Ladies and gentlemen, thank you for standing by. Welcome to The E W Scripps Fourth Quarter Earnings Conference Call. At this time, your telephone lines are in a listen-only mode. [Operator Instructions] As reminder, today's call is being recorded.

I'll now turn the conference call over to your host, Vice President for Investor Relations, Carolyn Micheli. Please go ahead..

Thanks, Alan. Good morning, everyone. And thanks for joining us for a discussion of The E. W. Scripps Company's fourth quarter 2018 results. A reminder that our conference call and webcast include forward-looking statements and actual results may differ. Factors that may cause them to differ are outlined in our SEC filings.

You can visit scripps.com for more information. You also can sign up to receive emails anytime we disclose financial information, and you can listen to an audio replay of this call there. The link to the replay will be up this afternoon and available for a week.

We'll hear this morning from President and CEO, Adam Symson; Chief Financial Officer, Lisa Knutson; Local Media President, Brian Lawlor and National Media SVP, Laura Tomlin. Also in the room is Controller and Treasurer, Doug Lyons. Now, here's Adam..

Good morning and thanks for joining us everybody. I'd like to start this morning with a quick look back at 2018 at our strong financial results and the changes we made to better the company.

Then I'll turn towards the future and address the company's opportunity we see in local broadcast industry and the progress we expect from our growth strategies in our national media businesses.

Last year, we steadily and effectively executed on our five point plan, putting equal emphasis on improving our near-term operating results while positioning Scripps for continued long-term growth. We think you will agree the progress we are making is tangible. After reorganizing and restructuring the company, we cut cost by more than $30 million.

We sold our radio stations and we got to work realigning our local television station portfolio, announcing plans to acquire 18 TV stations. When we closed the Cordillera transaction we will reach 21% of US TV households and will own the number-one stations in a third of our local media markets.

Each of our national media businesses exceeded expectations for revenue growth as they attracted larger audiences and consequently more national advertising dollars. The Katz networks, Newsy and Stitcher each have strong footholds in important emerging media market places.

Last year, we also acquired digital audio leader Triton, which is well positioned to help Scripps further capitalize on the fast-growing streaming audio industry. It was a busy year all around for the team and through it all we consistently delivered better than expected operating results. This team is committed to doing what we say we'll do.

Looking ahead, we remain focused on improving the reach and strength of our local media portfolio through strategic acquisitions. We're in the midst of a period of portfolio realignment.

Through the changes we made last year with our operating philosophies and through station M&A, we expect to emerge from this period with a stronger, more durable and better performing portfolio. We continue to see opportunity as a buyer of television stations and expect to appropriately pursue those opportunities.

We're disciplined buyers and we won't overpay but we're optimistic about the options. We remain just as focused on growing our national media businesses.

We more than doubled the profitability of the division from Q3 to Q4, and although we don't expect linear quarter-over-quarter growth in that line this year we remain committed to continued margin expansion. We'll continue to invest in these businesses to maximize growth potential and ultimate profitability.

The opportunity to relaunch the iconic Court TV brand and to expand our share of the fast-growing podcast ecosystem requires short- term investment to yield greater near term cash flow contribution. Now no book ahead for Scripps would be complete without a brief discussion of 2020.

First, we all expect a lively presidential election and once again Scripps is footprint will be well positioned. And our larger station portfolio will help us capture new value from election spending. We will be bigger in California, bigger in Colorado and bigger in Florida, and by then we'll have two stations in Texas.

Second, we'll finally benefit from the reset of our Comcast households which will drive significantly higher gross and net retransmission revenue.

2018 was a terrific year and we expect the momentum to continue over this year and next as we maintain a focus on executing our mission to produce remarkable journalism, serve our audiences and advertisers, grow our business and through it all create outstanding shareholder value. Now here's Lisa..

Thanks Adam, and good morning, everyone. Scripps had a busy, productive and profitable year in 2018 and the activity hasn't stopped.

Since November, we've closed on the divestitures of our radio stations, completed the acquisitions of Triton and the Raycom television stations, delivered a record quarter of midterm political advertising and outperformed expectations on our financial results.

