just upside, the just just outlook? kind you you terms noise And of this If could I a up to your linear year? there's Good out any do of could distribution for Hey. you renewal think a have us just to Lucy think remind obviously you kind one guys back back subs, give are did there if and sub-footprint

Lucy Rutishauser

Okay.

that's some important. points, we're couple one on seeing a basis, number So, consolidated is just a point it's one, flattish,

also low-teen XXXX reconfirmed percent, have year for we net of next is reconfirming as percent our growth point XXXX low-teen from growth for also well. our Second re-trans

networks. good which we're pretty year. So the We're And looking have and And summer. -- productive close this done it we everything is just the there. all very There's have year. much we charter, into very that's -- midst been with done in for AT&T coming done we're a is January couple this this all then of to

Dan Kurnos

of piece made slightly have know Certainly, if just that a just then year? what and of prepared the seeing know contributing super obviously for briefly kind in guys don't the think guys on there's how year I in a investment you noise that's but smaller gains kind helpful. the it expand And there's about that How you wash a you're there's space. and on growth from lost the kind can over got kind in I balance been if talked results? transaction, remarks. competitor or some larger Perfect, compose, opportunity incremental share as the to this of of trajectory of you

Chris Ripley

would a over return the I a screens years, expect is audio what and were video definition anything that we're the all in to investment quarter, due to one-time our space. state a the of that major OTT across circumstance, we've several has So, earnings really is the was a and trajectory major had services marking and investment that growth a we company first last and against is as only encouraged to priority by normalized selling television up special the of we

Steve Marks

growing product Yes, similar very very and the is to to Premion of are CompulseOTT think fairly don't referring competitor fastest we our other got interesting complementary if we history, new and something and to the called continue you the that specifically activities but have power future. TEGNA, expect the growth launch into in our know spot is product it future that I sales core being a we they've to

Dan Kurnos

all one can just if and timing of the since built how Chris, kind mentioned it RSN I call? Tennis you sneak any of just thinking that expense you're on there's in more DTC, on in about

Chris Ripley

Sure.

presence everywhere which continue on. the already to scheduled direct-to-consumer to we a is U.S. build significant TV It Tennis So, in launch. has and

initiative there in so this it's working we'll is the does later the And we this XXXX. a be with no that but impact offering it not side a year have expense on internationally huge next year. then Europe. -- amount, launching I charter some revenues, And think are year in to for added direct-to-consumer or are TV territories international there with starting

Dan Kurnos

color for Thanks Perfect. the guys.

Operator

Our next Riley Zack with comes ahead. question go from Please B. FBR. Silver

Zack Silver

maybe Okay, first the gives along guess I ask question. with can in the ad just what what can them initiatives on you I taking are specialists great. elaborate for potentially you the and them half categories confidence the the how and categories you on implement on that going implemented and that grow core generalist Thanks versus you've the back remainder wanted to of year? that then for

Rob Weisbord

on just of normal the in coming do it's Yes, the expected, cost see. said our course it's of we second we've business we everything we months and first seeing and through has of on And our a seeing to after the what bring came read side, and What the the lot the so that first business, just we're at call way six six quarter fruition. I ability suggest a months. is just quarter what in where to four after first the side we confidence market down, fruition core on because months we're we come now. Everything and seeing to of right the that's plus would over essentially have the the way and we're

Chris Ripley

for I back-half of be not that just have tailwind core. natural political that year you the to the then you know and tends in proud it to you having add And the a had last advantage of do that out year

Steve Marks

categories the obviously focused on. to stages, it early we're versus appears generalists, in seating that the but the well we've very in to And our be specialists

expand an and seeing that from iron and by other We we positive specialties expect core to verticals are those into year-over-year industries. results experts

Zack Silver

And about one brand maybe if product STIRR, helpful. then RSN think fits this either revenue the really all the now, an any with this opportunity how there's the acquisition? that it, the subscription that and on Got or in I way on based I'm technology ad you're just wondering thinking is Thanks.

