Sinclair Reports Second Quarter 2020 Financial Results

BALTIMORE, Aug. 5, 2020 /PRNewswire/ -- Sinclair Broadcast Group, Inc. (Nasdaq: SBGI), the "Company" or "Sinclair," today reported financial results for the three and six months ended June 30, 2020.

Second Quarter Highlights

    --  Consolidated total revenue increased 66% to $1,283 million as compared
        to the second quarter of 2019, with gains driven in large part by the
        Company's acquisition of 21 Regional Sports Networks (RSNs) and Fox
        College Sports in August 2019. Included in the quarter is a $124 million
        for accrued rebates to distributors based on minimum game guarantees.
    --  Consolidated operating income increased 364% to $492 million.
    --  Consolidated Adjusted EBITDA of $254 million increased 31% versus the
        second quarter of 2019.
    --  Five million shares of common stock representing 6% of the Company's
        outstanding shares as of March 31, 2020, were repurchased during the
        second quarter. Year-to-date, through August 4, 2020, the Company has
        repurchased 19 million of its outstanding shares.

CEO Comment:

"Our second quarter results were much as expected as a result of COVID-19," commented Chris Ripley, Sinclair's President and Chief Executive Officer. "The pandemic dampened advertising spending and resulted in the continued postponement of major sports league games. Advertising trends, however, did improve throughout the quarter, with the decline in June's advertising revenue versus the prior year period being roughly half the decline experienced in April. July trends showed further improvement throughout the month. Like many across the country, we are happy to see the return of sports." Ripley continued, "Despite the pandemic's significant disruption to our business during the quarter, our employees did an admirable job of adapting to the changes necessary to operate in a very different environment than we have experienced in the past. The transition was relatively seamless, and I could not be more proud of their efforts."

Ripley added, "We continue to judiciously manage our costs and to take the actions necessary to enable us to endure this period of economic weakness. This includes seeking ways to optimize our capital structure to create value for our investors."

Recent Company Developments:

Content and Distribution:

    --  In July, the Company entered into multi-year content carriage agreements
        with Comcast for all Sinclair television stations and regional sports
        networks in Comcast's cable television footprint, including the Marquee
        Sports Network and YES Network, as well as continued distribution of
        Tennis Channel.
    --  In June, the Company announced that it will be launching a headline news
        service scheduled to premiere in early 2021 on the Company's CW and MYTV
        network affiliates, as well as on STIRR, Sinclair's free ad-supported
        over-the-top streaming platform.
    --  In June, the Company signed a multi-year agreement with ViacomCBS to
        renew eight CBS network affiliations for Sinclair stations. ViacomCBS
        also reached agreements to renew the affiliations of two stations to
        which Sinclair provides services, WTVH in Syracuse, NY and WGFL in
        Gainesville, FL.
    --  Year-to-date, Sinclair's newsrooms have won a total of 233 journalism
        awards, including 28 Regional RTDNA Edward R. Murrow awards and 23
        regional Emmy awards.

Community:

    --  Since March, the Company partnered with the Salvation Army on the
        "Sinclair Cares: Your Neighbor Needs You" initiative which has raised
        almost $1 million for those financially impacted by COVID-19.
    --  In June, the Company selected ten winning applicants for its Broadcast
        Diversity Scholarship, awarding tuition assistance to students
        demonstrating a promising future in the broadcast industry.

ATSC 3.0:

    --  The Company, in coordination with other broadcasters, has recently
        deployed NEXTGEN TV, powered by ATSC 3.0, in five of its markets: Las
        Vegas, NV; Pittsburgh, PA, Nashville, TN; Salt Lake City, UT; and
        Portland, OR. Based on the same fundamental technology as the Internet,
        digital apps, and other web services, NEXTGEN TV can support a wide
        range of features currently in development, such as immersive audio and
        video (up to 4K), broadcasting to mobile devices, personalized viewing
        tools, and advanced emergency alerts that provide rich media rather than
        simple text messages. NEXTGEN TV also allows full integration with 5G
        and other broadband-delivered Internet content.  BitPath, the broadcast
        data network operated by Spectrum Co, LLC, led the planning and
        coordination efforts across the participating stations in each market.

