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Smulyan remains bullish on Emmis, radio

October 5, 2007

Despite slumping revenue, Emmis Communications Corp. Chairman Jeff Smulyan remains bullish on his company and the radio industry.

Emmis this morning reported that revenue in the quarter ended Aug. 31 fell to $96.4 million from $99.9 million during the same period a year earlier. The decline was mostly due to softness at its New York and Los Angeles radio properties. Radio revenue across markets where Emmis operates fell 6 percent.

But Smulyan told analysts that several factors are working in favor of radio long term. He noted, for instance, that Ford Motor Co. will equip some of its vehicles with standard HD radios.

In addition, he said, new technology will make listenership easier to measure. Radio is gaining traction through Internet initiatives, and the industry is preparing to celebrate its 100th birthday.

"This company is on the move, and this industry is on the move," Smulyan said. "I think we are coming out of what has been a very long malaise in this industry."

Still, Emmis officials noted during the conference call that sales in its home market of Indianapolis were off 14 percent in the quarter from a year earlier. Emmis locally operates WLHK-FM 97.1, WNOU-FM 93.1, WYXB-FM 105.7 and WIBC-AM 1070. That was four percentage points worse than the overall Indianapolis radio market.

Systemwide, Emmis saw double-digit percentage advertising declines in the automotive, movie, beverage, media and cellular categories.

Emmis stations in Austin, Texas, saw significant revenue gains compared to the same period a year ago. The company's publishing arm also continued to see revenue gains.

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