Welcome to Media General Inc.'s Earnings Call for the Fourth Quarter and Full Year Ended December 31, 2015. Today's call is being recorded. Now the company will read a brief legal statement.

This morning the company announced its fourth quarter and full-year 2015 results. The press release, along with the supplemental data can be found on the company's website at www.mediageneral.com. When available, a full transcript along with a replay of today's call will also be posted on the company's website. Today's presentation contains forward-looking statements which are subject to various risks and uncertainties. They should be understood in the context of the company's publicly available reports filed with the SEC, including sections in those reports concerning risk factors. Media General's future performance could differ materially from its current expectations. The company undertakes no obligation to update these forward-looking statements. Today's speakers will be the company's President and CEO, Vince Sadusky, who will provide high-level overview of our results and achievements and Jim Woodward, the company's Chief Financial Officer, who will discuss our financial results and guidance. They will take your questions after their prepared remarks. And now, I'll hand the call over to Vince.

Thank you, Andy. Good morning, everyone and welcome to our earnings call. Before we get into the fourth quarter and full-year results I want to take a moment to reflect on 2015, a transformational year for the company. Fresh off the LIN Media merger that closed in December 2014 our integration teams hit the ground running. We worked tirelessly to evaluate and improve all products and processes, make important management changes, convert all stations to our proven hub model, improve the quality of newscasts and programming, provide employees the training and tools they need to sell more across multiple screens and leverage our enhanced scale and footprint to negotiate better contracts. As a result of these efforts, on an annual run rate basis, we achieved $40 million in synergies this year which is $5 million above our originally stated plan. We believe scale is critical in today's ever evolving media landscape. On January 27 of this year we entered into a definitive agreement under which Nexstar will acquire a Media General and cash and stock valued at $4.6 billion. We're very excited about this combination which will enable our terrific group of TV stations and digital businesses to better serve their local communities and advertisers. We're working diligently with Nexstar on our divestitures and integration plans and still expect to close the transaction by late Q3 were early Q4 of this year. On top of all of the effort devoted to these mergers, our teams did a great job executing on our strategic and operating priorities in order to deliver solid results. Total net revenues on a same asset or as adjusted basis excluding political revenues grew 7% in 2015, compared to the prior-year. The underlying TV advertising business is strong. Core local and national time sales which excluded political…

Thank you, Vince and good morning everyone. Before I begin I would like to draw your attention to the explanation of GAAP results in our press release. As we've done in prior quarters in order to help you make more meaningful comparisons we have provided supplemental combined company financial information on the investor relations page of our website, www.mediageneral.com. The as adjusted amounts reflect those assets we currently operate. We believe that same asset comparison provides a more transparent and a complete basis by which to analyze our current operating results. So my comments today are going to focus on the combined company, using the supplemental combined company financial information. During the fourth quarter, our total net revenues were $366 million. Political advertising revenues were $10 million in Q4 of 2015 versus $62 million in Q4 of 2014. If you factor out the assets of the $52 million in political, our total net revenues were up 10%, compared to the prior year. Including political advertising our total net revenues in the fourth quarter declined 5%. For the full year, our total net revenues were $1.3 billion, political advertising revenues were $19 million compared to $111 million in 2014 and once again if you factor out the $93 million decline in political revenues, our total net revenues grew 7% year-over-year. Including political advertising, our total net revenues were down 1% versus 2014. Our results were driven by broadcasting solid performance including our ability to grow the pay TV subscriber fees. Excluding political our net broadcast revenues grew 13% in the fourth quarter and 9% in the full year. As Vince mentioned core times sales increased 1% for both the quarter and the full year compared to 2014. Overall our total net broadcast revenues were in line with our guidance at $321…

[Operator Instructions]. We will take our first question from Marci Ryvicker with Wells Fargo.

First question I have is, can you talk about how you moved through the fourth quarter and underlying core and how you entered the year? I know you were up in auto in the fourth quarter. Can you talk about auto a little bit more in the first?

