Earnings call transcript: Sinclair Q2 2025 shows mixed signals with slight stock dip

Sinclair Broadcast Group’s Q2 2025 earnings call presented a mixed financial outlook, with the company’s stock closing slightly down by 0.35% at $14.13. According to InvestingPro analysis, the stock appears undervalued compared to its Fair Value, with a healthy dividend yield of 7.08%. Despite exceeding its midpoint guidance for Consolidated Adjusted EBITDA and maintaining a strong cash position, Sinclair faced declines in core advertising and distribution revenues, reflecting ongoing macroeconomic challenges.

Key Takeaways

• Consolidated Adjusted EBITDA exceeded guidance midpoint at $103 million.
• Core advertising revenue fell by 4.7% year-over-year.
• Sinclair’s stock closed at $14.13, down 0.35% post-earnings.
• Significant cash reserves reported at over $616 million.
• Deregulatory environment offers potential growth opportunities.

Company Performance

Sinclair Broadcast Group reported a mixed performance in Q2 2025, with some financial metrics surpassing expectations while others lagged. The company’s Consolidated Media Revenue stood at $777 million, highlighting resilience amidst economic headwinds. Trading at a P/E ratio of 7.2x and maintaining a strong current ratio of 2.08, the company demonstrates solid financial fundamentals. Core advertising revenue and distribution revenue both recorded declines compared to the previous year, reflecting broader industry challenges. InvestingPro subscribers can access detailed financial health scores and 6 additional exclusive ProTips for deeper analysis.

Financial Highlights

• Revenue: $777 million
• Consolidated Adjusted EBITDA: $103 million
• Core advertising revenue: $272 million, down 4.7% YoY
• Distribution revenue: $380 million, 1% below prior year
• Cash balance: Over $616 million

Outlook & Guidance

Looking ahead, Sinclair provided guidance for Q3 2025, projecting Consolidated Media Revenue between $744 million and $768 million, and Consolidated Adjusted EBITDA between $71 million and $93 million. InvestingPro data reveals the company has maintained dividend payments for 16 consecutive years, though analysts anticipate a sales decline in the current year. The company remains focused on retransmission revenue growth and strategic investments in its Ventures portfolio. For comprehensive analysis including Fair Value calculations and growth projections, investors can access the detailed Pro Research Report, part of InvestingPro’s coverage of 1,400+ US stocks.

Executive Commentary

Rob Weisport, COO, noted, "We are seeing signs of improvements over the past several weeks," indicating cautious optimism. CEO Chris Ripley highlighted the favorable regulatory environment, stating, "The regulatory environment continues to provide encouraging tailwinds for future growth opportunities."

Risks and Challenges

• Continued macroeconomic uncertainty could impact advertising revenues.
• Fluctuating virtual MVPD subscriber trends may affect distribution revenue.
• Automotive advertising, while stabilizing, remains a potential risk area.

Q&A

During the Q&A session, analysts queried potential changes in network affiliate relationships and subscriber dynamics. The company also addressed challenges in core advertising, emphasizing strategic M&A opportunities as a path forward.

Full transcript - Sinclair Inc (SBGI) Q2 2025:

Conference Operator: Good day, everyone, and welcome to the Sinclair Second Quarter twenty twenty five Earnings Conference Call. At this time, all participants are in a listen only mode. It is now my pleasure to turn the floor over to your host, Chris King, Vice President of Investor Relations. Sir, the floor is yours.

Chris King, Vice President of Investor Relations, Sinclair Broadcast Group: Thank you. Good afternoon, everyone, and thank you for joining Sinclair’s second quarter twenty twenty five earnings conference call. Joining me on the call today are Chris Ripley, our President and Chief Executive Officer Dorinder Sahai, our Executive Vice President and Chief Financial Officer Rob Weisport, our COO and President of Local Media and for Q and A, Lucy Ruedeshauser, our Executive Vice President. Before we begin, I want to remind everyone that slides for today’s earnings call are available on our website, svgi.net, on the Events and Presentation page of the Investor Relations portion of the site. A webcast replay will remain available on our website until our next quarterly earnings release.