I'd like to start by discussing our strong fourth quarter 2018 results, driven by both divisions of the company. In our Local Media division, fourth quarter revenue was up nearly 40% over the fourth quarter of 2017, driven by $82 million of Q4 political advertising revenue.

That figures soundly beat the fourth quarters of both the 2014 midterms at $44 million on a pro forma basis and the 2016 general election at $56 million. Our Retransmission revenue for the fourth quarter was up 23%.

Expenses for Local Media increased 16% due to increase network programming fees, as well as non-cash write -off of our original daytime show Pickler & Ben. Brian will talk more about Pickler & Ben in a moment.

Turning to the National Media division, fourth quarter revenue was nearly $86 million which was significant, which significantly exceeded our guidance of low-to-mid $70 million range. We were also pleased to see national media deliver a record $7 million in segment profit. That compares to $2.8 million in the third quarter.

On the expense side, national media came in at about $79 million. The increase was driven by higher cost of sales primarily at Stitcher as it delivered 64% higher revenue year-over-year. Turning to our corporate restructuring costs related to the $30 million cost savings plan.

We incurred about $2 million in the fourth quarter and $9 million for the full year. We expect these restructuring charges to trend downward in 2019. The majority of the remaining chargers are coming from implementing some system efficiencies.

And just a reminder that the pension expense uptick in Q4 came out of the company's purchase of a group annuity contract in early November. We transferred $50 million of our pension liabilities to mass mutual life insurance. So we recognized a one-time non-cash pension settlement charge in the fourth quarter.

For the fourth quarter, income from continuing operations was $36 million or $0.44 per share. Pre-tax costs for the quarter included restructuring charges, a $9 million non-cash charge for Pickler & Ben, $3.8 million related to integrating Triton and the former Raycom stations, and the cost for the pending Cordillera acquisition.

Excluding these non -core items and the pension charge, income from continuing operations would have been $0.68 per share exceeding expectations. Our capital expenditures for the fourth quarter totaled about $40 million. There are a number of reasons that increased in the fourth quarter.

About $4 million was spent for the FCC repacking process, which we expect we will be fully reimbursed by the federal government. It also included some transmission power improvements at our television stations and office build out cost for Stitcher and Newsy.

Turning to capital allocations, the company repurchased 1.8 million shares in 2018 for $32 million. We also made dividend payments throughout the year totaling about $60 million. Our Board's initiation of the dividend last year is part of our approach to returning capital to shareholders that balances acquisitions with return of capital.

On December 31st, our cash totaled $107 million and net debt was $589 million. I'd like to hit a couple of items in our guidance. First, the full year, for the full year we expect capital expenditures to total about $35 million without the cost of the FCC repass. Second, we gave full year guidance for gross retransmission revenue in the press release.

And I want to be clear that the 15% increase does not include the impact of the Cordillera station. It's on an as reported basis for all completed transactions only. We expect net retransmission revenue to be up double digits this year as well.

Also a reminder that while about 40% of our households reset this year, more than half of those are the comcast households that reset on December 31st and will not bring in revenue in 2019. Finally, we know we have a lot of moving pieces right now in terms of acquisitions and the radio divestitures.

So I'd like to provide some color on our pro forma debt ratio at year-end, and also once we close the Cordillera transaction. We're providing this look at our leverage on a trailing eight quarters basis and pro forma for radio divested, the Raycom acquisition and also as though we had received comcast retransmission revenue during that time.

This provides a look at our leverage on a normalized basis. At the end of 2018, our leverage would have been 2.4x after closing Cordillera on the same basis we expect to be at 3.7x. Now here's Brian to discuss our local media results..

Thanks Lisa. Good morning, everybody. Since we announced the Cordillera acquisition last October, I've spent time visiting our 15 television stations, and I came away highly impressed and very enthusiastic about owning these stations. These TV stations are brands that matter in their communities.

They have strong ratings and large audiences and in nine of the markets Cordillera owns the number one ranked station. They have great customer relationships and cultures of quality journalism that fit well with our mission focused culture at Scripps.

