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Univision Swings to Q1 Profit After Earnings Rise on Advertising Growth

Spanish media giant Univision Communications Inc. (UCI) reported a 2016 first quarter total revenue growth of 5.7% to $660.4 million compared to the same time frame in 2015.

Priming for an IPO within the year, UCI posted a net income of $65.7 million for the first quarter ending March 31, 2016, a major boost from the same period last year when it reported a net loss of $139.7 million due to the termination of the company’s management agreement with its original sponsors and a technical assistance pact with its main programming supplier Televisa, as well as loss on the extinguishment of debt.

UCI also reported ad revenue growth of 5.1% to $429.6 million, and a 6.9% boost to $230 million from subscriber fees, content licensing and other revenue sources combined.

The group also benefited from higher retransmission consent fees, which were up 12.3% from the year-ago quarter to $193.3 million. Univision’s radio group was a big drag on the overall results. Revenue decreased 8.2% to $58.6 million. Advertising was down 6.8% to $56.3 million.

Randy Falco, president and CEO of UCI, pointed out that Univision was seeing an increase in ads from pharmaceuticals and car companies, more so than the mainstream media. “We’re also making inroads with movie studios which are finally waking up the fact that Hispanics go to the movies a lot and over index on openings of new movies,” he said in a conference call.

It’s expecting a boost in political and advocacy ads in the run up to the general elections in November.

“The Democrats understand that the road to the White House is through the Hispanic community, and we are the gateway to that community,” said Falco. “I have no doubts that the Democrats will spend heavily.”

Pointing out that presumptive Republican nominee Donald Trump has been taking advantage of free media publicity up to now, he warned: “Unless Trump wants to relive what [former Republican presidential nominee] [Mitt] Romney went through and disregard the Hispanic community, then he’ll probably end up in the same place that Romney did.”

Led by chairman Haim Saban, UCI owns and operates broadcast networks Univision Network and UniMas, formerly Telefutura, as well as cable channel Galavision and sports network Univision Deportes and various digital assets. It recently bought out Walt Disney from their Fusion network joint venture, created as part of its effort to reach the increasingly bilingual and English-speaking Hispanic youth.

It also has a stake in El Rey, Robert Rodriguez’s male youth-targeted cable network, which lost $24.6 million last year, an improvement from the $72.3 million loss in 2014.

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