Management:

    --  In June, Jeff Krolik, President, Regional Sports Networks, announced his
        retirement effective August 30, 2020. The Company announced in July that
        Steve Rosenberg, a broadcasting industry executive with over 30 years of
        experience, joined the Company and will be taking on the role of
        President of Local Sports, effective September 1, 2020.

Three Months Ended June 30, 2020 Consolidated Financial Results:

    --  Total revenues increased 66% to $1,283 million versus $771 million in
        the prior year period.  Media revenues increased 75% to $1,260 million
        versus $721 million in the second quarter of 2019. The increase was
        driven in large part by the Company's acquisition of 21 Regional Sports
        Networks and Fox College Sports in August 2019. Consolidated revenue was
        less than the Company's quarterly guidance, due to $124 million of
        accrued rebates to distributors tied to minimum game guarantees, which
        are expected to be paid in cash after the 2020 calendar year.
    --  Political revenues were $19 million in the second quarter versus $3
        million in the second quarter of 2019 due to the upcoming 2020
        elections. Distribution revenues were $1,010 million versus $367 million
        in the second quarter of 2019 driven by the acquisition of the RSNs.
    --  Operating income was $492 million, including $9 million of non-recurring
        costs for transaction, COVID, legal, litigation, and regulatory costs
        ("Adjustments"), versus operating income of $106 million in the prior
        year period, which included $28 million of Adjustments. Operating income
        when excluding the Adjustments, increased to $501 million from $134
        million for the same prior-year period.
    --  Adjusted EBITDA, which excludes Adjustments, increased 31% to $254
        million from $194 million in the second quarter of 2019, but was $43
        million lower than the low end of Company guidance, due to the
        distributor rebate accrual, which will be paid after the 2020 calendar
        year. Net income attributable to the Company was $252 million versus net
        income of $42 million in the prior year period.
    --  Diluted earnings per common share was $3.12 as compared to $0.45 in the
        prior year period. The impact of Adjustments in the second quarter of
        2020, on a diluted per-share basis, was $(0.09) and the impact of
        Adjustments in the second quarter of 2019 was $(0.25).
    --  For purposes of fiscal year 2020 results, the impact of the accrued
        rebates to the distributors, tied to minimum game guarantees, is
        expected to be $124 million in each of the second through fourth
        quarters of 2020. These rebates are expected to be more than offset by
        lower sports rights payments, and rebates from the teams, which are also
        tied to minimum game guarantees, and which are expected to benefit
        Adjusted EBITDA in the third and fourth quarters of 2020. The lower
        sports rights payments for the year are also reflected in lower sports
        rights amortization expense for the year, with the majority of the
        favorable net income impact having been realized in the second quarter,
        when sports rights payments were still being made but no games were
        played, resulting in no sports rights amortization.

Six Months Ended June 30, 2020 Consolidated Financial Results:

    --  Total revenues increased 94% to $2,892 million versus $1,493 million in
        the prior year period. Media revenues increased 103% to $2,834 million
        versus $1,394 million in the same period a year ago. Revenues benefited
        from the inclusion of the local sports businesses, which were not in the
        prior year results. Distribution revenues were $2,165 million versus
        $719 million in the same period a year ago.
    --  Operating income was $819 million, including $29 million of Adjustments,
        versus operating income of $200 million in the prior year period, which
        included $30 million of Adjustments.  Operating income when excluding
        the Adjustments increased to $848 million from $230 million for the same
        prior-year period.
    --  Adjusted EBITDA, which excludes Adjustments, increased 49% to $535
        million from $360 million for the six-month period ending June 30, 2020.
    --  Diluted earnings per common share was $4.36 as compared to $0.69 in the
        prior year period. The impact of Adjustments in the six months ending
        June 30, 2020, on a diluted per-share basis, was ($0.28) and the impact
        of Adjustments in the six months ending June 30, 2019 was ($0.27).

