Nexstar Media Group, Inc. Key Assets
Property Reach*
Television Stations 87 million U.S. Television Households
The CW Network 125 million U.S. Television Households
NewsNation 69 million U.S. Television Households
Antenna TV 125 million U.S. Television Households
REWIND TV 66 million U.S. Television Households
All Local and National Websites** Almost 99 million Unique Visitors for December 2023
Television Stations
Market
Rank Market Status
Full
Power
Stations
Primary
Affiliation
1 New York, NY LSA WPIX The CW
2 Los Angeles, CA O&O
KTLA The CW
3 Chicago, IL O&O WGN Independent
4 Philadelphia, PA O&O
WPHL The CW
5 Dallas, TX O&O KDAF The CW
6 Houston, TX O&O
KIAH The CW
9 DC/Hagerstown, MD
O&O
O&O
WDCW
WDVM
The CW
Independent
10 San Francisco, CA O&O
KRON The CW
11 Phoenix, AZ LSA KAZT The CW
12 Tampa, FL
O&O
O&O
WFLA
WTTA
NBC
The CW
17 Denver, CO
O&O
O&O
O&O
KDVR
KFCT
KWGN
FOX
FOX
The CW
19 Cleveland, OH O&O
WJW FOX
20 Sacramento, CA O&O KTXL FOX
21 Charlotte, NC
O&O
O&O
WJZY
WMYT
FOX
MNTV
22 Raleigh, NC O&O WNCN CBS
23 Portland, OR
O&O
O&O
KOIN
KRCW
CBS
The CW
24 St. Louis, MO
O&O
O&O
KTVI
KPLR
FOX
The CW
25 Indianapolis, IN
O&O
O&O
O&O
WTTV
WTTK
WXIN
CBS
CBS
FOX
26 Nashville, TN O&O WKRN ABC
27 Salt Lake City, UT
O&O
O&O
KTVX
KUCW
ABC
The CW
30 San Diego, CA
O&O
O&O
KSWB
KUSI
FOX
Independent
32 New Haven, CT
O&O
O&O
WTNH
WCTX
ABC
MNTV
33 Columbus, OH O&O WCMH NBC
34 Kansas City, MO O&O
WDAF FOX
35 Austin, TX
O&O
O&O
LSA
KXAN
KBVO
KNVA
NBC
MNTV
The CW
36 Spartanburg, SC
O&O
O&O
WSPA
WYCW
CBS
The CW
40 Las Vegas, NV O&O KLAS CBS
42 Grand Rapids, MI
O&O
O&O
WOOD
WOTV
NBC
ABC
43 Portsmouth, VA
O&O
O&O
WAVY
WVBT
NBC
FOX
44 Harrisburg, PA O&O
WHTM ABC
45 Greensboro, NC O&O WGHP FOX
46 Birmingham, AL O&O
WIAT CBS
47 Oklahoma City, OK
O&O
O&O
KFOR
KAUT
NBC
The CW
49 Albuquerque, NM
O&O
O&O
O&O
LSA
LSA
LSA
KRQE
KREZ
KBIM
KRWB
KWBQ
KASY
CBS
CBS
CBS
The CW
The CW
MNTV
50 Memphis, TN O&O WREG CBS
51 New Orleans, LA
O&O
O&O
WGNO
WNOL
ABC
The CW
52 Fresno, CA
O&O
O&O
KSEE
KGPE
NBC
CBS
53 Providence, RI
O&O
LSA
WPRI
WNAC
CBS
FOX
54 Buffalo, NY
O&O
O&O
WIVB
WNLO
CBS
The CW
56 Richmond, VA O&O
WRIC ABC
Market
Rank Market Status
Full
Power
Stations
Primary
Affiliation
57 Mobile, AL
O&O
O&O
WKRG
WFNA
CBS
The CW
58 Wilkes Barre, PA
O&O
LSA
WBRE
WYOU
NBC
CBS
59 Little Rock, AR
O&O
O&O
LSA
LSA
KARK
KARZ
KLRT
KASN
NBC
MNTV
FOX
The CW
60 Albany, NY
O&O
LSA
WTEN
WXXA
ABC
FOX
61 Knoxville, TN O&O WATE ABC
63 Lexington, KY O&O
WDKY FOX
66 Dayton, OH
O&O
LSA
WDTN
WBDT
NBC
The CW
67 Des Moines, IA O&O
WHO NBC
68 Honolulu, HI
O&O
O&O
O&O
O&O
O&O
O&O
KHON
KHAW
KAII
KGMD
KGMV
KHII
FOX
FOX
FOX
MNTV
MNTV
MNTV
69 Green Bay, WI O&O
WFRV CBS
70 Roanoke, VA
O&O
O&O
WFXR
WWCW
FOX
The CW
72 Wichita, KS
O&O
O&O
O&O
