Sinclair, Inc. (SBGI) Q1 2012 Earnings Report, Transcript and Summary

Greetings, and welcome to the Sinclair Broadcast Group First Quarter 2012 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, David Amy, Executive Vice President and Chief Financial Officer of Sinclair Broadcast Group. Thank you, sir. You may begin.

Thank you, operator. And good morning, everyone. Participating on the call with me today are David Smith, President and CEO; Steve Marks, Chief Operating Officer of our Television Group; and Lucy Rutishauser, Vice President, Corporate Finance and Treasurer. Before we begin, Lucy will make our forward-looking statement disclaimer.

Thank you, David. Good morning, everyone. Certain matters discussed on this call may include forward-looking statements regarding, among other things, future operating results. Such statements are subject to a number of risks and uncertainties. Actual results in the future could differ materially and adversely from those described in the forward-looking statements as a result of various important factors. Such factors have been set forth in the company's most recent reports on Forms 10-Q, 10-K and 8-K as filed with the SEC and included in our first quarter earnings release. Our earnings release was furnished to the SEC on an 8-K earlier this morning. The company undertakes no obligation to update these forward-looking statements. The company regularly uses its website as a key source of company information, which can be accessed at www.sbgi.net. In accordance with Reg FD, this call is being made available to the public. A webcast replay will be available on our website later today and will remain available until our next quarterly earnings release. Redistribution of this call is prohibited without the expressed written consent of the company. Included on the call will be a discussion of non-GAAP metrics, specifically, television broadcast cash flow, EBITDA, free cash flow and leverage. These metrics are not meant to replace GAAP measurements, but are provided as supplemental detail to assist the public in their analysis and valuation of our company. A reconciliation of the non-GAAP metrics to the GAAP measures in our financial statements is provided on our website under Investor Information, Reports & Filings.

Thank you, Lucy. Before we go through the results, I wanted to highlight some of our more recent accomplishments. Effective April 1, we closed on the acquisition of the 8 Freedom Communications' television stations as we mentioned on our February earnings call based on the 4.7 TV station acquisition effective January 1. The transitions of the stations onto our systems are basically completed. And as David Smith mentioned this in his closing in this morning's earnings release, we want to reiterate it here. Our hats are off to our employees as we increase the number of stations by almost 30%, bringing in into our systems which went off without any major bumps. Steve will talk about some of the local success stories we've enjoyed with the new stations later on. We are also very pleased to report that we exceeded our publicly provided financial estimates for the quarter. Now, turning to our results. Net broadcast revenues for the first quarter were $192.2 million, an increase of 23.2% or $36.2 million higher than first quarter 2011. It's slightly higher than our guidance. Excluding the $26.2 million from the acquisitions, same station revenues were up 6.4%. And excluding the acquisitions in political, same station core revenues were up 4.8%. Attesting further, for the Super Bowl, which was aired on our 1 NBC station this quarter as compared to our 20 FOX stations last year, our same station revenues were up 9.2%. Core growth came primarily from retransmission revenues and higher Freedom LMA management fees. Television operating expenses in the first quarter, defined as station production and station SG&A expenses before barter, were $96.3 million, up 32.1% or $23.4 million from first quarter last year. Excluding $17.6 million related to the acquisitions, $400,000 of stock-based compensation and $1.2 million of corporate overhead allocated to the TV operations, same station expenses were up $4.6 million or 6.3%. This increase was due to higher reverse retrans fees and higher employee compensation. Corporate overhead in the quarter was $9.4 million, up $700,000 or 8.1% versus the same period last year. Excluding $2.3 million in stock-based compensation and adding $1.2 million of expenses allocated to the TV operations, corporate expense would have been up $1.9 million due to acquisition-related costs and staffing, as well as certain compensation increasing. Television broadcast cash flow in the quarter was $81.1 million, up $15 million or 22.6% from last year's first quarter BCF. Broadcast cash flow margin on net broadcast revenues for the quarter was 42.2%. The acquisitions contributed $7.8 million of BCF in the quarter. On a same-station basis, BCF was $73.3 million, up 10.8%. I want to remind everyone that first quarter includes Four Points' results and only the Freedom LMA management fee. Freedom's results will not be reflected in our numbers until second quarter. EBITDA was $76 million in the quarter, up $14.7 million or 24.1% higher than the same period last year. EBITDA margin on total revenues was 34% for the quarter. Four Points plus the Freedom LMA management fee contributed $7.8 million of EBITDA in the quarter. On a same-station basis, EBITDA was $68.2 million, up 11.3% in the quarter. Net interest expense for the quarter was $27.4 million, that's down $1.8 million versus first quarter last year despite adding the $180 million for the Four Points financing, which we believe is a real testament to how well we've managed the balance sheet. We had diluted earnings per share of $0.36 in the quarter compared to $0.19 in the same period last year. The acquisitions added $0.02 to EPS in the quarter. We generated $34.2 million of free cash flow in the quarter and $150.9 million for the trailing 12 months. During the past year, we converted 53.1% of our EBITDA into free cash and distributed 25.6% to our shareholders. We produced a 16.8% after-tax free cash flow yield on our market cap and paid a 4.3% dividend yield based on our first quarter ending price of $11.06. The Board declared another $0.12 quarterly dividend and this implies a yield of 4.65% based on yesterday's closing. And that brings me to valuation. We believe our current public trading multiple, taking into account the competitiveness of our TV operations, our balance sheet and $190 million of value in our other operating divisions is surprisingly low. From our perspective, the recent decline in multiple seems severe, giving us solemness of our industry's business fundamentals and our prospects for monetizing the digital spectrum. Lucy will now take you through the balance sheet and the cash flow highlights.

