DARTMOUTH, NS – Radio broadcaster Newfoundland Capital Corp. Ltd. recorded a $7.4 million profit in the first quarter ended March 31 mainly due to a $10.5 million gain on the sale of its units of Halterm Income Fund Trust.
Profits for the quarter were $6.2 million more than the same quarter last year, with proceeds from the sale of Halterm Income going to repay long-term debt.
Revenue grew 5% to $19.5 million in the company’s broadcasting operations.
“The 5% total increase in broadcasting revenue is in-line with the radio advertising industry’s average growth rate of 5.1% for the same period,” states Newfoundland Capital in its financial results released Tuesday.
Highlights of the quarter include the launch of the company’s new FUEL 90.3 FM station in Calgary – the operations of which will be integrated with its existing radio station in that market.
“The potential for strong revenue and margin growth is especially promising in Calgary, one of the top five radio markets in Canada,” said Newfoundland Capital President and CEO Rob Steele.
The company also received CRTC approval to convert its AM station in Edson, AB to FM. The classic hits FM station is expected to hit the airwaves this summer. Subsequent to the first quarter, the company received commission approval to convert its AM station in Halifax to FM.
Also subsequent to the end of the quarter, the company sold its 29.9% interest in an FM radio station in Kitchener-Waterloo. The $3.8 million from that sale will be recognized in the second quarter.
Newfoundland Capital’s primary objectives for 2007 include launching stations in Lac LaBiche and Fort McMurray, AB (the licences have already been granted), integrating the operations of its two Calgary stations, converting more of its AM stations to FM, and changing radio formats where necessary to prevent market share erosion in the face of increased competition.
It will also apply for more radio licences and is currently waiting for decisions on licence applications for Regina and Saskatoon, SK; Medicine Hat, AB; Sudbury, ON; Carbonear, NF and Sydney and Kentville, NS, according to the financial results.
Newfoundland Capital has 74 radio licences across Canada.
