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E.W. Scripps Company Reports Q4 2024 Financial Highlights

The E.W. Scripps Company (NASDAQ: SSP) recently reported robust financial results for the fourth quarter of 2024, achieving a remarkable total revenue of $728 million. This impressive figure represents an 18% increase from the same period last year, primarily fueled by record-high revenues from political advertising, which played a crucial role in the company's financial performance.

Scripps determined that more than 80% of the $343 million generated from political advertising in the Local Media division came from six key states: Arizona, Michigan, Montana, Ohio, Nevada, and Wisconsin. These states are notable for their competitive swing electoral status, underscoring the strategic importance of local broadcast channels in political campaigns.

Financial Breakdown

Net income attributable to the company's shareholders for the quarter was an impressive $80.3 million, equating to 92 cents per share, a significant contrast compared to a loss of $268 million or $3.17 per share during the previous year’s fourth quarter. The notable turnaround in profitability demonstrates Scripps' strategic initiatives in managing costs effectively while enhancing revenue streams.

Local Media Division Performance

The Local Media segment saw revenues soar to $511 million, marking a 34% increase from the previous year. However, it is worth noting a decline in core advertising revenue, which fell by 11% to $147 million due to considerable local advertising displacement attributed to political ad spending. In comparison, political advertising revenue skyrocketed to $174 million, compared to just $16.4 million recorded in the previous non-election year. Distribution revenue, however, saw a slight setback, dropping to $186 million from $196 million the previous year.

Scripps Networks Contributions

In the Scripps Networks division, revenues decreased by 6.1% to $216 million compared to the previous year. The cost management strategies put in place led to a 6.3% reduction in expenses for this segment. Segment profits stood at $60.7 million, compared to $64.3 million a year ago.

Restructuring efforts throughout the year included costs of $14.9 million related to Scripps News operations and some unrelated severance charges. Furthermore, the company successfully negotiated new multi-year affiliation agreements with major networks, NBC and CBS, enhancing its content distribution capabilities.

Changes in Financial Strategy

The company also emphasized significant strides in reducing its leverage ratio. At the end of 2024, Scripps' net leverage stood at 4.8x, down from 5.7x the year before. This reduction reflects strong cash flow performance allowing Scripps to pay off the $330 million previously outstanding on its revolving credit facility during 2024. The company highlighted the successful execution of a transaction support agreement with the majority of its term loan holders, enabling more strategic financial management moving forward.

Looking Ahead

As Scripps gears up for 2025, the management team remains focused on strengthening the company’s financial performance and continuing the transformation plan aimed at enhancing operating efficiency and creating shareholder value. Expectations for the first quarter of 2025 indicate that local media revenues could decline in the high single-digit range, while Scripps Networks may see a mid-single-digit revenue decrease. Despite the anticipated challenges, the company remains committed to positioning itself for long-term success and adapting to changing market dynamics, particularly with potential adjustments in the regulatory environment affecting local broadcasts.

In conclusion, E.W. Scripps Company's fourth quarter results illustrate a period of recovery and strategic initiatives yielding positive results. CEO Adam Symson expressed optimism about the company's future, focusing on debt reduction and improving financial margins.

For more detailed insights into the key performance metrics and future guidance, Scripps will be hosting a conference call on March 12, 2025, to discuss these results and engage with analysts about the company's strategic outlook moving forward.