Consolidated and Segment Highlights

Segment financial information is included in the following tables for the periods presented (in millions). The Broadcast segment, previously referred to as the Local News and Marketing Services segment, consists primarily of broadcast television stations, which the Company owns, operates or provides services. The Local Sports segment, previously referred to as the Sports segment, consists primarily of the RSNs, Marquee, and a 20% equity interest in the YES Network. The Other segment includes corporate, original networks and content, including Tennis, non-broadcast digital and internet solutions, technical services, and other non-media investments.



       
              For the three months ended June 30, 2020                    Broadcast        Local Sports                Corporate,         Consolidated
                                                                                                                    Other &
                                                                                                                  Elimination




       
              
                ($ in millions)

    ---


       
              
                Revenue Highlights:



       Distribution revenue                                                             $
     349                                        $
     610                      $
       51  $
     1,010



       Advertising revenue                                                          208                        3                                          24           235



       Other media revenue                                                           35         (a)            3                                        (23) (a)       15




       Media revenues                                                                   $
     592                                        $
     616                      $
       52  $
     1,260



       Non-media revenue                                                                                                                                23            23




       Total revenues                                                                   $
     592                                        $
     616                      $
       75  $
     1,283






       
              
                Expense Highlights:


        Media programming & production expenses and media selling, general and
         administrative expenses                                                     430                      106                          (a)             33  (a)      569



       Sports rights amortization included in media production expenses                                       5                                                        5



       Non-media expenses                                                                                                                               21            21



       Corporate general and administrative expenses                                 27                        2                                           3            32





       
              
                Other Highlights:



       Sports rights payments                                                                               413                                                      413



       Program contract payments                                                     24                                                                               24



       Capital expenditures(b)                                                        9                        8                                          15            32



       Interest expense (net) (c)                                                     1                      105                                          46           152



       Adjusted EBITDA(d)                                                                                                                              254


               (a)               For the quarter ended June 30, 2020
                                  Broadcast includes $25 million of
                                  revenue and the Local Sports segment
                                  includes $25 million of selling,
                                  general, and administrative expenses
                                  for services provided by the Broadcast
                                  segment to the Local Sports and Other
                                  segments. Such amounts are eliminated
                                  in consolidation.


               (b)               Capital expenditures exclude $19
                                  million of repack capital expenditures
                                  expected to be reimbursed in the
                                  future from the TV Broadcaster
                                  Relocation Fund administered by the
                                  FCC.


               (c)               Interest expense excludes deferred
                                  financing costs, original issue
                                  discount amortization, and other non-
                                  cash interest expense, and is net of
                                  interest income.


               (d)               "Adjusted EBITDA" is defined as
                                  earnings before interest, tax,
                                  depreciation and amortization, plus
                                  non-recurring transaction, COVID,
                                  legal, litigation and regulatory
                                  costs, as well as certain non-cash
                                  items such as stock-based
                                  compensation expense and sports rights
                                  amortization; less sports rights
                                  payments and program contract
                                  payments. Refer to the reconciliation
                                  on the last page of this press release
                                  and the Company's website.



       
                For the three months ended June 30, 2019                  Broadcast          Local Sports        Corporate &     Consolidated
                                                                                                               Other




       
                
                  ($ in millions)

    ---


       
                
                  Revenue Highlights:



       Distribution revenue                                                             $
     335 
           $                                      $
       32  $
     367



       Advertising revenue                                                          315                              24                            339



       Other media revenue                                                           10                               5                             15




       Media revenues                                                                   $
     660 
           $                                      $
       61  $
     721



       Non-media revenue                                                                                            50                             50




       Total revenues                                                                   $
     660 
           $                                     $
       111  $
     771




       
                
                  Expense Highlights:


        Media programming & production expenses and media selling, general and
         administrative expenses                                                     424                              76                            500



       Non-media expenses                                                                                           39                             39



       Corporate general and administrative expenses                                 33                              19                             52



       
                
                  Other Highlights:



       Program contract payments                                                     24                                                            24



       Capital expenditures(a)                                                       19                               2                             21



       Interest expense (net)(b)                                                      1                              46                             47



       Adjusted EBITDA(c)                                                                                                        194


               (a)               Capital expenditures exclude $12
                                  million of repack capital
                                  expenditures expected to be
                                  reimbursed in the future from the
                                  TV Broadcaster Relocation Fund
                                  administered by the FCC.


