Sinclair, Inc.

Good day everyone and welcome to the Sinclair Inc. First Quarter 2025 Earnings Conference Call. At this time, all participants have been placed on a listen-only mode and we will open the floor for your questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Chris King, Vice President of Investor Relations at Sinclair Inc. Sir, the floor is yours.

Thank you. Good afternoon everyone and thank you for joining Sinclair's First Quarter 2025 Earnings Conference Call. Joining me on the call today are Chris Ripley, our President and CEO, Lucy Rudishauser, our Executive Vice President and Chief Financial Officer, and Rob Weisbord, our COO and President of Local Media. Before we begin, I wanna remind everyone that slides for today's earnings call are available on our website, sbgi.net, on the events and presentations page of the Investor Relations portion of the site. A webcast replay will remain available on our website until our next quarterly earnings release. Certain matters discussed on this call may include forward-looking statements regarding, among other things, future operating results. Such statements are subject to a number of risks and uncertainties. Actual results in the future could differ from those described in the forward-looking statements as a result of various important factors. Such factors have been set forth in the company's most recent reports as filed with the SEC and included in our first quarter earnings release. The company undertakes no obligation to update these forward-looking statements. Included on the call will be discussion of non-GAAP financial measures, specifically adjusted EBITDA. These measures are not formulated in accordance with GAAP, are not meant to replace GAAP measurements, and may differ from other companies' uses or formulations. Further discussions and reconciliations of the company's non-GAAP financial measures to comparable GAAP financial measures can be found on our website. Let me now turn the call over to Chris Ripley.

Good afternoon, everyone, and thank you for joining us. Beginning on slide three, we're off to a solid start to the year despite the macroeconomic uncertainty all around us. Our total media revenue was in line with our expectations. Once again, we reported what we believe will be among the strongest core advertising performances among our broadcast peers in the first quarter. Total advertising revenues were within our guidance range, excluding the impact in the quarter from an acquisition by Compulse. Distribution revenues increased by 15 million year over year, and while subscriber churn moderated slightly, the improvements have not yet caught up with our guide, which led to distribution revenues coming in two million below our guidance. Media expenses were better than expected, driving adjusted EBITDA comfortably above the high end of our guidance range. Turning to slide four, our venture's portfolio continues to transform away from our minority investment holdings as we look to position the portfolio for more majority-owned assets over time. Ventures benefited from 10 million of cash distributions and invested 38 million in the quarter, including approximately 30 million for an acquisition by Compulse. Ventures cash balance was 354 million at quarter end. After completing our comprehensive refinancing of SCG in February, we continue to carefully examine potential uses of venture's cash, which may include potential share repurchases or other shareholder-friendly activity. On slide five, I wanted to highlight a key announcement we made last week regarding the hire of Jeff Blackburn as chairman and CEO of Tennis Channel. Jeff comes to us after a storied 20-plus year career at Amazon, where he was the prime architect of the company's expansion into streaming of sports, while also developing and building Prime Video, Prime Studios, Amazon Music, Amazon's advertising and marketplace divisions. He will lead Tennis Channel's strategy to expand its digital and streaming footprint and deepen audience engagement in order to position Tennis Channel for its next phase of transformative growth and long-term value creation. As the latest example of such growth, just this morning we announced the formation of a new business unit to operate a groundbreaking partnership with the ATP WTA and participating U.S. tournaments to create a unified opportunity to purchase a single comprehensive sponsorship package that covers the entire country. This morning, Verizon was announced as the first sponsor sale with category of inclusivity in the 5G wireless space. We are excited to have attracted a media executive of Jeff Stachar and we view the Tennis Enterprise sponsorship announcement as an example of the growth and long-term value creation that we're committed to delivering in the quarters and years to come. With that said, let me now turn it over to Rob to continue the discussion about our broadcast business.

