Nexstar Media Group (NXST) Q4 2021 earnings summary

Executive summary

• FY21 net revenue reached a record $4.648B, up 3.3% YoY; non-election-year Adjusted EBITDA was $1.897B and free cash flow was $1.243B.

• Scale included 199 full-power TV stations across 116 markets, NewsNation, digital properties and a 31.3% stake in TV Food Network; station reach was 39% of U.S. TV households after the FCC UHF discount.

Financial highlights

• Net revenue was $4.648B, up 3.3%; operating income was $1.175B versus $1.375B in 2020, and net income attributable to shareholders was $834.6M versus $811.4M.

• Diluted EPS was $18.98 versus $17.37; reported net income was $830.4M, while Adjusted EBITDA was $1.897B after the stated adjustments.

• Core advertising revenue rose 12.1% to $1.762B; distribution revenue grew 14.9% to $2.473B; digital revenue increased 44.4% to $322.6M.

• Political advertising fell to $45.2M from $507.6M in the 2020 election year; 2021 free cash flow was $1.243B, excluding transaction and other one-time expenses.

• Net cash from operations was $1.215B; cash and cash equivalents were $190.9M at year-end, with $206.5M including restricted cash.

Outlook and guidance

• Management cited three-year visibility on free cash flow targets, supported by expected strong mid-term and presidential political advertising and distribution renewals covering a significant share of subscribers.

• Plans called for converting 20 additional markets to ATSC 3.0 in 2022, targeting coverage of ~50% of U.S. households; the 2021 rollout covered 17 markets and ~29%.

• Distribution fees were expected to continue rising until fees better reflect viewers delivered; network affiliation fees were expected to keep increasing over the next several years.

• The quarterly dividend increased 29% to $0.90 per share beginning Q1 2022; no required contribution to qualified pension plans was expected in 2022.