Gray Television, Inc. Q3 2008 Earnings Call Transcript

Nov.25.08 | About: Gray Television, (GTN)

Gray Television, Inc. (NYSE:GTN)

Q3 2008 Earnings Call

November 5, 2008 11:00 am ET

Executives

Robert S. Prather, Jr. - President and Chief Operating Officer

Hilton H. Howell, Jr. - Vice Chairman of the Board, Chief Executive Officer

James C. Ryan - Chief Financial Officer

Analysts

Marci Ryvicker - Wachovia Capital Markets, LLC

Scott Van den Bosch - Navigare Partners, LLC

Unidentified Analyst - MJX Asset Management

Linda Carne - Credit Suisse

Matthew Lee - Octagon Credit

Larry Schumacher - Oppenheimer & Company

Troy Isaacson - Princeton Advisory

Operator

Good day everyone and welcome to the Gray Television’s third quarter earnings release conference call. Today’s call is being recorded. For opening remarks and introductions, I would like to turn the call over to Mr. Bob Prather. Please go ahead sir.

Robert S. Prather, Jr.

Thank you Operator and I want to welcome everybody to our third quarter earnings call. With me on the line is Hilton Howell, our Vice Chairman and CEO and Jim Ryan, our Chief Financial Officer. Hilton would say a few opening remarks so Hilton I will turn over you right now and we will go from there.

Hilton H. Howell, Jr.

Thank you very much Bob. First, I wanted to just take this opportunity since my recent appointment to introduce myself to the industrial community here with Gray Television, but also I want to a moment to compliment Bob Prather and Jim Ryan who have been handling our investment relation calls in the past because I think they have done a superb job and their going to continue in that role. But I want each one of you to know that I will be participating in many of these calls going forward because I think that it is very important for our management team to make itself open and available to you. Bob and Jim have always said that we answer our own phone calls and we are always available to talk to you whenever you need to talk to us and I am certainly in that same camp with them. But also want you to know that while I will be participating I do not intend for us to step on each others toes as a management team because I want these guys to be able to answer those questions.

The things that may come directly my way I want to be able to be here for you because there is nothing more important to each of us and certainly to me in particular than increasing the shareholders value in their investments in Gray Television because truthfully, all of us believe very sincerely. The Gray is the best operator of TV stations in this country and that Gray has the best single collection of TV properties in this country and I personally believed that long term I have a truly high degree of optimism about the television broadcasting business in the television station business in particular. Because as I look around that all the businesses that I have had the opportunity to work in or to look at and review it remains about the best business that I know of and many of you may know and many of you may not know but the Howell family has been an investor in this Company for some of its predecessors since the early 50’s with the advent of KWTX at that time. And I am proud to say that we have not sold a share in all of those years and it disappoints me greatly to see where our shares prices right now because I think it shows a real fundamental lack of understanding of the true value of our businesses.

I am 46 years old and since I was a little boy I was listening to dinner table conversations about the TV station business and something that I have always noticed that I have never fully understood is that this is just about the biggest chicken little business that I have ever been a participant in. Because it is either been the remote control from a long time ago or the advent of cable television or the face out of network comp or the advent of TiVo that the investing public or the management teams swing our hands over. But I am certain that if we continue as a business to pay attention to our markets, to our viewers and most importantly to our advertisers that is still going to be one of the most outstanding businesses is going forward. And as I look forward to 2009, there is a lot of negative activity out there because our economy is an open question and people are concern about advertising levels going forward and it is a legitimate concerned but I am truly optimistic and really excited about finally getting a return on our enormous investment over the years in high definition television.

I am particularly pleased with what is going on with regards to retransmission consent in our television station broadcast business and with what I think that Gray Television will be getting out of that going forward. And I am also really excited and Bob has always made a great point of this and I think it is really quiet profound with the advertising revenues that we are getting from our internet websites because I mentioned in that chicken little comment that people were concerned about the face out of network comp.

