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The Honolulu Advertiser
Posted on: Friday, October 4, 2002

Emmis' sales, ratings rise in second quarter

By J. Kyle Foster
Bloomberg News Service

Indianapolis — Emmis Communications Corp., which owns 21 radio and 15 television stations in the United States, said its fiscal second-quarter loss narrowed as advertising sales and ratings improved.

In Hawai'i, Emmis has owned two Honolulu TV stations, Fox affiliate KHON (Channel 2) and CBS affiliate KGMB (Channel 9) for nearly two years under temporary FCC exemptions.

The company's net loss narrowed to $4.56 million, or 13 cents a share, from $7.15 million, or 20 cents, a year earlier, the Indianapolis- based company said in a statement. Per-share amounts reflect the payment of preferred dividends. Sales in the quarter ended Aug. 31 fell about 1 percent to $143.2 million from $144.6 million.

Second-quarter sales exceeded the $138.8 million forecast Emmis made in July, when it said sales would be hurt by competition from rival Clear Channel Communications Inc. in New York. New York sales fell 5 percent to 7 percent, Chief Financial Officer Walter Berger said during a conference call with analysts. Emmis owns WRKS, WQHT and WQCD radio stations in New York.

"Obviously, this is a very, very encouraging quarter for this company," Chief Executive Jeffrey Smulyan said on the conference call. "We're a leading indicator that this economy is on a pretty good track."

Sales in the third quarter ending Nov. 30 are expected to increase to $145.8 million from $135.3 million a year earlier, Emmis said. It was expected to have sales of $142.2 million, the average estimate of six analysts polled by Thomson First Call.

Emmis shares fell 40 cents, or 2 percent, to $19.70 at 4 p.m. on the Nasdaq Stock Market. They have fallen 17 percent this year.

Emmis also owns radio stations in Los Angeles, Phoenix, Chicago, St. Louis and Indianapolis, along with stations in Hungary and Argentina. It owns television stations in 12 states and magazines in six states, according to the company's Web site.

Excluding some costs, Emmis said it had second-quarter income of $4.22 million, or 4 cents a share, compared with a loss of $6.07 million, or 18 cents, a year earlier. On that basis, which isn't in accordance with generally accepted accounting principles, Emmis beat the 2-cent average estimate of analysts polled by First Call.