Sinclair Reports $0.28 Diluted Earnings Per Share in Fourth Quarter 2011; Declares $0.12 Quarterly Dividend Per Share

Sinclair Reports $0.28 Diluted Earnings Per Share in Fourth Quarter 2011; Declares $0.12 Quarterly Dividend Per Share

BALTIMORE, Feb. 8, 2012 /PRNewswire/ -- Sinclair Broadcast Group, Inc. (Nasdaq: SBGI), the "Company" or "Sinclair," today reported financial results for the three months and twelve months ended December 31, 2011.

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"We ended 2011 on a strong note with core broadcast revenues growing, and our largest advertising category, automotive, up almost 12% in the fourth quarter as compared to the same period in 2010," commented David Smith, President and CEO of Sinclair. "As we look ahead to 2012, our outlook is for continued ad spending growth by the automotive industry, as well as an increase in political advertising in this presidential election year. In addition, we expect the market for television station transactions to remain active and intend on evaluating potential transactions as they arise."

Financial Results:

Net broadcast revenues from continuing operations were $180.8 million for the three months ended December 31, 2011, a decrease of 4.9% versus the prior year period result of $190.1 million. The Company had operating income of $63.5 million in the three-month period, as compared to operating income of $81.5 million in the prior year period. Net income attributable to the Company was $22.7 million in the three-month period versus net income of $33.1 million in the prior year period.

The Company reported diluted earnings per common share of $0.28 for the three-month period versus diluted earnings per common share of $0.40 in the prior year period.

Net broadcast revenues from continuing operations were $648.0 million for the twelve months ended December 31, 2011, a decrease of 1.2% versus the prior year period result of $655.8 million. The Company had operating income of $225.6 million in the twelve-month period, as compared to operating income of $240.8 million in the prior year period. Net income attributable to the Company was $75.8 million in the twelve-month period versus net income of $76.1 million in the prior year period.

The Company reported diluted earnings per common share of $0.94 in the twelve-month period versus diluted earnings per common share of $0.94 in the prior year period.

Operating Statistics and Income Statement Highlights:

-- Political revenues were $4.1 million in the fourth quarter 2011 versus
$26.8 million in fourth quarter 2010.

-- Local net broadcast revenues, which include local time sales,
retransmission revenues, and other broadcast revenues, were up 6.6% in
the fourth quarter 2011 while national net broadcast revenues, which
include national time sales and other national broadcast revenues, were
down 31.0% versus the fourth quarter 2010 as a result of 2010's
political election year. Excluding political revenues, local net
broadcast revenues were up 13.3% and national net broadcast revenues
were down 7.4% in the fourth quarter.

-- Advertising categories that reported the largest spending increases in
the fourth quarter, as compared to the same period last year, were
automotive, grocery and medical, while services, media spending,
telecommunications, direct response and home products were down the
most. Automotive, our largest category, was up 11.9% in the quarter and
up 9.7% for the year.

-- The Company began operating the seven stations acquired from Four Points
Media on October 1, 2011 pursuant to a local marketing agreement and
funded and closed the acquisition effective January 1, 2012.

-- In November, the Company announced it had entered into an agreement to
buy the broadcast assets, which includes eight television stations, from
Freedom Communications, Inc. for $385.0 million. The Company began
operating the stations on December 1, 2011 pursuant to a local marketing
agreement and expects to fund and close the acquisition late in the
first quarter or early in the second quarter of 2012.

-- Interest expense in the quarter includes a one-time expense of $3.6
million associated with issuance fees related to the amendment of and
additional commitment raised under the Bank Credit Agreement.

Balance Sheet and Cash Flow Highlights:

-- Debt on the balance sheet, net of $13.0 million in cash and cash
equivalents, was $1,193.1 million at December 31, 2011 versus net debt
of $1,142.2 million at September 30, 2011.