Thanks Chris and good afternoon everyone. Turning to slide six, as Chris mentioned earlier, we expect our core advertising results to once again be a leader in the industry despite the uncertainty and volatility that is impacting major categories across the nation. This would continue recent trends which have seen us beating our publicly traded broadcasting years in year over year core growth rates and for the past six quarters through the end of 2024. During the first quarter, core advertising revenues were within our guidance range of down low single digits year over year. Having said that, the macroeconomic and tariff related uncertainty is creating hesitation by certain top categories. On a positive note, we are now less than eight months away from another political season kicking off. On slide seven, as an early preview on what we expect in 2026, we currently have 23 Senate races and 25 gubernatorial races in our footprint. We believe that at least six of these Senate races will be highly competitive and more than half the gubernatorial races will have competitive primaries. In addition, more than 30 House races have already been targeted by the national Republican and Democratic parties as potential flips. We expect intense battles across the country as the House, Senate, and gubernatorial elections are all close to being evenly split between the two parties and so we expect taking control will be a driver of midterm election dollars. Pushing our distribution revenues on slide eight, our net retransmission revenues grew by mid single digits year over year in the quarter and we continue to expect a two year mid single digit CAGR through the end of this year. Notably chart our largest MVPD, reduced video subscriber discounts in the first quarter by 55% year over year, highlighting their success in reducing return, including what we have called the great rebundling. The package is streaming platforms with legacy linear packages. We believe charted success in reducing return illustrates how creative solutions, including this type of bundling of the streaming platforms with legacy linear packages can reduce or reverse the driver term materially over time. From a renewal perspective, during the quarter we extended our YouTube TV distribution agreement. As a reminder, we do not have any outstanding traditional linear distribution or big four network affiliation agreements up for renewal before late 2026. I also wanna point out that our Portland Trailblazers coverage in this past MVA regular season doubled its average audience size on our stations in the Pacific Northwest versus the prior seasons coverage on a regional sports network. Once again, highlighting the importance of live sports and the benefits of the wide distribution of broadcast TV. The latest addition to our AMP Media Sports Podcast Lineup, BFFR, starring women's soccer stars, Sydney LaRue and Ali Reilly, two of the key members of Angel City Football Club launched last week. The weekly podcast will focus on the authentic, behind the scenes discussions that have helped them grow their social media identities into some of the largest in women's sports media landscape. We will also launch a women's basketball podcast shortly featuring WNBA stars, Candace Falkner and Aliyah Boston. These launches reflect our continued commitment to elevating women's sports and amplifying their voice of its top athletes. Stay tuned for additional announcements regarding the ongoing expansion of our social media and podcast platforms. I also wanted to briefly mention our very successful upfront presentation last week in New York, where we showcased our news and sports brands and demonstrated how advertisers can activate and amplify their brands as our partner. I wanted to thank all our podcast talent, including Coach Urban Meyer, Marking Room II, Rob Stone, Martina Navratilova, Sydney LaRue, Landon Donovan, Matt Liner and Jerry Farrar for being at our upfront and helping us demonstrate what a powerful partner we can be for our advertisers. We look forward to sharing updates with you in coming quarters. Now let me turn it back over to Chris to provide a couple of the industry

updates. Thanks, Rob. Turning to slide nine, we along with the NAB and the entire industry are hopeful that the many of the woefully outdated FCC regulations that have hampered growth in the broadcast industry over the recent decades will be revisited, if not eliminated in the coming months. And we remain hopeful that most of the outdated ownership rules impacting the sector will be modified to allow sensible M&A and portfolio rationalization. In addition, the industry will be lobbying for other issues impacting the sector, particularly the rules that prohibit broadcasters from negotiating directly with virtual MVPDs, as well as the rules that will allow the industry to rapidly sunset ATSC 1.0 networks, which will help accelerate wide adoption of next gen broadcast products and services. As an example of what may come, last week, FCC Commissioner Simonton and his chief of staff authored an op-ed suggesting that the FCC should take action to cap network programming fees at 30% of retransmission fees. The piece highlights this proposal as a way to protect local broadcasters and local journalism from big tech and big media. The implementation of such a proposal would allow for the strengthening of local broadcasters and local news throughout the country. We look forward to continuing to work with Chairman Carr and the rest of the FCC on the very welcomed and long overdue deregulatory approach to the broadcast industry to help level the playing field. Lastly, I wanted to extend my deep appreciation and best wishes to Lucy, who announced her upcoming retirement several weeks ago. While Lucy is staying on through the transition of the new CFO, her over 26 years at Sinclair will be coming to an end within the next several months. Lucy has more than eight years of experience in the CFO chair and her reputation and expertise has benefited Sinclair greatly over the years. Lucy recently led our almost four billion comprehensive refinancing and has helped guide the company through tremendous growth of our portfolio stations, diversification of our assets, many capital markets transactions and many other initiatives as well as the great recession, the pandemic and other challenges. Her numerous awards and recognitions from across the industry are a testimony to her leadership, dedication and knowledge of both Sinclair and the wider broadcast industry. Even though we expect her to remain with us in a senior advisory role, there is no question that we will greatly miss her guidance, strategic and fiscal contributions, mentorship and work ethic. On behalf of the company, thank you for everything Lucy. Now, perhaps for the final time, let me turn it over to Lucy for a discussion on her financial results in more detail. Lucy.

