Super Bowl Update

The Meredith Corporation board of directors has declared a regular quarterly dividend of $0.3825 per share, or $1.53 on an annual basis.  The dividend will be payable on Dec. 14 to shareholders of record on Nov. 30.

Meredith, which owns and operates Nashville NBC affiliate WSMV, has a strong history of returning cash to shareholders, paying a dividend for 65 consecutive years, and increasing it 19 straight years.  Meredith's calendar 2012 dividend of $1.53 represents a 33 percent increase over the prior year.  Over the last 10 years, Meredith has grown its dividend at an average annualized rate of 16 percent.

Meredith also announced today that it now expects second quarter fiscal 2013 earnings per share to range from $0.85 to $0.90 based on stronger than anticipated political advertising at Meredith's Local Media Group.  Previously, Meredith expected second quarter earnings per share of $0.80 to $0.85.  The rest of Meredith's businesses are performing as expected for the second quarter of fiscal 2013.

Meredith continues to expect full fiscal 2013 earnings per share to range from $2.60 to $2.95.  The Company has very limited visibility into calendar 2013 advertising budgets and the advertising marketplace remains volatile.

In other news from Meredith, James R. Craigie, Frederick B. Henry, and Joel W. Johnson were reelected to the Board by Meredith shareholders, each for three-year terms expiring in 2015.  Donald C. Berg, executive VP and CFO of Louisville-based Brown-Forman Corporation, was elected for a two-year term expiring in 2014.

"I am proud to reaffirm Meredith's commitment to our Total Shareholder Return strategy and returning cash to shareholders as demonstrated by our ongoing strong dividend program," said Meredith Chairman and CEO Stephen M. Lacy.  "We are also very pleased with the continued excellent performance of our Local Media Group. Finally, I congratulate my fellow directors on their reelection, and thank them for their service on behalf of our shareholders.  I'd also like to welcome Don Berg to the Board.  We look forward to his contributions."

Shareholders of Emmis Communications, the Indianapolis company which owns two (soon to be four) radio stations in the Terre Haute market (see below), voted Tuesday to eliminate $34 million in unpaid dividends owed to the company's preferred shareholders.

The vote came following Friday's decision by U.S. District Court Judge Sarah Evans Barker to throw out the preferred shareholders' request for an injunction against Emmis.

Corre Opportunities Fund and other shareholders say that the elimination of the unpaid dividends sets the stage for Emmis' chairman, Jeff Smulyan, to take the company private.  Smulyan has repeatedly denied that he plans to do so.

Belo Corp., the Dallas-based owner of television stations WHAS11 (ABC/Louisville) and KMOV 4 (CBS/St. Louis), today reported net earnings per share of $0.24 in the second quarter of 2012 compared to net earnings per share of $0.17 in the second quarter of 2011.

Dunia Shive, Belo’s president and CEO, said, "Second quarter total revenue increased 7 percent compared to the second quarter of 2011.  Political revenue totaled $9.5 million, with $5 million attributable to the Senate primary in Texas.  The company also received meaningful political revenue in Charlotte, Norfolk and St. Louis.  Core spot revenue was up in many of the Company’s markets in the second quarter of 2012, but was down slightly overall compared to last year due to softness in national spot in certain markets.  Third quarter total spot revenue is currently pacing up in the high-teens with strong core and political revenue."

Prior to releasing its results this morning, Belo declared an eight-cent dividend for holders of its Series A and Series B common stock on Thursday.

The dividend will be paid on Sept. 7 to shareholders of record as of Aug. 17.

Click past the jump to see the full report on Belo's second-quarter earnings.


Operating Results
The Company generated total revenue of $178 million in the second quarter of 2012, which was $11 million, or 7 percent, higher than the second quarter of 2011.

Political revenue in the second quarter of 2012 totaled $9.5 million, an $8.3 million increase compared to the second quarter of 2011.  Total spot revenue, including political, was up 6 percent in the second quarter of 2012 compared to the second quarter of 2011.  Total spot revenue, excluding political, was down 0.5 percent with a 2.3 percent increase in local spot revenue and a 5.5 percent decrease in national spot revenue.

Other revenue, which is comprised primarily of Internet advertising, retransmission revenue, and barter and trade advertising, was up 12 percent in the second quarter of 2012 due primarily to double-digit increases in both Internet and retransmission revenue. 

Station salaries, wages and employee benefits increased $1.9 million, or 3.5 percent, during the second quarter of 2012 versus the second quarter of 2011 due primarily to annual merit increases for employees and higher accrued performance-based bonus expense.  Station programming and other operating costs were down $4.5 million, or 8.5 percent, in the second quarter of 2012 compared to the second quarter of 2011 due primarily to lower syndicated programming expense.

Corporate
Corporate operating costs of $8.6 million in the second quarter of 2012 were $1.9 million higher than the second quarter of 2011 due primarily to higher accrued performance-based bonus expense and investments in interactive initiatives.  The Company’s combined station and corporate operating costs were 1 percent lower compared to the second quarter of 2011.

Other Items
Belo’s depreciation expense totaled $7.5 million in the second quarter of 2012, down from $7.7 million in the second quarter of 2011.

The Company’s interest expense was $17.7 million in the second quarter of 2012 compared to $18.1 million in the second quarter of 2011.

Income tax expense increased $5.5 million in the second quarter of 2012 compared to the second quarter of 2011 due primarily to higher pre-tax earnings. 

Total debt at June 30, 2012 was $887 million and consisted entirely of fixed-rate debt. Of this amount, $176 million is due May 2013 and is therefore classified as current on the Company’s June 30, 2012 balance sheet.  Also as of June 30, 2012, the Company had $126 million in cash and temporary cash investments and had nothing drawn on its $200 million revolving credit facility, which does not expire until August 2016.  The facility may be used, along with some level of cash, to retire the May 2013 notes. 

The Company’s total leverage ratio, as defined in the Company’s credit facility, was 3.9 times at June 30, 2012, and 3.4 times when including the Company’s cash.  Belo invested $6.9 million in capital expenditures in the second quarter of 2012.