The new stations also advance our strategies to improve the margin profile, our cash flow and operating performance of our broadcasting portfolio. The transaction has cleared the DOJ and is awaiting FCC consent and we look forward to owning them very soon. Now I'd like to take a quick look at the political advertising revenue.

As we look ahead to the 2020 presidential election, we think you'll agree the political candidates and issue campaigns continue to rely heavily on broadcast TV as the most effective, reliable and credible way to reach voters and share their messages. This was proved out by the record midterm election of revenue we saw last fall.

Campaigns appreciate that when they advertise during our local news programs, they're adjacent to objective, and community focused comment from rural brands. And for Scripps our footprint was well positioned to capture these high margin dollars.

Of course, the impact of such heavy political ad revenue coming to our stations in just a five week period did affect our core advertising performance. But the impact was less than in Q4, 2016 when we took in $56 million and back then we saw a 12% decline in Court.

This time it was only 8% and core began to bounce back immediately after a lull by a day. The local, national and political revenue lines combined to drive our total key advertising up more than 50% r the quarter, a very strong performance.

For the first quarter, we're seeing a nice return in several key categories including services, communications and home improvement.

Overall, if you back out last year's Winter Olympics and the Super Bowl and NBC from our core performance, we expect core to be up slightly on an as reported basis and that's against some really nice comps year-over-year when Scripps outperform the sector. Turning to our pay TV subscriber base.

We were pleased to see the total number of households on which we receive retransmission fees remain stable in the latest subscriber reporting period. In fact from September 2017 to September 2018 that counts was flat. Over the top subscribers have mitigated any decline from traditional MVPDs.

Now I'd like to talk for a moment about our original program Pickler & Ben. We launched this show back in September 2017 and we continue to be incredibly proud of the quality of the show. In season 2 Pickler & Ben reaches two-thirds of TV households. We're in 176 markets.

When both NBC and ABC decided to return to the daytime talk show business, both networks committed distribution of their shows on their owned and operated stations. That locked us out of some of the nation's top markets. This left Pickler & Ben with no path for distribution growth into the largest US cities, a path we counted on to grow the show.

The show will continue on the air until September and we will be very disappointed to see it end. Finally, we've been thrilled with the public reception of the announcement that we're bringing back Court TV and its live gavel-to-gavel trial coverage.

The Katz networks will relaunch Court TV in May and we've made significant progress hiring a mix of new and familiar talent for anchoring, reporting and analysis of the nation's most high-profile trials. We expect Court TV by year-end to reach about 75% of all US TV households. That will be the best first year distribution of any of the Katz networks.

And now here's Laura..

Thanks Brian. Good morning, everyone. In 2018, the National Media division delivered outstanding revenue growth, and segment profit that grew as the year went on. For the year, Newsy grew revenue nearly a 150%, Stitcher grew more than 60% and Katz grew revenue by 20%.

We have told you the National Media division would be a growth engine and that we would focus on growing audience and driving revenue. In 2018, we delivered on that commitment. The acquisition of the Triton digital audio business last fall was another step in the national media division's growth and contribution to the enterprise.

Triton is a profitable, high margin business with no direct exposure to advertising. These are fast business that diversifies the division beyond national ad dollars, long-term contracts and recurring revenue streams.

What Triton does have in common with our other national media businesses is that it capitalizes on rapidly evolving consumer media trends. More people across the globe are streaming their music and Triton is providing infrastructure and measurement services for the music streaming company, and their terrestrial counterparts.

As we look ahead to 2019, we expect Triton to maintain its focus on growing the use of its digital audio infrastructure and measurement products worldwide. Triton has recently expanded and renewed contracts with several existing customers, and sign new deals with others. Turning to Stitcher.

Our podcast company ended 2018 with its highest revenue quarter to date, driven by strong growth in both advertising and subscriptions. Podcasting is attracting new interest and investment and as a pioneer and leader in podcasting, Stitcher is benefiting from that growth.

