Greetings and welcome to the Sinclair Broadcast Fourth Quarter 2015 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. David Amy, Executive Vice President and Chief Operating Officer. Thank you. You may begin.

Good morning everyone, and thank you, operator. Participating on the call with me today are David Smith, President and CEO; Steve Marks and Steve Pruett, Co-Chief Operating Officers of Sinclair's Television Group; Chris Ripley, Chief Financial Officer; and Lucy Rutishauser, Senior Vice President, Corporate Finance and Treasurer. Before we begin, Lucy will make our forward-looking statement disclaimer.

Thank you, Dave. Good morning, everyone. 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 fourth quarter earnings release. The company undertakes no obligation to update these forward-looking statements. The company uses its website as a key source of company information, which can be accessed at www.sbgi.net. In accordance with Reg FD, this call is being made available to the public. A webcast replay will be available on our website later today and will remain available until our next quarterly earnings release. Included on the call will be a discussion of non-GAAP financial measures, specifically television broadcast cash flow, EBITDA, free cash flow and leverage. These metrics are not meant to replace GAAP measurements, but are provided as supplemental detail to assist the public in their analysis and valuation of our company. A reconciliation of the non-GAAP financial measures to the GAAP measures in our financial statements is provided on our website under Investors' Reports and Filings.

Thank you, Lucy. Before we go through the results, let me review some of the more meaningful activities that have taken place since our last earnings call. In a very value creating transaction, we announced that we are buying Tennis Channel for $350 million. Unlike most cable nets, which are securely challenged, Tennis with its live sports, passionate fans, and established brand is under distributed. Through our relationship with the MVPDs, we have already secured an increase in their carriage from 30 million homes to 50 million homes, the result of which will positively impact the revenue and EBITDA over the next 18 months. We recently closed on our previously-announced TV station acquisitions in Corpus Christi, Texas and the swap of our market stations for stations in South Bend. Adding to our retrans visibility, we finalized or have agreements in principle on almost 40% of our retrans subscribers that are renewing, leaving only 13% of the subs left to be negotiated this year. American Sports Network, while continuing to produce games for our stations, has officially transformed into a 24/7 multi-cast network carried in 15 of our markets. The intent is to affiliate the ASN network on other broadcasters' multi-cast lineup. On the content front, ASN produced its first college football bowl game, the Arizona Bowl, and recently entered into a two-year agreement to produce the regular and post-season games for the newly-created Major League Football, which is estimated to begin this spring. Our other multi-cast network, COMET, has also started affiliating with other broadcaster and now reaches approximately 70 million households. We expanded local news in Steubenville, Ohio, and Harlingen, Texas in time for the March primary races in those states. This spring, we will be re-launching Circa, an independent digital news site aimed at the growing social and non-linear audience. Circa will remain an independent organization funded by Sinclair and other potential investors. We recently joined the NewsON partnership that provides consumers live and on-demand local newscasts and news clips on mobile and connected TV devices. And we are pleased to announce the creation of a $0.5 million Broadcast Diversity Scholarship Fund to help minority students of race finance their undergraduate studies related to broadcast television and journalism. Chris will now take you through the fourth quarter results.

Thank you, David. If you haven't noticed yet, net broadcast revenues are now referred to as media revenues in our income statement, reflecting the expanding and diversified nature of our core business. We reclassified Ring of Honor and Circa into this broader media revenue category from what was previously classified as other operating division revenues, an effect which should be immaterial to your models. Media revenues for the fourth quarter were $546 million, a decrease of 2% or $11 million lower than fourth quarter 2014 but within our guidance. On a pro forma basis, fourth quarter 2015 media revenues were 6% lower than pro forma fourth quarter 2014, primarily due to the absence of $75 million of pro forma political revenues, offset in part by higher retransmission and digital revenues. For the full year, media revenues were $2.12 billion, an increase of 13% or $227 million higher than the full-year 2014. On a pro forma basis, media revenues for 2015 were $2.19 million up slightly from 2014's pro forma media revenues of $2.12 billion. Media operating expenses for the fourth quarter, defined as media production and media SG&A expenses before barter were $313 million, up 14% from fourth quarter last year and up 11% on a pro forma basis, primarily due to higher reverse retrans, $9 million to terminate an inherited pension plan, costs related to adding games in preparation of launching ASN to a 24/7 network, and expenses for the launch of Full Measure and adding news in 16 markets throughout 2015 in advance of the election year. On a full-year basis, media operating expenses were $1.165 billion, up 23% from 2014, and up 9% on a pro forma basis. Excluding reverse retrans, our investment in ASN, expanding our news product, the pension plan termination expense, and the launch…

