Sinclair Broadcast Group Inc. saw its profit grow 33 percent in the third quarter as political campaigns and automakers ramped up spending on advertising, the Hunt Valley-based company said Thursday.
The broadcaster earned $26.2 million in the three months that ended Sept. 30, or 32 cents per share, compared with $19.2 million during the same months last year, or 24 cents per share.
Boosted by political and automotive advertising, sales from continuing operations jumped 49 percent to $226.4 million, from $151.9 million in the third quarter of 2011. Political revenues totaled $27.8 million in the third quarter, up from $2.4 million in comparable period in 2011.
Higher retransmission revenues — the fees cable companies pay to use Sinclair's television content — also helped, the company said.
"Despite increased demand for air-time by politicians and political action groups, the core business showed solid growth" as well, said Sinclair CEO David Smith in a statement. Net broadcast revenue grew nearly 7 percent excluding political ads.
The demand by political candidates, political action committees and issue-related groups crowded out some of the regular categories, such as services, schools and fast food, Sinclair said.
"We expect this trend to continue through the November 6, 2012, Election Day as political advertising reaches historic levels," the company said in a statement.
The company is investing in its long-term growth, Smith said, recently agreeing to buy the assets of KBTV, the Fox affiliate in the Beaumont/Port Arthur, Texas, market, where Sinclair also owns the CBS station. The company has agreed to sell its ABC station in Lansing, Mich., after identifying it as a non-strategic market.
Anticipating an increase in dividend tax rates in 2013, Sinclair's board has approved returning about $81.2 million to shareholders in the form of a $1 per share special cash dividend, in addition to the regular 15 cents per share quarterly dividend, the company said.