Certain matters discussed on this call may include forward looking statements regarding, among other things, future operating results. Such statements are subject to a number of risks and uncertainties. Actual results in the future could differ from those described in the forward looking statements as a result of various important factors. Such factors have been set forth in the company’s most recent reports as filed with included in our second quarter earnings release. The company undertakes no obligation to update these forward looking statements.

Included on the call will be a discussion of non GAAP financial measures, specifically adjusted EBITDA. This measure is not formulated in accordance with GAAP, is not meant to replace GAAP measurements and may differ from other companies’ uses or formulations. Further discussions and reconciliations of the company’s non GAAP financial measures to comparable GAAP financial measures can be found on our website. Let me now turn the call over to Chris Ripley. Good afternoon, everyone, and

Chris Ripley, President and Chief Executive Officer, Sinclair Broadcast Group: thank you for joining us. Beginning on Slide three, I want to introduce Narinder Sahai, our new Chief Financial Officer. Narinder brings more than two decades of strategic financial leadership across multiple industries with deep expertise in capital markets, M and A, investor relations and financial planning and analysis. His broad experience brings fresh perspective that will be invaluable as we drive our transformation strategy. Before we continue with our standard earnings call format, I would like to turn the call over to Narendra to introduce himself and share his perspective on the Sinclair opportunity.

Narinder Sahai, Executive Vice President and Chief Financial Officer, Sinclair Broadcast Group: Thank you, Chris, and hello, everyone. First, let me express my gratitude to you, the entire management team and the Board for entrusting me with this important responsibility. I want to particularly thank Lucy for her outstanding mentorship during my transition. I’m inheriting a tremendously capable team, which speaks volumes about Lucy’s excellent leadership. I’m excited to join Sinclair at such a pivotal time in the company’s evolution.

Sinclair has been a truly transformational company throughout its history. We pioneered local marketing agreements, executed the first retransmission agreement, and have consistently led next gen broadcast development. This track record of innovation and industry leadership combined with a unique positioning as an integrated media and technology platform creates a compelling value proposition that I believe represents significant upside potential. With my financial leadership experience and engineering background, I see tremendous untapped potential in our next gen broadcast technology developments, operational improvements, and distinctive ventures portfolio. My focus will be on unlocking this value and demonstrating the multiple value drivers across our platform through strong execution.

At Sinclair, the fundamentals are strong and the opportunity set is significant. I look forward to building confidence in the Sinclair story with our investment community and demonstrating our progress. For those of you who have already reached out, thank

Chris Ripley, President and Chief Executive Officer, Sinclair Broadcast Group: you for your support. I look forward to meeting many of you over the coming weeks and months. Thank you, Narendra. We couldn’t be more excited to have you here. And I know I speak for the entire Sinclair team when I say that we look forward to your leadership and expertise as we continue this path in the quarters and years to come.

I also want to acknowledge the appointment of Conrad Clemson as our Chief Executive Officer of EdgeBeam Wireless, our data casting joint venture with our broadcast peers. Conrad has several decades of leadership experience in the media and telecommunications industries and is well known for his technology innovation leadership. Most recently, he served as CEO of Editshare where he successfully scaled the company to a high growth enterprise grade energy industry leader. As CEO of EdgeBeam, Conrad will lead the continued build out of EdgeBeam’s platform and operations as it continues to move aggressively to fully commercialize the highest value business use cases for next generation data delivery. Turning to Slide four.

In what was a challenging quarter amid macroeconomic uncertainty impacting the global economy, we delivered solid results with total advertising revenue coming in within our guidance range and core advertising revenue up year over year on an as reported basis. Our distribution revenues were below our expectations as growth from some of our larger virtual MVPDs was slower than expected. However, it is important to note that distribution revenue was up year over year in the first half of the year and flat with year ago levels during the second quarter. Media expenses were materially better than expected, driving adjusted EBITDA comfortably above the midpoint of our guidance range. Slide five highlights our ventures portfolio as we continue to trend our transformation away from our minority investment holdings and look to position the portfolio for more majority owned assets over time.

