DARTMOUTH – Newcap Radio owner Newfoundland Capital Corporation said Wednesday that flagging advertising rates and Alberta’s ongoing economic uncertainty helped to weigh down first quarter revenues and profits.
For the period ended March 31, 2017, revenues of $35.7 million were 3% lower than the same period last year, primarily due to revenue declines in the Alberta markets due to continued economic uncertainty in that region and declines in Ottawa due to downward pressure on advertising rates.
Profit for the period plunged 35% to $3.0 million year-over-year due to lower revenue and a higher provision for income taxes. Earnings before interest, taxes, depreciation and amortization (EBITDA) of $7.0 million was 14% lower than last year as a result of lower revenue.
"The first quarter was challenging as our Company experienced revenue declines consistent with the overall radio industry" said president and CEO Rob Steele, in the company’s Q1 financial report. "We believe that our quality product and keen focus on cost control will allow us to overcome some of this shortfall during the remainder of the year."
In other news, Newcap Inc. has entered into an agreement to acquire 100% of the shares of NL Broadcasting Limited, which owns and operates the radio broadcasting licences CHNL-AM, CJKC-FM, and CKRV-FM in Kamloops, BC, subject to CRTC approval.
Financial terms of the deal were not announced. The news comes just weeks after Newcap agreed to sell off CISL-AM in Vancouver to Rogers Media.
"We are excited about the opportunity to enter the Kamloops market, where these stations already have a strong presence in the community", added Steele, in that news release. "This acquisition continues to expand our presence in British Columbia and fits well with our current operations in Vancouver and the Okanagan Valley."
Newfoundland Capital Corporation Ltd. owns and operates Newcap Radio which holds 95 radio licences across Canada.