O&O
KSNW
KSNC
KSNG
KSNK
NBC
NBC
NBC
NBC
73 Springfield, MO
O&O
O&O
LSA
KRBK
KOZL
KOLR
FOX
MNTV
CBS
76 Rochester, NY O&O
WROC CBS
79 Charleston, WV O&O WOWK CBS
81 Huntsville, AL
O&O
O&O
WHNT
WHDF
CBS
The CW
82 Brownsville, TX
O&O
O&O
KVEO
KGBT
NBC
MNTV
83 Waco-Bryan, TX
O&O
O&O
KWKT
KYLE
FOX
MNTV
85 Savannah, GA O&O WSAV NBC
86 Colorado Springs, CO O&O
KXRM FOX
87 Syracuse, NY O&O WSYR ABC
88 Charleston, SC O&O
WCBD NBC
89 El Paso, TX O&O KTSM NBC
91 Champaign, IL
O&O
O&O
WCIA
WCIX
CBS
MNTV
92 Shreveport, LA
O&O
O&O
LSA
KTAL
KSHV
KMSS
NBC
MNTV
FOX
93 Burlington, VT
O&O
LSA
WFFF
WVNY
FOX
ABC
95 Baton Rouge, LA
O&O
LSA
WGMB
WVLA
FOX
NBC
96 Fayetteville, AR
O&O
O&O
O&O
KFTA
KNWA
KXNW
FOX
NBC
MNTV
98 Jackson, MS O&O WJTV CBS
99 Myrtle Beach-Florence, SC O&O
WBTW CBS
101 Tri-Cities, TN-VA O&O WJHL CBS
102 Greenville, NC O&O
WNCT CBS
104 Quad Cities, IL
O&O
O&O
LSA
WHBF
KGCW
KLJB
CBS
The CW
FOX
107 Evansville, IN
O&O
LSA
WEHT
WTVW
ABC
The CW
108 Ft. Wayne, IN O&O WANE CBS
109 Tyler-Longview, TX
O&O
LSA
KETK
KFXK
NBC
FOX
Market
Rank Market Status
Full
Power
Stations
Primary
Affiliation
110 Augusta, GA O&O WJBF ABC
111 Sioux Falls, SD
O&O
O&O
O&O
KELO
KDLO
KPLO
CBS
CBS
CBS
112 Altoona, PA O&O WTAJ CBS
113 Lansing, MI
O&O
LSA
WLNS
WLAJ
CBS
ABC
115 Springfield, MA O&O WWLP NBC
117 Youngstown, OH
O&O
LSA
WKBN
WYTV
CBS
ABC
123 Peoria, IL
O&O
LSA
WMBD
WYZZ
CBS
FOX
124 Bakersfield, CA O&O
KGET NBC
125 Lafayette, LA O&O KLFY CBS
126 Columbus, GA O&O
WRBL CBS
129 La Crosse, WI
O&O
O&O
WLAX
WEUX
FOX
FOX
131 Amarillo, TX
O&O
LSA
KAMR
KCIT
NBC
FOX
137 Rockford, IL
O&O
LSA
WQRF
WTVO
FOX
ABC
140 Topeka, KS
O&O
LSA
KSNT
KTKA
NBC
ABC
141 Lubbock, TX
O&O
LSA
KLBK
KAMC
CBS
ABC
142 Monroe, LA
O&O
LSA
KARD
KTVE
FOX
NBC
145 Minot-Bismarck, ND
O&O
O&O
O&O
O&O
KXMB
KXMC
KXMD
KXMA
CBS
CBS
CBS
The CW
147 Midland, TX
O&O
LSA
KMID
KPEJ
ABC
FOX
148 Panama City, FL O&O WMBB ABC
149 Wichita Falls, TX
O&O
LSA
KFDX
KJTL
NBC
FOX
150 Sioux City, IA O&O KCAU ABC
151 Joplin, MO
O&O
LSA
KSNF
KODE
NBC
ABC
153 Erie, PA
O&O
LSA
WJET
WFXP
ABC
FOX
159 Terre Haute, IN
O&O
LSA
WTWO
WAWV
NBC
ABC
162 Binghamton, NY O&O WIVT ABC
163 Wheeling, WV O&O
WTRF CBS
165 Billings, MT
O&O
LSA
KSVI
KHMT
ABC
FOX
166 Beckley, WV O&O
WVNS CBS
167 Abilene, TX
O&O
LSA
KTAB
KRBC
CBS
NBC
168 Hattiesburg, MS O&O
WHLT CBS
169 Rapid City, SD O&O KCLO CBS
170 Dothan, AL O&O
WDHN ABC
171 Utica, NY
O&O
LSA
WFXV
WUTR
FOX
ABC
172 Clarksburg, WV O&O
WBOY NBC
175 Jackson, TN O&O WJKT FOX
178 Elmira, NY O&O
WETM NBC
179 Watertown, NY O&O WWTI ABC
181 Marquette, MI O&O
WJMN MNTV
182 Alexandria, LA O&O WNTZ FOX
187 Grand Junction, CO
O&O
O&O
LSA
KREX
KREY
KFQX
CBS
CBS
FOX
197 San Angelo, TX
O&O
LSA
KLST
KSAN
CBS
NBC
(1)