Yes. Sure thing. Auto is currently facing up in the first quarter which I think is a good sign considering we had a bit of an anomaly in most of 2015 that continued into the first quarter of 2016 regarding Hyundai You probably heard from other broadcasters as well.

Yes.

The issues associated with the factory not matching the dealer money on the dealer group side and there has been an agency switch and a refocus. So we think that'll be helpful going forward. Having a diversity of markets, we saw a lot of ups, a lot of downs or some downs. And I think net-net, we were pleased with the overall growth that we had in the core given it was a year that was non -- we really didn't have Olympic revenue and no terrific catalyst and the economy started off I think a little bit slower. But overall, pleased with the results. In the first quarter, inclusive of political, we're seeing pacing up in the mid-single digits. We're seeing pacing kind of flattish on the core side. But there's been a good amount of political. I think on the political side for the first quarter, our business on the books is in the $12 million range. As you know, business comes in very quickly on political, so there's still quite a bit of time left to go in the first quarter. And for 2014, so two years ago, I think we finished the quarter at about $5 million in total political revenue. So the year is starting off really strong and of course so much of that will be backend loaded but yet the way the year is starting off on political is a very, very good sign.

There are a couple of affiliation changes just going on. So I'm curious how you're doing in Indianapolis with WISH TV?

Yes. While WISH, that station going from an affiliate to an independent is a completely different model. We're really proud of the group there. They continue to be very competitive on the local news front, especially in morning news. With regard to the change that we announced in Raleigh, that'll actually be effective on Monday. The switch on over from an NBC affiliate to a CBS affiliate and we're pretty excited about that. We have a lot of CBS affiliates in the southeast. And the CBS programming with SCC football and just the nature of their programming has a tendency to over index in that region and do very well. So we're getting the affiliation with that network from capital broadcasting that was a very strong station in connection with being a CBS affiliate. So we've been gearing up and we've got our branding initiatives. We've been promoting and there will be a lot more to come over the next couple of months. We're excited about the opportunity to grow share with that affiliation change.

And next we will hear from James Dix with Wedbush Securities.

Vince, you talked a little bit about the digital business and what you've been doing there in response to the market and then it sounds like synergies on the merger have come in a little ahead of expectations. Any other important variances versus your 2015 budget that you would call out and then any implications that they might have as you look forward to 2016? And then I have got two follow-ups.

I think I would say a couple it things. One is, on the core revenue, the year started off slower than we had planned, but then I think picked up some momentum throughout the course of the year. The controllable things for us enabled us to -- we have market audits done in almost every one of our markets, so what we've analyzed is that net-net we've been able to grow share year over year. Which gives us good confidence in a lot of these early operating initiatives that we've put in place and I've tried to kind of summarize in my earlier comments. Really, the opportunity to take best practices from the predecessor companies that had invested in content, invested in digital. And so again as we look forward to going from 23% of the country or so which is fairly sizable to now, just under 40% with the Nexstar combination and given Nexstar's history and best practices, we've got an opportunity to do that again in the very, very short order. We're making those plans and pretty excited about that opportunity. With regard to the digital, that's been an area that's been a challenge for us. It's hard to kind of summarize very quickly, because we're in a lot of different digital businesses. But again tried to summarize in the script as best we could. Just to kind of repeat, net digital revenue, overall, declined for us about 5% or so. We know we've had very good sustained multi-year success and growth on the local side and on the social and mobile side as well. And within those numbers, are very strong growth for both of those, two of the three categories of digital businesses the way we look at the businesses we're in. As I mentioned, national has been our challenge, but we're very aggressively executing on our plan. And as I look at the first quarter, I'm encouraged as right now our digital ad revenue that's on the books at this moment, with a lot to go left in the first quarter, is greater than our entire first quarter of 2015 final number for digital last year. So it's encouraging and I think right sizing the business, identifying the competitive advantages, where they are, where they are not on the national side is important. I do believe overall within the digital performance is good growth in areas that are I think clear strategic complements to our leading local television businesses and will really benefit from further scale across a larger platform in combination with Nexstar and be a good complement to their digital businesses as well.

