Good day and welcome to the Nexstar Media Group Third Quarter 2021 Results Conference Call. Today's call is being recorded. I would now like to turn the conference over to Joe Jaffoni, Investor Relations. Please go ahead.

Thanks, Katie and good morning, everyone. I'll first review the Safe Harbor language and we'll get right into the call. All statements and comments made by management during today's call other than statements of historical fact and maybe deemed forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. Nexstar cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those reflected in the forward-looking statements made during the call. For additional details on risks and uncertainties, please see Nexstar's Annual Report on Form-10K for the year ended December 31st, 2020 and Nexstar's subsequent public filings with the Securities and Exchange Commission. Nexstar undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. With that, it's my pleasure to turn the call over to your host, Nexstar's Chairman, Founder and CEO, Perry Sook. Perry, please go ahead.

Thank you, Joseph and good morning, everyone. Thank you all for joining us to review Nexstar's third quarter financial results which highlight the competitive advantages of our scale and reach, our continued success in achieving a faster and stronger than anticipated recovery in core advertising, and another period of double-digit distribution and digital revenue growth. Once again, our third quarter net revenue, adjusted EBITDA and free cash flow were nicely ahead of consensus expectations, reflecting growing momentum across our Broadcast, Digital and Network Divisions and their associated revenue streams. Tom Carter, Nexstar's President and Chief Operating Officer is on the call with me as always this morning, and we're delighted to be joined this morning by Lee Ann Gliha, who has taken the CFO reins from Tom back in early August. As I mentioned at recent Investor Events, Lee Ann is an accomplished finance leader with more than 20 years of experience in TMT Investment Banking and operations, and she was a sought after candidate at other scale TMT entities. So we're very fortunate to have her on our team to support our next phase of growth. Together, we will review the quarter, our outlook, our plans for continued growth investments, leverage reduction and capital returns, and our competence in achieving our upsized pro forma average annual free cash flow guidance of approximately $1.33 billion for the '21-'22 cycle. I'll start with a summary of the quarterly highlights and recent developments, including our continued focus on accretive M&A and driving value through high return growth opportunities. Tom will then provide an operations review, and Lee Ann will finish up by covering the financial report. With many pandemic-related challenges behind us, we are beginning to actualize the value of the scaled program and platform that we have created, and it turned…

Thanks, Perry and good morning, everyone. Our solid third quarter and year-to-date '21 results reflect the resiliency and adaptability of our businesses and our long-term strategies to leverage our scale to drive top line growth. We're extremely proud of the consistent strength of our operating results and the more than 12,000 members of the Nexstar Nation across the country, who while serving their local - communities have consistently demonstrated their ability to offset the pandemic challenges, putting Nexstar on a path to continued success and growth. As Perry said, our Q4 operating results are pacing strongly and we expect to end 2021 on a solid note before entering 2022, which will be a year of growth given our internal opportunities, including the return of political - the political ad cycle. As we further look into 2023, there will be an upside benefit that year from the large percentage of retrans distribution agreements that we will complete during 2022. Operationally, Nexstar's strong rebound in 2021 continued in the third quarter with net revenue rising 3.5% over the prior year to $1.16 billion. As we more than offset approximately $120 million in year-over-year decline in political advertising. Nexstar's third quarter net revenue, excluding political, increased approximately 16%, reflecting our success and leveraging the - unrivaled with multiplatform consumer reach and engagement of our content to deliver continued strong growth across all of our non-political revenue sources. Our top line growth combined with expense management go third quarter adjusted EBITDA and free cash flow before one-time expenses, of $413 million and $254 million, respectively. Nexstar brought over 35% of our - Q3 net revenue, turn - to the unadjusted EBITDA line before the one-time transaction - before one-time transaction expenses and we brought approximately 61% of every adjusted EBITDA dollar to the free…