O&O refers to stations that we own and operate. LSA, or local service agreement, is the general term we use to refer to a contract under which we provide services utilizing our employees to a station owned and operated by an
independent third-party. Local service agreements include time brokerage agreements, shared services agreements, joint sales agreements, local marketing agreements and outsourcing agreements.
* Source: Nielsen for local television stations, The CW Network, NewsNation and Antenna TV; Internal estimates for REWIND TV; and Comscore for digital assets
** Includes all digital properties including 140 local websites, The Hill, BestReviews and NewsNationNow.com
May 2, 2024
Dear Fellow Shareholders:
Fiscal 2023 marked another year of strong operating execution at Nexstar, once again
showcasing the power of our business model. Balancing the cyclical impact of election-year
political advertising over the 2022/2023 period, Nexstar delivered record average annual net
revenue of $5.1 billion, an increase of over 10% from the prior 2020/2021 cycle of $4.6
billion. During the most recent 2022/2023 cycle, we returned an average of $910 million each
year to shareholders in the form of dividends and share repurchases, reducing our shares
outstanding by 18% during that time. Nexstar’s importance to the television ecosystem and
the value we create is clear from our financial performance and shareholder returns and I
want to share our view of the current media landscape and why Nexstar Media Group
remains strongly positioned for the future.
A recurring theme for many years now has been disruption of the pay TV industry. A recent
Harvard Business Review article notes “corporate leaders have continually been told that the
only way to innovate and grow is to disrupt their industries or even their own companies” (Kim & Mauborgne, May-June
2023). The allure of the disrupter obscures an important fact: all cases of disruption require a clear trade-off between
winners and losers. It has been over three and a half years since the majority of diversified media companies launched
direct-to-consumer platforms seeking to disrupt their linear business models to generate new value and profits in the
digital world. So far, all that has happened is the new direct-to-consumer businesses have generated billions of dollars of
losses and because of the disruption, the linear businesses of these companies have also suffered – a lose/lose
proposition.
In the meantime, our business has continued to grow in the face of this disruption. And that’s an important fact.
Consumers value the bundled programming offerings provided by the pay TV distributors that are anchored by us,
broadcast television – the most-watched television programming.
