Scripps provides financial outlook at media conference in New York
Wed, December 05, 2007 by Tim Stautberg
NEW YORK - Members of the senior management team of The E. W. Scripps Company today discussed the company's business strategy and provided a general financial outlook for 2008 during an investor conference being held this week in New York City.
Kenneth W. Lowe, president and chief executive officer, Richard A. Boehne, executive vice president and chief operating officer, and Joseph G. NeCastro, executive vice president and chief financial officer, led the discussion, which included comments that focused on the company's Scripps Networks, interactive and local media divisions.
The comments were made during the UBS 35th Annual Global Media and Communications Conference.
"Our portfolio has taken shape over a 130-year period as the company kept pace with evolving media technologies and the ever-changing expectations of media consumers and advertisers," Lowe said. "By building prosperous businesses from the ground up, combined with some strategically deliberate acquisitions, Scripps has grown to become one of the country's leading diversified media companies, with consolidated revenues projected to reach $2.5 billion again this year."
NeCastro, in his remarks, affirmed the company's previously issued operating projections for the fourth quarter 2007 and provided an update on progress the company has made toward completing the transaction to separate into two publicly traded entities.
"We're well along in executing the steps we need to undertake between here and life as two separate publicly traded companies," NeCastro said. "Last week we filed a request with the IRS for a private-letter ruling affirming the tax-free nature of the proposed transaction, and we're full-speed ahead preparing to file the Form 10 registration statement by the end of February. As it stands now, we're on track to complete the transaction, as anticipated, by the end of the second quarter of next year."
The full-year 2008 outlook, broken down by business segment, is as follows:
Based on the strength of upfront advertising commitments and scheduled increases in affiliate fees, the company expects Scripps Networks total revenue to grow between 8 and 10 percent for the year. Expenses are expected to be up a similar amount.
Programming is expected to account for a large share of the increase in expenses as the company remains focused on attracting new viewers to all of its networks. The company also will be investing in a number of interactive initiatives at Scripps Networks.
Shopzilla and uSwitch
At its Shopzilla and uSwitch subsidiaries, the company expects combined segment profit for the year to be in the $55 million to $65 million range. The company is expecting stronger results at Shopzilla in 2008 and a return to modest profitability at uSwitch.
At the company's newspapers, the local and classified advertising environments continue to be a challenge. As a result, total revenue for newspapers managed solely by Scripps is expected to be down in the low-single digits. Total newspaper expenses also are expected to be down in the low-single digits.
Scripps Television Station Group
Television station group revenue is expected to be up 15 to 20 percent as a result of a significant increase in political advertising that is expected during the 2008 election campaigns. TV station group revenue also will be favorably affected by NBC's coverage of the Summer Olympics. TV station group expenses are expected to be up in the mid- single digits in 2008.
The company provided an outlook on the following other items:
Depreciation and amortization will be between $130 million and $135 million.
Minority interest is expected to be higher because of the increasing profitability of the Food Network. Projected minority interest of $84 million to $86 million largely reflects Tribune's 31 percent interest in Food.
The company is planning to spend about $170 million to $180 million on capital expenditures next year, including expansion of the Scripps Networks offices and production operations in Knoxville, Tenn., and a new production facility for our growing Southwest Florida newspaper properties.
This press release contains certain forward-looking statements related to the company's businesses that are based on management's current expectations. Forward-looking statements are subject to certain risks, trends and uncertainties, including changes in advertising demand and other economic conditions that could cause actual results to differ materially from the expectations expressed in forward-looking statements. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. The company's written policy on forward-looking statements can be found on page F-5 of its 2006 SEC Form 10K.
The company undertakes no obligation to publicly update any forward-looking statements to reflect events for circumstances after the date the statement is made.
About ScrippsThe E. W. Scripps Company (NYSE: SSP) is a diverse and growing media enterprise with interests in national cable networks, newspaper publishing, broadcast television stations, interactive media, and licensing and syndication.