We have the best ad network infrastructure in the business and our strong agency relationships continue to pay off. Within the last year, we have added major national brands including Microsoft, Snickers, Lego, Facebook, Google and many others to our long list of active advertisers.

Stitcher has recently formed, renewed or extended partnerships with high-profile talent including Oprah Winfrey, Conan O'Brien, Stephen Dubner and Dr. Phil, as well as Marvel and Vox media. These partnerships are crucial to capturing new podcast fans and continuing the rapid expansion of the ecosystem.

Finally, our national news network Newsy saw tremendous growth in 2018 as it gained further traction on over-the-top TV services and established its brand on cable. This past year has proved out our multi-platform strategy for Newsy.

OTT is the most natural platform for us because of Newsy's younger skewing demographic, which is drawn to our objective and authentic approach to the news, Cable complements healthy strong position on OTT. So today we're on your OTT and cable service, on your laptop and on your mobile devices.

Newsy is resonating with viewers because of its impactful journalism. Recently, the investigative team working with our Scripps Washington bureau completed several major investigations that have led to substantive government changes. One of them case cleared prompted the FBI to change the way local police tracked the success of rape investigation.

The year-long reporting was conducted in partnership with Reveal from the Center for Investigative Reporting and ProPublica, Newsy's partnerships with other news organizations to produce and amplify this important work are also helping us establish a strong national news brand that we expect to drive continued financial growth.

Looking ahead the national media division will continue to grow by capitalizing on a changing way consumers find news, information and entertainment. Katz captures audience through growing over-the-air viewing, Stitcher with podcasting and Newsy with over-the-top television. And Triton is seizing the B2B opportunity in digital audio.

The growth in these platforms is driving the national media division toward its estimated 2021 revenue of more than $500 million. And now operator, we are ready for questions.

[Operator Instructions] We will first go to the line of Marci Ryvicker with Wolfe Research. Go ahead..

Thank you.

With Cox being sold to Apollo, Adam, what are your thoughts on M&A? Is still purely stations or are you looking for more wanly?.

Well like we said earlier, Marcy, in our prepared remarks, obviously, we are looking and our probably I'd say our first and prior use of capital on the corporate development side would be in adding strength and durability, growing the size of our local media portfolio.

We're always opportunistic looking for things that will continue to help develop our national media businesses, particularly adjacencies like we found that are in and of themselves good businesses. Things like Triton, but I'd say right now from a capital allocation perspective our primary focus is on the station business..

And then can --I guess this is for Brian, thoughts on core for the year. I understand I think it's up for the first quarter and then also can you help us with the cadence of re-trends to the year I think for-- you said 40% of your subs are up. I know half of that comes in the back half, but how should we think about 2019 in the first half at least..

Good morning, Marcy. We're expecting core to be up for the year. Obviously, with such significant displacement last year, we think that Cordillera effect clearly had an impact on our advertisers, but we think there's the opportunity to build as we go through the year.

We had very little to no displacement in first quarter last year, and really even the first half of last year. So we do expect sequential growth as we move through the year, but we're expecting core to be up. We like what we see in first quarter.

A lot of that categories are healthy and bounced back nicely after a disruptive October in the first couple weeks in November. So I think we feel pretty good about core.

Relative to just the cadence of re-trends, we do as we said expect 40% of our subs to renew at higher rates this year, half of which are the Comcast rates that will come December 31st. So we won't really be able to realize that until next year, but the other half happened really in the first half of this year right around the midpoint of the year.

We have two renewals that come up at the end of June. So we'll see that benefit in the back half of the year..

For our next question we will go to the line of Dan Chronos with Benchmark. Go ahead please. .

Thanks, good morning. I don't know who wants to take this one, but we haven't really talked a lot about sort of the Katz migration to direct. I'm just curious how much runway we still have there.

And then just maybe at a higher level interesting sort of fortune news about Pickler & Ben but obviously you guys are sort of forging ahead on the syndication front. We're seeing a lot of the space kind of follow suit so within sort of the national segment just how do we think about expense on either original programming, new syndicated content.