Ventures benefited from $6,000,000 of cash distributions and invested $11,000,000 in the quarter as required by our outstanding funding commitments. Venture’s cash balance was $393,000,000 at quarter end, up $39,000,000 sequentially. On Slide six, I wanted to better highlight a key acquisition that Venture’s made during the first quarter that we briefly mentioned on last quarter’s earnings call. In mid March, we acquired the remaining 75% stake in Digital Remedy that we did not already own for approximately $30,000,000 Digital Remedy offers omni channel media activation solutions with a focus on Connected TV. As a result of the acquisition, Compulse has now rebranded as Digital Remedy.

Digital Remedy is a rule of 40 software company, defined as the sum of the company’s revenue growth rate and profit margins exceeding 40%. In addition, Sinclair now comprises only approximately 40% of Digital Remedy’s total revenue. And that number is declining with new outside clients growing more rapidly. We are very pleased to have Digital Remedy join the Sinclair team and we look forward to continued strong growth and value creation trends from this business. On Slide seven, I want to highlight the substantial asset value within Sinclair Ventures and how it supports our evolving investment strategy.

Our current minority investment portfolio and cash represents over $726,000,000 in book value as of quarter end or about $10 per share. This excludes Tennis Channel, Digital Remedy and other consolidated minority owned investments. With ventures carrying no debt, this represents significant unencumbered capital and we believe the current market market value of these assets is significantly higher than the current book value. Importantly, as we pivot toward majority investments where we have greater operational control and strategic influence, these assets provide substantial monetization opportunities and capital deployment flexibility. The value we’ve built through our diversified approach now positions us to be more strategic and selective, focusing on investments where we can drive outcomes and create value through active management.

Let me now turn it over to Rob to continue the discussion about our Local Media segment.

Rob Weisport, COO and President of Local Media, Sinclair Broadcast Group: Thanks, Chris, and good afternoon, everyone. Beginning on Slide eight, I want to focus on several important developments for our Local Media operations since our last call. First was the launch of four college football podcasts covering four of the biggest, most historic college programs in the country, Ohio State, Alabama, Texas, and Notre Dame. In addition, we also launched a new WNBA podcast in conjunction with the league’s All Star Weekend called Post Moves, which features WNBA legend Candice Parker and Indiana Fever star Elia Boston. These podcasts join our previously launched sports focused podcasts that have quickly become among the most popular sports podcasts in the country.

We view these podcasts and related social media as a key growth driver for the segment, as their popularity and advertising dollars continue to grow rapidly. However, the story does not end there. We will shortly be announcing a landmark events and media partnership with a leading sports representation and marketing agency that will include signature live events with our podcast talent. These events will include a nationwide tailgate tour during the upcoming college football season, as well as an exclusive hospitality and brand activation event at the Super Bowl in February from Santa Clara. We will be producing original content and brand activations at these events, which will be distributed across our various media platforms to maximize exposure and engagement for our customers.

Turning to Slide nine, I’d like to take a moment to highlight our multicast networks, which have been delivering record growth in recent quarters. Driven by the acquisition of popular series and movies and expansive distribution growth in top 10 DMAs, these networks are poised for continued strong growth in the coming quarters. Through the May sweeps, our four networks, Charge, Comet, Roar and The Nest had the highest year over year coverage growth among all Nielsen rated broadcast networks. And among total viewers and top 10 DMAs, Charge, Common and ROAR suggest year over year growth of 21, 1740%, respectively. Looking ahead, these multicast networks continue to invest in even more big hits for the upcoming television season, including Criminal Minds, Life on the Street, Wahlburgers, Xena, Warrior Princess, and many other fan favorites.

Lastly, from a core advertising perspective, I wanted to provide a little color on the current conditions that we are seeing. While several large categories remain hampered by macroeconomic and tariff related uncertainty, we have started to see signs of improvements over the past several weeks. While I would still characterize our overall visibility as below historical levels, given the uncertainty, I do think several key categories have begun to show stronger demand. Now let me turn it back over to Chris to provide a brief regulatory update.

