Gray Television, Inc. (NYSE:GTN) Q2 2020 Earnings Conference Call - Final Transcript

Aug 06, 2020 • 10:00 am ET


Gray Television, Inc. (NYSE:GTN) Q2 2020 Earnings Conference Call - Final Transcript


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Q & A

[Operator Instructions] Your first question is from the line of Dan Kurnos with The Benchmark Company.

Daniel Kurnos

Great. Thanks, good morning. And appreciate all the color. Kevin, I'm sure you're already eagerly anticipating the crystal ball question on subs. So I guess you might as well start there just in terms of visibility and kind of any thoughts in the back half of the year and how it kind of relates to your net retrans outlook?

And then maybe, Jim or whoever wants to take it on core, your Q3 guidance is actually relatively really strong, I think, especially in comparison to the peer group and, obviously, what we've been hearing from Roku and others. So just can you give us a sense of maybe why the outperformance, where you're seeing pockets of strength? And does that -- do you anticipate that sequential improvement continuing until we're back to kind of pre-COVID levels early 2021? Thanks.

Kevin Latek

Hi, Dan. First on sub losses, obviously, down 3%, first half of the year is not what we were expecting, and its acceleration is also nowhere near what we were seeing the public companies announce over the last two quarters. Looking forward, if the economy is recovering, it seems that in today's headlines that the hotspots or the country is going to be stabilizing. As we kind of move a little bit more towards normal, you get another round of stimulus checks and UI pieces solve, confidence returns, etc., etc. It seems to us that the sub declines should certainly mitigate from what we saw in the first half of the year.

We also suspect there's a number of folks who didn't pay their cable bill, given losing their jobs or otherwise change in circumstances. And when the grace periods end on that, they may end up paying some past bills and showing up as subs again, especially again as jobs return and stimulus money is provided. So I think we remain optimistic that we're not going to see the sub declines of second half of the year that we saw the first half of the year, but really it's anybody's guess. So we were surprised at how much it did decline the first half for us. So we can be surprised. We remain optimistic. It seems, as I sit here today, that the economy of the virus, etc., things seem to be pointing in a bit more hopeful direction than we saw even just two or three weeks ago. Jim?

James Ryan

As far as the forecast, I'll let Pat and Bob probably give a little bit more color on that. I think it, first and foremost goes to the strength, the deep penetration we have in our markets is a key factor. The other thing is, obviously, especially when we get to September in political, that's a little bit of a wildcard. It could skew the core downward a little bit more. Simply be -- I mean if political is super strong, then obviously, core is