Thank you, Chris. Capital expenditures in the fourth quarter were $19 million and $91 million for the year. For 2016, we are estimating CapEx of $95 million, which includes expenditures for buildings, HD news and master control upgrades. Cash programming payments in the fourth quarter were $26 million and $109 million for the year. For 2016, we are estimating film payments of $112 million. Cash taxes paid in the fourth quarter were $23 million and $107 million for the year. For 2016, we expect to pay 70% to 75% of the tax provision in cash. At December 31, total debt was $3.854 billion. Included in that amount was $123 million of non-guaranteed and VIE debt that we are required to consolidate on our books. We ended the quarter with $150 million of cash on hand and $483 million available on our revolver for total liquidity of $633 million. Of this, $387 million is earmarked for the first quarter closing of Corpus Christi, which has already closed, and the Lincoln Stations and Tennessee Channel acquisitions. During the year, we repaid $60 million of scheduled debt amortization. Total net leverage through the holding company at quarter end was 5 times. This excludes the VIE and non-guarantor debt and is net of cash. The first lien indebtedness ratio was 2.3 times on a covenant of 4 times. Our 2014-2015, two-year average net leverage was 4.7 times. And with 2016 being a presidential election year, our 2015-2016, two-year average net leverage is expected to decline significantly to approximately 3.9 times, assuming our current portfolio and pending transactions. David Amy will now take you through the operating performance.

Thank you, Lucy. For the fourth quarter, political revenues were $12 million as compared to $80 million in the fourth quarter of 2014. On a pro forma basis, core advertising revenues were up 2% in the fourth quarter and in line with our guidance. For the year, pro forma core advertising revenues were up just over 1%. Digital revenues on a pro forma basis grew 23% in the fourth quarter and 19% for the year. Now we're going to turn to our outlook for 2016 and we have a lot of good news to provide for you here, but also some complexities. So let me take you through that. For the first quarter of 2016, we're expecting media revenues to be approximately $516 million to $521 million, up 11% to 12% as compared to first quarter of 2015. Political revenues are expected to be $16 million to $18 million in the first quarter versus $2 million for the first quarter of 2015. On a pro forma basis, including all pending transactions, first quarter core advertising revenues excluding political and $3 million of incremental Super Bowl revenues, are estimated to be up low single-digit percent versus the same period last year. On the expense side, we are forecasting media expenses in the first quarter to be approximately $326 million versus $274 million in the first quarter of 2015. For the year, pro forma 2016 media expenses are forecasted at $1.453 billion versus 2015 pro forma media expenses of $1.258 billion. That's a 15% increase on higher reverse retrans, a music license settlement received in the first quarter of 2015 that reduced our music license fees by nearly $3 million, full year versus part year expenses related to the launch of Full Measure with Sharyl Attkisson, and expanding news in 16 markets…

Thank you. At this time we'll be conducting a question-and-answer session Our first question comes from Tracy Young from Evercore ISI. Please go ahead.

Hi. It's sounds like your EBITDA, as you mentioned, David, is $155 million to $159 million in the first quarter. That sounds like it's lower than what consensus was looking for. Could you talk a little bit more about the timing of expenses in the first quarter? Thanks.

Yeah. Tracy, this is Lucy. I'll go ahead and take that and I'm glad you started with that question so we can clear up some of the complexities off the bat and then talk about some of the really good things that we're doing. So, what it looks like is based on the published models out there. This is simply a timing item for the quarter and how the quarters are spread throughout the year. In fact, as David mentioned, when you think about the 2016-2017 free cash flow guidance that we issued just now, most of the models on the Street will actually need to be taking their free cash flow up for the two-year period. So, again, just timing on the expenses on how they're spread throughout the year. And I can work with anybody on getting their models aligned with what we're seeing.

Our next question comes from Marci Ryvicker from Wells Fargo. Please go ahead.

Hi. I have a couple, I'm going to start with – the first is underlying core advertising revenue, you talked about being up low singles, ex-Super Bowl, ex-political in Q1. Can you talk about what you saw in the fourth quarter? How strong it started in Q1 and if there are any signs of weakness because we are starting to hear from at least some companies that there might be some weakness starting. So, any comment on that would be the first question? Steven M. Marks - Co-Chief Operating Officer & Vice President, Sinclair Television Group, Inc.: So far we're doing just fine. As you mentioned, we had a really good fourth quarter on core and it shouldn't be lost on anybody when we're talking about the percentages on digital specifically, how we're enjoying huge increases in that. That's becoming part of our core. As we mentioned, we re-described core recently within the last year or so. Our business is blooming digitally, we're talking about 20% increases and we're continuing to do that not only in fourth quarter, but we're off to a good start in that category again in the first quarter. Automotive was good in fourth quarter, automotive is good in first quarter. So, I think when you take into the effect backing out Olympics and the special events and still being able to provide a decent core percentage, bodes very well for us. We're doing well with core and have been doing well for the last couple of quarters.

So is it safe to say Q4 was also up low single because that – while we appreciate the digital, your stock is down 7% and I think people are not paying for the digital growth. They really want to know what the underlying station ad revenue is. So is it safe to say it was up low single also in the fourth quarter?

Yeah. So, Marci, we were up low-single digits with and without digital...

Okay.