Thank you Chris, for the very kind words and good afternoon everyone. I'm pleased to say that I depart with Sinclair in a financially strong and healthy position and poised to grow in what should be a transformative next few years with deregulation and next gen broadcast. Turning to slide 10, following our recent refinancing, we have significantly extended the debt maturity profile of the company with the current weighted average maturity of more than six years. As of March 31st, our first out firstly net leverage was 1.8 times with total firstly net leverage at 4.2 times and total net leverage at 5.8 times as defined in our new STG credit agreement. Our balance sheet is now not only the industry's longest in terms of maturity profile, but more importantly positions us well to participate in what we hope will be a period of renewed M&A activity within the sector. In addition to the comprehensive refinancing, we also repurchased approximately 66 million in face value of STG's 2027 notes for 62 million in early April. On slide 11, we highlight our first quarter statement results. Despite the negative economic headlines and general levels of uncertainty throughout the economy, we delivered inline media revenues in our local media segment with core advertising down four and a half percent year over year and distribution revenues were slightly below expectations although they grew year over year. Our political revenue outperformance in the quarter was largely driven by Wisconsin Supreme Court race that garnered national attention in what could be an early indicator of what's to come in next year's midterm elections. Adjusted EBITDA beat the high end of our guidance range by approximately $9 million for local media driven by favorable SG&A and promotional expenses on a continued cost savings focus. Tennis Channel had another strong quarter with revenues and adjusted EBITDA both inline with our guidance ranges as total revenues grew by 9% from year ago levels. Slide 12 reviews are consolidated media revenue which was within our guidance range as inline core and higher political advertising were offset by slightly lower than expected distribution revenues. Media revenues fell by approximately 22 million year over year driven by lower political advertising revenues in this non-election year and the absence of material diamonds for its management fees which were offset by higher distribution revenue of 15 million year over year on the recent renewals. Turning to slide 13, our consolidated adjusted EBITDA exceeded our guidance range primarily on a continued focus on managing expenses which were lower than forecast due to several SG&A line items. As compared to last year adjusted EBITDA declined by 27 million driven by lower core political and management fee revenues and slightly higher media expenses on network programming fees, production costs and annual compensation increases. On slide 14, we introduced our second quarter 2025 guidance. Please note that our guidance includes the recent acquisition by Compulse which is included in other in our segment reporting. We expect second quarter media revenues to be lower year over year on a consolidated basis due primarily to significantly lower political revenues in a non-election year, the absence of material diamond management fees as well as some continued softness in core advertising categories. We anticipate local media core advertising revenue to be lower by approximately 2% at the midpoint of our guidance range while distribution revenues are expected to be 1% higher year over year as we begin to cycle through some of the larger distribution renewals from a year ago. Our consolidated adjusted EBITDA is expected to be within a range of 91 to 107 million. Turning to slide 15, we present our full year guidance. However, we have removed the media expense line item. We believe the current macroeconomic and tariff related uncertainty is causing our advertisers in several key categories to have significantly reduced visibility and is therefore driving a wide range of potential outcomes in the second half of the year. In fact, several of those advertisers have pulled their own financial guidance. With the reduced visibility on core revenues in the back half of the year, it's difficult to provide a range for the media expenses given the direct cost associated with those revenues such as commissions, bonuses, et cetera. However, you do have Q1 actuals and Q2 guidance to inform your full year media expense estimates based on your advertising revenue assumptions in the back half of the year. We will note that consistent with our beat on media expenses in the first quarter, we would expect those expense trends, pre-acquisition, to continue under an assumption of consistent revenue expectations for the remainder of the year. In the full year guidance provided, net interest expense includes the non-recurring 68 million in fees and expenses related to the refinancing that were expensed in the first quarter. Notably for the year, we are now forecasting much lower cash tax payments of 121 million at the midpoint of our guidance, which is $95 million lower than our guidance provided last quarter. Driving the reduction is a revised estimate of the taxes on the diamond exit gain, which declined from an estimated 170 million to 83 million. The 87 million dollar estimated reduction is largely due to having more current information regarding the utilization of certain tax attributes. Of the 83 million diamond exit gain taxes, local media is estimated to fund 58 million and ventures to fund 25 million. I will now turn it back to Chris for some closing remarks before we open the call to Q&A.

