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E.W. SCRIPPS Co (SSP)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue was $728.4M (+18.3% YoY) and diluted EPS was $0.92; adjusted EBITDA rose to $229.3M. Political advertising set a record, while Local Media core ads were displaced by political demand .
  • Net leverage improved to 4.8x vs 5.7x at year-end 2023, supported by strong cash flow and refinancing steps; management announced commitments to extend term loans, add a $450M A/R securitization, and a new $208M revolver to July 2027 .
  • Scripps Networks expenses fell 6.3% YoY in Q4; management reiterated plans to improve Networks margins by 400–600bps in 2025 and guided Q1 Networks expenses down mid-teens, trending toward the high end of the margin improvement range .
  • Guidance: Q1 2025 Local Media revenue down high-single digits; Networks revenue down mid-single digits; shared services ~$22M; FY 2025 cash interest $175–$185M, capex $55–$60M, cash taxes $25–$30M, D&A $150–$160M .
  • Potential stock catalysts: closing of refinancing transactions, Networks margin execution, FCC ownership-rule changes creating consolidation optionality, and women’s sports monetization (ION rates >2x non-sports) .

What Went Well and What Went Wrong

What Went Well

  • Record political revenue drove Q4 company revenue to $728.4M and Local Media revenue to $511.0M; Local Media segment profit nearly doubled YoY to $198.8M .
  • Leverage improvement: year-end net leverage declined to 4.8x (from 5.7x in 2023); revolver fully paid down ($330M) in 2024 and refinancing actions announced to push maturities and add A/R securitization capacity .
  • Networks cost control: Q4 Networks expenses down 6.3% YoY; management expects 400–600bps margin improvement in 2025 and indicated Q1 is trending toward the high end of that range .

What Went Wrong

  • Core advertising declined 11.1% YoY in Q4 to $147.4M due to displacement by record political ads; Q1 core expected down low- to mid-single digits amid macro uncertainty (tariffs, rates) and category weakness in auto and retail .
  • Networks revenue decreased 6.1% YoY to $216.1M; pricing pressure in general market and direct response persisted, even as CTV improved (+16% Q4; >30% growth expected in Q1 ex-programmatic) .
  • Distribution revenue declined 5.0% YoY in Q4 to $185.9M on legacy pay-TV subscriber attrition (~5% YoY), with mid-20% of the sub base up for renewal in 2025 and affiliate fees expected to trend down .

Financial Results

MetricQ4 2023Q3 2024Q4 2024
Revenue ($USD Millions)$615.8 $646.3 $728.4
Operating Income ($USD Millions)$(201.6) $121.8 $191.6
Net Income Attributable to Shareholders ($USD Millions)$(268.3) $33.0 $80.3
Diluted EPS ($USD)$(3.17) $0.37 $0.92
Adjusted EBITDA ($USD Millions)$117.6 $176.8 $229.3

Segment results:

MetricQ4 2023Q3 2024Q4 2024
Local Media Revenue ($USD Millions)$381.0 $445.6 $511.0
Scripps Networks Revenue ($USD Millions)$230.1 $201.7 $216.1
Local Media Segment Profit ($USD Millions)$85.7 $160.7 $198.8
Scripps Networks Segment Profit ($USD Millions)$64.3 $42.1 $60.7

Local Media KPIs:

KPI ($USD Millions)Q4 2023Q3 2024Q4 2024
Core Advertising$165.8 $129.3 $147.4
Political Advertising$16.4 $125.2 $174.4
Distribution Revenue$195.8 $186.5 $185.9

Non-GAAP and items affecting EPS:

  • Adjusted EBITDA reconciliation indicates Q4 adjusted EBITDA of $229.3M; notable items: $19.1M gain on property sales, $14.9M restructuring, $9.7M miscellaneous charge; combined special items decreased income attributable to shareholders by $0.09 per share in Q4 .
  • Q4 included $15.0M non-cash impairment for an investment write-off and restructuring costs related to Scripps News reductions .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Local Media RevenueQ4 2024Up low-to-mid 30% Actual +34.1% YoY Achieved/inline
Local Media ExpenseQ4 2024Up mid-single digits Actual +5.7% YoY Inline
Scripps Networks RevenueQ4 2024Down mid-single digits Actual down 6.1% Inline
Scripps Networks ExpenseQ4 2024Down high-single digits Actual down 6.3% Lower-than-guided (miss)
Shared Services & CorporateQ4 2024About $25M Actual $24.7M Inline
Local Media RevenueQ1 2025n/aDown high-single digits New
Local Media ExpenseQ1 2025n/aUp low-single digits New
Scripps Networks RevenueQ1 2025n/aDown mid-single digits New
Scripps Networks ExpenseQ1 2025n/aDown mid-teens New
Shared Services & CorporateQ1 2025n/aAbout $22M New
Cash InterestFY 2025n/a$175–$185M New
Capital ExpendituresFY 2025n/a$55–$60M New
Cash TaxesFY 2025n/a$25–$30M New
Depreciation & AmortizationFY 2025n/a$150–$160M New