... where business in fourth quarter. And I just want to reiterate what Steve is saying because other than Q2 of 2015 where we had some weakness in FOX primetime, Q1 of 2016 would now be four out of five quarters, where we're seeing the core business up low-single digits.

Okay. And then, of that $140 million you gave for the year, the acquisitions and other related expense, can you at least take about how much falls into the first quarter; then we can kind of figure out the rest?

Yeah. So, that's really going to be – the first quarter is actually going to be the lowest quarter in terms of that because a lot of the acquisitions have either will not have closed in the first quarter or close in March. And just kind of from a trending perspective, second quarter will be the highest of the four quarters, and it'll trend down as you get into Q3 and Q4. And a lot of that is really based on timing of the major tournaments as they hit in Q2 and Q3 for Tennis Channel.

Okay. And then since you mentioned AT&T and DirecTV in the press release, any issues given cable consolidation? I think we heard from some of the cable networks, or at least implied by their guidance that conversations have gotten tougher. I'm just curious since you have so many stations and I feel like you enter these negotiations in a position of strength, has anything changed as these cable companies get bigger?

So, again, as we stated, AT&T, which was up at the end of 2015 and DirecTV here at the end of February, we already have agreements in principle. So, I think really any issues that you're hearing in the marketplace really have to do with the cable network, which are fully distributed and really don't have any significant viewership base; broadcast doesn't have those issues.

I think I would just add to that, that certainly AT&T and Direct combined is now the largest MVPD in the country and certainly their stance has been more aggressive as it relates to subscriber fees. So, we're very happy with the outcome that we've just negotiated. So, from our standpoint, we never thought that was very problematic, that asset, that merger, in terms of our relative negotiating leverage and that's proven out in the results that we achieved.

Got it. And my very last one, sorry, is we're watching Trump likely get the Republican nomination. Does that damper any expectations for political for this year?

I think that remains to be seen. As we talk about political, as we speak, we were pleasantly surprised so far with the primaries. We busted Iowa, South Carolina and Vegas in terms of expectations. And that quite frankly was with Donald sitting on the sideline for the most part. So, the spending as – to-date has been enormous actually, and we'll have to wait and see what Donald does. I would suspect that if he is the nominee, and this is just me thinking out loud, the RNC is going to have no choice but to back him and the money will flow, the prize is too big.

Got it. Thank you all very much.

Thank you.

Our next question comes from Dan Kurnos from The Benchmark Company. Please go ahead.

Great. Thanks. Good morning. Just a couple quick housekeeping questions. Maybe just to follow up on Marci's political question and this could be something that I'm just having an issue with. Lucy, maybe you weren't somewhat – if you have the numbers, if we could just get a reminder of what pro forma all-in political was in 2012 just so we have a clean comp? And then again, it really was I know, David, you just talked about political spend over the balance of the year. It looks like Q1 was a little bit lower than what people were forecasting. So it sounds like you're expecting a pretty significant ramp, so really no change to your forecast for the year. Is that fair?

So, let me do – pro forma 2012, so if we earned all the acquisitions that we have today, we would have been $254 million of political. We do not have a full-year 2016 political guide out there, but I will say that the Q1 our $16 million to $18 million forecast is actually running about 60% to 80% higher than our Q1 of 2012. Now, we don't expect that trajectory to continue throughout the year, but I think it just is another indicator of how strong political will be this year. And just remember, the stronger it is, the more displacement you're going to have of just – of your normal core in the back half of the year because of the finite amount of inventory that we have. But again, I just want to point out that, over the past four years we've been building this company for this political year. So, we've been acquiring a lot of big four affiliates that have a lot of news, we've been adding a lot of news inventory. We mentioned on the call, we added Full Measure last year. We expanded news in 16 markets, we're in all the key swing states in very big ways. And so, we're building this company to grow political share in 2016.

Okay, that's really helpful. Thanks for that. And then just one other quick housekeeping question. Your guidance says Tennis Channel beginning April 1. On the Tennis call, you had said possibly March 1 close. Has there been any change to the timing on that front?

We expect it to close sometime between March 1 and March 15.

Okay. So, that – but that's not embedded in your Q1 guidance?

It's not in the Q1 guidance, but also in the guidance we have the Lincoln Stations estimated to close March 1. Those will probably be more in the back half of March. So, there's some give and take there with the timing of those two acquisitions.

Got it. Just wanted to make sure we have the numbers right. Just some higher level questions, if you don't mind, maybe even for David. Just on the spectrum auction, you know look we've obviously had some nice tailwinds from ATSC 3.0, and clearly you guys have put out your monetization studies at least initially. As that evolves, has that changed at all your thought process on spectrum auction participation?

So, we certainly do factor in our expectations of what we can do with ATSC 3.0. First, in terms of Sinclair's view, we haven't changed our models internally as to what we can do and how that relates to what we might do in the auction. So, our expectation and conviction around ATSC 3.0, as you all know, has been quite high and has only been getting higher. So, I wouldn't characterize, if your question is, has there been any change in terms of our stance and our expectations on ATSC 3.0 and the effect on the auction, as I would say, there hasn't been much, if any, change, at least for Sinclair, I can't speak to other players in terms of their increasing confidence, but there is I think a feeling that the whole industry is more bullish than ever on ATSC 3.0, so that may affect some players in terms of their actions.

