Tough conditions in the radio and especially the live-entertainment sectors held Clear Channel Communications to a flat financial performance in the first quarter — and the company warned that things are likely to remain choppy for some time.
Clear Channel said revenues for the quarter were dead even with those of the same period in 2002 at $1.7 billion, excluding the effects of acquisitions, sales and other one-time factors. The company’s cash flow edged 2.5% higher to $373 million.
The company’s flagship radio division, which controls more than 1,200 stations nationwide, managed topline growth of just 0.4% in the quarter, with cash flow actually falling by about 1% from the same interval a year earlier.
Radio congloms across the spectrum have been hit by the persistent ad-market slump. Infinity Broadcasting, whose topline sagged 2% in the first quarter, was singled out for criticism by Mel Karmazin, operating chief at parent Viacom, who sacked Infinity’s head of operations days later.
Live entertainment mixed
Live entertainment was a mixed bag of results: Revenue tumbled by more than 9%, but cash flow rose 27% in the quarter. A Clear Channel rep said the 2003 quarter had fewer big events than 2002, but that the smaller events offered much more cash flow per revenue dollar.
The company’s 700,000 outdoor-ad displays continued to perform strongly worldwide, boosting revenue by 7.5% and cash flow by nearly 12%. The company said the gains came from better ad rates as well as higher occupancy on its displays.
Clear Channel declined to provide guidance for the second quarter’s financial results, citing the uncertainty created by “a rapidly changing advertising environment.”
Nevertheless, investors were pleased at the company’s ability to deliver on analysts’ expectations Wednesday. They bid Clear Channel shares up nearly 4% to finish the day at $39.11.