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Contact: David Amy, EVP & Chief Financial
Lucy Rutishauser, VP-Corporate Finance & Treasurer
SINCLAIR REPORTS PRELIMINARY FOURTH QUARTER 2008 RESULTS
Company Suspends Common Stock Dividend
BALTIMORE (February 11, 2009) Sinclair Broadcast Group, Inc. (Nasdaq: SBGI), the Company or Sinclair, today reported preliminary financial results for the three months and twelve months ended December 31, 2008. The preliminary results do not include non-cash impairment charges expected to be recorded in the fourth quarter of 2008, which have not yet been finalized. In accordance with SFAS No. 142, we are required to test our goodwill and FCC licenses for impairment based on estimated fair values as of October 1, 2008. Due to the economic recession, we expect to record a non-cash impairment charge of approximately $460 million (approximately $300 million on an after-tax basis). Our final results will be included in our Annual Report on Form 10-K to be filed with the Securities and Exchange Commission.
Commenting on the quarter, David Smith, President and CEO of Sinclair, stated, In the fourth quarter 2008, in response to a deepening economic recession and going into a non-election year where there would be an absence of political revenues, we took steps to reduce our 2009 operating costs and to preserve liquidity, and we are currently re-evaluating how best to utilize our cash flow. Among some of the initiatives implemented, we drastically cut capital expenditures, are limiting our outside investments, reduced corporate overhead and TV station expenses, including reducing staffing levels and freezing salaries. While the savings from our cost control initiatives are meaningful, we do not expect them to offset the expected declines in advertising revenues in 2009. Although we expect to generate sufficient cash flow in 2009 to meet our principal obligations and pay our regular quarterly dividends of $0.20 per share, the Companys Board of Directors felt that the Companys ownership should make a financial sacrifice just as our employees have done, and therefore, has suspended our dividend until further notice.
Net broadcast revenues from continuing operations were $164.4 million for the three months ended December 31, 2008, a decrease of 0.8% versus the prior year period result of $165.7 million. The Company had preliminary operating income of $46.9 million in the three-month period, as compared to operating income of $47.0 million in the prior year period. The Company had preliminary net income available to common shareholders of $20.3 million in the three-month period versus net income available to common shareholders of $13.0 million in the prior year period. The Company reported preliminary diluted earnings per common share of $0.24 for the three-month period versus diluted earnings per common share of $0.15 in the prior year period.
Net broadcast revenues from continuing operations were $639.2 million for the twelve months ended December 31, 2008, an increase of 2.7% versus the prior year period result of $622.6 million. The Company had preliminary operating income of $173.8 million in the twelve-month period versus the prior year period operating income of $159.2 million. The Company had preliminary net income available to common shareholders of $61.7 million in the twelve-month period versus net income available to common shareholders of $22.7 million in the prior year period. The Company reported preliminary diluted earnings per common share of $0.72 in the twelve-month period versus diluted earnings per common share of $0.26 in the prior year period.
The following information was filed by Sinclair Broadcast Group Inc (SBGI) on Wednesday, February 11, 2009 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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