Yeah. I think part of the question I left out was that we've seen or heard that a lot more independents seem to be willing to participate. So I didn't know if that had changed your outlook, but it sounds like your numbers haven't really changed at all. And then just – and again, high level, I know you guys talked a little about this on the Tennis call specifically, but just some of the ancillary network effects you guys expect to benefit from once Tennis closes? And just sort of the timing of going after either international or more of a digital-oriented focus would be helpful for our thought process. Thanks.

Sure. So job number one on Tennis is to get the subs up, and we're already going from 30 to 50 contractually, but there is plenty of room above that for further subscription or sub growth. And then the second order is getting the ad revenue up, the network is a massive underperformer in terms of the amount of revenue it produces by sub, and that's driven by subscale platform, it's not a national buy, it's also driven by the fact that it doesn't even subscribe to Nielsen ratings, so it's really not even playing in that pool of money. And so we think there is a big opportunity on the ad side. And then kind of second and third order opportunities are what you mentioned in terms of expanding their digital and OTT strategies. The company is going to bootstrap together a very interesting OTT platform, which is award-winning and well-recognized within the OTT universe. We plan to supercharge that and explore opportunities to bring that to international markets. And further, then just OTT there is also an entire sort of digital strategy around Tennis, which is quite interesting.

That's more what I was trying to get at with the now that you have sort of additional organic content on a larger scale fitting it into the content management system and using it and leveraging your digital properties if you can start really ramping CPMs on the digital side as a result. It seems like a longer-tailed opportunity, but just wanted to get a little bit into the weeds there?

It is a longer-tail opportunity, it's not anything we're prepared to quantify, but it's certainly something we're focused on. Quite frankly, we haven't even close the acquisition yet. So we have a lot of ideas about what to do there, and how to do it, the execution we'll have to put in place and some of that will take time. So but I think you're right in thinking that there are opportunities there, we see opportunities in digital, OTT and international for that brand, and that was part of the reason or kind of the cherry on top, if you will, for doing the acquisition.

Okay. Great. Thanks for all the color guys.

Our next question is from Aaron Watts from Deutsche Bank. Please go ahead.

Hi, everyone. I think I heard you guys that auto was strength to strength 4Q into 1Q. Can you talk about whether you're seeing any leakage of auto advertising dollars from kind of traditional TV to digital? And if so, are you able to hold on to some of that or is it going to third parties?

So, the digital has grown as the marketing tool for dealers and we specifically have gotten very aggressive with our digital teams in creating dealer focus or what we call Tier 3 marketing plans that incorporate things like SEO/SEM, retargeting email campaigns, and business intelligence or analytics intelligent management software, two of those things that are exclusive to us. And so, we have been very aggressive to make sure, and with the support of our Seattle team, that we can design new competitive products for specifically Tier 3, eventually Tier 2 and Tier 1. And so, to answer your question, there has been leakage for 15 years to digital. It's been a part of their marketing program that has not come of out TV, and we're doing everything possible, including relationship management and organizing our dealer relationships, our high level contacts, our Tier 2 and Tier 1 contacts, to make sure that we continue to enjoy a big position in their marketing plan.

Okay. That's helpful. And then secondly, I'm just curious if you think about where historically the percentage of revenues you get from the network programming that you have versus where you see that going in the future, given that you, I think, have said you've increased your news inventory, you've certainly started and launched a lot of other programming initiatives. Just as we think about the business overall, how do you see that trending?

Sure. So, just to level set for 2015, we derived about 30% of our ad revenue from news, 29% from network programming, another 29% from syndicated, 8% from sports and 4% from paid. The network programming bucket includes more than just primetime by the way, so that's all our network programming, that's 29%, and we expect that percentage to go down over time as some of the other areas grow. I don't think it will go down dramatically, but I think you'll continue to see that number slowly reduce as we diversify, as you noted.

Great. And one last one from me, a little bigger picture. Financial markets have been choppy, concerns about the economy in general. How do you think about your business positioning now just from the standpoint of your revenue mix, your leverage, versus the last recession? To the extent that things do get a little bit more choppy for everyone, and advertising has a little bit of a pullback, how do you see Sinclair positioned?

I think that's a great question. From my perspective as chief financial officer and looking at the capital structure and the mix of business, I think we're in incredibly a great position to weather any future storms because when you take a look at where we are now versus say where we were in 2007, the mix of our business in terms of contractual subscription revenue versus ad revenue has changed dramatically. And it's no – nothing short of revolutionary in terms of where our business comes from, and as you know, subscription – contractual subscription revenue is much sticker and much less volatile in economic downturns. And furthermore our capital structure is such, it's lower leverage than it was back then, it's lower cost, it's much more flexible in terms of covenants, and it's further out in maturities. So capital structure, very solid, very de-risked and business much more stable and recession resistant.