That kind of leads a little bit too my second question. Just following up, what do think the key drivers are that are leading to the challenges that you've seen in national and therefore your response going forward in that part of the digital business? But I guess the tailwinds or at least the better opportunity you're seeing in local and social which you think are going to go forward? Then, if you could address in particular how you think ad blocking is effecting that? I would be interested in that as well.

Yes. On the digital side nationally, for the non-platform businesses, kind of across the industry, it's frankly been a challenge. And the challenge, I think, really is coming from programmatics. So you're getting of lot of focus on the buy said on volume given there's an assumption of a terrific amount of false traffic. So, again, I don't want to get into it, but that's been an area where we've invested to ensure that we're not delivering false traffic and that our product is high quality. The thesis for this area that's been very challenged for us on the national side, the thesis is, we can deliver video at scale, in a terrific content environment, free of a lot of the mischief that takes place when you buy ad volume. And don't get me wrong, we've had actually very good success. We have run several campaigns underneath are connected screen moniker, being one of the few companies that can offer up high quality video on television to national brands and high quality video at scale in a native environment online. I think there is an opportunity for that, but the transformation away from media and the pricing pressure on core media placement has been so significant and so dramatic that the transformation of our business has been one that's caused us to be unprofitable in that area for 2015.

And then, my last one actually just has to do with the kind of the core non digital business. Any color you could give on the ad growth that you've seen by programming type across your station group? So how is the news advertising growing as distinct from the network versus the syndication versus the other? Then, any important changes in trend you're seeing there? Thanks.

Sure. Yes. So you've seen the national versus local trends for many years, for many quarters following the industry. Local has been stronger than national over this time period, in general. And much of the national advertising is placed in network time periods. So I think you'd say overall there is not much of a distinction between the overall movement of dollars. Let's say we had ad revenue up in the fourth quarter, in general, there wasn't much of a movement other than the rating points. The total rating points we deliver on any given station are more heavily skewed towards local news nowadays because those ratings have been fairly resilient, whereas the live linear viewership in primetime to non-sports scripted programs has declined. So bottom line is we're delivering -- if you look at the entire population of eyeballs we deliver that percentage of eyeballs that's being generated by non-scripted network programming is greater than it's ever been before and thereby the revenue has a tendency to follow the eyeballs.

[Operator Instructions]. And our next question comes from Lance Vitanza with CRT Capital Group.

A couple from me, the first, is there any update that you can provide on the upcoming spectrum auction? Are we still on track for that to begin next month and have you heard anything that you can discuss regarding your thoughts on participation levels and what not? And then, my next question would just be, if you could refresh my memory as to the timing milestones, hurdles on the merger I'd appreciate it. Thank you.

Yes. Sure thing. So with regard to the auction, we were at the FCC last week, have not heard any news about potentially pushing the auction off further. I think the FCC is very committed and very, very focused on the outlined date when we will get our kind of final determination around the market participation in March. Likely in the spring, early May timeframe, the actual physical sales side auction will begin. With regard to our participation, we had stated back on Investor Day, our best estimate of our net spectrum values potentially in that $2.00 to $4.00 range. We've not adjusted that. As we know, it's incredibly challenging to know what the results of the auction are going to be. There's a lot of smart people out there trying to figure that out, but our view is it will be what it will be. For our shareholders it was very important to carve out through the CDR our value of that oil in the ground and give our shareholders an opportunity to participate in that value, whatever it may be. We're now at an FCC quiet period so there's not much more we can say regarding our strategy and our thoughts going forward that we haven't already said. With regard to hurdle dates on the merger, we'll get this 10-K filed. The finance teams for both companies will work together on pro formas, updating those, get those in. We will get a proxy statement on file. And then we'll march towards a shareholder meeting and a shareholder vote for both companies. In the meantime, we've been going through the regulatory process. We have filed with the FCC and we're working our regulatory applications for license transfers and approval of the deal.

With no other questions in the queue, I will now turn it back over to the Company for closing remarks.

Okay. Very good. Thank you all for your interest.

That does conclude today's conference. We appreciate your participation.