Thanks, Dave. Total debt at March 31 was $1,367. 2 million, which includes the draw of the $180 million term loan B for the Four Points closing. That also includes $53.8 million of the non-recourse VIE debt that we are required to consolidate on our books and another $10.7 million that is related to Cunningham staff. On April 2nd, we borrowed the remaining $350 million in term A and term B loan commitment for the Freedom closing, bringing our post closing debt balance to $1,717.2 million. We ended the quarter with $26.8 million of cash on hand with 0 drawn under the revolver. Total net leverage through the holding company was 4.14x, that's down slightly as compared to the 4.18x at the end of 2011. This excludes the VIE in non-recourse debt and is net of cash. First lien indebtedness ratio was 1.75x on a covenant of 3.25x, the total indebtedness ratio through the television operating company was 4.11x on a covenant of 7.25x, and interest coverage was 3.19x on a covenant requirement of 1.35x. So we're in good shape with our credit stats. I want to remind everyone that when you're calculating the covenants, you will need to pro forma the EBITDA for the acquisitions so that you're your reflecting a full 12 months. So for instance, Four Points is reflected in our first quarter results but not the last 3 quarters of 2011. The pro forma add for those missing 3 quarters is $23.9 million of adjusted EBITDA. When you get to your year-end 2012 EBITDA estimates, keep in mind that there will be 1 quarter of Freedom's results not in our reported numbers, so you'll need the pro forma for that 1 quarter for both covenant calculation and valuation. Capital expenditures in the first quarter were $6.7 million with no change to our full year guidance of $45 million. Cash programming payments in the first quarter were $16.6 million and estimated at $69.8 million for the full year. Now Steve Marks will take you through our operating performance.