With mounting losses and pressure from investors, we are now beginning to see the diversified media companies return to
a focus on profitability. We expect pay TV programming bundles, content spending and pricing will be rationalized across
the industry and better models will be developed with broadcast as the anchor, as it always has been, given viewer
demand for our “must-have” local and national programming including the NFL, sports and special event programming that
relies on our unrivalled reach to maximize audience. During this transition, we will continue executing on our playbook,
making return-focused growth investments, and delivering excellent results and returns for our shareholders.
Throughout the year, we made continued meaningful progress on our long-term organic growth initiatives, including
growing our cable and broadcast network audiences. NewsNation remains the fastest-growing cable news network in
primetime. We continue to attract top talent and add new programming, including securing the final GOP Presidential
primary debate before the Iowa caucuses. In 2024, NewsNation will become a 24/7 news network – and we are achieving
this milestone profitably. At The CW Network, we have curated a compelling and diversified programming line-up, which
generated more total viewership in 2023, our first full year of ownership, than it did in 2022 under prior management. We
acquired sports rights for LIV Golf, Atlantic Coast Conference (ACC) college football and basketball games which helped
drive 2023 viewership, and later this year we will be launching WWE NXT and NASCAR Xfinity Series, which are expected
to further grow our audience.
When I consider Nexstar’s future, I see tremendous opportunity. Taken together, our assets provide national reach as well
as local activation at scale greater than any other media company, creating a differentiated and attractive value proposition
for advertisers, brands and content owners. Importantly, our consistent record of operating execution and cash flow growth
combined with a capital allocation strategy prioritizing the creation of shareholder value, continues to differentiate Nexstar
from its peers and larger diversified media companies.
In addition, we continue to be committed to meeting the highest standards of journalism and to enhancing the Company’s
environmental, social and governance practices. Investors can review our 2023 ESG Report on our website, nexstar.tv,
which summarizes our most recent ESG performance and goals.
As we look forward to the balance of 2024, I trust you share my enthusiasm about Nexstar Media Group’s bright future.
Our continued growth and success are predicated on the unique strength of our highly profitable asset base and operating
model, the experience of our leadership team and our more than 13,000 talented, diverse employees across the country.
Thank you for your confidence and ongoing support. We look forward to reporting on our continued growth and progress.
Sincerely,
Perry A. Sook
Chairman and Chief Executive Officer
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
☒
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
for the fiscal year ended December 31, 2023
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
for the transition period from to .
Commission File Number: 000-50478
NEXSTAR MEDIA GROUP, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 23-3083125
(State of Organization or Incorporation) (I.R.S. Employer Identification No.)
545 E. John Carpenter Freeway, Suite 700, Irving, Texas 75062
(Address of Principal Executive Offices) (Zip Code)
(972) 373-8800
(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s) Name of each exchange on which registered
Common Stock NXST NASDAQ Global Select Market
Securities registered pursuant to section 12(g) of the Act: None
Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that it was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes ☒ No ☐
Indicate by checkmark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).
Yes ☒ No ☐
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or
an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth
company” in Rule 12b-2 of the Exchange Act. (check one):
Large accelerated filer
☒
Accelerated filer
☐
N
on-accelerated filer
☐
Smaller reporting company
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any
new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal
control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or
issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in
the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of June 30, 2023, the aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant was
$5,587,374,931.
As of February 27, 2024, the Registrant had 33,428,504 shares of Common Stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Proxy Statement for the Registrant’s 2024 Annual Meeting of Stockholders will be filed with the Commission within 120 days after the
close of the Registrant’s fiscal year and incorporated by reference in Part III of this Annual Report on Form 10-K.