Chris Ripley, President and Chief Executive Officer, Sinclair Broadcast Group: Thanks, Rob. Turning to Slide 10, Sinclair has already begun to complete several transactions given the deregulatory approach that the industry has seen in recent months. We’ve already concluded the purchase of several stations for which we were providing sales and other operating services, while divesting several smaller stations and we continue to explore and work on other M and A opportunities including highly accretive market swaps and JSA acquisitions. Notably, our opportunities for growth and synergies have increased in the recent ruling by the Eighth Circuit Court of Appeals, which vacated the antiquated FCC prohibition of owning two top four ranked TV stations in a local market and the recently adopted inconceivable rules that attempted to restrict our use of our multicast streams. Our industry has watched for years as our competitors grew unburdened by these types of ownership rules.

So this is a long awaited and much welcomed common sense ruling that has unburdened us and will open up more opportunity for rational growth within the industry. We’re also pleased to see multiple proceedings currently under review by the SEC, including the sunset of the industry’s one point zero spectrum, which would unlock high value spectrum positions for next gen data distribution business models as well as the review of the current national ownership cap and the recent approval of several duopoly markets for broadcasters. I also think it’s important to address the current state of the network affiliate relationship. Recently, Chairman Carr sent another letter to a network questioning current practices within this relationship and opening an inquiry. This is not the first time the SEC has reviewed this relationship structure.

While we have long appreciated our relationships with our network partners, we believe to allow for continued growth and viability of local journalism and broadcasters, this review of the affiliate network relationship is needed, timely and appropriate. As of late, the burdensome control and financial obstacles implemented or attempting to be implemented by certain networks are hampering local broadcasters’ ability to serve their communities. In particular, we support a review of practices relating to affiliates being forced to into streaming deals or excluded from entering into independent deals, oftentimes with streaming services owned by the networks themselves. Independence of local broadcasters is paramount to their ability to produce local independent journalism and provide communities with an option for different voices. As we often see, local broadcasters provide a voice not often heard on national stages and are the most trusted or more trusted than any other source in media.

And as certain media companies continue to grow their content and distribution holdings, this review is more important than ever. Again, we welcome FCC Chairman Carr’s approach towards regulatory clarity that supports both strong network partnerships and local editorial independence. As both a major station group and content creator, Sinclair believes balanced affiliate relationships are essential to serving local communities effectively. This development reinforces the fundamental value of local broadcasting and our role as trusted community partners. We continue to view the deregulatory environment in Washington as highly constructive and we will continue to work with Chairman Carr and the rest of the SEC on the very welcomed and long overdue approach to protect local journalism across the country.

Now for the first time, let me turn the call over to Narinder to walk through our financial results and guidance.

Narinder Sahai, Executive Vice President and Chief Financial Officer, Sinclair Broadcast Group: Thanks, Chris. I’ll cover our financial results in three parts. First, I’ll review our balance sheet, net leverage and cash flow related items. Second, I’ll walk through our segment performance as well as consolidated revenue and adjusted EBITDA results for the quarter. And third, I’ll provide our outlook for the third quarter and key financial metrics for full year 2025.

Turning to slide 11, Our balance sheet remains the industry’s longest maturity profile, but more importantly, it positions us well to participate in what we expect to be a period of renewed M and A activity within the sector. During the second quarter, we opportunistically repurchased approximately $81,000,000 in face value of STG’s 2027 notes for $77,000,000 capturing immediate value. We ended the quarter with first out first lien net leverage at 1.8 times and net leverage at 5.7 times based on a trailing eight quarter calculation. Capital expenditures of $17,000,000 were well below our guidance range, primarily reflecting project timing within the year. Our liquidity position remains strong with a fully undrawn $650,000,000 revolver and consolidated cash of over $616,000,000 including approximately two twenty four million dollars at STG and nearly $393,000,000 at Ventures.