-- In December, the Company amended certain terms under its bank credit
facility, raised an additional $372.5 million of term B loans, $157.5
million of additional term A loans, increased its revolving line of
credit from $75.4 million to $97.5 million, extended the revolving line
of credit maturity from 2013 to 2016, and reduced the revolving line of
credit pricing to LIBOR plus 225 basis points from LIBOR plus 300 basis
points with a 1% floor. In January of 2012, $180.0 million of the new
term loan commitments were drawn in connection with the funding and
closing of the Four Points transaction. The remaining $350.0 million of
the new term loan commitments are planned to be drawn on a delayed basis
in connection with the funding and closing of the Freedom Communications
transaction.

-- During October, the Company repurchased in the open market $8.6 million
face value of its 8.375% Senior Notes due 2018.

-- On December 15, 2011, the Company paid a $0.12 per share quarterly cash
dividend to its shareholders.

-- As of December 31, 2011, 52.0 million Class A common shares and 28.9
million Class B common shares were outstanding, for a total of 80.9
million common shares outstanding.

-- Capital expenditures in the fourth quarter were $9.0 million.

-- Program contract payments for continuing operations were $14.6 million
in the fourth quarter.

Notes:

Prior year presentation has been reclassified to conform to the presentation of current year generally accepted accounting principles.

The management fees associated with the Four Points Media and Freedom Communications local marketing agreement ("LMAs") are recorded in other net broadcast revenues.

Forward-Looking Statements:

The matters discussed in this news release, particularly those in the section labeled "Outlook," include forward-looking statements regarding, among other things, future operating results. When used in this news release, the words "outlook," "intends to," "believes," "anticipates," "expects," "achieves," and similar expressions are intended to identify forward-looking statements. Such statements are subject to a number of risks and uncertainties. Actual results in the future could differ materially and adversely from those described in the forward-looking statements as a result of various important factors, including and in addition to the assumptions identified in this release, but not limited to, the impact of changes in national and regional economies, the volatility in the U.S. and global economies and financial credit markets which impact our ability to forecast, our ability to integrate acquired businesses and maximize operating synergies, our ability to obtain necessary governmental approvals to acquire the stations from Freedom, successful execution of outsourcing agreements, pricing and demand fluctuations in local and national advertising, volatility in programming costs, the market acceptance of new programming, the CW Television Network and MyNetworkTV programming, our news share strategy, our local sales initiatives, the execution of retransmission consent agreements, our ability to identify and consummate investments in attractive non-television assets and to achieve anticipated returns on those investments once consummated, and any other risk factors set forth in the Company's most recent reports on Form 10-Q, Form 10-K and Form 8-K, as filed with the Securities and Exchange Commission. There can be no assurances that the assumptions and other factors referred to in this release will occur. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements except as required by law.

Outlook:

In accordance with Regulation FD, Sinclair is providing public dissemination through this news release of its expectations for certain components of its first quarter 2012 and full year 2012 financial performance. The Company assumes no obligation to update its expectations. All matters discussed in the "Outlook" section are forward-looking and, as such, readers should not place any undue reliance on this information and should refer to the "Forward-Looking Statements" section above.

All line items in this "Outlook" section include full-year expectations for the stations acquired from Four Points Media and nine-month expectations for the stations acquired from Freedom, assuming that the Freedom acquisition closes April 1, 2012.

"2012 is off to a good start with both automotive and political advertising spending leading the way," commented David Amy, EVP and CFO. "With the upcoming Presidential election this year, we expect to experience another record-breaking year for campaign and issue advertising. Meanwhile, consumer confidence appears to be improving, and with that, we should expect to see growth in ad spending."

-- The Company expects first quarter 2012 station net broadcast revenues
from continuing operations, before barter, to be approximately $187.6
million to $190.6 million, up 20.3% to 22.2% compared to first quarter
2011. This assumes approximately $4.0 million in political revenues in
the first quarter as compared to $0.6 million in first quarter 2011 and
$0.1 million of Super Bowl revenues versus $6.2 million in 2011 when it
aired on our 20 FOX stations. The 2012 first quarter estimates assume
$23.6 million related to the Four Points and Freedom acquisitions,
including $2.9 million related to the Freedom LMA management fees and
$6.0 million of Freedom LMA expense reimbursement.