Thanks, Lucy. Turning to slide 16 to wrap up the quarter with our key takeaways. Sinclair delivered solid financial results in a challenging environment. Adjusted EBITDA exceeded the high end of our range guidance. Core advertising trends continue to be among the best in the industry despite the macroeconomic uncertainties and lack of visibility. Subscriber churn continues to moderate. Regulatory optimism remains buoyant with expectations for loosened M&A restrictions and next gen spectrum relief among other potentially favorable changes that could lead to a strengthening of local journalism. The balance sheet is strong with the comprehensive refinancing completed during the first quarter. Our weighted average maturity of more than six years out, our nearest meaningful maturity not until December of 2029 and 66 million of debt repurchased at a discount. Finally, liquidity got a further boost from a significantly lower cash tax payment estimate for the full year related to the diamond chapter 11 emergence. In summary, we could not be more optimistic about the future for the industry and Sinclair's continued position as an industry leader. Thank you very much for joining us today and your interest in Sinclair. Rob, Lucy and I will now take your questions.

Certainly, everyone at this time will be conducting a question and answer session. If you have any questions or comments, please press star one on your phone at this time. We do ask that while posing your question, please pick up your handset if you're listening on speakerphone to provide optimum sound quality. Once again, if you have any questions or comments, please press star one on your phone. Your first question is coming from Dan Kernos from Benchmark, your line is live.

Great, thanks, good afternoon. Chris, let me just echo sentiments. Lucy, we go back a long, long way. A certain one-handed catch at Brewer's Stadium while holding a beverage, I might add, will never be forgotten. So I do certainly wish you nothing but the best. I just wanted to start with that.

I appreciate that. Thank you, Dan.

Chris, obviously, the Symington op-ed piece has gotten a lot of attention. There's a lot of debate as to whether or not the SEC can cap retrans rates, reverse rates, I should be clear. Can you please address that and whether or not you think they can do something like that? Although obviously, if they were even just to allow you to negotiate directly with the virtuals, that would change the net trajectory pretty significantly.

Sure. So the SEC does have the ability to regulate the relationship between networks and affiliates that is a part of their charter. So obviously, capping a major expense like that could be very helpful in terms of leveling the playing field with us and Big Tech and big media. And it could also open up bigger opportunities for us in terms of filling in day parts that maybe the networks don't want to service anymore, which would also dovetail with the SEC's objectives. So overall, I think what our key takeaway is from that Symington op-ed is that we're seeing this groundswell of deregulatory support for the broadcast industry that we believe is well overdue. And the right answer for the industry, I think, will end up being a combination of things, some of which will be loosening up ownership rules, sunsetting 1.0, but other ideas that are coming to the surface here. And we're just thrilled that the SEC is stepping in to help level the playing field.

Got it. Super helpful. And then kind of the other obvious question, given sort of the uncertainties out there, you pulled your media expense line item, we got the 2Q guide, maybe just tell us what you're seeing out there, conversations with advertisers, and how do you guys feel about how CORE might shape up for the year, understanding you have some really easy comps in the back half of the year?

Yeah, as we look at as the year goes on, we still expect our CORE to grow year over year. However, I'll caveat that by saying that our visibility is greatly reduced over what it was six to eight weeks ago. We've seen large companies and several of our key advertising categories, such as Ford, pull their own financial guidance for the year, given the uncertainty around what the broader economic and tariff policies are. Those companies are concerned about what the supply chains as well as consumer confidence and demand. So while we expected to grow year over year, I'd couch it that we're cautiously optimistic with limited visibility as time has gone on.

Got it, super helpful, thank you, and Lucy, best of luck.

Thank you, Dan.

Thank you, your next question is coming from Aaron Watts from Deutsche Bank, your line is live.

Hey, everyone, thanks for having me on, Lucy. I wanna thank you for everything over the many years, including putting up with all my questions and all our conferences you took time to participate in. We'll miss you at those and on these calls, but I am glad that you'll still be with the company in your new role, so best of luck with that. Appreciate

it, thank you.

Of course, a follow-up on CORE advertising, and maybe the auto category specifically, how did that trend in first quarter and how's it looking in 2Q? Are you seeing any bump on kind of beat the tariff ads, get a car before the price increases, and do you see this bump if it is happening as sustainable at all?

Up to this date, we haven't seen that bump. We were just notified though that Nissan will be going on an aggressive, bad campaign. What's interesting is the trends are moving away from outright buys to leases, and so the leases are tending to trend up. So we're bullish on the financial segment wrapped around the automotive, and again, they're gonna have to clear out the 25s in the back half of the year and make room for the 26s, but again, with some of the visibility not there, how much of the foreign manufacturers OEMs, how much is gonna come into the country, still remains not visible to us. So I think we're competitive on the domestic side and the foreign side is still to be seen.