Thanks, Tom and good morning, everyone. I'm thrilled to join the Nexstar team as a banker I've covered the broadcasting and broader TMT sector for a couple of decades and I've known Perry and Tom for more than one of those. I'm a huge fan of what they've built and the returns they've generated for shareholders. I look forward to helping facilitate the growth for the next 10 years like Nexstar has had over the last 10. I've listened to hundreds of these earnings calls from the other side, so it's interesting being on this side this time, so this is my first one so everybody go easy on me. Since Tom has provided most of the color on the revenue line items, I'm going to fill in a few blanks and then start as a good CFO should, on providing you some color on our expenses in the quarter. Net revenue for the quarter was up 3.5%. On the same-station basis, net revenue was effectively flat and up 11.5%, excluding political. Core revenues on the same-station basis were up 10%, distribution revenue was up 13% and digital revenue was up 10%. Third quarter direct operating expenses, SG&A and trade expenses all increased, primarily as a result of higher revenues related to the recovery in core and digital advertising, as well as expenses from station and digital acquisitions, including a partial quarter of expenses from The Hill. Total corporate expense was approximately $47 million, including non-cash compensation expense of approximately $12 million in additional legal expenses. During the quarter, we recorded one-time transaction costs of $2.7 million related primarily to the acquisition of The Hill. CapEx was approximately $36.3 million and was slightly above our third quarter guidance as our guidance reflected a CapEx figure net of insurance proceeds and…

Thank you. [Operator Instructions] Thank you. Our first question will come from John Janedis with Wolfe Research.

Thanks, good morning. Perry, going back a few months ago, there was a lot of concern that having the NFL on the streaming services would impact your business. So can you give us an update on what you're seeing now that were deep into the season? And then on the core advertising front, as you know there's been a lot in the press about supply chain issues impacting advertising. Have you seen anything or are your people on the ground hearing of an upcoming on and is there anything that call back - call out on in terms of large markets versus small or national versus local?

Let me start first with the NFL. I mean, obviously all of the NFL games with the exception of FOX are on streaming platforms now, and I think the overriding positive of NFL viewership this fall has been a, more competitive games and secondly, fans in the stance. I think it enhances the viewing experience and I think that's what's driven the overall ratings increase you know the ratings for NFL telecast continue to be measured in the millions and you know the streaming component of that is a fraction. And John, I didn't quite get the last two pieces of your question. Could you run those by me again, please?

That on the advertising side, now with a lot in the press around supply chain issues, it sounds like you're not seeing anything just based on the comments coming out of 3Q into 4Q and so. Are you hearing anything for 4Q? What are your people on the ground talking about as they talked it to local customers and is there anything to call out, meaning, large versus small markets or national versus local advertising?

Yeah, we're not seeing much of a difference now between large versus small. I think you know everything is fairly homogenized. There's no material differences in market size or regionality at this point. You know, I do think that the results that we've turned in had been despite the supply chain and issues that you know have been prevalent, that affect furniture category, appliance category, electronics as well as certainly automotive. But, you know, good news on the automotive front you know, the GM plant here not too far from our offices in Arlington, where all of the Escalades and Yukons and Suburbans are made are most of them in America is just added overtime shifts to kind of catch up with the demand. So we anticipate that the automotive category will remain a headwind in the fourth quarter and perhaps the first quarter of next year, but should probably turn to a net positive tailwind by the second quarter and certainly the second half of next year. Tom, do you have anything to add?

John, just looking at comparison of '21 to '19. In Q3 and in Q4, 14 of the top 25 categories are up. You know, Perry mentioned some of the other ones, furniture, autos, electronics, et cetera that are being affected, but the rest of them are more than making up for that from a growth perspective. So we're seeing you know growth over '19 ex auto and growth over '20 ex auto.

All right, thanks.

Thank you. Our next question comes from Dan Kurnos with The Benchmark Company.

Great, thanks. Good morning and welcome Lee Ann. [indiscernible] there. I guess if I could just follow-up on John's question and Tom, thanks for the additional color there. Just as we think going into Q4, obviously Perry, you called out sports gambling is a huge category now. You know, we're not quite, you said, ex auto we're back to 2019 levels. In Q4, do we get you know, I guess, does that number improve in Q4 accelerating trends? Do we get back to 2019 levels even with auto? Maybe not quite there would be kind of my first question. And then secondarily you know you guys now have a $400 million plus digital business that I kind of ballpark your website, maybe a quarter of that it's still $300 million standalone you know. So I guess maybe can you give us sort of your long-tail thoughts on how big that gets? How you think about monetizing? Obviously, right now everything has synergies. But you know do you consider having kind of a much larger digital standalone operation sometime in the future? Thanks.

Well, sure. I mean as it relate - you know, if I look at our top 10 product categories for third quarter, everything was up anywhere between 104% to 166% and 141% over the prior year. So major increases with automotive you know down about 10%. So, you know I don't know that you'll see much of a change thematically into the fourth quarter other than, if you remember fourth quarter last year, obviously a huge political quarter. So there was some displacement, we have that inventory back, political is active, but obviously won't be anywhere near that order of magnitude. And so you know we're positive that you know as I said earlier, we've got 99% of our budgeted ad revenue on the books for the year as of this morning and literally two months to make the last point. So, I think we feel very good about fourth quarter, we feel very good about the transition into 2020 - 2022.