A statistic that I absolutely love is that our advertising revenue from our websites in many instances has eclipsed the hallmark in network comp that we got in the past. And I think something else which is really important as eyeballs have began to migrate from the printed page. I believe that more and more opportunities will be open to our local television station to our sales teams and our various managers to take those advertisers because I believe very sincerely that the best way to drive traffic into a retailers operation is broadcast local television and I think that our TV stations in our market have the best ability to do that. And so, I think as long as our businesses continue to do the blocking and tackling that I think we are particularly good at, then I think that the future for Gray Television is really, really excited or exciting and I am personally very excited about being able to participate in a more direct an open manner with the management of this Company.

With that being said, let me turn it over to your Bob for your comments.

Robert S. Prather, Jr.

Thanks very much Hilton. I want to start out today. I always like to start with a quote. The good friend of mine is on a third generation family business, recently said his grandfather told him 50 years ago, he said “Son, when business is good it will get bad and when it is bad it will get good.” And I am looking at this bad is going to get good right now. And I am going to focus on positive things that have been going on for us.

I will start out with the fact that our results are right at the very top of the industry if they are not at the absolute top. In a bad economy and in a tough time for broadcaster is particularly because if the EOs of the automotive industry but I think our numbers are right at the very top of our industry as far as other public companies go.

Number two Hilton makes in the internet. We continue to grow internet. We grew it 18% in the third quarter, in here again, that is in a tough economy with prices actually coming down online even online of advertising prices have come down pretty much across the board over the last few months but we continue to grow this business double digit and I think we will continue to that in the future.

One area that we are really pleased with is our retrans negotiations. We are in the process of negotiating about 60% of our cable subscribers right now for year end renewals and we are negotiations with several large MSOs. We already made deals with the good many smalls systems at very favorable prices for us and we have actually made a deal with one system over 100,000 subscribers that we are very, very pleased with. In addition, we just signed a new 5 year deal with Dish on all our markets with a very good retransmission deal with them also. So, we are very pleased with that.

Another thing that is very positive about us, you probably all seen a little bit in the press about NBC. We have an agreement in principle with NBC to renew our Huntington-Charleston, WSAZ station for three years virtually the same terms that we had previously reduced demanding our own affiliation agreement and it will expire. And also they went ahead and extended our station in South Bend, WNDU through 2011, it was up next year, so all our NBCs will come up for renewal now at the end of 2011, at that point with NBC and we are very pleased with that deal.

One of the thing, I think it is very positive for us is at the end of last year, I put in a program with all our managers that we called the triple play tellers. We really went after traditional advertising, newspapers, local cable advertisers and continued growth in internet. And I am pleased to say that at the end of nine months we have added $19 million of revenue from those sources. This obviously has had a huge impact on our numbers continuing to be right on top of the industry. It has made up in a lot of cases for declines and traditional TV advertisers especially automotive obviously. But it is something, we are very, very pleased with and we think we can continue to do even better with this as we get better at it. We have got programs in all our stations where we really know how to go in and show advertisers exactly what our sales proposition is, compare to newspapers, compare to local cable and other forms of advertising that doing yellow faces is another one that we also concentrate on. But this has been a very good area for us and we think this will continue to grow and we think the basic business will start coming back at some point and I do not know how long is it coming, is going last like it is but we are concentrating on watching our expenses, our budgets are being finalized for next year. Right now, we are cutting our expenses significantly going in the next year. We have already got our general managers bound in the fact that we all need to cut expenses going in the next year because obviously no political and no Olympics next year. It is going to make it a challenge.

But on the other hand, I think next year could be better than people think too. I think at some point the automobile industry has got to get out and advertise if they want to sell cars. I think people will only go so long without buying new cars and I think this is just a function of, at some point these guys stepping up and saying “Hey! We got to start advertising again”, especially the big three domestic makers and even the foreign guys have Toyota, Honda. They have all been hit pretty hard by this automotive recession we are in right now. But I think next year could be better than we think in that area. But we are going to watch expenses very close. We are going to watch capital expenditures very close. Going to next year right now, our plans are basically only capital that we are planning to spend is just pretty much for emergency purposes.

