DMD.WI Demand Media

E.W. Scripps Co. swung to a profit in the latest quarter, helped by strength in retransmission revenue and acquisitions, but results came in sharply below estimates as the media company contended with significantly lower-than-anticipated political spending.

"This uncommon—if not downright unique—presidential election, combined with key Senate races in Ohio, Florida, Colorado and Wisconsin becoming far less competitive than forecast, leaves us with much less political advertising revenue than we expected," said Chief Executive Rich Boehne.

"Political spending was healthy further down the ticket and across the country, but presidential spending in some typically crucial swing states was roughly half of what we saw four years ago, reducing the opportunity for some Scripps stations," he said.

He added, however, that "we also used the spectacle of this election to boost the brands and audiences of our fast-growing over-the-top video and audio businesses."

E.W. Scripps completed its merger with Journal Communications last year, under which the companies spun off and then merged their newspaper-publishing operations into one company and combined their broadcast operations under Scripps. The move came as broadcast-TV station owners consolidate and as media companies try to streamline and shed lower-growth assets.

For the September quarter, Scripps reported a profit from continuing operations of $12.5 million, or 15 cents a share, compared with a loss of $24.4 million, or 29 cents a share. The quarter last year was dragged by a noncash impairment charge and Journal-related costs reduced net income by $24 million or 31 cents per share in 2015.

Revenue shot up 23% to $233 million, mostly owing to higher retransmission revenue, political advertising revenue and growing digital businesses.

Analysts were looking per-share earnings of 29 cents on $256.5 million in revenue, according to Thomson Reuters.

Television revenue climbed 25% to $197.3 million, as retransmission revenue rose 46%. Political advertising totaled $26.9 million during quarter, compared with $4.3 million in 2015.

Digital revenue surged 45% to $15.8 million, helped by last year's acquisition of podcast advertising network Midroll Media.

Revenue in company's radio segment, meanwhile, slipped 5.5%.

In April Scripps acquired humor site Cracked from Demand Media for $39 million in cash. On Friday, Mr. Boehne said at Cracked, "where the brutal absurdities of current events are our currency, the election has been an opportunity to build both brand and reach through clever satire."

Scripps stock, inactive premarket, has lost 31% of its value so far this year.

Write to Anne Steele at Anne.Steele@wsj.com

(END) Dow Jones Newswires

November 04, 2016 08:45 ET (12:45 GMT)

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