Okay, and in terms of what you see from some of your bigger markets versus maybe more of your smaller markets, national versus local, are you seeing a widespread kind of difference in advertiser sentiment based on that? I mean, we've been hearing that national is a bit weaker than local. Are you seeing that play out?

No, both are running parallel with each other, and again, I think we approach the business in a unique way. Our moniker is one part, partners, possibilities, and we just ran a draft with our audio talent from Green Bay, we activated a couple of our major advertisers. So as we look at it, we don't really look at trying to do just straight ads but just turn the spots and dots world. It really is cross platform and the activation and amplifying of our partners, which we're seeing in our upfront. So we have long term partnerships that have been strong and stay with us because of that activation. So we're not really seeing much difference between local and national as far as our pace, and it has to do just with how we both serve as the local clients and the national clients.

Okay, that's helpful, thanks. Lucy, maybe I could aim one your way. You noted the 66 million of bond repurchases in April. Can you just remind us the capital allocation priorities for the television groups specifically? Should we expect continued debt pay down going forward in particular as we roll into next year when the political dollars Chris highlighted start to roll in?

Yeah, so as we've been saying for a couple of quarters now, Aaron, and especially with the refi, our focus is on deleveraging the local media group. And this is one indication buying the debt in at a discount where we can start to drive that deleveraging down.

Okay, perfect. Thank you for the time and Lucy, best of luck.

Thank you.

Thanks, Aaron.

Thank you. Your next question is coming from Steven Cahal from Wells Fargo, your line is live.

Thank you, Chris, I was wondering if you could talk a little more about the specifics of how you see deregulation unfolding. I think when the Republicans have a majority of commissioners, then maybe they'll move to notice of proposed rulemaking. So I was wondering if you think that's the next step where then the industry will begin to have substantive conversations and whether you participate as a buyer or a seller, you feel like that process needs to clear any court challenges that it could face before you'd be willing to sort of sign and be willing to transact. Just trying to get an understanding of like how fast this can happen or if there's a number of steps in the process that we'll need to wait for before you'd be comfortable transacting if we do get pretty significant deregulation like we expect.

Sure, so look on that front, there's a number of current data points in terms of just the rules changing. One is that the confirmation of the third Republican commissioner, Olivia Trusty is moving forward well. I think our expectation is that she could be in place by Memorial Day. And after that, I do expect that a rulemaking will start to proceed. You saw Commissioner Carr making news today calling the in-market ownership rules outdated and antiquated. And so there's definitely this groundswell is there and I expect that action will be taken once the third Republican commissioner is put in place and that's looking like it's gonna move forward fairly quickly. That said, in terms of M&A in the meantime, just the rules that we have on the books today, which include things like the UHF discount, which include ownership of two big fours subject to a big four waiver, but the rules as they exist today do actually afford most players including Sinclair, a significant amount of flexibility for M&A. So I think that at least from our perspective, you're gonna see more activity from us. You've already seen some, right? We announced a sale of five markets, a station swap, but you're gonna start seeing more in the weeks to come, we will start filing for some of the JSA buy-ins that I've been talking about before and that's a very accretive trade that should add tens of millions of dollars to our bottom line with very little cash out the door. I think station swaps are going to happen in the meantime while we wait for some of these rules to change. And even large scale M&A or mergers are on the to-do list, I think for many broadcasters and I don't think many, depending on the situation, I just, you don't necessarily have to wait for the rules to change.

Got it, thank you. And then just on advertising, should we assume with the change to the expense guide in the back half of the year that your visibility is also a little lower as you look out later in Q2, obviously April's down, I don't know if you have M&A, but maybe you can just speak to where the visibility starts to decline, should we go forward in Q2 or is it kind of as you said before we had all the volatility? Thank you.

So I'll let others chime in, but in terms of our visibility, it's really about four to six weeks out. So what data we have on Q3 and Q4 really isn't, doesn't really tell us much at this point. And about 20% of our total expense load is variableized to revenue. And so that sort of gives you a window as to why talking about full year guidance didn't make sense at this time.