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2024, Q3 2024)Current Period (Q4 2024)Trend
Debt reduction & leveragePlan to end 2024 at low–mid-5x; asset sales, debt paydown priority ; Leverage improved to 5.1x at Q3 end; expect high-4x by year-end Leverage 4.8x at year-end; commitments to extend 2026/2028 term loans, add $450M A/R securitization, new $208M revolver Improving leverage, extended maturities
FCC ownership rulesn/aCEO highlights Chairman Brendan Carr’s intent to revisit ownership limits; potential consolidation opportunities New positive regulatory tailwind
Women’s sports monetization & CTVUpfront strategy boosted sports/CTV; WNBA revenue +85% YTD; CTV guidance reduced due to market pressure ; Q3 WNBA viewership doubled YoY; Networks expenses down ION sports ad rates >2x non-sports; CTV +16% in Q4 and expected >30% growth in Q1 ex-programmatic Strengthening monetization and CTV recovery
Core advertising displacement & macroCore down ~7% in Q2 with displacement; categories softened (services, auto) Q3 core down 9.2% ; Q4 core down 11% with political displacement; Q1 core guided down amid tariff/rate concerns (auto, retail weak) Continued pressure; management offsetting via cost actions
Distribution & affiliate feesvMVPD up; overall subs down mid-single digits; distribution flat Q3 distribution down; Q4 distribution $185.9M vs $195.8M; subs ~5% down YoY; mid-20% subs up for renewal in 2025; affiliate fees expected to head down Ongoing legacy pay-TV attrition; cautious outlook on renewals
ATSC 3.0 / Edge Beam wirelessn/aJV with major broadcasters; 97% U.S. TV household reach; early traction; timing too early for 2025 modelable revenue Early-stage optionality; medium-term upside

Management Commentary

  • CEO: “We are pleased to be announcing a significant round of debt refinancing… Our record political advertising revenue and strategic expense management helped drive down our leverage significantly, to 4.8x, at year-end 2024… We are on track… to increase the Scripps Networks division margin by at least 400–600 basis points this year” .
  • CEO on FCC: easing ownership restrictions would enable scale and unlock shareholder value; Scripps expects to lean into opportunities from potential deregulation .
  • CFO: Refinancing includes extensions on 2026/2028 term loans and an A/R securitization at a favorable rate; blended cost of debt rises by less than 1% .
  • CFO: Q1 2025 guide—Local Media revenue down high-single digits; Networks revenue down mid-single digits; Networks expenses down mid-teens; shared services ~$22M; FY 2025 cash interest/taxes/capex/D&A detailed .

Q&A Highlights

  • Debt & maturities: A/R securitization included in cash interest guide; excluded from leverage metrics post-close; discussions ongoing with holders of other near-term maturities; confidence in cash flow to manage revolver balance through 2027 .
  • Distribution & affiliate fees: ~mid-20% of sub base up for renewal in 2025; Q1 distribution trend similar to Q4 (down mid-single digits); affiliate fees expected to head down to reflect DTC shifts .
  • Core advertising outlook: Q1 core down low- to mid-single digits; macro uncertainty around tariffs and interest rates weighing on auto and retail; services/home improvement down less .
  • Edge Beam wireless (ATSC 3.0 JV): 97% national footprint; early traction with cost-efficient datacasting vs 5G; not modelable material revenue in 2025 but medium-term potential .
  • Women’s sports rights: Ongoing constructive WNBA renewal discussions; ION’s reach across OTA, pay-TV, FAST valued; sports rates significantly higher than typical programming .

Estimates Context

  • Wall Street consensus EPS and revenue (S&P Global) for Q4 2024 were not available due to data access limits; comparisons vs estimates are therefore unavailable in this recap (consensus unavailable via S&P Global).
  • Near-term estimate implications: management guided Q1 2025 Local Media revenue down high-single digits and Networks expenses down mid-teens, which may necessitate lower revenue expectations and improved margin assumptions in models .

Key Takeaways for Investors

  • Political cycle delivered outsized cash generation and leverage reduction; refinancing actions extend maturities and add low-cost liquidity, lowering event risk into 2027 .
  • Networks margin story is central to 2025: cost actions (incl. $35M annualized savings from Scripps News OTT-only) and mid-teens expense declines in Q1 should drive 400–600bps margin improvement execution; monitor delivery against this cadence .
  • Core advertising remains pressured near term (auto, retail) with displacement effects; expect sequential normalization post-election but macro (tariffs/rates) is a watch item .
  • Distribution headwinds persist; affiliate fees likely trending down over time; focus on vMVPD growth, renewal outcomes, and potential FCC-driven consolidation to offset economics .
  • Women’s sports is a differentiator: ION’s rates >2x non-sports and growing advertiser base support revenue quality; WNBA renewal would underpin the sports-led strategy .
  • Optionality from ATSC 3.0 (Edge Beam) is building but not a 2025 driver; treat as medium-term upside that could diversify revenue streams .
  • Trading lens: near-term catalysts include closing the refinancing, Q1 margin delivery in Networks, and any FCC ownership developments; risks include macro core-ad weakness and pay-TV attrition .