               (b)               Interest expense excludes deferred
                                  financing costs, original issue
                                  discount amortization, and other
                                  non-cash interest expense, and is
                                  net of interest income.


               (c)               "Adjusted EBITDA" is defined as
                                  earnings before interest, tax,
                                  depreciation and amortization,
                                  plus non-recurring transaction,
                                  legal, litigation and regulatory
                                  costs, as well as certain non-
                                  cash items such as stock-based
                                  compensation expense and sports
                                  rights amortization; less sports
                                  rights payments and programming
                                  payments. Refer to the
                                  reconciliation on the last page of
                                  this press release and the
                                  Company's website.

Consolidated Balance Sheet and Cash Flow Highlights:

    --  Total Company debt as of June 30, 2020, was $12,399 million, which
        includes Diamond Sports Group (DSG) debt of $7,959 million.
    --  Cash and cash equivalents for the consolidated total Company as of June
        30, 2020 was $622 million, which includes $436 million held at DSG.
    --  During the quarter, Sinclair Television Group (STG) repaid the full $648
        million drawn amount under its revolving credit facility and DSG repaid
        the full $225 million drawn amount under its revolving credit facility.
        Currently, the STG and DSG revolvers are not drawn.
    --  In May, the Company's indirect subsidiaries, Diamond Sports Group, LLC
        and Diamond Sports Finance Company (together, the "Issuers") commenced a
        private exchange offer (the "Exchange Offer") for any and all of the
        Issuers' outstanding 6.625% Senior Notes due 2027 (the "Senior Notes")
        for newly issued 12.750% Senior Secured Notes due 2026 (the "New Secured
        Notes") and a cash payment. On June 10th, the Issuers completed the
        Exchange Offer, in which the Company accepted for exchange all of the
        approximately $66 million aggregate principal amount of the Senior Notes
        (or approximately 3.6%) that were validly tendered in the Exchange
        Offer. The Company (i) issued approximately $31 million aggregate
        principal amount of New Secured Notes and (ii) made cash payments
        totaling approximately $10 million (including accrued but unpaid
        interest) in exchange for the validly tendered and not properly
        withdrawn Senior Notes.
    --  As of June 30, 2020, 53.3 million Class A common shares and 24.7 million
        Class B common shares were outstanding, for a total of 78.1 million
        common shares, reflecting five million shares that were repurchased in
        the second quarter. Third quarter-to-date, another approximate four
        million shares have been repurchased. Since December 31, 2019, the
        Company has repurchased approximately 29% of its Class A common shares
        outstanding at that time and 21% of the total shares outstanding.
    --  In August, the Board of Directors approved an additional $500 million of
        share repurchase authorization to its existing approximately $380
        million authorization remaining.
    --  In June, the Company paid a $0.20 per share quarterly cash dividend to
        its shareholders.
    --  Routine capital expenditures in the second quarter of 2020 were $32
        million with another $19 million related to the spectrum repack.
    --  The Local Sports segment's media production expense included $5 million
        of sports rights amortization, while sports rights payments in the
        quarter were $413 million.

Notes:

Certain reclassifications have been made to prior years' financial information to conform to the presentation in the current year.

Outlook:

The Company currently expects to achieve the following results for the three months ending September 30, 2020. The outlook includes the acquisition of RSNs and Fox College Sports (August 23, 2019), the 20% ownership investment in the YES Network (August 29, 2019), an increased investment in Stadium which is now consolidated (December 2, 2019), the launch of the Marquee RSN (February 22, 2020), and the divestiture of the non-license assets in Harlingen, TX (January 27, 2020).

The Company is closely monitoring the impact of the COVID-19 pandemic on all aspects of its business, including how it has and will continue to impact its advertisers, distributors, and professional sports leagues. The Company is currently unable to predict the extent of the impact that the COVID-19 pandemic will have on its financial condition, results of operations and cash flows in future periods due to numerous uncertainties. For additional discussion of how the COVID-19 pandemic has impacted the Company's business, please see the section titled The Impact of COVID-19 on our Results of Operations in the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2020.