-- The Company expects barter revenue to be approximately $20.7 million in
the first quarter.

-- The Company expects barter expense to be approximately $20.7 million in
the first quarter.

-- The Company expects continuing operations station production expenses
and station selling, general and administrative expenses (together,
"television expenses"), before barter expense, to be approximately $95.9
million in the first quarter and $424.0 million for 2012, as compared to
the 2011 actuals of $72.9 million and $302.6 million for the quarter and
year, respectively. The 2012 first quarter estimate assumes $15.8
million related to the acquisitions, including $6.0 million of Freedom
LMA expenses which are reimbursed and recorded as revenue, and $84.7
million related to the acquisitions for the year. Also included in the
2012 estimate is $5.3 million of corporate expenses allocated to all of
our television stations. The 2012 expense forecast includes $1.3
million of stock-based compensation expense for the year as compared to
$1.3 million for 2011.

-- The Company expects program contract amortization expense to be
approximately $15.1 million in the first quarter and $62.2 million for
2012, as compared to the 2011 actuals of $12.6 million and $52.1 million
for the quarter and year, respectively. The 2012 estimates assume $0.6
million and $5.9 million for the quarter and year respectively, related
to the acquisitions.

-- The Company expects program contract payments to be approximately $16.7
million in the first quarter and $68.6 million for 2012, as compared to
the 2011 actuals of $18.8 million and $67.3 million for the quarter and
year, respectively. The 2012 estimates assume $0.8 million and $6.7
million for the quarter and year respectively, related to the
acquisitions.

-- The Company expects corporate overhead to be approximately $6.9 million
in the first quarter and $29.7 million for 2012, as compared to the 2011
actuals of $8.7 million and $28.3 million for the quarter and year,
respectively. This assumes $5.3 million of corporate overhead being
allocated to television station expenses for 2012, and includes $3.5
million of stock-based compensation expense for 2012 as compared to $3.5
million for 2011.

-- The Company expects other operating division revenues less other
operating division expenses to be $2.1 million of income in the first
quarter and $10.3 million of income for 2012, assuming current equity
interests, and as compared to the 2011 actuals of $1.5 million of income
in the quarter and $5.0 million of income for the year.

-- The Company expects depreciation on property and equipment to be
approximately $8.5 million in the first quarter and $37.7 million for
2012, assuming the capital expenditure assumptions below, and as
compared to the 2011 actuals of $8.1 million and $32.9 million for the
quarter and year, respectively. The 2012 estimates assume $0.9 million
and $6.6 million for the quarter and year respectively, related to the
acquisitions.

-- The Company expects amortization of acquired intangibles to be
approximately $4.1 million in the first quarter and $19.1 million for
2012, as compared to the 2011 actuals of $4.8 million and $18.2 million
for the quarter and year, respectively. 2012 estimates assume $0.3
million and $4.2 million for the quarter and year respectively, related
to the acquisitions.

-- The Company expects net interest expense to be approximately $25.5
million in the first quarter and $114.4 million for 2012 (approximately
$105.5 million on a cash basis), assuming no changes in the current
interest rate yield curve, the acquisition and funding of the Four
Points Media stations on January 3, 2012, the Freedom acquisition
closing and funding on April 2, 2012, and changes in debt levels based
on the assumptions discussed in this "Outlook" section. This compares
to the 2011 actuals of $29.2 million and $106.0 million ($96.9 million
on a cash basis) for the first quarter and year, respectively.