Yeah and I would just add to Chris' part that the portfolio of assets that we have is actually much stronger. Back then we were pretty much FOX and MyTV centric. Today, we're one of the largest CBS, ABC and near largest NBC affiliate. So we have big – a lot more big three in our portfolio, so more diversified that way, and we have a lot more markets. So we're more geographically diversified than we were back in the last recession as well as having besides just advertising and a higher retrans, we also have digital and other revenue streams that we're building.

And I would just add from the business operating side, the one thing we've barely scratched the surface on so far is our scale. We are just now learning how to attack other pockets of money with our scale. And having 2008 and 2009 fresh in my mind, which it wasn't at the time because we had a long history of no challenges, we now see that we could go after network money and regional footprint money by aligning with other broadcasters and just using our scale to be more effective.

Great. Thank you for taking my questions.

Our next question is from Kyle Evans from Stephens. Please go ahead.

Hi. Thank you. David, you laid out four items in your operating focus for 2016. And I was hoping you could dive down into two of those, in particular. The first is launching Circa; I'm not familiar with that. And the second is, monetizing digital content management system. On the CMS side, is that kind of a shot across the bow of the newspaper industry and the ad dollars that are still over-indexed there? Just any detail on those two things would be helpful. Thanks.

Sure. The Circa initiative is taking advantage of our news platform and the strength that we have in news, and just combining that with our efforts out of Seattle in terms of our complete digital connection. So it's a true initiative that we're launching in DC, and it's really focused on kind of the vices of the world and the boxes of the world in regards to just how they provide news and updates to the younger generation or the next generation or the millennial generation, however you want to label them in this day and age, and it's the recognition and the adaption of – adoption to the fact that news is being consumed in so many different ways and we have a lot of confidence in just what direction that will go and the technology behind Circa is very unique and it will provide us with an advantage over your normal kind of run-of-the-mill type of news asset that's providing information and so it has a philosophy to it that we're confident in, in regards to providing updated news on the moment and it – without having a lot of significant bias one way or the other as we deliver that. And...

Let me jump in on the CMS. I think that's the second part of your question.

Yeah.

So the monetization of CMS, is that a direct competitor to newspaper, I think the short answer to that is yes. And each one of our local stations their mandate is to be the number one local content provider on all platforms that – and a big part of that is obviously news, but it includes more than news. So that's really when the station wakes up every day, that's what they think about beyond sales and other sort of operational objectives, but that – they want to be the local, the number one local content provider on all platforms and the CMS enables that and before we had this confederation of CMS' outsource ones, home world ones, it was a mess. So, unifying everyone on that platform was essential and modernizing that platform was essential. And ultimately, we see our local content presence as being bigger than local newspapers over time. That is the objective and the goal. And Circa ties into that just from a national umbrella perspective, so at the end of the day, all news is local. And when you have 80 markets or 81 markets like we do, we generate a lot of news and tying that together to a national brand is the next logical step and that's what you're seeing with Circa.

And it allows you to do it – the workflow has improved dramatically in publishing for us. Just to put some context to that, as tragic as it is, when you look at the events that took place in Kalamazoo recently, we happened to be a dominant station in that marketplace and we broke the story – we were the story on a national basis instantly, that's something nobody else can do. No other news organization in the country does that because there's a practical matter of the vices of the world and the rest of those folks don't have boots on the ground like we do. So, we expect to lead as I would suspect every broadcaster in the country thinks about their news operations, we expect to be the source of all news to essentially all these peripheral sites that everybody kind of looks at today and says, this is where I go to get my news. The reality is, we originate it and it's incumbent upon us to take control and not only be the originator, but be the dominator in that space on a going-forward basis.

Thank you.

Our next question comes from James Dix from Wedbush Securities. Please go ahead.

Hey, good morning, everybody. I guess just a first one following up on a point you made, Chris, on just how your revenues become more diversified. Any rough range you could give on how much advertising is as the revenue in 2015 versus 2007, just to give some sense of what you said was kind of a revolutionary change there? And then I had a couple follow-ups.

Sure. So, as you know we don't break out retrans specifically, but if you were to compare 2007 to today, I would – my estimate which is just off the top of my head would be it's 10x greater in terms of how much revenue is sitting there versus 2007. Whereas, it would have been a small single-digit percentage back then and now it's a very large double digit percentage.

Okay. Great. That's helpful. And then I think, David, you indicated that if you looked at your 2016, 2017, free cash – your 2016 free flow guide, it kind of implied around $75 million increase from what was previously implied. Any breakdown you could give on what are the drivers of those, of that $75 million increase?

It's coming primarily from the two areas, one is the acquisitions that we've mentioned that'll generate the significant free cash flow, and then reductions in taxes and freeing up a lot of our estimated tax payments. And we've been able to capture and we'll able to utilize the NOLs that come along with the Tennis acquisition.

Okay. So not much in terms of change of the various contributions in terms of advertising and retrans and things like that? It's really more those two items?