We are all very happy that the digital transitions happening on February, the17th next year, I think it is going to be good for industries. It is going to be good for everybody and the viewers, the advertisers and the station operators, so I think this is going to be a win, win, win for everybody. So, I am looking forward to that.

Political is a little bit disappointing. I think this is the good news and the bad news. The good news is there was more money spent in every TV advertising politically. The bad news is they are getting much more targeting with their advertising and if you want in a spot where they felt that they could really make a difference, they move the money somewhere else. I will use the example of Tallahassee and Panama City. Traditionally, we have gotten great political advertising down there. This year was way off and not only thought on that is they felt that was pretty much republican territory. They would not make any difference who advertises there and they spent all their money down in South Florida, in Orlando and Tampa. And I think you are seeing that going all around the country. The good news for us we had tremendous political advertising in Colorado, Nevada, some areas that we had not missed nearly got near as much in the past. So, from that standpoint, we were in the right spot. So, I think going forward on political is really going to be, you are going to be in the right place at the right. We are going to be much more careful on how we budget political in the future and try to figure out where we have got areas that there might be some vulnerability that candidates will want to spend money on. But I think this is going to be a continued trend in the future.

At this point I would like to turn it over to Jim and let him go through some more details and we will open it up for questions. Jim?

James C. Ryan

Thanks Bob. Good morning everybody. I will try to give my comments very brief. Looking at the quarter, our overall revenue with the political end was up 12%. Local ex-political was down three. National was down nine. In comparison to the report of the television bureau of advertising puts out that survey of over 400 stations and dozens of group owners. TVB indicated in Q3. Local ex-political was down about 8.5% and national was down almost 11%. So, on a relative basis, we are pleased with our results and certainly the local is reflective of the issues Bob was speaking about the triple play challenge in converting newspaper and cable and other local media dollar expenditures back over to our station.

The Olympic number in Q3 ended up at $3.4 million, which is consistent with the summer Olympics in ‘04 as well. As far as categories go, we did see actually a Telco up a little, medical was up, restaurants up as well. I think that may have been some bind associated with the Olympics, and supermarkets were doing well. Everybody is reporting our auto was soft; it was down about 18%. We also saw some weakness in the entertainment category. The financial, the furniture, appliance, electronics and the department discount stores.

Operating expenses came in slightly under where we thought they were and Bob already commented that we have worked very hard at our 2009 plans and will be significantly reducing our operating expenses going forward.

For the nine months, the trends are very similar as well. Year over year with our political, we are up. Local is trending down about 3.5% and national down between 6% and 7%. Again, those trends and local and national excluding political are still very favorable in relation to the TVB reports for the whole nine months. TVB was indicating that local was down 7% and national down 10%.

Political for the nine months is at $21.1 million based on the political guidance we have put out for fourth quarter looks like political fourth quarter came in at 26.5, which would put the total year at about 47.6 . The 26.5 in Q4 would be up a little bit from Q4 ‘06 and be basically consistent with Q4 ‘04 as well on a pro forma basis for the acquisitions we have made since ‘04. So, political in fourth quarter on a historic basis actually finished relatively strong and Bob has already commented on the concentration of political in certain markets and we got some winners and some losers this year just like everybody else.

Turning to balance sheet items for a moment. Cash at the end of the quarter was at $32.6 million and early October, we voluntarily prepaid on our term loan of $10 million. Debt at the end of the quarter was $830.4 million and after that $10 million in early October, it is stand at $820.4 million.

