CBS continued to trim its struggling radio portfolio, announcing plans Thursday (July 31) to divest 50 radio stations in 12 midsized markets.
The 50 stations represent roughly $300 million in annual revenue or about 15 percent of the radio division's revenue. Following the divestitures, CBS will own about 90 radio stations.
The company has already had initial discussions with prospective buyers, CBS said during its second quarter conference call Thursday.
Overall, CBS reported profit was up 1 percent and revenue growth increased 1 percent to nearly $3.4 billion, but local radio and TV stations continue to face a persistently soft advertising environment. Radio revenue was down 10 percent in second quarter to $416 million, compared to 2 percent growth for CBS' combined TV segments (local TV stations were down) to $2.2 billion and 8 percent for outdoor. Publishing was down 7 percent. As a result of the rocky economy, CBS cut its full-year profit outlook.
"By selling these slower-growth stations, we can focus on the larger markets that are showing growth," said Les Moonves, president and CEO of CBS. According to Moonves, the 15 major market stations recently reformatted have dramatically improved ratings and earnings.
"Divesting will allow us to focus on this opportunity in the largest markets," Moonves added.