Right.

Okay. And then for 2015, any color you could give on just what your largest advertising categories were, roughly how big they were, the growth you saw for the year in them? And then any important continuations or changes in the growth outlook for those key categories as you look at 2016? Steven M. Marks - Co-Chief Operating Officer & Vice President, Sinclair Television Group, Inc.: Look, we had a good year in terms of 2015, in terms of core. The automotive category as we've been mentioning was pretty stable. Services was a good category for us throughout 2015 into 2016, a very strong category, doing very well in the first quarter as well. Telecommunications was decent for us, off to a good start with telecommunications in first quarter as well. We have roughly about 15 categories that we track, and 13 of them are up right now the first quarter. Or we have 13 categories that are up right now in the first quarter, which is a little bit better than normal for us. So, we're off to a good start and we ended the year good. So, we're very optimistic on 2016.

Great. And then my last one is just any update on important milestones for ATSC 3.0 either for the company or for the industry that we should be focused on for this year or next year in particular? Thanks.

Yeah. I think the most important milestone is that the ATSC Standards Committee hoisted up the key components of the future standard which are ours, and we expect that the ATSC Committee will vote on that momentarily and essentially finalize the standard as it relates to our intellectual property. So, we are doing and we are now preparing to do a full-blown demonstration between Washington and Baltimore to demonstrate what the future world will look like in the context of single-frequency networks, and the ability to do directed advertising to zones, handing off city-to-city kind of stuff, we expect a full-blown demonstration of any number of capabilities at the NAB this year. And we're hosting a plug-and-play here shortly for all the global manufacturers, which is really nothing more complicated than the people who manufacture devices and equipment literally all get in a room and they start comparing notes and making sure their equipment all interfaces does everything it is supposed to do. So, it's advancing very quickly now. We expect to be on – I would expect that we'll be on the hill sometime in the next few months. And if the Federal Communications Commission probably getting ready to make an application to on behalf of the industry, be industry supported to advance to the next television standard in this country.

Great. Thanks, very helpful.

The next is from Lance Vitanza from CRT Capital Group. Please go ahead.

Hi, guys, thanks. I think I've got it down just to two questions remaining. The first on the underlying business conditions, it seems to be like there's a lot of concern that they're deteriorating. We've heard that in the Q&A thus far. But just to be clear, your guidance for core ad sales in Q1 is essentially flat with the 2% you reported for Q4. And isn't it also the case that reverse crowding out would have accounted for a good chunk, if not most, of the core growth that you saw in Q4? Which, if that is right, doesn't that suggest that the underlying trends are actually accelerating, getting better into the new year? Can you come comment on that, please? Steven M. Marks - Co-Chief Operating Officer & Vice President, Sinclair Television Group, Inc.: Well, look, I think as we stated, the core business was up single-digits in 4th, and when you exclude the Super Bowl and special events, we're still up in first. So, there are so many dynamics with crowding out and core versus political and so on and so forth, but at the end of the day to be able to say to you that we've been consistent in putting single-digit growth throughout the last four quarters is really special. And then when you got into 2016 again, exclude the Super Bowl, which by the way we have more CBS stations this – doing the Super Bowl than last year, with NBC just because of the amount of affiliates that we have, I think the number speaks for itself, it's a very strong number and we're very excited about it.

I think what's fair to say on this topic is that we're not seeing any weakness. So, that was a question earlier that some people are reporting signs of weakness, that's not showing up in our business whatsoever.

And we don't see anything degrading underneath our client so. Steven M. Marks - Co-Chief Operating Officer & Vice President, Sinclair Television Group, Inc.: The other thing you've to take into account too and it can't be minimalized is the core business in digital. Earlier in the call, we were talking about are we up if you took digital out. Going forward you can't take digital out, it is part of what we do and it's every day when we come to work, that is our core business and you can't exclude it. Every time we're going out and we're selling something, we're selling digital in conjunction with spot, so the dynamics have changed. And we listen to other calls and our digital performance we'll put up against any other broadcast company. It's really special.

Also part of core to sell digital services, so we are expanding our reach.

That's great. I appreciate the color there. The last question that I had was the ATSC 3.0 demo at CES was impressive I thought from the standpoint of advertiser utility. But I'd love any help you can provide on connecting the dots to revenue and cash flow. Is the idea to harness metadata and thereby compete more effectively with social media? Will there also perhaps be an IP opportunity or anything you can provide there would be helpful.

Well, the IP opportunity is fairly straightforward, we own it, so it's ours. So whatever it becomes will be a function of how many television sets are sold in this country and probably all of North America and South America, very likely Korea. It's entirely possible that given some of the comments of some of the people from foreign countries have made in Europe after having seen the demonstration at CES, and I know they're going to be coming over to see a single frequency network that we're setting up between Baltimore and Washington, is possible that it becomes the global standard. So how do you ascribe value to that, we're not even going to try, but you should assume that anybody who wants to watch television, whether it's on virtual reality devices, cars, machines, phones, pads, TV sets or whatever, is going to have our technology in it. So that's just the reality of what's going to happen.