Eventually syndicating your own content to out to other networks and balancing that with kind of the overall profitability of the segment. Thanks..

Hey, Dan, it's Brian. Let me start with the programming question first and then I may probe for a little bit of more what you're looking for the cadence, so I can get the answer right or at least the question right.

On the programming front, yes, we're really disappointed to have to announce that we were going to be sunsetting Pickler & Ben after season two. We love the show; audiences love the show. The fact that in two seasons we got up to 176 markets was really remarkable. That was a big swing for us and we went it alone.

And so we're very much where we needed to be through season two, but as I said in the prepared remarks, it's been a number of years since some of the production studios and the network's have been aggressive in daytime, and we were able to take advantage of that opportunity.

Now I think they're all seeing our success and others and decided to get back into the space. And they're obviously using their own O's to clear that. So for a show that was a big swing and we were going in ourselves, we realized that the path long-term profitability was limited there.

As it relates to some of our other shows, we were one of the early pioneers in this. And we've got Right This Minute that's in it's I think eight season. The List is right there as well. These are distributed well beyond Scripps Right This Minute the seasons in like 96% of the country.

The thing we like about Right This Minute is we have partners in that which mitigate the risk, but also you get to share the upside and the commitment to that. And I think our commitment to programming hasn't changed. We'll continue to look to take some creative risk and try to give a unique voice to daytime.

We think it's a fun space and we think that there's a ways that local broadcasters can create content programming, and certainly have a feel for the middle of America. We've chosen not to produce any of our shows in New York or LA, but I think we found a real niche in the middle of America. And we'll continue to take advantage of that.

But I think you expect to see us still in that space. In a perfect world, we'll have partners and Right This Minute and The List of two of the most profitable shows on our schedules as a result of the way they're produced and the partnerships we have. So I don't think our commitment there has changed.

Going back, so we talk to -- you asked the question about Katz and its migration to direct.

Can you just clarify that?.

Yes. I meant, look, I-- we knew when you bought it a lot of it was paid advertising right moving towards general market.

I was just curious if you could give us an update on sort of how that trend is progressing? How much low-hanging fruit you still have there?.

Yes. We still have a lot. So I think what we've told you in the past are that bounce is the most advanced. It's the oldest network but also the most advanced relative to general market. Roughly half of its revenue comes from general market basically the rest comes from hybrid direct response.

They've really moved out of any of the just low-hanging basic direct response. Laughing escape are kind of next we're seeing significant growth in both of them as they move into the general market space, basically doubling the amount of general market they had in the last year.

But there's still a lot of runway and they're nowhere near where bounces yet. Grits the one, grit is built at more as a direct response-type product. Grits our second most profitable network so the DR works really well in that space. So we still have a lot of run room. I can say advertisers are really excited and leaning in on Court TV.

There's a lot of excitement and advertisers stepping up not even stepping in at the direct response, they're moving right to hybrid, and we won't be nationally rated when we launch, but I would imagine in a year or so we will and then we'll be ready to move into the general market space. But general market is important.

We've got, I don't know, maybe almost 150 general market advertisers that buy onto the Katz networks. Our up fronts were up double digits on both the calendar and the broadcast up front, and all of that is general market. So it's a healthy space for us..

Our next question will be going to the line of Michael Kupinski with Noble Capital Markets. Go ahead please. .

Great. Thanks for taking the question. I was wondering if you can give us any update on Newsy cable subscriber goals and targets. Any updates there..

Hey, Mike. It's Laura. Yes, so we are nearing 40 million cable subscribers right now. I think for 2019, you can expect continued growth and revenue primarily coming from OTT, but will start to lay in some nice cable ad revenue and carriage fees this year.

Okay and then in terms of the guidance for the national media segment for the first quarter. I believe that a part of the company's cost-cutting initiatives was earmarked for national segments. And in addition you acquired Triton which was profitable.

So I was kind of anticipating that maybe there might be a little bit more margin in the segment starting in the first quarter. Can you give us some color on the investments spent for Court TV and is that in, I assume that's in the first quarter guidance for the --for that division of numbers and just kind of framed the spend there..