-- The Company expects a current tax provision from continuing operations
of approximately $10.1 million and $53.1 million in the first quarter
and for the full year 2012, respectively, based on the assumptions
discussed in this "Outlook" section. The Company expects the effective
tax rate to be approximately 15.5% due to the release of valuation
allowance reserves and 32.1% for the first quarter and full year,
respectively.

-- The Company expects to spend approximately $8.4 million in capital
expenditures in the first quarter and approximately $45.0 million for
the year. The 2012 estimates assume $6.6 million related to the
acquisitions, $7.8 million in building projects, and $14.0 million to
complete the high-definition news and master control upgrades.

Sinclair Conference Call:

The senior management of Sinclair will hold a conference call to discuss its fourth quarter 2011 results on Wednesday, February 8, 2012, at 9:30 a.m. ET. After the call, an audio replay will be available at www.sbgi.net under "Investor Information/Earnings Webcast." The press and the public will be welcome on the call in a listen-only mode. The dial-in number is (877) 407-9205.

About Sinclair:

Sinclair Broadcast Group, Inc., the largest and one of the most diversified television broadcasting companies, owns and operates, programs or provides sales services to 73 television stations in 45 markets. Sinclair's television portfolio consists of 20 FOX, 18 MNT, 13 CW, 11 ABC, 9 CBS, 1 NBC, and 1 Azteca station, in addition to 82 sub-channels. Sinclair's television group reaches approximately 26.3% of U.S. television households and is affiliated with all major networks. Sinclair owns equity interests in various non-broadcast related companies. The Company regularly uses its website as a key source of Company information and can be accessed at www.sbgi.net.

Sinclair Broadcast Group, Inc. and Subsidiaries
Preliminary Unaudited Consolidated Statements of
Operations
(in thousands, except per share data)

Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2011 2010 2011 2010
---- ---- ---- ----
REVENUES:
Station
broadcast
revenues,
net of
agency
commissions $180,795 $190,051 $648,002 $655,836
Revenues
realized
from
station
barter
arrangements 19,541 24,637 72,773 75,210
Other
operating
divisions
revenues 12,440 10,980 44,513 36,598
------ ------ ------ ------
Total
revenues 212,776 225,668 765,288 767,644
OPERATING
EXPENSES:
Station
production
expenses 51,857 40,951 178,612 154,133
Station
selling,
general
and
administrative
expenses 31,843 33,665 123,938 127,091
Expenses
recognized
from
station
barter
arrangements 17,669 22,388 65,742 67,083
Amortization
of program
contract
costs and
net
realizable
value
adjustments 13,962 13,700 52,079 60,862
Other
operating
divisions
expenses 13,384 8,657 39,486 30,916
Depreciation
of
property
and
equipment 9,351 8,563 32,874 36,307
Corporate
general
and
administrative
expenses 6,784 6,737 28,310 26,800
Amortization
of
definite-
lived
intangible
assets 4,426 4,747 18,229 18,834
Impairment
of
goodwill,
intangible
and other
assets - 4,803 398 4,803
--- ----- --- -----
Total
operating
expenses 149,276 144,211 539,668 526,829
------- ------- ------- -------
Operating
income 63,500 81,457 225,620 240,815
OTHER
INCOME
(EXPENSE):
Interest
expense
and
amortization
of debt
discount
and
deferred
financing
costs (27,564) (27,346) (106,128) (116,046)
Loss from
extinguishment
of debt (328) (1,889) (4,847) (6,266)
Income
(loss)
from
equity and
cost
method
investments 363 (2,383) 3,269 (4,861)
Gain on
insurance
settlement 19 285 1,742 344
Other
income,
net 447 502 1,717 1,865
--- --- ----- -----
Total other
expense (27,063) (30,831) (104,247) (124,964)
------- ------- -------- --------
Income from
continuing
operations
before
income
taxes 36,437 50,626 121,373 115,851
INCOME TAX
PROVISION (13,084) (17,294) (44,785) (40,226)
------- ------- ------- -------
Income from
continuing
operations 23,353 33,332 76,588 75,625
DISCONTINUED
OPERATIONS:
Loss from
discontinued
operations,
includes
income tax
(provision)
benefit of
($111),
$125,
($477) and
($77),
respectively (111) (375) (411) (577)
---- ---- ---- ----
NET INCOME 23,242 32,957 76,177 75,048
Net
(income)
loss
attributable
to the
noncontrolling
interests (540) 122 (379) 1,100
---- --- ---- -----
NET INCOME
ATTRIBUTABLE
TO
SINCLAIR
BROADCAST
GROUP $22,702 $33,079 $75,798 $76,148
======= ======= ======= =======
Dividends
declared
per share $0.12 $0.43 $0.48 $0.43
===== ===== ===== =====