I think I would just add to that in terms of your question around revenue and cash flow opportunity, ATSC 3.0 will allow for addressable advertising. So that from our perspective is a big opportunity because we are at the low end of the CPM range when it comes to advertising, just more broadly speaking video advertising, and so going addressable is a big step up in terms of what CPMs are paid for in that marketplace. So that's the economic opportunity for us on the advertising side as represented by ATSC 3.0 in conjunction with a plethora of other business models that could be put on that same IP pipe because it's now – it will be mobile and it will be IP. So those two – those are two big transformational moves that ATSC 3.0 does to our platform and there is any number of business models that could be put on that, including subscription fees direct to consumer. But on the ad side, being able to have addressable ads we think is a huge opportunity.

I think the other thing not to lose sight of, and it's a direct byproduct of it is, in the future world all the devices that are out there that will be receiving over-the-air broadcast will be IP-based and the information that exists inside the devices will come back to us. So the idea of having a rating service today where in any market in this country you have 300 diaries that go into a marketplace that's got a 1 million homes in it will be kind of yesterday's news because we expect to have live, real-time information, we expect to mine that data on a live ongoing basis with advertisers. So that's the future world that – one of the future worlds that 3.0 creates. We'll be in...

Thanks for the help.

Our next question is from Barry Lucas from Gabelli & Company. Please go ahead. Barry L. Lucas - Gabelli & Company: Thanks and good morning. Just two areas. I want to come back to the balance sheet, if we could, and what you're seeing in the high yield market? What opportunities may or may not exist on refinancing, and is there a window of opportunity given the quality of the cash flow that broadcasters in general and Sinclair produces versus what we're seeing in some other sectors of the economy that are not quite so robust?

Sure. So on our – on the credit markets, as we all know that they've had some dislocation recently mainly driven by energy names. Our credit stats and our credit trading stats rather have been quite resilient in the face of that, and our yields have held within a pretty tight range. And so that being said, all of our bonds and our credit facility have all been fairly recently put in place, so they are at very attractive rates. As I mentioned before, our average cost of debt is 5%. There isn't an obvious refinancing opportunity right now, but it wouldn't take that much improvement in the market to make some of these upcoming bonds potentially attractive. Some of our near-term bonds become callable later this year. So, we are looking at those. Right now, we don't see an (55:39) positive trade, but the markets improve a little bit and there might be something there. Barry L. Lucas - Gabelli & Company: Great. Thanks, Chris. One more for David, I'll squeeze it in if I can. On ATSC 3.0, you talked about a vote and then going up to the Hill. If you could extend that further, David, in terms of real adoption and commercial deployment, what would be a best guess at this juncture?

Yeah, I think – that's really more a function, Barry – excuse me, of the cooperation that would exist between the broadcasters, and I say that recognizing that in today's world, it's a lot easier to have conversations with broadcasters because there's only a few of us left. So, five years ago you had to sit in a room with 25 people to get something done; now you sit in the room with five people and you get something done. So it's becoming dramatically easier to have conversations about laying out the future platform in front of the country. So I think from a timing perspective, in theory, when the industry files its petition to the FCC for a change in the transition, I expect the FCC to go through it's normal process, which is issue an NPRM, ask for comments, after which I see no reason why they shouldn't say you can do whatever you want to do. We should be indifferent to it as the technology, just like they're indifferent to what technology any other company uses, whether it's the phone companies or anybody else. So, in theory, we could at that juncture – if three or four broadcasters got together and said let's go, we could do that. We could literally start the next day to start in New York City and work our way right up the ladder. Whether we will or not is to be determined, but as a technical matter, there would be nothing stopping us. So, whether it happens in 6 months or 18 months or 24 months is to be determined by probably three or four of us or five of us sitting in a room and saying are we ready to go? And if we are, then we'll go. And it's also determined by the manufacturers who are gearing up to build first level devices and you'll see some of those at the NAB show this year. Barry L. Lucas - Gabelli & Company: Great. Thank you, David.

Okay.

Our next question is from Leo Kulp from RBC Capital Markets. Please go ahead.

Hi. Good morning. Thanks for taking the questions. Just had a couple here. Can you provide an update on your net retrans guidance following your recent retrans signings?

Sure. So, including Tennis Channel in these numbers, so we're looking at net retrans to be up for 2016 in the high-teen percent and for 2017 to be up in the low-teen percent. And at this point, visibility for 2018 to be single-digit percent growth, and that's more of a function of timing of contracts that come due around that period of time.

Okay. And then can you also provide some color around the timing of your new affiliation agreements? Did these already roll in or are they going to roll in over the year? So I mean, I guess, in Q1 2016, will you see the full impact of the new affiliation agreements and reverse comp?