This financial strength combined with no meaningful debt maturities until the 2029 gives us significant optionality. On Slide 12, we highlight our second quarter segment results. Local Media and Tennis Channel delivered adjusted EBITDA of $99,000,000 and $13,000,000 respectively, well above the midpoint of our guidance ranges. In the Local Media segment, distribution revenue of $380,000,000 was 1% below the prior year quarter and came in slightly below our expectations, largely driven by lower than expected subscriber growth for virtual MVPDs. Note that distribution revenue is still up 1% for the 2025 compared to the prior year as Chris referenced earlier.

Core advertising revenue of $272,000,000 was within our guidance range, but was down by 4.7% year over year on as reported basis as macroeconomic and tariff related pressures continued to weigh on certain key categories. Media expenses of $542,000,000 were $23,000,000 favorable to the low end of our guidance range, driven by cost savings resulting from lower sales related and employee costs from open positions, deferred timing on certain initiatives and successful resolution of various outstanding FCC matters during the quarter, which allowed us to reverse approximately $13,000,000 in previously accrued expenses. However, please note that only $3,000,000 of these reversals are favorably impacting adjusted EBITDA for the quarter. Dennis Channel delivered total revenue of $68,000,000 up 1% versus the prior year quarter, but below our guidance driven by softer advertising trends. Adjusted EBITDA of $13,000,000 was at the high end of our guidance range.

Turning to Slide 13, consolidated media revenue of $777,000,000 came in a touch below our guidance range, primarily due to softer than anticipated distribution revenue driven by slower than anticipated virtual MVPD growth. Year over year performance reflects the expected industry dynamics in a non political year. Media revenue declined $42,000,000 versus the prior year driven by the expected reduction in political advertising revenue in this non election year and the absence of material diamond management fees. However, core advertising revenue grew $13,000,000 year over year on as reported basis, which includes contribution from our Digital Remedy acquisition. Note that Digital Remedy, the now combined Compulse and Digital Remedy businesses recorded $38,000,000 of revenue and $7,000,000 of adjusted EBITDA in the second quarter.

Distribution revenue for the quarter was essentially flat year over year as rate increases offset subscriber churn. Turning to Slide 14. Consolidated adjusted EBITDA of $103,000,000 exceeded the midpoint of our guidance range. This outperformance was driven by lower than anticipated media expenses due to cost savings and reversal of prior FCC expense accruals as noted earlier in segment results. As compared to last year, adjusted EBITDA declined by $55,000,000 reflecting expected impact of $42,000,000 in lower media revenue combined with $11,000,000 in higher media expenses driven by network programming fee increases, production costs and annual compensation adjustments.

Once again, please note the media expenses do not reflect the benefit of prior period reversals of certain expense accruals related to FCC matters. On Slide 15, we introduce our detailed third quarter twenty twenty five guidance. Note that our guidance does not incorporate any anticipated or pending M and A activity. Consolidated media revenue of $744,000,000 to $768,000,000 reflects the anticipated year over year decline in political advertising revenue as we cycle against the strong twenty twenty four election year. Core advertising revenue is expected to be in the range of $3.00 $3,000,000 to $314,000,000 as specific categories remain pressured, although as Rob noted earlier, we are seeing some signs of stabilization.

Distribution revenue is expected to be modestly lower at the midpoint of our range versus prior year, driven by several factors. One, traditional MVPD subscriber churn continues, though industry wide trends appear to be moderating. Note that while we are encouraged by improving churn metrics announced by our largest MVPDs, we have not yet seen these improvements translate into our subscriber numbers, though we do expect to see some improvement in the coming quarters. Number two, partial offset provided by continued subscriber growth at virtual MVPDs, albeit at a slower rate and rate increases later in the quarter. And number three, keep in mind, we have a negative impact from our completed divestiture of four markets to RingCon Broadcasting, which closed in July.