Hey, Mike. It's Lisa. I'll take the first part and kick over to Brian on the Court TV investment piece. So we had earmarked about $3 million of cost cutting in the national division that actually came at the end of 2017 when we started our cost-cutting initiative. So that was laid in for 2018. So that's in the run rate at this point in time..

Hey, Mike. It's Brian. Relative to Court TV, obviously, were busy hiring talent but also building out a terrific production studio and set down in Atlanta. So between the capital, the startup and some programming that will be beyond just the live gavel or gave coverage where somewhere between $10 million and $15 million all in for the startup.

And that's built into the P&L..

Hey, Mike. Just reminder too on the international media division, most of the businesses is ad based businesses. So we expect seasonality in the first quarter as well..

Got you. And so can you just kind of because there's so much noise moving part in that national division. Can you kind of give us a sense of where the margins could go after we start to see some of those heavy spent for Court TV and things like that.

What could we see in terms of margins for the balance of this year maybe into 2020?.

Hey, Mike. We're not giving a full your guidance on sort of margins but as we've mentioned we continue to pursue margin expansion. I think the important point is that the metrics were really focused on as revenue growth. A couple of these businesses are really in high growth mode and that requires support.

That's going to come through continued investment. Our goal is to see revenue growth outpace any expense growth. And we expect sort of our segments to contribute handsomely to the bottom line eventually. It just takes investment right now..

I totally get that but would we see margin improvement year-over-year from 2018 for instance?.

I think you can see the margins this year are sort of going to vary by quarter. And I would say it would be small to incremental,.

Got you. And then in the past we talked about station swaps.

Can you talk a little bit about the prospect there? Are we just stopping focusing more on building out the platform?.

Hey, Mike. Good morning. It's Adam. Yes, I mean I think the regulatory environment right now is questionable with respect to swaps.

I would say our commitment to realigning the portfolio and emerging as I said from this period with a much stronger portfolio as a result of changes to our operating philosophy along with the opportunity to acquire stations and potentially continue to pursue our buy sell swap strategy. I think we expect to emerge with the net result being the same.

We do look for opportunities to be deeper in the markets where we operate. Ultimately what we're looking at as our filter is how we continue to enhance the strength, the operating performance of our portfolio, as well as the durability. And so I think second stations is definitely something we're interested in continuing to pursue..

We'll go now to line of Craig Huber with Huber Research. Go ahead..

Yes, hi, good morning. Maybe we'll start with TV first.

I'm curious Brian for the year you guys are thinking what on net retrans growth, can you help us a little bit?.

Double digits, correct..

So 10% plus okay. And then if you took out the OTT subs. I think you said you were basically flat overall if you took out the OTT piece, is that mean you're sort of down maybe 1%-2% the traditional part..

Yes. I mean I think that that's no surprise if a MVPDs have been shedding households and people are converting over to the virtual MVPDs. At year end well through our last reporting which is through September we have a little over 850,000 OTT subs since this started about two years ago.

So you could assume that those subs have come directly from MVPD households and as I said earlier, since September of last year so for last twelve months that we have reported any household that has left MVPD has converted directly into an a virtual MVPD sub. So the good news is we're able to monetize those households exactly the same.

So we're indifferent as to whether they're getting their subscriptions through a traditional MVPD or one of the new virtual services..

Then Brian maybe I'm just curious is there much difference in the year-over-year performance and local versus national say what happened [Indiscernible] what you're seeing in the first quarter..

Yes. It gets muddier every year because there's just a lot of movement of clients that are local. Like a national ad agencies, people who are national agencies move to regional agencies and so it kind of moves around. As we're looking at this year just based on where everything's slotted we see local up a couple percentage points a national about flat.

So more of our growth comes on the local, Obviously, that's where we can control the controllables. We'll do well over $50 million of new business, another $30 million of digital. So that's where our folks are really talented sales folks are out there banging on doors and creating business for us.