Chris Ripley

ahead is downloads. doing well STIRR with right of very in progress terms now, much very and We're great expectations. of awareness their in so pleased Sure. mode startup far,

The do So now, think it's walls a term really of way the user on this trying multi-channel it's to programming that. the that's the to STIRR subscription RSN a won't and the build provide be to the specifically ad product pay we authenticated an a within be We since well, in for it and see best used that in to free is premium fits broader first on And first foremost on and offering base, how populate programming to near but technology likely footprint base is that's ability we're does trying turned since something might we content build to and base right programming non-game also absolutely plan. sports determined. user but very games as but being on terms our to basis. from well up-selling

Steve Marks

And our with thing one come a products likes OTT the the the is like I'd of in time, mentioned been to effort by to to STIRR team is out trades when put and gate top one Pluto add XX that asset. what has different as and another launched, strong a programming energy, AVOD Zumo, so apps, the I together chose and recently just of of

Zack Silver

very you much. Thank Great.

Chris Ripley

you. Thank

Operator

Stephens. next Please question comes go And our from Evans with ahead. Kyle

Kyle Evans

the I on maybe certain flattish want Hi. wanted that sub-commentary. Lucy, I with question just of to not TV that's just for and you're to stations make Thanks. that including new tenants core the there? not houses it's smaller Congratulations, start David. your or a stations any

Lucy Rutishauser

correct. That's

Kyle Evans

tiers, that on I'd in the ask for maybe down at dig some the to comments auto. Is dealership years level, strength and and the driving makes little higher our XQ the a bit that you Steve, which balance of seeing you're that. local Great. into to like there

Steve Marks

biggest which largest dealer Actually is up. It's mentioned manufacturer is X% is quarter, revenue foreign domestic just categories derive than of the the even second two the Domestic just is dealership to we up, down. Not from I three that where and others X%. on auto slightly down. up or less the of

that have are us our were to gives on and a deliver. turning we that said we're reason now categories biggest efforts of we we propelling delivering the So going three corner believe to kind right what the this

Kyle Evans

level at the can you're local comment that specific dealership Anything you that seeing on?

Steve Marks

emphasis dealing the large a rooftops focused level. where on on are I agencies, directly we've dealing that of having we many focused dealer local had at are with the think

we're seeing the rooftops that's where solving individually. So of our directly needs at success the

Kyle Evans

seeing one Great. is And content startup major particular I early a you. and those in about on hours web drive there? days? platforms. Are small. mode and all across STIRR still know streaming expansion available in of know it's then I one it's little these the the the Last you you bit strategy Could talk any Thank

Chris Ripley

Sure.

XXX that channels a plan to to and those making lot is there are down of deals well in pipeline. over the way the add their So a have queue, STIRR, we

One points of which of running. - to we channels technological is hard ingestion solve, the up more more and content, working so get can we're choke

on and So right making and now, quantity adding where progress there. we're focused we're also quality

I the already then to on usage, TV channels. think is all of around we're of product. terms a it available It streaming in And XX up boxes. is

is get You in televisions, mobile your of the boxes, of on on terms can contributor phone, vast mainly usage. biggest but the usage it that Roku majority being streaming through with

Kyle Evans

programming live that driving that's is the it's television and stat to-date, VOD not interesting television An viewership.

Chris Ripley

have linear, service. a thing It just which as lot it's that pure VOD, other platforms we we about like demand of as VOD a that's lean has Yes, really on streaming that's just and traditional know not back that you experience the a is the shortcoming. well think strategy

Kyle Evans

Thank you much. so

Operator

go question ahead. Aaron from with And comes Watts Deutsche Bank. our next Please

Aaron Watts

having for Hi, on. everyone. Thanks me

on congratulations retirement. by me saying start Let Dave your to

on you enjoyed many over that Sinclair will these personal that I've I you've a level. with years. working Now achieved say

So congratulations.

David Amy

always Deutsche the Bank I've Thanks, September Bond Aaron. enjoyed conference.

a quite I So that miss bit.

AaronWatts

Yes.

for that miss quick will full you for there. We auto full question Do your on year being embedded out the category belief as auto follow up? growth core year. see a and up you the can One

David Amy

Yes, focusing in we've the couple again being of last single-digits, it investments. the the spent seeing of really to category, it's we up and years see starting that low and fruits on auto we're our see

Aaron Watts

maybe low leverage memory - been for after to a any recently I where going pop of got levels you? - I that XX from maybe thoughts for we're think about back ahead a recent Lucy, to transaction it. remember and what of Okay, the -- days And can have kind over leverage closes? preliminary I the up, kind see the with as what XX falls target month transaction, secondly as you've looking priority operating de-leveraging on RSM in

Lucy Rutishauser

Yes.