So, right now we have – we're in discussions with a handful of our FOX affiliation agreements and our NBC agreements. We're on extensions right now as we continue to negotiate. That is ordinary course of business. We expect to get those renewals done, that's pretty much all we have right now here for this year. And then the next large group doesn't start until the end of 2017, and that's basically the former Albright (59:46) and ABC stations to come up as well as the majority of our FOX stations. So, outside of the few that we have right now, we're pretty much done with everything until the end of 2017 and then the next guidepost is 2020, 2021, because we've already done all the CWs and just about all the CBSs and the majority of the ABCs.

Got it. Thank you. And if I could just squeeze one last one in? On the spectrum auction, how are you looking at the LPTV Spectrum Rights Coalition lawsuit? Do you see it having a big potential to delay the timing of the auction?

We highly doubt that that will have an impact on the timing. Whatever lawsuits went through against the auction were settled a while ago, and to the extent that things get delayed, it will be driven by SEC decisions at this point is our view.

Got it. Thank you for taking the questions.

Our next question is from Alexia Quadrani from JPMorgan. Please go ahead.

Hi, good morning. This is James Kopelman in for Alexia. My first question is around political. Can you remind us roughly how concentrated your political revenue is across your affiliate group? In other words, what percentage of your overall political typically comes from the handful of swing states versus obviously the vast majority of your stations, which are not in swing states. Steven M. Marks - Co-Chief Operating Officer & Vice President, Sinclair Television Group, Inc.: That's a great question. I'm not sure we have that information, but thank God we are in this great space I can tell you that and we are in quite a few of them. So Columbus, Ohio, West Palm Beach specifically, Florida market, Texas, Pennsylvania, Las Vegas, we are situated absolutely global (61:50), so if it comes down to the swing states, which it usually does, we are not tell you anything you don't know, we're in a better position than any other broadcast company. So it's going to be interesting.

So as Steve said, we don't have that data handy, but it is fairly skewed in terms of the where the money drops on political.

So it could be half or more from a handful of swing states, or is that – do you think it's even more skewed than that?

You know what James, I cannot – if you want to give me a call back later today, we can get that number for you, that percent.

Great. And then just to switch gears for a second on retrans. When you guys look ahead past the current cycle, obviously, a lot of renewals recently and a few more subscribers coming up. Do you see at the end of the cycle, still a significant value gap remaining between what your stations receive versus what a typical cable network receives? And then looking out into the future, how long does it take to close that value gap?

Yeah, we do see a significant value gap. We're still at about a one-third of fair value, just based on our audience versus our share of the subsidy pie and that will close some through the next cycle, but still nowhere near parity. And we also believe that our programming is more must have than any other channel out there. So, there is a good case to be made that we should be over-indexing our audience share. And you also have to remember that these shares are not static and the pie is not static either, it changes over time. So three years out, the pie, although it has slowed in terms of total growth, it will be bigger as well. So the type of increases that we're, as an industry we're looking at, in fact are still smaller than the increases that the rest of the cable universe is expecting in aggregate dollars. Maybe – so that's kind of an interesting factoid that we maybe experiencing higher percentages, but in gross dollars we're still taking less of the growth. And so we still feel we have a long road to run in terms of getting to fair value. Steven M. Marks - Co-Chief Operating Officer & Vice President, Sinclair Television Group, Inc.: I'd also mention that there's a couple of favored questions that come our way in terms of retrans risk. And one of them is what happens if cable goes a la carte? What will happen to you? And it's one of those answers that is pretty clear to us, cable is so dependent on local broadcast and if they go a la carte, it would not hurt us at all. We have no fear of that in any regard; although we consider that hypothetical that will never take place. The other is just the launching of over-the-top type of services whether it's an Apple or what have you and will we participate or how would we participate? And it's clear that you see some of the failures in trying to get this launched and primarily that had to do with copyright issues around local broadcast and that's how important we are to the pay TV business.

I think another accelerator in the whole equation is the reality that the broadcast industry continues to consolidate. So, what for the last 15 years has been a whole lot of small broadcasters around just a few television stations. You're rapidly seeing a consolidation of the industry to the point where you've got whole lot of television stations. And that has the natural tendency to want to increase the dollar flow to us.

Great. Thanks for taking the questions.

Our next question is from Davis Hebert from Wells Fargo. Please go ahead.

Hi, thanks for squeezing me in. Just one question. I wanted to drill down a little bit on the 3.9 times to your average leverage number. Are you assuming actual debt pay down or do you assume that you just build cash throughout the year to get to that 3.9 times on a net basis?

Yeah. So, it is a net leverage number, Davis. So it almost doesn't matter if we're paying debt down, we're letting the cash grow, but given the availability that we have, the cash balance is growing.

Understood.

(66:31) our model and we just let the cash build, so there's a little bit of negative carry there.

Got it. Okay. All right, just thought I'd bring that up. Thanks.

Thank you. If there are no further questions, I'd like to turn it back over to management for any closing remarks.

Thanks, operator. And we want to thank everyone for participating on our earnings call this morning. And certainly if you have any additional questions, feel free to contact us. Have a good day.

Thank you, this concludes today's conference. You may disconnect your lines and have a wonderful afternoon.