And so local is where we have better control, but we think nation national stable and we're seeing more and more money move through the automated systems. And I think that's really good for our long-term prospect to be able to take money from the national ad agencies..

Brian my last question for you.

What are your updated thoughts with the ownership cap in terms of what the FCC may or may not do here?.

Yes. I don't know. I mean we've been at this for well over a year. So we still think we were one of the companies have filed that we thought the cap should move to 50%. We still think that there's opportunity for growth. We think there's a strong case for white broadcasters should be able to expand beyond the 39%.

And so I still think that whenever it gets resolved, it will grow north of 39. I don't know if it settles in with the UHF discount and it's 78 or it gets eliminated. But obviously we filed and believe that somewhere between 50 and 78 would be a good..

Okay. Then like question the national media side if I could. I mean given all the high growth properties you have in this space here. Obviously, it's going to be somewhat difficult to sort of figure out where you want to allocate sort of internal investments spending.

I guess what I like to hear just briefly if I could where do you guys are most excited about for the growth prospects for this year they just you're funneling money behind that to help drive the growth within national mea..

HI. Dan, it's Laura. I mean I would say we're excited about every business in the portfolio from a growth perspective. Your question around allocating capital is a good one. We really balance the investment we're making in each business with the expected return.

This year I think we're really expecting high revenue growth rates to continue from Stitcher and Newsy, but across the board all of these businesses expect to contribute significant revenue growth to the division. .

Is it a one area one company within national media one or two that you're in particular spending heavily behind or it's sort of all across the board?.

Yes. I think this year most of that will come from Stitcher and Katz. So the investment in Court TV we have high expectations for what that's going to deliver to the division. And we continue to identify opportunities each and every year where the investment that we make will yield greater return and more long-term value for the company..

We'll go now to the line of David Steinhardt with Litespeed Partners. Go ahead please.

Hey, all, congrats on a transformative 2018, really excited for your progress.

I'm just wondering I might have missed this, what is the expectation as to when Cordillera will be closed?.

Hey, Dave, it's Brian. We have DOJ approval. We're working through the FCC right now. So we're hoping beginning of second quarter somewhere in there..

Okay. Great. And I know that you're spending and trying to grow the national media business but in terms of the local media business, obviously, 2020 is going to look very different once Cordillera closes and you get Comcast retrends.

But what is the margin that you'd be happy with and what are you working towards at 2020 and beyond?.

Hey, David. It's Adam and I'll let Brian sort of give you some color on the numbers. But I just wanted to clarify that while we are absolutely opportunistically looking at organically growing the national business and of course continuing to fuel the growth of the national business organically.

Our top priority is to add strength and durability to our local media portfolio. And I just want to make sure you understood that. Brian you want --you want to give him some color on the business..

Sure, obviously. Dave margin is a priority here, making sure that we're building the most effective, successful and profitable television stations we can. You touched on the fact that Cordillera comes in or comcast will finally materialize in 2020 will have the benefit of political.

We will also have the benefit of the $20 million of cost cuts that we took out at a local media division last year. So last year we were taking those cuts out through the year. Our margin was mid- 30s for the full year.

I expect that to be able to grow as we get to 2020 with the success and the strong margins associated with the Cordillera stations full-year realization of all of our cost cuts. The improvement on comcast as well as obviously some other growth initiatives that we've initiated this year that we expect to continues to grow.

So pushing well north of the mid-30s is certainly our target. End of Q&A.

This time we have no further questions in queue..

Thanks Alan. Thanks everybody for joining us today. And Alan you can do the replay information now..

Okay. Ladies and gentlemen, your conference will be available for replay beginning at 11:30 a.m. today March 1st, 2019 and lasting for one week March 8, 2019 at 11:59 p.m. To access the AT&T executive playback service during that time please dial 1-800 -475 - 6701. Internationally you may dial area code 320-365-3844 and enter the access code 462-637.

Those numbers again are 1-800-475-6701 and are code 320-365-3844 with the access code 462-637. That will conclude your conference call for today. Thank you for your participation and for using AT&T executive teleconference service. You may now disconnect..