              
                For the three months ending September                                 Broadcast       Local Sports                     Corporate and            
       
            Consolidated
    30, 2020 ($in millions)                                                                                                             Other and
                                                                                                                                        Elimination

    ---


              
                
                  Revenue Highlights:



              Core advertising revenue                                                                                                                                                   
              $363 to 388



              Political revenue                                                                                                                                                        
              77 to 83




              Advertising revenue                                                            
     $298 to 324     
      $111 to 116                               $31                      
              $440 to 471



              Distribution revenue                                                              349 to 351         602 to 606    (a)                         50                   
              1,001 to 1,007



              Other media revenue                                                                       48 (b)               5                               (34)  (b)    19




              Media revenues                                                                    695 to 723         718 to 727                                47                   
              1,460 to 1,497



              Non-media revenue                                                                                                                                         17                      17




              Total revenues                                                                 
     $695 to 723     
      $718 to 727                               $64                  
              $1,477 to 1,514






              
                
                  Expense Highlights:


               Media programming & production expenses and media selling, general and
                administrative expenses                                                       
     $471 to 476     
      $810 to 811  (b) (c)                      $39   (b)            
              $1,320 to 1,326



              Sports rights amortization included in media production expenses                                                     630                  (c)                                    630



              Non-media expenses                                                                                                                                        23                      23



              Corporate overhead                                                                                                                                        33


               Stock-based compensation and non-recurring costs for transaction, legal,
                litigation and regulatory fees included in corporate and media expenses above                                                                            22



              Depreciation, intangible & programming amortization                                                                                                      202





              
                
                  Other Highlights:



              Sports rights payments                                                                                              $138                                                        $138



              Program contract payments                                                                 26                                                                                      26



              Interest expense (net)(d)                                                                                                                                144



              Income tax benefit                                                                                                                                                         Approximately 12%
                                                                                                                                                                                         effective tax rate



              Net cash tax payments                                                                                                                                          
        Approximately $4 million


               Payments to noncontrolling interest holders, including preferred dividend (e)                                                                             29



              Total capital expenditures, including repack                                                                                                                             
              55 to 60



              Repack capital expenditures                                                                                                                               20



              
                Adjusted EBITDA(f
                )                                                     
      $402 to 410                                                       
              $589 to 621


               (a)               Reflects $124 million of accrued
                                  rebates to distributors tied to
                                  minimum game guarantees.


               (b)               The Broadcast segment includes $36
                                  million of revenue and the Local
                                  Sports segment includes $35 million of
                                  selling, general, and administrative
                                  expenses for services provided by the
                                  Broadcast segment to the Local Sports
                                  and Other segments. Such amounts are
                                  eliminated in the Consolidated column.


               (c)               Reflects lower payments to teams of
                                  sports rights payments tied to minimum
                                  game guarantees.


               (d)               Interest expense excludes deferred
                                  financing costs, original issue
                                  discount amortization, and other non-
                                  cash interest expense, and is net of
                                  interest income.


               (e)               Preferred dividend was paid in cash in
                                  the quarter ending June 30, 2020 and
                                  is expected to be paid in cash in the
                                  quarter ending September 30, 2020.


               (f)               "Adjusted EBITDA" is defined as
                                  earnings before interest, tax,
                                  depreciation and amortization, plus
                                  non-recurring transaction, COVID,
                                  legal, litigation and regulatory
                                  costs, as well as certain non-cash
                                  items such as stock-based
                                  compensation expense and sports rights
                                  amortization; less sports rights
                                  payments and programming payments.
                                  Refer to the reconciliation on the
                                  last page of this release and the
                                  Company's website.

Sinclair Conference Call:

The senior management of Sinclair will hold a conference call to discuss its second quarter 2020 results on Wednesday, August 5, 2020, at 9:00 a.m. ET. The call will be webcast live and can be accessed at www.sbgi.net under "Investors/ Webcasts." After the call, an audio replay will remain available at www.sbgi.net. The press and the public will be welcome on the call in a listen-only mode. The dial-in number is (877) 407-8033.