Our leverage ratio under our credit facility at the end of the quarter is at 7.29 against the 775 covenant. We had CapEx on the quarter of about $5.4 million bringing the total for the year to about $11.6. Negligible cash taxes in the quarter of about $300,000. Our cash taxes for the year are about $700,000 to date and will be a little shy of a $1 million for the full year. Program payments were $3.7 million in the quarter. The amortization was about the same number as well.

At this point, Bob, I will just turn it back to you.

Robert S. Prather Jr.

Alright, thanks a lot, Jim. Operator, at this time we would like to open it up for questions.

Question-and-Answer Session

Operator

(Operator Instructions). Your first question comes from the line of Marci Ryvicker – Wachovia. Please go ahead.

Marci Ryvicker – Wachovia Capital Markets, LLC

Thank you, good morning. I have a couple of questions. First, Jim, on the Olympics what is the local and national split?

Robert S. Prather Jr.

Marci, Honestly, I do not have that number. I would have to dig that out and get back to you. It is obviously going to weigh more heavily on local. I think it would follow more or less our routine split which is heavily weighted to local.

Marci Ryvicker – Wachovia Capital Markets, LLC

Okay. And then, a general question. How does the Board think about your dividend? Did they look at the yield or they look at the par ratio?

Robert S. Prather Jr.

Marci, we constantly evaluate the dividend. I think we look at every corner. The Board discusses it and I think we continue to do that and we have been paying a dividend for over 40 years. So, as long as we think it is prudent to do it, we will probably continue to pay it but we evaluated on a quarterly basis.

Marci Ryvicker – Wachovia Capital Markets, LLC

Okay. And then, in your retrans negotiation, has there been any trade off with digital channel placement or that is a non-issue at this time?

Robert S. Prather Jr.

No, we are getting digital channel placements as part of it. That is one of the things we are asking for especially where we have got this on networks. We think that is imported. Most cases that is definitely part of the negotiation for us and it is important for us to get as low tier as possible. We have been able to do that so far and some of the deals that, as I mentioned, the major MSOs, Comcast, Time-Warner, Charter, those guys we are just starting negotiations with them so we are waiting to hear back basically, term sheets from these guys. That is important for us to get as good a placement as possible these digital channels. If you get placed way up high on the channel placement, it is pretty tough to get people to find. So, it is important for us to get as low a channel placement as we can.

Marci Ryvicker – Wachovia Capital Markets, LLC

Okay. Thank you.

Robert S. Prather Jr.

Thanks Marci.

Operator

(Operator Instructions). Your next question comes from the line of [20.17]. Please go ahead.

Unidentified Analyst

I see you paid back $10 million voluntarily. Is there any reason you cannot go in to the open market and buy this at the heavy discounted trading at?

Robert S. Prather Jr.

Yes. There is a reason. Our loan agreement does not allow that. We are studying the fact whether we can get an amendment to allow us to do it but because we would like to do that at these discounts. It is an unprecedented discount unlike for most TV guys on their debt. It is something we are exploring with our legal team. And if there is something that is possible to do on prudent basis, it is something we would look at here.

Unidentified Analyst

Now, since the question before me was about the dividend. Now, since on a large common shareholder, have you ever considered, rather than the $5 million or whatever it is you are paying this out this year in dividends, you can buyback about 20% at a float with that. I believe in the companies as well as you. Why will you even consider suspending the dividends?

Robert S. Prather Jr.

Here again, I think, all options are on the table. I make that something will be discussed in our Board Meeting and I think it is legitimate point and it is something that is on our radar screen also.

Unidentified Analyst

Okay. Thank you very much.

Operator

Your next question comes from the line of Scott Van den Bosch – Navigare Partners. Please go ahead.

Scott Van den Bosch – Navigare Partners, LLC

I was just wondering, previously you had commented that you are comfortable meeting your comments would you please step down in the fourth quarter. Is that still the case or anything you want to elaborate on that level?

Robert S. Prather Jr.