And in to call credit -- up the we all the in absolutely are leverages. de-leveraging the we will So, be Monday in the about step company. stacks talked our goal the

months side the So be a back company, to that side low four times an to would the get over investment company grade the as to the XX goal but, help. media RSN will high XX ultimately say longer mid were into the the, to fours, but get term looking our threes, parent's I FTG to through months the diversified we

Aaron Watts

Okay, much. great. Thank you very

Operator

And next take Joyce we'll a with go David Evercore. from ahead. Please question

David Joyce

questions. Thank couple of you, a

Thank there? start how step value of distribution secondly given any then should have think or ATSC the we've exchanges generated on side And any might well there? we being about on that's to other thoughts when, learnings the escalators when First ups any if revenue you. retiring rollouts that X.X about progressing

Chris Ripley

contracts from bigger, there agreements escalators specifics. of exclude, to are we, you So, generally when reverse anywhere bigger that again are And the the renew disclose we also have can't we have our reasons our we specific on our, every of terms and of ups distribution upon subject contracts to we year then know our of And, one tend to contracts so step have and most renewal. escalators fixed and then XX%. fees can X% confidentiality

essentially the are to Lucy learning over double-digits re-trans we XXXX, as the So quite in street focus XXXX the as bottom as in know on that's which you bit. for a guidance On ATSC what's well is, X.X, our you for why we like mentioned earlier. net gives the left which line

app now the and the terms all with the throughout terms include three that through DMA as Telecom right interactive the expect low that commentary. that of that the that and out synchronization, focus testing and these the kicking and the much launched right for There'll we characteristics And dramatically stats is like actually be work in undoubtedly on which entirety is adding carrier, on X.X, testing we're the RF subscriber in more of sites, events, experience so, signal reception in capabilities, by will finalized DMA, level just of the be from RF targeted we sporting facing physical media SK -- our is being based single of to joint product features choice reception latency network frequency off with based and venture out a most now quality -- social of of out integrated the premium that the an iterations reception. of venture VOD SFN the signal capabilities. coming entire programming quality the of know Rs of consumer speak. of In way of assets Dallas saturating you'd specifically, advertising, You actual more will the the enhanced wireless content, and

And I there in one SK. that on think in by worked horse our the dog, being is our by our industry just not and but joint our is the all others know race so with of -- you us venture

David Joyce

you. thank Great,

Operator

go And comes with Wells our ahead. question Hebert Please Davis next Fargo. from

Davis Hebert

congratulations I morning retired Good enjoy you everyone, life. and to Dave, hope

Just of new secured for Group, unsecured? Sinclair quick debt you of being the Lucy, one or $XXX million that questions Television do couple anticipate at

Lucy Rutishauser

incremental be would B. That loan term

Davis Hebert

B. loan term Incremental

the leverage intention Okay, investment in you. trying your for And you of of aspiration there parent comment to terms thank any on there or the target is then level? imply grade are sort

Lucy Rutishauser

how are know company time we we Not want directionally and to it we about what just, think is, you we're on. at focused term the know, longer quite this where you

Davis Hebert

to is curve? non-GAAP EBITDA, paid that in Okay, management I the RSN reconciliation think was that the is that's helpful. a from fee Television the going Sinclair million the $XX for And there the to adjustment be RSN then detail

Chris Ripley

right. that's Yes,

Davis Hebert

one clarification. big of that for you And thank then Okay, a last more picture.

little new about to on into Nielsen and they're you you you're on gone how local your for think positioned viewership you year more they're in think broadcast you you. think maybe into I measurement the how things? viewership is far I'm if Thank follow TV that more think so effective a bit on then a curious a just capturing how think that's the And RSN of side relationship.

Chris Ripley

and Nielsen for we things less the it more world right more as the for need is panel currency still the -- we're answer based into to accepted look, increasingly as widely less. happy the a they move keep, become are that and they price that our but So, has and to not targeted essential a currency business. RSN something for Comscore used is is service And the And well. that's probably same is

Davis Hebert

so much. Okay. you Thank

Chris Ripley

you. Thank

Operator

over Q&A the today. Lucy concludes for any closing our turn that remarks. And back to call I'll for session

Lucy Rutishauser

Thank you, Operator.

first So this which exciting as the for has week been us outlook announcement good very RSN, a an is as acquisition and results for XXXX. with quarter transforming of a us well the for

any questions a please give feel us you. If Thank you call. have to

Operator

This teleconference. participation. your We you. today's Thank does you for thank conclude

lines a You day. disconnect may great your time at this have and

Sinclair Broadcast (SBGI) 8 May 192019 Q1 Earnings call transcript