Thank you, Lucy. And good morning, everybody. Our net broadcast revenues in the first quarter were $192.2 million. And as Dave mentioned, slightly exceeding guidance. This reflects a 9.2% growth in the same station core business, excluding the acquisitions, political and Super Bowl. We are very pleased with how well the new stations are performing under Sinclair. KUTV, the CBS affiliate in Salt Lake City which we acquired from Four Points, gained market revenue share year-to-year over in the first quarter of 2012 despite losing Oprah. WPEC, the CBS affiliate in West Palm Beach, which we acquired from Freedom, was rated #1 in the February 2012 rating books in the 11:00 p.m. news on adults 25 to 54, Monday through Friday, for the first time since it tied for #1 in the Feb 2010 book. Meanwhile, the Sinclair legacy stations saw strong rating increases in the February book versus the November book for Big Bang Theory and Family Feud, and this should be beneficial to our CW or MyNetwork stations in dealing with the buying community. Political revenues in the quarter were $3.6 million as compared to $600,000 in the first quarter last year. Primary difference to our $4.0 million guidance was due to the Texas primary being moved out of the first quarter and into May, and now with the Republican primary completed we may see less political from the state than originally anticipated. Local broadcast revenues were up 26.4% in the first quarter. Excluding political, local was up 26.1% for the quarter. On the same-station basis, local net broadcast revenues were up 8.4%. National broadcast revenues were up 12.4% in the quarter including political, and up 5.3% excluding political. On a same-station basis, national net broadcast revenues were down 0.06%. Some station categories that were up in the quarter were automotive, media spending and medical, while weaker categories were services, schools, fast food, telecommunications, pharmaceuticals and entertainment. We feel the questions from investors regarding the state of the movie category, this category is not significant for us, representing less than 1% of our time sales. Same-station spending by the automotive sector represented 21.3% of our time sales and grew 2% in the quarter, in line with our guidance of low single-digit percent growth due to the Super Bowl being on fewer of our stations this year as compared to last. Turning to our outlook for second quarter. We are estimating that net broadcast revenues will be approximately $211.2 million to $212.2 million, up 32.6% to 33.2% as compared to second quarter 2011. This assumes $4 million of political versus $1.2 million in the same period last year. Also included is $47.5 million of revenue related to the acquisitions, which includes Freedom's results. Excluding the acquisitions and political, our core revenues on a same-station basis are expected to be up 1.8% to 2.4% in the quarter. Our second quarter on a same-station basis is expected to be driven by retrans renewals, digital interactive revenues and time sales growth. Categories expected to grow are automotive, direct response, and restaurants. While schools, telecom, entertainment, services paid, and fast food are expected to be down. Auto, which will be cycling over the impact of the tsunami last year, is expected to be up mid-teen percent in the second quarter on a same-station basis. On the expense side, we are forecasting our TV production and SG&A expenses in the second quarter to be approximately $106.2 million, of which $24.2 million relates to the acquisitions. $1.4 million relates to corporate expenses that we will be allocating to the stations, $300,000 to non-cash stock-based compensation. Excluding these, same-station expenses will be up 10.3% over the second quarter last year. Included in the $7.5 million same-station increase is higher reverse retrans payment for the networks, station maintenance expenses, our compensation and bonus expense and variable expenses relating to higher sales. The acquisitions are expected to contribute $21.2 million of EBITDA in the quarter. The same station EBITDA is expected to be down $4 million to $5 million due to the expense growth as discussed. Based on our guidance included in our earnings release provided this morning, we are expecting EBITDA in the second quarter to be approximately $82.4 million to $83.4 million, or up 24.5% to 26% over the same period last year. With that, I now would like to open it up for questions.

[Operator Instructions] Our first question is from Bishop Cheen with Wells Fargo.

A lot of moving parts, so let me just make sure I got this right. For the -- on the pro forma basis and the way your covenants work for the 4 quarters, I think, Lucy, you said we should be adding $23.9 million of EBITDA on a trailing 3-quarter basis, correct?

Yes, that's correct. So that's trailing 3 quarters, but that is an adjusted EBITDA. So there's certain pro forma items that the bank agreement allows us to add back in.

Right. And is that for both Four Points and for Freedom or just Four Points?

And that is just Four Points because Freedom does not come into our numbers until the second quarter.

Okay. And then can you give us some guidance as we look towards year end to the pro forma all-in number, with everything in, or for EBITDA? Because you mentioned that -- you said when you do your work, make sure you have it all in there. So Four Points, at least we have a base, can you remind us again with Freedom?

Yes. So we have not put out any Freedom full year numbers. And I -- so what I would say is just -- and this would be a -- the minimum EBITDA add back, if I sort of point you to the $385 million that we bought them for, divided by the 6.6x buyers multiple, and then if you take that over the 4 quarters, you end up close to $15 million of EBITDA...

Per quarter.

Per quarter. Right.

Right. So that was an average, Bishop, also between odd and even. So when you're looking at this year, we have the benefit of political. So political net this year with both Freedom and Four Points in it, we're projecting in excess of $60 million and your old number that you're -- you would be thinking of in terms of Sinclair legacy was about $43 million, in that neighborhood for the year. So it'd give you some sense of where the -- where to go with that average.

Our next question comes from the line of Alexia Quadrani with JPMorgan.

This is Nadia Lovell in for Alexia. I was hoping that you can give us some colors on how auto has been progressing through the quarter. Has momentum been built in to get to that mid-teens pacing that you gave?

I didn't hear the second part of it. Could you repeat the question again?

Sure. I was wondering if you can give us a little bit more color on auto, how it's progressing through Q2. And if momentum has been built in to get to the mid-teens pacing that you gave?