Consolidated adjusted EBITDA guidance of $71,000,000 to $93,000,000 reflects these revenue dynamics, while maintaining operational excellence and cost discipline. Turning to Slide 16, we present our full year 2025 guidance for key financial metrics. Two things to note here. Number one, the most notable change is that we have substantially reduced our cash tax expense guidance to $46,000,000 at the midpoint, which is a $74,000,000 improvement from our guidance provided last quarter. This favorable revision is primarily driven by significantly lower forecasted federal tax payables resulting from the passage of the one big beautiful bill act in July.

And number two, just as a reminder, net interest expense includes $68,000,000 of refinancing fees and expenses that were expensed in the first quarter when we completed our comprehensive debt refinancing. With that, let me now turn the call back to Chris for closing remarks before we open the call to Q and A.

Chris Ripley, President and Chief Executive Officer, Sinclair Broadcast Group: Thanks, Nirinder. Turning to Slide 18 to wrap up the quarter with our key takeaways. We delivered solid financial results with adjusted EBITDA within guidance and successfully repurchased $81,000,000 of our 2027 notes, while reducing our full year cash guidance by $74,000,000 We brought in seasoned financial executive in our new CFO and announced Conrad Clemson as CEO of EdgeBeam Wireless, positioning us well for our transformation strategy. Our content initiatives continue gaining momentum. Digital Remedy is driving growth as a consolidated asset.

Our multicast networks delivered record growth and AMP Media expanded with five new sports podcasts covering major college programs and the WNBA. Most importantly, the regulatory environment continues to provide encouraging tailwinds for future growth opportunities. All in all, we’re very well positioned for continued progress in the quarters ahead. Thank you very much for joining us today and your interest in Sinclair. Rob, Narinder and I will now take your questions.

Conference Operator: Certainly. Everyone at this time will be conducting a question and answer session. If you have any questions or comments, please press star one on your phone at this time. We do ask that while posing your question, please pick up your handset if you’re listening on speakerphone to provide Your first question is coming from Dan Kurnos from Benchmark. Your line is live.

Dan Kurnos, Analyst, Benchmark: Yes. Thanks. Good afternoon. Welcome, Narendra, to the party. Just, Chris, appreciate the regulatory commentary.

I mean, obviously, we’ve got a lot of news. We’ll see what happens in the September meeting. You guys have positioned yourselves, it seems, more likely to be active on the buyer side. You know, and talked a little bit about balance sheet flexibility. I mean, how aggressive do you think that you can get, and do you think you’re gonna get any remedies on, you know, the network side, which you called out?

And then separately, just additional color on what happens with the virtual distributors. Does that mean that your sub declines came in a little bit worse than you anticipated? Because, obviously, the the and I know you’re on a ninety day lag with traditional, but it sounded like sub trends were getting better there.

Chris Ripley, President and Chief Executive Officer, Sinclair Broadcast Group: Yes. Thanks, Dan. So I’ll answer the second question first. Look, I think we’re confident that the market trends are working in our favor in terms of reverse compensation. And you can see over the years that we’ve been able to manage down increases at a steady rate and we’re starting to see decreases in certain of our reverse compensation to networks.

And so you couple that with the recent launches, two networks recently launching D2C services that would be ESPN and Fox One. And I think that just bolsters our position, our negotiating position because I think it’s there’s an increasing awareness within the industry and quite frankly the FCC that now that exclusivity is essentially gone from the network affiliate relationship, that the networks are really grossly overpaid. And that’s why we continue to believe that we will do better and probably should do probably even better than we actually will do. But on your other question around subscriber trends, a big virtual MVPD in second quarter actually lost subs quarter over quarter in fairly significant way. Now we do think there’ll be a big bump coming back up for football.

As we see this trend within the virtual space, given that it’s a month to month program where people are coming in and out of the virtual space for the football season in a more exaggerated way now that the space is getting bigger, is a bigger part of the overall ecosystem.

Conference Operator: Thank you. Your next question is coming from Steven Cahall from Wells Fargo. Your line is live.

Steven Cahall, Analyst, Wells Fargo: Yeah. Thank you. Welcome to broadcast. Niveredahl. A few questions for me.

