As WWL New Orleans pushes on with its coverage of Hurricane Katrina, its parent company Belo Corp. is conducting a financial damage assessment.
Belo is withdrawing its financial estimates for the third quarter, following a similar move earlier this week by Hearst-Argyle, owner of New Orleans' NBC affiliate WDSU. Belo is also putting on hold plans to build a new facility for WWL.
Belo President and CEO Robert Decherd says it is not possible to estimate how long it will take for the market to stabilize and revenue patterns to emerge. The company is asking Wall Street analysts and investors to "take a conservative approach" toward the New Orleans advertising market. WWL has been a strong contributor to Belo's coffers, with $35 million in revenue last year accounting for 2.3% of the company's revenue.
Decherd said the stations' operating expenses will remain at pre-Katrina levels of $22 million for the next 12-15 months.
As New Orleans and its TV stations rebuild, "WWL's longtime news leadership position in New Orleans, and its singular performance over the past fortnight, constitute a valuable competitive advantage that will contribute significantly to the station's ability to rebuild its advertising base as the New Orleans market recovers," the company said in a statement.
WWL has managed to stay on the air, but was forced out of its French Quarter facilities. Instead, the station has been broadcasting from Louisiana State University, its transmitter site and, most recently, the Public Broadcasting Station in Baton Rouge. Decherd says Belo is facing incremental cost from such operations and WWL's ongoing news coverage. Other Belo stations, including WFAA Dallas and KHOU Houston, have been pitching in to help cover the story themselves, although that is expected to be scaled back by the end of September.
Belo says it is still committed to a new building for WWL, but plans have been postponed indefinitely.
The company does have insurance coverage, which Belo says should "mitigate near-term financial impacts of Katrina."
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