Yes, it has been building. Last year at this time, we started getting massive cancellations. So the pace for April, before the tsunami actually took place was very positive and extremely strong. And it will continue to get better because we fielded quite a few cancellations from this point going forward last year. So the pace at a minimum should be able to maintain, if not pick up a little bit. We are in that mid-teens area and that's an extremely strong number. As you go throughout the course of the remainder of the year, we will still have the benefits of Toyota, Honda, and anybody that was directly affected by the tsunami, getting back to regular expenditures. So I think this category, which is so critical to our business, is off to a real good start. We were plus in the first quarter with a lot of Super Bowls that we didn't enjoy from last year in this category. We're putting up a big number in second quarter, and we expect that this category will continue its momentum throughout the remainder of the year, actually.

Okay. And then can you talk a little bit about how, in general, from an advertising standpoint, how national is looking versus local?

This is the first quarter that I can reference in quite some time, and I think a good part of it is because of the tsunami and a lot of automotive business obviously being placed national. We're looking at national in the second quarter to out-distance, in terms of pace, local. And that's the first time that we could make that statement in quite some time. So national is picking up and that is a terrific reference point for us because it's been a long time coming.

And then for clarification, I'm not sure if this question is for you, Lucy, but the $47 million -- or roughly $47 million that you gave for the acquisition -- revenue from the acquisition in Q2, now that Freedom is included and Four Points for Q2, I'm wondering if that's a good neighborhood for these -- that these stations could deliver from a revenue standpoint x political, and if there are any retrans deals that we should be considering?

Yes. I'm not sure, Nadia, what you're looking for there. As far -- I mean, the Q2 guidance is what it is. I'm not sure if you're asking for full year guidance or...

Well, I'm just -- I'm -- now that we have both acquisitions in Q2 versus in previous quarters you had LMAs. I'm just trying to get a sense if that's a good neighborhood for what these stations could have in terms of revenues x political.

Yes. Let me address that. Because in our comments we were talking about how excited we are about our performance to date. We picked up some very, very strong television stations. And when you look at the first quarter performance, it should give you some insight to how we're performing. Grand Rapids, for argument's sake, had one of the strongest first quarter audits in the history of the station. KUTV in Salt Lake City, #1 biller in the marketplace, increased share with not having Oprah on the air year-to-year. West Palm Beach, as we made mention, #1 in late news, and that happens very rarely in that marketplace. Austin, Texas, grew share at the first quarter. You could go right down the resume of the acquisitions and these, again, are very strong television stations that did not have the benefit of Super Bowl either this year or last year, and they increased share with our leadership. So they are performing, not only to expectation, but you're beginning to see what Sinclair is bringing to the table. These are very strong television stations that grew share in first quarter, and are performing quite well for second as well.

And just my last question, for just a little bit more insight. The other divisions' revenues was a bit stronger than we had anticipated. Can you talk about a little bit what drove performance there?

Sure. It's primarily going to be coming from Alarm Funding. It's a business we have in -- that it's producing significant EBITDA. And I think in terms of just bottom line performance, we're looking at close to a $10 million EBITDA this year coming out of that other group. And probably $6 million or $7 million of that will be driven by Alarm Funding. The rest is coming from a lot of the real estate businesses and a bit from the Triangle Signs company.

Our next question comes from the line of Marci Ryvicker with Wells Fargo.

A couple of questions for Steve. Just clarifying your comments on national, were you talking about the pickup being generally across the entire broadcast categories? Or were you talking specifically about national auto?

I'm actually talking both. When you add up all of our dollars, national is pacing pretty positive. So again, that side of our business is definitely on the plus side.

And did you say it was better than local?

Pacing better than local in terms of a percentage over last year.

Okay. And then we know that your affiliation agreement with FOX is up for renewal at the end of this year. Can you just talk about how the tone of conversation has been? While I was at the NAB -- it sounded like FOX has become a little bit more cordial with the affiliates in general. Just curious as to your take.

We're making progress, Marci. So I guess cordial is a good way to describe it as we, hopefully, will have something to announce here prior to the end of the second quarter.

Okay. And then my last question is with regards to this political public file disclosure stuff that we've written a lot about. I think the one point that we probably overlooked is the fact that broadcast TV is the only media to have to succumb to this requirement. So can you just talk about what recourse you have? And what you think the timing of this is going to be?