And with regard to digital, digital will continue to grow, we see more opportunities there. With content acquisitions like The Hill that can be utilized across our spectrum of you know, the multiplatform carriage that we have, I think you'll see us do more content acquisitions and less technical acquisitions or you know the actual plumbing. I think we feel good about our distribution from a - from a digital, from a linear cable and from a broadcast perspective and we'll be able to monetize that and I think you'll see a nine-digit digital revenue for Q4 and that will, I think you know serve us well beginning into 2022.

Look, digital advertising surpassed all of television advertising now in terms of total dollars. So, we told our management team, there's no reason that that is not permitted to happen in this company here. So, I think you'll continue to see, as Tom said, we'll build on a content-first strategy kind of build the broadest base of content and distribution to allow us to compete for the largest amount of dollars. So, I think you'll see continued investment and continued growth from digital and you know it's - you know we look to build that to a point over time, where you know the revenue potentially could rival that of the ad support for the broadcast stations. So, that's obviously where the growth is and as my dad used to say, it helps to hunt where the ducks are.

Love it, Perry. Thanks, guys. Appreciate it.

Thank you. Our next question comes from Steven Cahall with Wells Fargo.

Thanks. Maybe first just to follow-up on advertising. You made the comment that Q4 is pacing strongly. Just wanted to clarify, is that a comment specifically related to advertising? Or is that about the business more broadly? And maybe you could give us a sense of how much The Hill contributed in the quarter will contribute in the fourth quarter? And then I have a quick follow-up. Thanks.

I would say - the advertising market continues to improve. Total advertising - total Broadcast advertising will be up Q3 over Q4 on a core basis. It won't be back to 2019 levels just yet, but we continue to make progress in that regard. So from that perspective, I would say you know we're - it is improving, but we're still being weighed down by auto from that perspective. Lee Ann, do you have any specific comments on The Hill -

Yeah on The Hill in terms of you know the contribution it was you know only really a very small percentage of the quarter that it was in there. So it was like a little over $5 million of revenue from The Hill.

Great. And then, Lee Ann I think this is an easy enough one on you. But you know, you're new to Nexstar, but certainly not to the industry. I think you've said you know, you see your role as more than just you know paying down debt and paying the dividends. So when you think about some strategic growth areas for the business, either organically or inorganically, where you'd like to look at allocating capital. Could you give us any more color on that? Thanks.

Yeah. Look, I think you know I - obviously, there's a lot of things that we could be doing with this platform. And I think it's really continuing to pursue what we've been doing in the past, which is, you know, continued to make station acquisitions where we're able to do that from a regulatory perspective. It's continuing to invest in content, both from a television perspective, and then also from a digital perspective. And then, I think it's just then the other sort of question mark area of you know, are there other businesses out there that could be complementary to the assets that we have to kind of continue to grow it? And you know that includes you know what can we do with our spectrum? So I don't think it's going to be too far afield from what you've seen and what we've said. But you know we know we need to continue to grow this business, because we want to have the same sort of returns the next 10 years that we did for the last 10 or better.

Thank you.

Thank you. Our next question comes from Aaron Watts with Deutsche Bank.

Good morning, everyone and Lee Ann, welcome to the NXST. Two questions for me. The first question is on your network partnerships, and I appreciate that you don't have to focus on this for another 12-plus months, given where you are in the cycle. Curious if some of the actions been taken by your partners to bolster their streaming services. Make you see an opportunity during the next round of network renewals to push back on increases and reverse comp and relatedly how we should think about where the margin is today on retransmission fees and where it might be heading over the next few years, especially in light of the new long-term NFL broadcast deal and perhaps the desire from those networks to have you helped pay for that?

