Revenue more than doubled in the third quarter at Nexstar Media Group, fueled in large part by the completion of its purchase of Media General Corp. in January.
Overall revenue was $611.9 million in the period, about $2 million above consensus estimates and more than twice the $275.7 million in the same period last year. Net income for the period rose 64% to $42.1 million while cash flow was up 95% to $191.6 million. Retransmission consent revenue increased to $275.5 million in the period, up 162% from the prior year and the highest quarterly level in company history.
Nexstar completed its purchase of Media General in January, a $4.6 billion transaction that resulted in a 170-station powerhouse covering 100 markets or about 39% of the country. Nexstar agreed to divest of about 13 stations to obtain approval for the deal.
“Our record third quarter results highlight our success in integrating the Media General broadcasting and digital media properties into our platform while extracting anticipated revenue and cost synergies and capitalizing on the many growth opportunities throughout our portfolio,” Nexstar chair and CEO Perry Sook said in a statement. He added the company is positioned for growth in the coming year, with the Winter Olympics, the Super Bowl, heavily contested mid-term elections in its broadcast territories and new over-the-top agreements expected to fuel growth.
In a research note, RBC Capital Markets analyst Steven Cahall said Nexstar had a solid quarter, despite a 4.3% decline in ad revenue, mainly due to tough Olympics comparisons.
“Looking out, 4Q core ads are pacing well and the outlook for 2018 is positive with solid retrans growth and a strong political outlook,” Cahall wrote.
Investors appeared to feel the same. Nexstar shares closed at $65.28 each on Nov. 6, up $2.23 each or 3.5% per share.