Well, as far as recourse, I think it's -- the top 50 markets have so many days to get it done and place it on the website. So it's moving it from the public file that exists in the -- at the stations today. And so the information has been available. It's, as you point out, a focus on broadcast TV only in terms of revealing rates. There is no requirement for cable, there is no requirement for newspapers, et cetera, to reveal their political rates. So whoever is looking at that, it's -- they're seeing only a partial picture of what's going on and it's, I think, places -- I think most of us would say that puts our competitors at an advantage to us because we can't look at their rates as easily as they can look at our rates.

[Operator Instructions] Our next question comes from the line of Aaron Watts with Deutsche Bank.

Okay, so just couple of clarifiers real quick for me. When you were talking about same-station local revenues up, I think, 8.5%, national down around 0.5% in the first quarter. Was that including political or x political?

Including.

Including, okay. And then same thing on the guidance. The 2.7% to 3.4% up for the second quarter for net broadcast revenues, is that including political as well?

That's correct, Aaron.

Okay, perfect. And then I guess as I think about that guidance, so you have auto up mid-teens, political is going to be up year-over-year but the same-station revenues are only up kind of wrapped around 3%. What's the big drag? What's going on there? What categories are really just struggling right now that's bringing that average down so much?

I wouldn't call it a drag. The way I see what's going on right now, to position it for the Street, we're seeing a huge benefit from the acquisitions in key categories. If you take a look at the original Sinclair stations, some of our key categories -- put auto off to the side for a second, some other key categories are actually being pushed up by the new acquisitions. If we're falling short anywhere, it's in categories that are traditionally unique to the MyNets and CW stations. But when you look at tech schools, for argument's sake, paid programming, direct response, these are areas that typically the MyNets and CWs excel in. Those categories are pacing a little bit behind. So what I look for going forward is in the back half of the year when political starts cramming some inventory, these MyNet and CW stations should benefit from that. We are well fortified, as I said in my comments, on the MyNet and CW side in terms of ratings. We picked up in almost all of our markets. Big Bang, Family Feud have made significant inroads in these stations, specifically on the MyNets and CWs. We're all dressed up and need somebody to play with, that's what it boils down to. So I think as the year goes forward, those 2 networks will benefit from a little bit more crowding on inventory, and we'll be able to tell our story a little bit more successfully on the ratings increases that we're enjoying with those 2 networks. So if there's any softness whatsoever, it's really more geared towards categories where we usually enjoy a bigger share, with the MyNets and CWs, i.e. the schools, direct response, paid, fast food, those type of categories, and that's what we're witnessing.

That's helpful, Steve. And then I guess just specifically on the telecom category. Is that still kind of hangover from the same issues we've been seeing for the last few quarters?

I think if I was ballparking the telecom, I think it's pretty much just about bottomed out. The decreases that we've seen over the last handful of quarters, we're starting to see less of a decrease. Although we're still seeing decreases, they're not as monumental as they were over the last year. So I think that speaks to the category as pretty much found its bottom for the most part. And probably a category that will go cyclical and as time goes on, it will rebound. But I think it's at a level right now where the losses, when compared to other quarters, has pretty much bottomed out.

Okay. And last question for me. I know this is a tough one to answer because we're in the early days. But anything you can gather from a ratings standpoint with online viewing, mobile viewing of prime time content and whether that's impacting kind of your lead-ins, lead-outs for your kind of non-prime time content.

Well, I could tell you from our standpoint in the markets that we're in and the leverage that we have in bringing to the table in terms of buying programs that register in the rating books, we enjoyed in February some of the strongest ratings that we've ever had as a company. A couple of shows have literally resurrected some time periods in television stations, i.e. the Big Bang and Family Feud. So I think from a ratings standpoint and what we're enjoying, we've never been in a better position. And that's all what we've got to go by. When the book is printed, we take a look at how it compares to previous years, and we're in a good position.

Okay. So some of the viewership erosion that's being seen, maybe more so in the younger demographics to some of your viewing options online, you're not seeing anything kind of hurting your kind of non-prime time content?

Like I said, my ratings are up. I mean anywhere where I'm running Big Bang, which I'm running all over the place, and Family Feud all over the place, my ratings are up.

Our next question comes in the line of Edward Atorino with Benchmark.

You gave an EBITDA number and you rushed through it and I wasn't able to write it down. Would you mind repeating it?

Was that for the forecast, Ed?

Yes.

Yes. So we said, based on our guidance that we gave this morning, we're expecting EBITDA in the second quarter to be approximately $82.4 million to $83.4 million. And that's up 24.5% to 26% over last year. And in that number is $21.2 million from the acquisitions.

