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Univision Second Quarter Financials Down Amid Robust Upfront Sales

It was good news and bad news for leading Spanish-language media company Univision, which reported a further slide in earnings in its second quarter financial report. However, the company has seen its best upfront in four years, said CEO Vince Sadusky in an earnings call, noting a sales spike in the “mid-single digits” for its linear business and double-digit growth in its digital biz.

“However, there is still a large gap between Univision’s ratings delivery and its share of TV ad revenues,” said Sadusky, echoing a lament that has resounded through previous administrations at Univision.

Univision’s income from continuing operations for the second quarter of 2019 was $92.0 million compared to $121.3 million for the same prior period, a decrease of 24.7%.

According to the firm, its revenue for the second quarter this year fell 4.0% to $701.7 million compared to $730.9 million for the same prior period. Core revenue for its second quarter dipped 3.5% to $694.5 million compared to $719.5 million for the same prior time frame.

On the plus side, Univision ended its long-simmering carriage dispute with Dish Network and renewed deals with other major distributors. “With our Dish battle, we proved that you don’t have a Hispanic service if you don’t have Univision,” said Sadusky who noted that Dish had suffered subscriber losses as a result of pulling Univision from its programming.

However, rate increases from these renewed deals won’t take effect until 2020, Sadusky pointed out.

“Univision finished the 2018/19 broadcast season as the #1 US Hispanic network for the 27th consecutive time. In July sweeps, Univision and UniMas were the only broadcast networks to grow viewership from a year ago. In that period the Gold Cup final on Univision ranked as the #1 Men’s soccer match of 2019, and our youth-oriented music tentpole Premios Juventud achieved a 40% larger audience than the prior year and beat the Big-4 broadcast networks,” said Sadusky, who reiterated the company’s mandate to focus on its core business.

Univision is currently on the block as its current private equity owners — Madison Dearborn Partners, Providence Equity Partners, Saban Capital Group, TPG Capital and Thomas H. Lee Partners — seek to divest from their 2006 purchase. It has tapped Morgan Stanley, Moelis & Co. and LionTree to serve as financial advisers as its board of directors explores a sale and “other strategic options.”

Regarding Univision’s potential sale, Sadusky said: “This is the best growth opportunity at scale in America when it comes to media.” “Even if the timing may not be great for certain folks, this is the last opportunity for this asset to trade.”

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