BASIC AND
DILUTED
EARNINGS
PER COMMON
SHARE
ATTRIBUTABLE
TO
SINCLAIR
BROADCAST
GROUP:

Basic
earnings
per share
from
continuing
operations $0.28 $0.42 $0.95 $0.96
===== ===== ===== =====
Basic loss
per share
from
discontinued
operations $- $- $(0.01) $(0.01)
=== === ====== ======
Basic
earnings
per share $0.28 $0.41 $0.94 $0.95
===== ===== ===== =====
Diluted
earnings
per share
from
continuing
operations $0.28 $0.41 $0.95 $0.95
===== ===== ===== =====
Diluted
loss per
share from
discontinued
operations $- $- $(0.01) $(0.01)
=== === ====== ======
Diluted
earnings
per share $0.28 $0.40 $0.94 $0.94
===== ===== ===== =====
Weighted
average
common
shares
outstanding 80,779 80,365 80,217 80,245
====== ====== ====== ======
Weighted
average
common and
common
equivalent
shares
outstanding 81,119 83,775 80,532 83,606
====== ====== ====== ======

AMOUNTS
ATTRIBUTABLE
TO
SINCLAIR
BROADCAST
GROUP
COMMON
SHAREHOLDERS:
Income from
continuing
operations,
net of tax $22,813 $33,454 $76,209 $76,725
Loss from
discontinued
operations,
net of tax (111) (375) (411) (577)
---- ---- ---- ----
Net income $22,702 $33,079 $75,798 $76,148
======= ======= ======= =======

Preliminary Unaudited Consolidated Historical Selected
Balance Sheet Data:
(In thousands)

December 31, September 30,
2011 2011
---- ----
Cash & cash equivalents $12,967 $61,367
Total current assets 209,717 245,645
Total long term assets 1,361,700 1,318,205
Total assets 1,571,417 1,563,850

Current portion of debt 41,209 29,485
Total current liabilities 195,582 199,899
Long term portion of debt 1,164,816 1,174,087
Total long term liabilities 1,487,197 1,489,309
Total liabilities 1,682,779 1,689,208

Total stockholders' deficit (111,362) (125,358)
Total liabilities & stockholders'
deficit $1,571,417 $1,563,850

Unaudited Consolidated Historical Selected Statement of Cash
Flows Data:
(In thousands)

Three Months Twelve Months
Ended Ended
December 31, December 31,
2011 2011
---- ----
Net cash flow from operating
activities $20,163 $148,513
Net cash flow used in investing
activities (54,714) (112,248)
Net cash flow used in financing
activities (13,849) (45,272)
------- -------

Net decrease in cash & cash
equivalents (48,400) (9,007)
Cash & cash equivalents, beginning
of period 61,367 21,974
------ ------
Cash & cash equivalents, end of
period $12,967 $12,967

SOURCE Sinclair Broadcast Group, Inc.

Sinclair Broadcast Group, Inc.

CONTACT: David Amy, EVP & Chief Financial Officer or Lucy Rutishauser, VP-Corporate Finance & Treasurer, both of Sinclair Broadcast Group, Inc., +1-410-568-1500

Web Site: http://photos.prnewswire.com/prnh/20100119/PH39783LOGO

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