Well, I would say you know, first of all, we've always helped the networks pay for the NFL and the Olympics, the NCAA and pretty much, you know all the other ala carte sports offerings out there. So, no change in that. Our desire to decrease fees and - or certainly decrease the rate of increase of the fees that negotiating effort has not changed and will not change in upcoming negotiations. We obviously do take note of the fact that the networks are oftentimes competing with themselves with their streaming offerings and therefore competing with us. And that, you know therefore that means, less exclusivity to what we're buying from the networks that comes at a cost or should come at an impact to the cost, we believe. But I would say, you know, our - you have to look at our mix of stations, because we have some very large markets, CW and MyNetwork stations that paid very little of any reverse compensation. And therefore, when you look at the numerator and denominator of retrans revenue and network payments, we are at and I think for the foreseeable future as far out as I can see, continue to be above a 50% margin. And I think that you know would bring us in at - an approximate 50% margin our Big four stations and obviously higher than that on our non-Big four. And I think we're relatively unique in that regard. So I don't think you can mark us to the market or mark the market to us in terms of retrans margins, because of the uniqueness of our station portfolio.

Okay, that's helpful, Perry. Thanks. And if I could sneak one more in and maybe this is for Tom or Lee Ann. Tom, you mentioned where your free cash flow production is headed and the IG rated company you'll be keeping with that, you certainly will have the capacity to drive your leverage down further to achieve investment grade ratings, if you want it to. Is there a desire to go in that direction to capture the benefits of cheaper cost to capital, longer duration financing? Not that I would obviously ever want to lose you guys do IG land.

This is Lee Ann. I don't think we're intending to try to drive towards an investment grade rating. I think our - as we've said before you know our target is you know, 3.5 times or around there. And in the past you know what we've done is, if there's been a nice deal, we've levered up a little bit, but then repaid the debt really quickly to get back down to that leverage level. So, I think we'll probably see more of the same -

No, I think we've benefited you know from our business model that obviously I think the high yield market embraces from a free cash flow perspective. So, you know, yes, we would receive some benefit from being investment grade, but I'm not sure it's really commensurate with the amount of capital that would have to be allocated to debt reduction to get to an investment grade rating which would be substantial. So, I think we're in a happy kind of place now from being able to price our debt at attractive levels at this leverage juncture.

All right, great. Thank you very much.

Thank you. Our next question comes from Craig Huber with Huber Research Partners.

Great, thank you. My first question on auto, of course. I think you said auto was down 10% year-over-year in the third quarter. What's it pacing at for the fourth quarter and have you seen a major difference with on the national side of auto versus a local dealer side?

No, actually our Tier 3 revenue, because some people are advertising service, some people are advertising you know, collision repair and body shops and things like that. You know, our Tier 3 revenue is pacing on par maybe slightly better than Tiers 1 and 2. I think you know what we saw, you know throughout this year is automotive revenue on the books that perhaps for supply chain issues was somewhat canceled off as the quarter went on. We're going into the quarter with less revenue on the books, so less to cancel and we think we'll probably end up in and about the same area that we did for third quarter as a category.

Okay. And then would you also - I appreciate that. Would you also care to just let us know what you think the pacing number is that for overall core ad revenue on a year-over-year basis in the fourth quarter?

Yeah, it's a positive number. And again, it's a different number for Broadcast, Digital and Networks. But I mean, all three taken together, each individually are positive and all-in it's a positive you know single-digit number.

So just the core TV ad revenue year-over-year is up some number less than 10% is what you're saying?

A single-digit number -

Okay. Very good -

Single-digit percentage. Yes.

And obviously you have to ex political out of that, right.

Right, okay. And then your retrans subs, please. How that number for the quarter? Was that down say roughly 5% year-over-year?

I -

Retrans subs, no.

It was down less than 5%.

Right.

And then how would you say that was - is versus the prior one or two quarters if the trend line - is it slightly better -

That's - the positive trend has continued, yes.

Okay, my last nitpick question on the digital side, excluding the two acquisitions, how much was digital revenues up year-over-year? You guys mentioned in the press release where local side did pretty well. Thank you.

The question is with - on a pro forma basis?

Same-station, yeah -

Same-station basis what was digital revenue up? Digital revenue up - with up about [30%] [ph].

Very good. That's all I had. Thank you.

Thank you. Our next question comes from Jim Goss with Barrington Research.

Thank you. One question about the NewsNation. Congratulations on achieving CPM parity with the others. And given the combination of that and neutral - your neutral stance. Do you have an opportunity to get competing political ads from both sides you know more than some of the other networks might? And what is the mix of national versus regional ads within that service? Is it all national? Or do you have regional opportunities?

