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UPDATE: Emmis shares rise after report

May 12, 2008
Emmis Communications Corp. Chairman Jeff Smulyan was as upbeat as ever about the company's earnings report today, but this time there might be greater reason for his optimism.

Revenue at the Indianapolis-based media company rose 9 percent, to $85.8 million, in the fiscal fourth quarter despite having posted a $13 million loss.

Much of the loss in the quarter ended Feb. 29 was caused by a $21.2 million charge for its broadcast license. Emmis' operating income was $18.6 million, compared to $15 million a year earlier.

Investors were optimistic, too, bidding up the price of Emmis stock to $3.11 a share, a 6.1-percent increase.

Smulyan insisted Emmis and the radio industry as a whole are on the way up.

"Our industry is also fighting back," he told analysts in a conference call this morning. "I've seen more progress from our industry in the last six months than I've seen in the last 15 years."

Smulyan added that he expects Emmis radio stations to outperform those in its markets in the coming year. "We feel we've turned a corner, but it's more than that," he said.

The company also will be bolstered by innovative partnerships with companies such as Apple and other interactive initiatives, Smulyan added, including one to get radio tuners placed in cell phones.

Emmis saw big gains in its overseas operations, with a 31-percent revenue increase for the fourth quarter and 22 percent for the year at its properties in Hungary, Bulgaria, Slovakia and Belgium.

Its publishing division, which now represents 27 percent of total revenue, was up 4 percent for the quarter and 5 percent on the year.

Emmis officials were at a loss to explain rough months in the domestic radio sector in March and May. Domestic radio trended down 6 percent in the first quarter of 2008, Emmis officials said.

During the fourth quarter, national radio ads were down 10 percent and local ad revenue was down 7 percent.

Several top 10 advertising categories also saw declines during the fourth quarter, including automotive, down 11 percent, and media, declining 16 percent. Movies, retail, wireless, health care and beverages also were down. The restaurant, entertainment and financial institution categories saw small gains in the quarter.

But Smulyan said changes in markets such as New York, Los Angeles and Indianapolis have the company headed in the right direction.

"Obviously we're in the back drop of a challenging economy, but we're starting to see some positive signs," Smulyan said.

For more, go to NewsTalk.

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