What I'll add is the visibility is four to six weeks, but as we go into middle of third quarter, fourth quarter with the return of college football and NFL, we're coming off a record championship games, Super Bowls, sports on broadcast have seen record highs and the advertisers have noticed it. So even with the economic times, uncertainty is what we know is certain is that there is a demand for top eight tier sports and we're set up perfectly in the third and fourth quarter to capitalize on the eight tier sports that'll be

returning to the networks. Thank you. Thank

you. Your next question is coming from Benjamin Soft from Deutsche Bank. Your line is live. Good afternoon, thanks

for the question. I was curious if you could talk a little bit more about the compost deal, any additional color on that asset and how it's impacting numbers. And then for Lucy, another really strong quarter on the expense side, can you talk about where you were able to capture those savings and how much runway is left to continue taking costs out of the business? Thank you.

Yes, so why don't I do that part first and then Chris will talk about the acquisition. So appreciate the compliment on the expense side. This is an enterprise wide focus where all of our department heads are engaged in looking for ways to work smarter, be more efficient and really question the spending. And so I'd like to take credit for it, but I really have to give credit to the entire organization on that. And so really in first quarter, that is coming across a multitude of departments. I wish I could just point to one of them as being the main driver, but it really is coming across on an inter-wide basis. Now, what I would say is, are there more expenses that if we needed to, that we could take out of the business? Again, if we needed to, the answer is yes. But right now, there is not a need to go down to the bare minimum. And so we continue to spend where we see growth in the business and be smarter about the places where it's not growing or we really don't need to put investment behind it.

And in terms of the acquisition, Compulse, as I've stated in prior earnings results, is matured to the point where it really is a -in-class platform. It's delivering double-digit growth for us every quarter, year over year. It's got healthy margins, and we really are looking to scale it in a big way. So this acquisition on a pro forma basis ends up being a very attractive multiple for us because of the synergies, and it significantly increases the amount of revenue that we're putting onto the Compulse platform. So it's a very accretive move in an area that is consolidating, and this will increase the financial size and significance of Compulse for the venture's portfolio going forward.

I'll add that it follows our commitment to be in a multimedia company, not a singular broadcast company, and we recognize where viewer habits are shifting, and we will shift with those habits. We've made a commitment to our sellers, to our digital content folks, that we would support them, and the demand showcases why we will support that growth for Compulse, because it's justified by its growth and by where viewer habits are.

Got it, appreciate

the color, thank you.

Thank you. Once again everyone, if you have any questions or comments, please press star then one on your phone. Your next question is coming from David Hamburger from Morgan Stanley. Your line is live.

Thank you very much. And again, I'd like to echo the sentiment. Lucy, you've always been very helpful answering questions and otherwise, and wish you the best in your new endeavor.

Appreciate it, thank you.

Of course. Last quarter you had disclosed that you had renewed your three trans agreements representing 80% of the traditional big four. You had one negotiation that was active at the time. I assume based on the disclosures now, I wanted to confirm one that you've renegotiated that agreement seeing that you now mentioned you have nothing until the end of 2026. As well you had mentioned on the earnings call that the guidance you gave for the first quarter reflected accruals based on the current state of negotiations with that counterparty. I'm just curious, how did that end up shake out based on what you were accruing the result, and did that at all impact the distribution revenues in the first quarter?

So the short answer to that is no, it did not impact the Q1 results. We ended up, there is an agreement in principle with that MVPD and we ended up right at where we were where we were accruing at.

Okay, and just generally speaking about the slower than expected improvement in churn, I mean you did highlight and we've all seen kind of the charter numbers. It does appear still to be somewhat mixed when you look across the pay TV universe. What are you expecting now as you looked at the second quarter guidance? Can you provide any additional thoughts or color on kind of your expectations for subscriber churn and I think in the past you've actually disclosed that it's been pretty consistently in mid single digits, is that still the case?

Yeah, so David, that is still the case. Our forecast does assume mid single digit percents and to your point, we were a little bit more optimistic in how quickly the subchurn would moderate, but again, it's just slightly off and I do wanna remind you that on a year over year basis, putting aside the forecast, on a year over year basis, we grew distribution revenues significantly.

I also would like to add, David, that we, everything that we've seen so far the growth in gross retrans and our renewals on the reverse side, we are reiterating our two year CAGR from 23 to 25 of mid single digits.

Thank you so much.

Thank you so much.

Thank you, that concludes our Q&A session. I'll now hand the conference back to Chris Ripley, President and CEO for closing remarks. Please go ahead.

Thank you all for joining our call today and supporting Sinclair. To the extent you have any questions or comments, please reach out to us.

Thank you, everyone, this concludes today's event. You may disconnect at this time and have a wonderful day. Thank you for your participation.