Right now, we are comfortable. I think we are going to watch it closely. Obviously it depends on how business goes in the fourth quarter, but based on our projections right now, we feel okay about it. But there is a very little visibility out there, that is a pretty popular word these days, but I think you see it that in guidance from a lot of companies in a lot of different areas. I think people are having a hard time, really knowing what fourth quarter. I personally think that people are not go and forget about Christmas and I think the advertisers are going, including the car guys, are going to realize that Christmas is right around the corner. And I do not think they will just going to give up on Christmas. It is too important for retailers and too important for people. I am actually optimistic that fourth quarter might be better than we think. Although, I think a lot of it depends on how the market is perceived. In general, there is lot of the old perceptions reality. It is pretty true and I think people are pretty negative right now because of the stock market has been so volatile. People could still be sitting on their wallets but I am open for a better fourth quarter than people are thinking.

Scott Van den Bosch – Navigare Partners, LLC

Just one other question. I think in the past, you had mentioned that I think it was an NBC affiliate that actually as part of the negotiation, actually tried to get part of your retransmission fees. Have you seen that from anyone else or kind of heard any more of it?

Robert S. Prather Jr.

Yes. That is the only one we have seen it from. It did not happen. I have not heard it from anybody else. Although we do not have any other negotiations coming up right now and I am not sure I have not heard any public pronouncements like NBC made from CBS or ABC that they will trying going to go after retrans money. And I think we just got to take it on a, luckily, I think our most broader deals were out until 2012, I believe it is and so, we got some time but we will be able to see what happen in the meantime with other people. But I will make this important for us as an industry to really be united in the fact that this retrans money is important to us and we are not going to be willing to give that up to the networks.

Scott Van den Bosch – Navigare Partners, LLC

You do not feel giving any kind of guidance on what you will get at this point? Or you are going to keeping that close to vest?

Robert S. Prather Jr.

In what way now?

Scott Van den Bosch – Navigare Partners, LLC

In terms of like, how much do you expect to get out of it on the retransmission agreements?

Robert S. Prather Jr.

No, we have not given any guidance on that. I do feel, I actually think we are going to probably wind up better than I thought. But you have mentioned we got about 60% of our subs up. And I am so far pleased with the way the negotiations that go on the deals we have made. Obviously, the big dollars accompany with the big MSOs, which we are literally just starting to talk to. But I think they all realize now that they are paying local stations for retrans. One big advantage we have got that I like to brag about all the time is we have got 24 number one stations out of 36. The other 12 are number two in the market. These are all important stations with these cable operators. We have got probably half of our markets where our ratings are more than all the cable channels in that market combined. And we do not mind reminding these cable guys of that. On our local news is so strong in many of our markets that we feel like is something that the audience is going to demand from the cable guys. We are willing to go off the air if we have to make a point. We do not want to do that and we do not like to even think about doing it. But I think we have got to be realistic in today’s climate. If we got our cable operator that is just not being realistic on what our signal is worth. It is something we have to use as one of our cards in our deck.

Scott Van den Bosch – Navigare Partners, LLC

Okay, okay. Well, great, thank you for taking my call.

Operator

(Operator Instructions). Your next question comes from the line of Unidentified Analyst – MJX Asset Management. Please go ahead.

Unidentified Analyst - MJX Asset Management

Good morning. I just need to get some color I guess or what is trailing 8-quarter from cash flow and the trailing fourth quarter?

Robert S. Prather Jr.

Jim, you want to take that?

James C. Ryan

Yes. The trailing 8-quarter as defined in the credit agreement definition was $110.5 million. That is the trailing 8-quarter.

Robert S. Prather Jr.

He wants the four quarter too, Jim.

James C. Ryan

Trailing fourth quarter, bear with me a minute. I have to look that up for you. It would be a little bit, trailing fourth quarter LPM Q3 a little bit around $108 million.

Unidentified Analyst - MJX Asset Management

And you guys you see eight quarters to determine.