It's all national, except as you know, most cable networks give back two minutes an hour to the local cable interconnect to sell so, but all of our revenue is national delivered by Dave Rotem and in his national Salesforce. And as it relates to political, we did about $1 million in political last year on NewsNation and that was just with our three hours of primetime, obviously with our acquisition of The Hill and the fact that we're doing 13 hours a day of live programming, Monday through Friday, we would expect we'll do certainly as well in political next year. Although, again, politics in the mid-term elections are all local. There's no real national referendum you know, it's issue ads, it's state and local races, Senate House Governors. So that inherently would be much more a linear broadcast rather than a linear national cable play in terms of political ad revenue, but we'll get some.

Okay. Now, that's why I asked about the regional potential. The other question I had is about Rewind TV. Is there - and can you frame the potential significance. Is it very minor or is it relatively - is there some importance and look at the economics of it between program availability and cost versus your audience access and distribution potential?

We basically bifurcated the syndicated programming that we own for our diginets and made Antenna TV, which is now Nielsen rated and doing very well. It is something like if it were a cable network, it would be in the top 65 cable networks in terms of total audience delivery. And we just rated it by Nielsen earlier this this year. But Antenna TV is not focused on 50s and 60s sitcoms and Rewind TV, we just kind of bifurcated the programming and made that more of a 70s and 80s sitcom network. And right now it's virtually distributed in just in the next our platform, but reaching approximately 50 million homes. And we'll grow that distribution over time. Primarily now the advertising is direct response, but it has the - easily has the potential to be a double-digit million revenue contributor on top of what we do with Antenna TV in 2022.

Okay, thank you very much.

Thank you. Our next question comes from Alan Gould with Loop Capital.

Thanks for taking the question, I've got two questions. First for Perry. Political, anything you can read into how political is doing this year versus 2018? And read into what that might imply for - versus 2019 and what that might imply for next year? I know you said between 2018 and 2020. But any chance '22 could beat 2020? And then I'll have a question for Tom after that.

Well, I don't want to be irrationally exuberant here as it relates to political, but as you look at our footprint and the races, I mean, we're going to have - we're going to participate in 30 of the 34 Senate races and the ones we think will be particularly competitive next year will be Florida, Ohio, Pennsylvania, North Carolina, Georgia and Nevada, Wisconsin, Governor, 31 of 36 races, and again, Florida, Pennsylvania, Kansas, Maryland, Michigan, Georgia, Wisconsin and in the House, we've literally participated in 355 of the 435 races. So, we think we'll do very well. We are not guiding to a number that would equal or exceed 2020 in terms of total ad revenue, where we generate over $600 million in revenue. But I think that as the year goes on, and of course you know it's, political is kind of a wild card in terms of who's in, who drops out, what races change, where the money flows, but I think that will be a lot closer to 2020 than maybe most folks are thinking, but we're not guiding to a number equal to that or greater than that for next year.

Thanks, Perry. And then for Tom, Tom has a word in the press release I haven't seen since pre-pandemic that is visibility. I mean, you're talking about visibility, talking about a big political year 20% plus free cash flow yield, and you're going to have a lot of incremental revenue and cash flow coming out of political, you've been consistently buying back about $150 million worth each quarter this year. Would it make sense to increase it now in the anticipation of what you should be generating next year?

Well, I think that would be probably a little bit out over our skis you know typically we have not borrowed to buy back stock or to you know, pay dividends, which would - it would take us doing that to increase it basically, we're spending what we bring in from a debt and from a you know, return of capital to shareholders perspective. So, I would not anticipate that being the case. But I would tell you that you know, our cash flow is a little bit countercyclical relative to other broadcasters largely due to the fact that we get the large Food Network distribution in March of every year. So our free cash flow in Q1 will be significant and kind of countercyclical to what you would think of a broadcaster having a modest first quarter EBITDA and free cash flow, it will be our - may not be our largest for the year, because of political in Q4, but it'll be larger than a typical broadcast free cash flow. So you'll see more availability and our resources will increase in Q1 and we'll allocate that when we get to that point.

Okay, thanks.

I think the x factor all of that is going to be what M&A opportunities that are currently percolating bubble up to the surface. And you know I think that will determine you know the capital allocation which is something that the three of us talk about literally almost every day.

Okay, thank you.

Thank you. [Operator Instructions] Our next question comes from Connor Murphy with Deutsche Bank.

Hey, guys. How are you? Can you just talk a little about how your conversation with national advertisers has evolved? Now that you have NewsNation, The Hill as sort of a suite of digital and national news products. I guess secondly you know as we think about you know heading into the '22 political cycle, should we expect a big marketing push over the next couple of quarters to build even more awareness for NewsNation to drive incremental ad spend on those platforms next year? And then on top of that a better positioning NewsNation ahead of obviously a bunch of distribution deals you have coming up at the end of '22? Thank you.

