The E W Scripps Co (SSP, Financial) released its 8-K filing on August 9, 2024, reporting second-quarter financial results that fell short of analyst expectations. The media enterprise, known for its local and national media brands, reported a revenue of $574 million, missing the estimated $629.96 million. The company also posted a loss attributable to shareholders of $13 million, or 15 cents per share, compared to the estimated loss per share of 38 cents.
Company Overview
The E W Scripps Co is a diversified media company with interests in local and national media brands. It operates a collection of daily and community newspapers in medium-sized cities across the southern and western United States. The company's operating segments include Local Media, Scripps Networks, and Other, with the Local Media segment generating the maximum revenue. This segment includes local broadcast stations and their related digital operations.
Performance and Challenges
Despite the revenue miss, The E W Scripps Co saw significant growth in its political advertising revenue, which reached $28 million in Q2 2024, driven by U.S. Senate races and controversial ballot issues. However, the company faced challenges with core advertising revenue, which decreased by 6.9% to $139 million due to displacement from political advertising.
Financial Achievements
The company reported a segment profit of $88.1 million for its Local Media segment, up from $81 million in the prior-year quarter. This growth is crucial for the media industry, especially in an election year, as political advertising can significantly boost revenue.
Income Statement Highlights
Key details from the income statement include:
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Revenue | $574 million | $582.8 million |
| Segment Expenses | $479 million | $471 million |
| Net Loss Attributable to Shareholders | $13 million | $682 million |
| Net Loss Per Share | $0.15 | $8.10 |
Balance Sheet and Cash Flow
As of June 30, 2024, The E W Scripps Co had cash and cash equivalents totaling $26.7 million and total debt of $2.9 billion. The company reduced its outstanding balance on its revolving credit facility by $40 million and made mandatory principal payments of $7.8 million on its term loans during the first six months of 2024.
Commentary from Management
"During the second quarter, our Local Media political advertising revenue came in much stronger than expected at $28 million, driving 40 percent growth in the first half of the year over the same period of 2020 and creating some local core advertising displacement. That start to the year and our latest back-half outlook led us to once again raise our expectations for 2024 presidential election-year revenue." - Adam Symson, President and CEO
Analysis and Outlook
The E W Scripps Co's performance in Q2 2024 highlights the importance of political advertising revenue in an election year. While the company faced challenges with core advertising revenue, the significant growth in political advertising and tight expense management helped mitigate some of the losses. The company's efforts to divest non-strategic assets and manage expenses are expected to contribute to debt reduction and improved financial stability going into 2025.
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Explore the complete 8-K earnings release (here) from The E W Scripps Co for further details.