James C. Ryan

That is correct. [inaudible] that uses an eight quarter test.

Unidentified Analyst - MJX Asset Management

Okay. Great. Thanks.

Operator

Your next question comes from the line of Linda Carne – Credit Suisse. Please go ahead.

Linda Carne – Credit Suisse

Hi, thank you very much. I just have a couple questions. First, can you just go over the CapEx numbers again for third quarter and full year and also what the main CapEx number for ‘09 would be?

Robert S. Prather Jr.

Jim mentioned it was around $5 million for the third quarter and $11 million plus for the year. I would say 80% of that was for digital transition purposes. We have spent on our digital several years ago. But one of those things that we are doing is where it is advantageous to us signal wise, we have gone back to our channel placement, and when you do that you have to have a new transmitter. Also, just a shift taken old equipment down off towers and things like that is running us about $150,000 per station. We have to take all the antennas down, old wiring, those kinds of things. But most of our money was spent this year on decent transition expenses. Next year, as I mentioned, we are right now planning to just look at capital based on emergency basis until we see how the year is progressing. If it looks like things are bad than we thought. We will address that on a quarter-by-quarter basis. But we have basically just going to do an emergency maintenance type cap for next year right now.

Linda Carne – Credit Suisse

So, would that be something like 2 to 3 million a year?

Robert S. Prather Jr.

I am not sure. I would say less than 5 probably, but somewhere in that range I can say that if the years looking better than we thought, we might increase that sum. We are going to be very prudent with our capital next year because I think, as I mentioned earlier, the visibility is just pretty tough to see very far ahead out there.

Linda Carne – Credit Suisse

Okay. I guess going back to what you were speaking about in terms of buying the loan back at a discount, can you just go through is that a 51% amendment or a 100% amendment for the bank group?

Robert S. Prather Jr.

That is a good question. We think it is 51%. We got lawyers looking at it. We have, it is something that we were talking of Wachovia, as our lead bank on our current loan agreement about. I think it is something we need to make a decision on some time before the end of the year whether to make sense to try to get an amendment and be able to buyback. Ideally, if we could use our excess cash to buy back debt, we could obviously decrease our debt at a much faster rate than we could just paying a hundred cents on a dollar. There is a lot of companies out there that looking for extra liquidity in these lines and we think it might be popular with the holders to have the ability to sell somebody like us if they wanted to. It would be strictly be on a, if you want to sell fine and if you do not you want to keep it. We are all for keeping it because we have some very long term holders of our debt over many years and we have always done very well by them. So, we want to make sure we keep people who have been good to us, happy over the long term.

Linda Carne – Credit Suisse

Okay. And I guess just going to the cost side, can you just talk about what you are doing in terms of controlling costs and if any of those add back cost cuts can be added back to your EBITDA for definition purposes under your covenant?

Robert S. Prather Jr.

I do not think they can. What we are doing for our budgets for next year, we basically have asked each station. We went through in detail and ask them to basically give a number. We wanted them to cut. We went through with each station. Some of them we made some compromises, some one way, some another. But we have tried to do it on a basis that we thought was fair based on the operations of each station. Right now, we are pleased with what we have been able to cut and I think our managers have done a very good job of realizing it. This is something we need to do to make sure we continue to be competitive in the future and to make sure we, one of the things we did do is we told them that we did not want to touch our news product and we want to make sure we continue to have the best news product on air in all of these markets that we are in.

Linda Carne – Credit Suisse

Okay, thank you very much.

Operator

Your next question comes from the line of Matthew Lee – Octagon Credit. Go ahead sir.

Matthew Lee – Octagon Credit

Have you guys thought about broader alternatives for releasing the leverage and just chipping away of the debt because it seems that given the current pace of the revenue decline, it looks like you guys are seeing in going to ‘09. Leverage is going to take up materially next year and there might be further problems there. Have you started to think about other alternatives? Maybe raise more capital?

