News Column

Meredith Posts Fiscal 2014 2nd Quarter and First Half Results

February 4, 2014

Meredith Corp. reported fiscal 2014 second quarter earnings per share of $0.67 , which includes $1.6 million , or $0.02 per share, of transaction expenses related to previously announced agreements to purchase broadcast assets. In a release on January 29 , the Company reported that prior-year second quarter earnings per share were $0.79 , or $0.89 excluding special items. Meredith recorded $25 million , or $0.34 per share, less of political advertising revenues in the second quarter of fiscal 2014 than in the prior-year period, as expected in an off- election year. Total revenues were $354 million , compared to $361 million . "We continued our strong performance into the second quarter of fiscal 2014," said Meredith Chairman and Chief Executive Officer Stephen M. Lacy . "Our National Media Group delivered revenue and profit growth in the quarter, while our Local Media Group achieved record revenue and profit performance for a non-political fiscal second quarter and first half. "Importantly, we continue to execute strategic initiatives to deliver increased cash flow and returns to our shareholders over time, most recently through the announced acquisition of great television assets in attractive markets," Lacy continued. On December 23, 2013 , Meredith announced agreements to purchase the broadcast assets of KTVK and KASW in Phoenix , and KMOV in St. Louis . Meredith anticipates the transactions will close in the second half of fiscal 2014. In the first full year post closing, these stations are expected to generate combined revenues of $105 to $115 million , and be accretive to run-rate earnings per share by $0.16 to $0.18 . Lacy noted the following fiscal 2014 second quarter financial highlights compared to the prior-year period: - Local Media Group non-political revenues increased over 20 percent, led by growth in non-political advertising and retransmission revenues. Non-political advertising revenues increased 10 percent, driven by strong performances from Meredith television stations in Phoenix , Kansas City and Las Vegas . - National Media Group revenues grew slightly. Operating profit grew more than 25 percent, and was up 1 percent excluding special items in the prior-year period. Performance was driven by Meredith's parenthood and food brands, including Parents, FamilyFun and Allrecipes. -Meredith's brand licensing revenues increased more than 30 percent, due primarily to continued strong sales of over 3,000 SKU's of Better Homes and Gardens' licensed products at more than 4,000 Walmart stores nationwide. -Meredith Xcelerated Marketing grew revenues, and operating profit increased more than 35 percent, driven by new and expanded programs, including those with Kia Motors , Mercer , Chrysler and Maserati . Fiscal 2014 first half earnings per share were $1.20 , which included the $0.02 per share of transaction expenses. In comparison, prior-year earnings per share were $1.34 , or $1.44 excluding special items. Meredith recorded $37 million , or $0.50 per share, less of political advertising revenues in the first half of fiscal 2014 than in the prior-year period, as expected in an off-election year. Total revenues were $711 million , compared to $715 million . Looking to the remainder of fiscal 2014, with limited visibility into customers' calendar 2014 advertising and marketing budgets, Meredith continues to expect fiscal 2014 full year earnings per share to range from $2.60 to $2.95 , excluding operating results and transaction expenses related to the acquisitions of television stations in Phoenix and St. Louis . Looking more closely at the third quarter of fiscal 2014 compared to the year-ago period, with significant month-to-month volatility and excluding operating results and transaction expenses related to the acquisitions of television stations in Phoenix and St. Louis : -Total company revenues are expected to be flat to down slightly. - Total Local Media Group revenues are expected to be up mid to high single digits. - Total National Media Group revenues are expected to be down low single digits. -Meredith expects fiscal 2014 third quarter earnings per share to range from $0.63 to $0.68 . ((Comments on this story may be sent to newsdesk@closeupmedia.com ))


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