Okay, I just missed it, I guess, or couldn't write fast enough.

Ed, I started getting a little faster there. I was trying to go slow but...

I understand. I understand. It's -- that's fine. That's fine. Oh, Lucy, is the -- I was looking for the reconciliation numbers, it looks like the 1 -- Q1 '12 is not there on your website?.

Let me check that as soon as I get off the call.

[Operator Instructions] Our next question comes from the line of Howard Rosencrans with Value Advisory.

Some of my questions have certainly been answered. I didn't -- I thought you said something regard -- in your guidance for Q2, you said something about -- in the press release it says excluding acquisitions, you're guiding to net broadcast revenues up 2.7% to 3.4%. I then thought I heard you say something about 1.8% to 2.4% in the call. Did I hear something wrong?

No, Howard. So the 2.7% to 3.4% up, that is same-station including political. And the 1.8% to 2.4% up is same-station excluding political.

Okay. So that's the real core number, okay. And the -- I -- could you just save us, in terms of the easy math or the -- if we back out the acquisitions, what sort of EBITDA growth are you looking for, for Q2 on a same-station basis in EBITDA, if we back out that $20 million-something from the $83 million-ish?

Yes. So the EBITDA would be down on a same-station basis excluding the acquisitions. That would be down about $4 million to $5 million.

That would be down $4 million to $5 million. Okay. Can you tell me why, please?

Yes. What we were talking about there is the fact that the networks -- the portion of retrans that we pay to the networks is starting to build. And that's the growth in the reverse retrans, that's the primary driver.

Is that particularly lumpy? Or...

No, it's just -- we haven't been in a situation where all contracts that relate to the networks are pay -- the way we pay our reverse retrans, so it's a timing matter as contracts came up and reverse retrans payments became -- started to be paid. So it's a number that's building over time. So we had retrans without reverse retrans. Now we have both retrans and reverse retrans payments. So think of it is a catch-up, where the expense is starting to catch up to the revenue line.

Okay. So if you would, could you tell us where you stand in terms of bulking up than the straight retrans number? When do the contracts expire with the distributors? Where do we stand? Just the majors. You don't need to go through the small satellites or whatever. I guess it's really the major cable and I forgot which one is -- which ones are very important. But just to -- the real guys that really move the needle.

Sure. The -- I wouldn't say there's -- satellites are small but Direct and Dish are the primary, are very big in terms of the coverage of their markets. They're both coming up here. Dish comes up later this year, Direct in the beginning of next year. So those are kind of the beginning of a new round of retrans for us. If you're -- I don't know how long you've been following Sinclair, but I guess, what, 6 years ago, we really -- our retrans was really started off by through the satellite guys and then to the cable guys and then it's -- so that's kind of the cycle. Satellite, cable, satellite, cable. And there's a few cable deals that have to get done this year, but most of the majors are completed at this time and they'll start cycling in over the next couple of 3 years, it'll come back. Satellite is, I'd like to say, a large coverage of our markets and they have a significant percentage of viewership. And so, those are coming up, like I said, 1 this year and 1 next.

Okay. And your agreement now for the reverse retrans is set through -- that your -- you -- because you have the new Fox agreements coming into place. Or is the -- how long are your, I guess, reverse retrans rates now set at?

Well, yes, they're set. We're in -- like I mentioned earlier, we hope to announce the FOX affiliation agreement that expires at the end of this year. We hope to announce the renewal of that agreement sometime during this quarter. And the other significant affiliation agreement that we have is ABC, that's through the middle of '16...

'15.

'15, I'm sorry. And CBS is -- we have two that come up at the end of this year. And the rest of our CBS affiliates are through the acquisitions we've been talking about, and those come up later, '15, '16, '17. They'll be further down the road.

Okay. So just so I understand. So this FOX agreement, the new Fox agreement that you'll hopefully enter into this quarter, I mean, it'll be fair to say that there'll be another bump in the reverse retrans associated with that?

Oh, yes. There is a schedule that comes with FOX as far as how they calculate the reverse retrans.

Mr. Amy, we have no further questions at this time. I would now like turn the floor back over to you for closing comments.

All right. Well, thank you, operator. This will end our conference call. And I'd like to thank everybody for participating on the call this morning. And if you have any further questions with all these moving parts and the complexity that we have, please feel free to give us a call. Thank you.

Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation and have a wonderful day.