Maybe for Chris, you all have a ton of deals here and you said there’s a lot of opportunity. Can you just help us with what the accretion is from the things that you’ve announced so far? I think there’s a lot of option duopolies in there. I think we’ve thought about these as maybe being sort of double digit million dollars accretive to EBITDA. So I just wanted to know if there was any outlook on the contribution there.

And then to follow-up on the retrans question, I think you have guidance for mid single digit net growth, which ends in 2025. I think that’s a two year CAGR. Based on what you’re seeing in sub declines and the first comp, is there any risk to that guidance? And then maybe lastly, a little surprised to see core adds not better in Q3 with the easier comps. Wondering if you have kind of green shoots yet in core or if it’s still pretty choppy out there.

Chris King, Vice President of Investor Relations, Sinclair Broadcast Group: Thank you.

Chris Ripley, President and Chief Executive Officer, Sinclair Broadcast Group: All right. Well, I’ll let Rob address the last question around core, but I will hit your first two before that. And on the M and A front, I think it’s easiest to like just to give you scope here. And I do think, as I mentioned in my comments, it’s very, very important and very positive news that the Eighth Circuit overturned the two big four rule. I think that really accelerates the expected path of deregulation because the expected outcome was a remand to the FCC and then we could have been waiting for another year for that process to play out.

But now we’re within ninety days of operating in a world where there is no more too big for prohibition. And what I think gets less notoriety is that the multi cast restrictions that were placed on the industry last year were overturned immediately. And so both are very, very significant and they’re very near term relief items. And so you’ve seen us already be active. We’ve closed one station swap, four station sales, two new station service agreements.

But there’s the pipeline is pretty robust and it’s going to accelerate here, especially with these recent rulings. So we have 18 more JSA buy ins planned in the pipe and we’re busy working on other transactions like I mentioned, station swaps, etcetera. So probably the easiest way to think about all of the JSA activity, which you’re going to see more coming in the near future, is that they will contribute tens of millions of dollars of additional EBITDA and it will be a very small purchase price. So in terms of purchase multiple, it will be far less than one times purchase multiple in terms of impact and it will be tens of millions of dollars of benefit. In terms of the 23 to 25 CAGR, we are guiding now to low single digits on the 23 to 25 retrans CAGR.

And I’ll turn it over to Rob to talk more about your core ad question.

Rob Weisport, COO and President of Local Media, Sinclair Broadcast Group: Steve, within the current environment, it’s still tough right now. Last week with the jobs announcement as well. But we are cautiously optimistic as we move through the summer months into September with the return of college football and NFL. We’re seeing much larger buys coming down the pipeline. We’re seeing Tier two automotive activating as well.

So on a pull forward, we saw the Tier 1s remain strong, but we rely on Tier two and Tier three, and we’re starting to see that money flowing. So even though the environment remains tough, we are optimistic based upon our activity we’ve seen. And then it follows coming out of September into the fall with the NBA joining NBC as well. So it’s well stocked. If you saw the updates from the networks, they had double digit increases on their sports sales, which will put pressure and inventory coming back to local broadcast.

Chris Ripley, President and Chief Executive Officer, Sinclair Broadcast Group: And I just want to emphasize the point there because I think it’s there’s a little bit of misunderstanding within the marketplace about auto. We definitely saw tariff induced weakness within auto, but national players didn’t necessarily see that. And that’s what Rob is referring to. So there was this pull forward in demand created by the fear of tariffs increasing prices. That didn’t really affect OEM advertising, but it did affect Tier two and Tier three, so down to the dealers.

The uncertainty caused them to reduce. And they had demand just walking in the door. So the need to advertise was not that acute. We see that unwinding here as it becomes more certain what the future is. And we don’t actually have this pull forward of demand hitting the dealers’ floors anymore.

So we’re seeing signs of that trend unwinding.

Steven Cahall, Analyst, Wells Fargo: Thank you all for the color. Thank

Conference Operator: you. Your next question is coming from Benjamin Soff from Deutsche Bank. Your line is live.