About Sinclair:

Sinclair is a diversified media company and leading provider of local sports and news. The Company owns and/or operates 23 regional sports network brands; owns, operates and/or provides services to 191 television stations in 89 markets; is a leading local news provider in the country; owns multiple national networks; and has TV stations affiliated with all the major broadcast networks. Sinclair's content is delivered via multiple platforms, including over-the-air, multi-channel video program distributors, and digital platforms. The Company regularly uses its website as a key source of Company information which can be accessed at www.sbgi.net.



     
                Sinclair Broadcast Group, Inc. and Subsidiaries



     
                Preliminary Unaudited Consolidated Statements of Operations



     
                (In millions, except share and per share data)






                                                               Three Months Ended                     Six Months Ended
                                                       June 30,                              June 30,


                                             2020                             2019        2020                        2019

                                                                                                                    ---


     REVENUES:



     Media revenues                                $
              1,260                            $
          721               $
         2,834  $
        1,394


      Non-media revenues                       23                                      50                              58             99




     Total revenues                        1,283                                     771                           2,892          1,493





     OPERATING EXPENSES:


      Media programming and
       production expenses                    383                                     335                           1,211            654


      Media selling, general
       and administrative
       expenses                               186                                     165                             396            325


      Amortization of program
       contract costs                          21                                      22                              44             46


      Non-media expenses                       21                                      39                              51             78


      Depreciation of property
       and equipment                           26                                      22                              50             45


      Corporate general and
       administrative expenses                 32                                      52                              81             80


      Amortization of definite-
       lived intangible and
       other assets                           150                                      44                             300             87


      Gain on asset
       dispositions and other,
       net of impairment                     (28)                                   (14)                           (60)          (22)


      Total operating expenses                791                                     665                           2,073          1,293



      Operating income                        492                                     106                             819            200





     OTHER INCOME (EXPENSE):


      Interest expense
       including amortization
       of debt discount and
       deferred financing costs             (165)                                   (54)                          (345)         (108)


      Gain on extinguishment of
       debt                                     3                                                                      5


      Loss from equity method
       investments                            (7)                                   (12)                           (13)          (26)


      Other income, net                         4                                       6                                             8



      Total other expense, net              (165)                                   (60)                          (353)         (126)


      Income before income tax                327                                      46                             466             74


      INCOME TAX PROVISION                   (54)                                    (3)                           (42)           (8)




     NET INCOME                              273                                      43                             424             66



      Net income attributable
       to the redeemable
       noncontrolling interests              (12)                                                                  (32)


      Net income attributable
       to the noncontrolling
       interests                              (9)                                    (1)                           (17)           (2)



      NET INCOME ATTRIBUTABLE
       TO SINCLAIR BROADCAST
       GROUP                                          $
              252                             $
          42                 $
         375     $
        64



      EARNINGS PER COMMON SHARE ATTRIBUTABLE TO
       SINCLAIR BROADCAST GROUP:


      Basic earnings per share                       $
              3.13                           $
          0.46                $
         4.39   $
        0.70



      Diluted earnings per
       share                                         $
              3.12                           $
          0.45                $
         4.36   $
        0.69



      Weighted average common
       shares outstanding (in
       thousands)                          80,425                                  91,764                          85,517         92,032



      Weighted average common
       and common equivalent
       shares outstanding (in
       thousands)                          80,737                                  93,163                          85,981         93,189

The Company considers Adjusted EBITDA, to be an indicator of the operating performance of its assets. The Company also believes that Adjusted EBITDA is frequently used by industry analysts, investors and lenders as a measure of valuation.

Non-GAAP measures are not formulated in accordance with GAAP, are not meant to replace GAAP financial measures and may differ from other companies' uses or formulations. The Company does not provide reconciliations on a forward-looking basis. Further discussions and reconciliations of the Company's non-GAAP financial measures to comparable GAAP financial measures can be found on its website www.SBGI.net.



