Belo Corp. 2Q Revenue Falls 4.7%

Belo Corp. total revenues decreased 4.7 percent in the second quarter of 2008 versus the second quarter of 2007, the company announced this morning.

Total spot revenue, including political, was down 6.4 percent with 5.9 percent and 10 percent decreases in local and national spot, respectively. Second quarter 2008 revenues were affected by a weak advertising environment, particularly in the automotive category which was down 10 percent.

Second quarter 2008 political revenues of $3.6 million were up $1.4 million versus the second quarter of 2007.

Advertising revenue associated with Belo's Web sites increased 7.3 percent to $7.5 million in the second quarter 2008, representing 4 percent of Belo's total revenues. Second quarter Internet revenue growth was affected by a significant non-returning promotion in the second quarter of 2007. Importantly, Belo said, third quarter Internet revenues are currently pacing at growth levels comparable to the first quarter of this year.

Retransmission revenues totaled $7.6 million in the second quarter of 2008, a 36 percent increase compared to the second quarter of 2007. The company expects to generate approximately $30 million in retransmission revenue for full year 2008, which is slightly higher than the previous guidance of $28 to $29 million.

Total station expenses decreased 7.4 percent in the second quarter of 2008 versus the same period last year due primarily to the freezing of open positions company wide, staff reductions in certain markets, the aforementioned non-cash expense reduction and other cost-saving measures.

The $4.7 million non-cash expense reduction relates to a 2005 FCC decision that allowed a major wireless provider to finance the replacement of analog newsgathering equipment with digital equipment at television stations across the country in exchange for those stations vacating the analog spectrum earlier than required.

Five Belo markets received such new digital newsgathering equipment in the second quarter. As future Belo stations are converted, further expense reductions will be realized. Excluding the non-cash expense reduction, station expenses decreased 3.3 percent in the second quarter of 2008. As of June 30, 2008, the number of full-time equivalent employees at its television stations was 3 percent lower than the number of full-time equivalents at the end of 2007.

Dunia A. Shive, Belo's president-CEO, said, "Belo's second quarter results were highlighted by excellent expense management as soft advertising conditions reflected a continuing weak economic environment. Combined local and national spot revenue declines in the second quarter improved marginally when compared to the first quarter of this year. We cannot predict the duration of the current economic downturn and are continuing to focus on cost reductions while considering the overall quality and competitive positions of our operating companies."

To read the company's press release, click here.