We'll start and work our way backwards through all of that. NewsNation is you know, is already distributed on the MVPDs that are up for renewal in 2022, it'll just be a question of what enhancements we can make to that from a rate per distribution perspective. Most of the virtual MVPD deals expire at some point next year or in 2023. We participate in all of those or most all of those now. So again, it's what we can do to upgrade. You will see a continued promotional push, our awareness number is up to 21% of the country. But as I'd like to say that means, you know 79% is still a greenfield opportunity for us in terms of NewsNation. You know anecdotally you know, the Salesforce for The Hill secured $2 million order from Google in the fourth quarter, that would not have happened likely without our ownership and the ability to advertise our portfolio as a portfolio to Google. But that did result in an incremental $2 million revenue that was not in their plan. So I think that's a preview of coming attraction of what we can do. We're still in the early phases of the integration with The Hill, we realized most all of our synergy targets, but you know people are still not yet on our payroll and benefit plans, that all happens in the first of the year. So and we're about to name a new General Manager for The Hill kind of an individual with Washington insider experience, which we think will be hugely beneficial in elevating our visibility in the ad community there. So you know we're excited about our prospects for The Hill and continue improving the BestReviews as well as NewsNation. So you know I think all taken together, you'll see more of the proof of your concept of an integrated cell you know as time goes on in 2022.

Okay, thank you.

Thank you. Our next question comes from Monica Liu with Onex Credit.

Thank you. Congrats on the quarter and then congrats to the new role, Lee Ann. Just wanted to follow-up on your comment on the direct operating expense increase. It looks like that increased about [indiscernible] percentage of revenue. Understand you talked about some of the drivers there. I'm wondering if you mind repeating that. And also, if you're seeing some of the increasing reverse retransmission also contributing to the increase of OpEx as a percentage of revenue? Thank you.

Yeah, so I think a couple of things there. So just what I said before was that, it was primarily a result of higher revenues related to the recovery in core and digital advertising. So you know commissions and everything is kind of in that number, as well we had some expenses from - some new expenses from the acquisitions like The Hill and the like. I think as a percentage of revenue if you look at it quarter-over-quarter, Tom and I were talking about this last night you know, 2020 you got to remember is a, got a lot of political revenue in it. So the margin looks better in that quarter, because there's just more revenue in that quarter.

Okay, thank you.

Thank you. Our next question comes from Craig Huber with Huber Research Partners.

Yes. I have a follow-up if I could ask. The new standard ATSC 3.0. Maybe if you just update us somewhere Nexstar is with that? What's the longer-term business plan there? And how significant could be to you guys on the revenue side?

Sure, well we will have markets by the end of this year reaching approximately 30% of the US, approximately 30 markets. We anticipate having 50 markets on the air with an ATSC 3.0 signal reaching half of the country by the end of next year. That's just the Nexstar platform and portfolio. And you know this is literally you know you have to build the toll road before you can you know charge people to drive on it. So, this is done primarily to quote “light the light in an ATSC 3.0 set which are on sale and your local BestBuy or appointment - appliance store now, and there'll be more sets and cheaper sets coming online in 2022. But we've got to build the - build out the infrastructure before we can build any kind of a use case. But we're involved in both the Pearl Consortium as well as [technical difficulty] in terms of developing the uses of the spectrum. And I think you know we're very excited, we - you know, spectrum is typically valued on a per pop basis and retrans is valued on a household - per household basis. And so they're kind of valued and measured the same way. And I've said before I think that you know, 10 years from now, we'll be generating as much revenue from ancillary uses of our spectrum as we do from distribution revenue today. I think it'll take almost 10 years to get there. But I think this is like the mineral rights of television broadcasters, it's in the ground, we just have to you know, build out to be able to monetize it, but we think it's significant. We think there's autonomous cars, there's internet backhaul, there's all sorts of you know each of our broadcast…

That's, great. Thanks, Perry.

Thank you. I'm showing no further questions at this time. I will now turn the call back over for closing remarks.

Well, thank you very much everyone for joining us today. We look forward to joining you in the New Year to update you on our fourth quarter results, but most importantly, to update our free cash flow guidance for the '22 and '23 two-year cycle. So thanks for joining us, and we'll look forward to talk with you soon in the New Year.

This concludes today's call. Thank you for your participation. You may now disconnect.