Sinclair Broadcast Group said it made $2.59 billion — yes, with a B — in the first quarter by “deconsolidating” its local sports segment from its financial statements.
As a result of a March 1 corporate reorganization that included recapitalizing the debt of Diamond Sports Group, which owns the local sports networks, and raising additional capital, Sinclair Broadcast reported a non-cash pre-tax profit of $3.4 billion. “on the disposition of assets.”
Hunt Valley-based Sinclair wrote off $4.2 billion worth of sports networks in the third quarter of 2020 after the pandemic decimated live sports programming less than a year after Sinclair bought the networks for $10.6 billion.
Diamond Sports has been removed from Sinclair’s financial statements, but the company still owns and remains committed to the networks, Chris Ripley, Sinclair’s chairman and chief executive officer, said during a conference call.
Profit of $2.59 billion for the three months ended March 31 compares to a net loss of $12 million in the first quarter of 2021. Earnings were $35.39 per share compared to a loss of 16 cents per share on last year.
Excluding adjustments, Sinclair said he would have earned $27 million.
The broadcaster said revenue fell 14.8% to $1.29 billion in the three months ended March 31, compared with $1.5 billion in the first three months of 2021.
But better-than-expected political advertising helped boost its first-quarter revenue, a sign that political ads will hit record levels this year.
“We think this is a good indicator of how strong this year’s political cycle can be and gives us confidence that we can pull off a record amount of political advertising for a midterm election year,” Ripley said.
In addition to deconsolidating Diamond Sports, Sinclair sold assets from the Ring of Honor wrestling promotion in May to sports executive Tony Khan, founder of Jacksonville-based All Elite Wrestling and co-owner of the NFL’s Jacksonville Jaguars. The sale includes the wrestling promotion’s video library dating back to 2002, brand assets, intellectual property and production equipment.
Sinclair also said Wednesday that he nominated Dr. Ben Carson, a former US presidential candidate and former secretary of the US Department of Housing and Urban Development, for election to the company’s board of directors, as he seeks to add diversity to its leadership.
Sinclair shares were trading at $24.12 a share on Wednesday morning, up 3%.
the afternoon sun
Get your evening news delivered to your email inbox. Get the best news and sports from baltimoresun.com.
This story will be updated.