Nexstar Media Group (NXST) Q4 2016 earnings summary

Executive summary

• Fifth consecutive year of record results; FY16 net revenue exceeded $1.0B for the first time, with double-digit growth in key operating metrics.

• January 17, 2017 Media General acquisition expanded the portfolio to 171 stations in 100 markets and reach of nearly 39% of U.S. TV households.

Financial highlights

• FY16 net revenue $1.103B, up 23.1% YoY; operating income $287.3M vs. $206.1M; net income $93.1M and attributable net income $91.5M.

• FY16 diluted EPS $2.89 vs. $2.42; adjusted EBITDA $405.5M, up 32.9%; broadcast cash flow $456.7M, up 30.5%.

• Free cash flow $244.8M, up 17.6%; free cash flow per share ~$7.98, up 18.4%; excluding Media General transaction fees, over $9.00 per share.

• Q4 2016 net revenue $309.9M and operating income $92.5M; attributable net income $20.5M and diluted EPS $0.64, versus $27.2M and $0.86 in Q4 2015.

Outlook and guidance

• Media General integration and synergy realization were on schedule, with completion expected by year-end 2017.

• Projected average annual free cash flow for the 2017/2018 cycle of ~$565M, or ~$12.00 per share per year.

• Absent further strategic activity, net leverage expected in the high-4x range at end-2017 and mid-3x by end-2018; a sixth consecutive record-results year expected in 2017.