ATLANTA - Gray Television, Inc. (NYSE:GTN) announced a robust start to 2024, with its first-quarter earnings significantly surpassing analyst expectations. The multimedia company reported first-quarter earnings per share (EPS) of $0.79, a substantial increase from the analyst estimate of $0.07. Revenue for the quarter was reported at $823 million, closely aligning with the consensus estimate of $823.8 million.
Gray Television's first-quarter performance marked a notable improvement from the previous year, with core advertising revenue climbing to $372 million, a 4% increase from the first quarter of 2023. This growth is attributed to a $15 million rise in core advertising revenue and a strong demand for local content, including the broadcast of high-profile sporting events like the Super Bowl and NBA games. The company highlighted that its core advertising business has not only recovered from the pandemic downturn but has also exceeded pre-pandemic levels by 3%.
The company's net income also saw a dramatic turnaround, with a profit of $75 million compared to a loss of $44 million in the same quarter last year. Adjusted EBITDA rose by 21% to $197 million. Gray Television cited advertiser confidence and its portfolio of strong local news stations as key factors driving the quarter's success.
Looking ahead, Gray Television is guiding for second-quarter political advertising revenue to increase significantly, ranging between 55% and 72% higher than the same quarter in 2020. This projection aligns with the company's anticipation of robust political advertising revenues for the full year, expected to materialize later than in past election cycles.
The company's financial maneuvers included the sale of Broadcast Music, Inc. (BMI) for pre-tax cash proceeds of $110 million, with a portion of the proceeds used to pay down existing credit facilities. Gray Television also reported an extension and upsizing of its revolving credit facility due to strong demand from its banking group.
In a statement, the company's management expressed confidence in Gray Television's position to capitalize on competitive political races across the country. However, they did not provide full-year guidance for political advertising revenue due to limited visibility at this time.
Gray Television's management remains committed to executing its growth strategy and delivering value to shareholders, as evidenced by the Board of Directors authorizing a debt repurchase program of up to $250 million through the end of 2025. The program's extent will depend on market conditions and other factors, with no obligation to repurchase a minimum amount of debt.
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