Robert S. Prather Jr.

Well, there are two areas there, Matthew that you are talking about. One of them is raising more capital. I think it is more difficult in this market. I would not want to sell any stock at the price as it is. Number two, if you look at asset sales, I think you will see right now that that is a virtual impossibility. The only deal that is what really out there in the public market over the last six months was the landmark sale in Nashville, and that deal fell through. There has been no other deal announced. I just think that in this kind of climate, it would be extremely difficult to do asset sales. Fortunately, all our stations are profitable. But I would not say that is not something we would look at down the road but I do not see that in the near term I think we will be able to operate our business in the short term to make sure we stay within our covenants and we are wide open to ideas on alternatives if it make sense to make us a stronger company.

Matthew Lee – Octagon Credit

Thank you.

Operator

Your next question comes from Larry Schumacher – Oppenheimer. Please go ahead.

Larry Schumacher – Oppenheimer & Company

Hi guys. Just a question, what are you thinking on operating expenses next year?

Robert S. Prather Jr.

We want to be under $190 million, a pretty good drop from this year.

Larry Schumacher – Oppenheimer & Company

Percentage drop?

Robert S. Prather Jr.

Yes, yes.

Larry Schumacher – Oppenheimer & Company

How big a percentage drop, I am sorry?

Robert S. Prather Jr.

Just to give you just over $12 million a year in cuts. So, over a $1 million a month.

Larry Schumacher – Oppenheimer & Company

Okay, thanks. Good luck.

Robert S. Prather Jr.

Thanks, Larry.

Operator

Your next question comes from the line of Troy Isaacson – Princeton Advisory. Please go ahead.

Troy Isaacson – Princeton Advisory

Hey guys. You guys just recently got downgraded by Moody’s. I was just wondering if you guys are in current talks with S&P and I ask question to that. What kind of guidance can you give us on this?

Robert S. Prather Jr.

Moody’s, I guess you are saying they have been downgrading everybody in the broadcast industry. They just downgraded MSN-line in the last few days and said there is going to be more. S&P I think downgraded us a while back and I think we are actually lower with them than we are with Moody’s right now. The rating agencies are all running scared right now. They have all got their own problems and I think they are probably overreacting. But that is something we cannot control right now. But I think most of the holders of our debt feel good about it. So, like I said, it is something out of our control. We got to run our business and run it as good as we can. I think we will get our ratings improved over a period of time.

Troy Isaacson – Princeton Advisory

So, currently, S&P is not in.

Robert S. Prather Jr.

No.

James C. Ryan

There is no active discussion with S&P at the moment.

Troy Isaacson – Princeton Advisory

Okay. Thank you.

Robert S. Prather Jr.

Okay. Thank you.

Operator

Ladies and gentlemen, there are no further questions. I will turn it back to you for any closing remarks or comments.

Robert S. Prather Jr.

Thank you very much, Operator. I would like to thank everybody for being on the call today. And I know, as I mentioned, we are all going through some pretty tough economic times. But we are trying to look on the optimistic side. One of the things I have told all our GMs, we have got an extremely strong company with extremely strong market positions in most of our markets. Let us use that strength to go get more market share and go get more business in tough times. And that is one of the things that we are going to concentrate on in the year ahead to really make sure we are out there using our number one position in most of these markets to make sure we let people notice that the best buy possible in a tough economy. We got the most eyeballs and the most, all I would like to mention this, and I will mention again, but we have got 16 stations have been number one for 50 straight years or more. That is a pretty long record of excellence in these markets. And people trust us and believe in us, both the viewers and advertisers and I think we have got a play on that strength in the year ahead and we plan to it. But we appreciate all your support.

I will mention again, we answer our own phones so you can call anytime and we look forward to talking to you at our year-end call. Thank you everybody. Operator?

Operator

This concludes today’s teleconference. You may now disconnect your line. Thank you and have a great day.

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