Benjamin Soff, Analyst, Deutsche Bank: Good afternoon. Thanks for the question. I wanted to ask first on guidance. It sounds like the 3Q guide has some moving pieces from asset sales. I’m wondering if you could help us parse out what that is.

And then appreciate all the color on the sum of the parts for Ventures. Would love if you guys could just talk about your process for evaluating if Ventures asset might make sense to monetize. Thank you.

Chris Ripley, President and Chief Executive Officer, Sinclair Broadcast Group: Yes. So look, on the guide, I think the most important thing that was pointed out in the script was the sale of four stations. So there was a decent amount of expense that rolled through that closed in July. Also on the closed in March, but the so it did affect Q2, but it will affect Q3. There is digital remedy as well now in the numbers adding expense and revenue.

If you want to get more specific, we can follow-up to guide to walk you through some of those numbers. Ben, can you repeat your is your second question? I think it was on Ventures. Is that right?

Benjamin Soff, Analyst, Deutsche Bank: Yeah. Just just curious how you guys go about evaluating if a Ventures asset might make sense to monetize in the future.

Chris Ripley, President and Chief Executive Officer, Sinclair Broadcast Group: Yes. So our core assets within ventures are Tennis Channel and Digital Remedy. Both we are very bullish on their future growth opportunities, Tennis Channel in particular with new leadership under Jeff Blackburn from Amazon. And Digital Remedy now combined with the legacy Compulse business is going to really hit its stride in a market and end market that’s growing very fast and with a product offering that’s best in class. And then we’re looking to add additional portfolio companies, as I mentioned, that we know and we’re definitely factoring in favoring quality over speed here in adding additional portfolio companies.

But the rest of the assets, which on this call we highlighted have a book value of $726,000,000 We’re ultimately looking to monetize all of those. Obviously, a big chunk of the $726 is already cash, $393,000,000. But that leaves over about $340,000,000 or 30,000,000 or $40,000,000 of book value that needs to be monetized. And there will be some additional monetizations in that portfolio later in that back half of this year. So there’s already some monetizations there in the works.

But none I would say none of those are long term holds except for the Valley stake. Within that group, the Vale stake is mark to market based on its current over the counter pink sheets trading price. We do not think that thinly traded price is reflective of its true value. And in fact, Vale just recently did a very strategic transaction with Intralot in Europe earlier about three, four weeks ago that we think was highly accretive to the overall Vale story. And we’re looking forward to many more catalysts here for Vale.

So we think the growth opportunities within that position are significant. And so that’s the only one that really for now we’re not thinking there’s going to be a near term monetization event or opportunity?

Narinder Sahai, Executive Vice President and Chief Financial Officer, Sinclair Broadcast Group: Ben, hi, this is Narinder here. Let me just take a crack at addressing, two items of, what’s baked into the guide. Digital remedy, you should not expect any material changes in Q3 to what we disclosed in Q2 in terms of the contribution. But keep in mind that, there is a piece of Compulse built into it, so not all of that is due to the acquisition. And number two, on the sale of stations to Rincon, the the major impact you saw, and I called out in my prepared remarks, was on the distribution revenue.

So if you look at the quarter over quarter reduction or sequential excuse me, reduction in distribution, I would say nearly half of that is due to RINCON. So hopefully that adds some color to what’s in the guide.

Benjamin Soff, Analyst, Deutsche Bank: Okay. Yeah, that’s really helpful. Thank you both.

Conference Operator: Thank you. That concludes our Q and A session. I will now hand the conference back to Chris Ripley for closing remarks. Please go ahead.

Chris Ripley, President and Chief Executive Officer, Sinclair Broadcast Group: Once again, thank you for joining us on today’s call. To the extent you have any questions, please feel free to reach out to us directly.

Conference Operator: Thank you.

Rob Weisport, COO and President of Local Media, Sinclair Broadcast Group: The rate that’s well done.

Conference Operator: Concludes today’s event. You may disconnect at this time, and have a wonderful day. You for your participation.

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