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Friday May 9, 10:06 PMClear Channel posts weaker-than-expected profitNEW YORK (Reuters) - Clear Channel Communications Inc posted a weaker-than-expected quarterly profit on Friday and the U.S. radio station operator said it was unclear whether a proposed buyout would be completed.Last year, at the peak of the private equity boom, Clear Channel struck a $20 billion buyout deal with private equity firms Thomas H. Lee Partners and Bain Capital. The deal fell into litigation this year when THL and Bain filed suit against their bankers, who want to pull out of their financing commitment. In its earnings report, Clear Channel said trial of the suit is set to begin June 2. It said it was unable to estimate a closing date for the proposed buyout, adding that it "is not certain that a closing will occur." Clear Channel's first-quarter net income rose to $799.7 million, or $1.61 a share, from $102.2 million, or 21 cents per share, a year earlier. Earnings before discontinued operations, which includes the sale of many radio stations and its television group, amounted to 32 cents per share. Excluding a gain related to the sale of an advertising company, profit before discontinued operations was 19 cents a share, falling short of analysts' average forecast of 21 cents, according to Reuters Estimates. Revenue rose 4 percent to $1.56 billion. Foreign currency translation gains accounted for three-quarters of the increase. Chief Executive Mark May suggested that despite the slowing U.S. economy, Clean Channel continues to outperform the industry overall. "While our results were affected by the soft advertising market, we continued to out-deliver the majority of our media industry peers," he said in a statement. The company said preliminary indications show revenue declines of 2.7 percent for the second quarter and 1.2 percent for the full year, based on early advertising commitments. Clear Channel shares were down 23 cents to $29.61 in early New York Stock Exchange trade. Separately, Clear Channel affiliate Clear Channel Outdoor Holdings Inc , a billboard owner, posted higher quarterly earnings on Friday, but revenue fell short of market expectations amid weakness in the U.S. economy and tepid local advertising. Clear Channel Outdoor shares were down $1.54, or 8 percent, to $17.35 on the NYSE. (Reporting by Franklin Paul;/Editing by Derek Caney and John Wallace) |
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