     
                Sinclair Broadcast Group, Inc. and Subsidiaries



     
                Reconciliation of Non-GAAP Measurements - Unaudited



     
                
                  All periods reclassified to conform with current year GAAP presentation



     
                (in millions)




                                                                  Three Months Ended                                      Six Months Ended
                                                           June 30,                                               June 30,


                                            2020                                        2019              2020                                    2019

                                                                                                                                                ---

                   Adjusted EBITDA


          Net income
           attributable to
           Sinclair Broadcast
           Group                                                $
              252                                              $
              42                $
        375       $
      64


          Add:   Income from
           redeemable
           noncontrolling
           interests                          12                                                                                                  32


          Add:   Income from
           noncontrolling
           interests                           9                                                       1                                           17               2


          Add:   Provision for
           income taxes                       54                                                       3                                           42               8


          Add:   Other (income)
           expense                           (4)                                                                                                  1               2


          Add:   Loss from
           equity method
           investments                         7                                                      12                                           13              26


          Add:   Loss from other
           investments and
           impairments                         1                                                                                                   3               1


          Add:   Gain on
           extinguishment of
           debt/insurance
           proceeds                          (3)                                                                                                (6)


          Add:   Interest
           expense                           165                                                      54                                          345             108


          Less:  Interest income                                                                    (5)                                         (2)           (11)


       Less:  Gain on asset
        dispositions and
        other, net of
        impairment                          (28)                                                   (14)                                        (60)           (22)


          Add:   Amortization of
           intangible assets &
           other assets                      150                                                      44                                          300              87


          Add:   Depreciation of
           property & equipment               26                                                      22                                           50              45


          Add:   Stock-based
           compensation                       15                                                       9                                           28              22


          Add:   Amortization of
           program contract
           costs                              21                                                      22                                           44              46


          Less:  Cash film
           payments                         (24)                                                   (24)                                        (47)           (48)


          Add:   Amortization of
           sports programming
           rights                              5                                                                                                 396


          Less:  Cash sports
           programming rights
           payments                        (413)                                                                                            (1,025)


          Add: Transaction,
           COVID, legal and
           other one-time
           expense                             9                                                      28                                           29              30


                   Adjusted EBITDA                 $
              
                254                                $
              
                194            $
     
          535  $
     
        360

Forward-Looking Statements:

The matters discussed in this news release, particularly those in the section labeled "Outlook," include forward-looking statements regarding, among other things, future operating results. When used in this news release, the words "outlook," "intends to," "believes," "anticipates," "expects," "achieves," "estimates," and similar expressions are intended to identify forward-looking statements. Such statements are subject to a number of risks and uncertainties. Actual results in the future could differ materially and adversely from those described in the forward-looking statements as a result of various important factors, including and in addition to the assumptions set forth therein, but not limited to, the potential impacts of the COVID-19 pandemic on our business operations, financial results and financial position and on the world economy, the impact of changes in national and regional economies, our ability to generate cash to service our substantial indebtedness, the completion of the FCC spectrum repack, successful execution of outsourcing agreements, pricing and demand fluctuations in local and national advertising, volatility in programming costs, the market acceptance of new programming, the successful execution of retransmission consent agreements, the successful execution of network and MVPD affiliation agreements, the successful execution of media rights agreements with professional sports teams, the impact of OTT and other emerging technologies and their potential impact on cord-cutting, the impact of MVPDs, vMVPDs, and OTT distributors offering "skinny" programming bundles that may not include all programming of our networks, our ability to identify and consummate acquisitions and investments and to achieve anticipated returns on those investments once consummated, the impact of pending and future litigation claims against the Company, the impact of FCC and other regulatory proceedings against the Company, uncertainties associated with potential changes in the regulatory environment affecting our business and growth strategy, and any risk factors set forth in the Company's recent reports on Form 10-Q and/or Form 10-K, as filed with the Securities and Exchange Commission. There can be no assurances that the assumptions and other factors referred to in this release will occur. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements except as required by law.

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SOURCE Sinclair Broadcast Group, Inc.