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Political Ad Market Remains a Drag for LIN TV

The relative dearth of political advertising versus 2006 pressured LIN TV’s results, but the company also cited lower automotive advertising hitting its ad sales.

Excluding political advertising, national ad revenues, which represented 35% of LIN’s ad revenues in the third quarter, decreased 1% versus Q3 2006 largely because ads from automakers were down. Political ad revenue was $1.3 million versus $15.5 million a year ago. Local ad revenue, representing the bulk of the pie at 64%, increased 4% in the third quarter, partly due to the acquisition of a Fox-affiliated station in Albuquerque, N.M.

In the third quarter, the company’s total revenues dropped 8% to $93.7 million versus $102.4 million a year ago. The company’s digital revenues, which include retransmission-consent fees, were up 134% to $4.3 million. Operating income was 20% lower to $18.3 million from $23.05 million, while net income slid 55% to $1.73 million from $3.85 million. LIN’s earnings per share for the quarter were $0.03 versus $0.08 in Q3 2006, beating the street consensus of $0.02 per share.

Looking ahead to the fourth quarter, the company expects revenue to be lower by the order of 15%-17%, or by $19.4 million-$21.4 million, again based on comparisons with a Q4 2006 boosted by political ad sales. LIN expects political ad revenue in Q4 to be in the range of $1.5 billion-$2.2 billion.