Hearst-Argyle Profit Drops 75 Percent in Q4

Feb 23, 2006  •  Post A Comment

Hearst-Argyle Television on Thursday reported a 75 percent decline in fourth-quarter profit as a drop in political advertising and a charge related to the company’s New Orleans television station depressed results.

The company reported a profit of $9.9 million, compared with a year-earlier figure of $39.6 million. The numbers reflected the absence of $35.6 million in political advertising revenue in the quarter and a $29.2 million charge related to reducing the value of intangible assets in New Orleans, where the company’s television station WDSU-TV was hit physically and revenue-wise by Hurricane Katrina.

Revenue fell to $192 million from $221 million a year ago,

For the year, Hearst-Argyle’s profit fell to $100.2 million from $123.9 million a year ago. Revenue slipped to $706.9 million from last year’s $779.9 million.

In providing guidance for 2006, Hearst-Argyle said it expects huge gains in retransmission consent revenue and digital media revenue, which will offset expected declines in network compensation.

Retransmission consent fees are expected to be in the range of $16 million to $17 million, compared with 2005’s figure of $6.8 million. Digital media revenue is expected to be in the range of $16 million to $18 million, up from 2005’s figure of $300,000. Political advertising revenue is projected at between $50 million and $60 million.

Network compensation, which hit $19 million in 2005, is projected at $8 million to $9 million for 2006.