TABLE OF CONTENTS
Page
PART I
ITEM 1. Business
4
ITEM 1A. Risk Factors
18
ITEM 1B. Unresolved Staff Comments
29
ITEM 1C. Cybersecurity
29
ITEM 2. Properties
30
ITEM 3. Legal Proceedings
30
ITEM 4. Mine Safety Disclosures
30
PART II
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
31
ITEM 6. Reserved
32
ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
33
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk
49
ITEM 8. Financial Statements and Supplementary Data
49
ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
49
ITEM 9A. Controls and Procedures
50
ITEM 9B. Other Information
50
ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 50
PART III
ITEM 10. Directors, Executive Officers and Corporate Governance
51
ITEM 11. Executive Compensation
51
ITEM 12. Security Ownership of Certain Beneficial Owners and Management, and Related Stockholder Matters
51
ITEM 13. Certain Relationships and Related Transactions, and Director Independence
51
ITEM 14. Principal Accountant Fees and Services
51
PART IV
ITEM 15. Exhibits and Financial Statement Schedules
52
ITEM 16. Form 10-K Summary 52
Index to Exhibits 53
Index to Financial Statements F-1
3
General
As used in this Annual Report on Form 10-K and unless the context indicates otherwise, “Nexstar” refers to Nexstar Media
Group, Inc., a Delaware corporation, and its consolidated wholly owned and majority owned subsidiaries, “Nexstar Media” refers to
Nexstar Media Inc., a Delaware corporation and Nexstar’s wholly owned subsidiary; the “Company” refers to Nexstar and the variable
interest entities (“VIEs”) required to be consolidated in our financial statements; and all references to “we,” “our,” “ours,” and “us”
refer to Nexstar.
Nexstar Media has time brokerage agreements (“TBAs”), shared services agreements (“SSAs”), joint sales agreements
(“JSAs”), local marketing agreements (“LMAs”) and outsourcing agreements (which we generally and collectively refer to as “local
service agreements”) relating to the television stations owned by VIEs but does not own any of the equity interests in these entities.
For a description of the relationship between Nexstar and these VIEs, see Item 1, “Business.”
The information in this Annual Report on Form 10-K includes information related to Nexstar and the VIEs with which Nexstar
has relationships. In accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and as discussed in
Note 2 to our Consolidated Financial Statements in Part IV, Item 15(a) of this Annual Report on Form 10-K, the financial results of
the consolidated VIEs are included in the Consolidated Financial Statements contained herein.
In the context of describing ownership of television stations in a particular market, the term “duopoly” refers to owning or
deriving the majority of the economic benefit, through ownership or local service agreements, from two or more stations in a
particular market. For more information on how we derive economic benefit from a duopoly, see Item 1, “Business.”
There are 210 generally recognized television markets, known as Designated Market Areas (“DMAs”), in the United States.
DMAs are ranked in size according to various factors based upon actual or potential audience. DMA rankings contained in this
Annual Report on Form 10-K are from the 2023-2024 Nielsen Local Television Market Universe Estimates as published by The
Nielsen Company.
Cautionary Note Regarding Forward-Looking Statements
This Annual Report on Form 10-K contains “forward-looking statements” within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). All statements
other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including:
the risks and uncertainties of current economic factors that are beyond our control, such as inflation, rising interest rates and supply
chain disruptions; any projections or expectations of earnings, revenue, financial performance, liquidity and capital resources or other
financial items; any assumptions or projections about the television broadcasting industry; any statements of our plans, strategies and
objectives for our future operations, performance, liquidity and capital resources or other financial items; any statements concerning
proposed new products, services or developments; any statements regarding future economic conditions or performance; any
statements of belief; and any statements of assumptions underlying any of the foregoing. Forward-looking statements may include the
words “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,”
“plans,” “believes,” “estimates” and other similar words.
Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could
differ from a projection or assumption in any of our forward-looking statements. Our future financial position and results of
operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties discussed under Item
1A, “Risk Factors” located elsewhere in this Annual Report on Form 10-K and in our other filings with the United States Securities
and Exchange Commission (“SEC”). The forward-looking statements made in this Annual Report on Form 10-K are made only as of
the date hereof, and we do not have or undertake any obligation to update any forward-looking statements to reflect subsequent events
or circumstances.
4
PART I
Item 1. Business
Company Overview
We are a leading diversified media company that produces and distributes engaging local and national news, sports and
entertainment content across our television and digital platforms, including more than 310,000 hours of programming produced
annually by our business units. Nexstar owns America’s largest local television broadcasting group comprised of top network
affiliates, with over 200 owned or partner stations in 117 U.S. markets in 40 states and the District of Columbia reaching over 220
million people. Nexstar’s national television properties include a 75% interest in The CW Network, LLC (“The CW”), America’s fifth
major broadcast network, NewsNation, America’s fastest-growing national cable news network in primetime, popular entertainment
multicast networks Antenna TV and REWIND TV, and a 31.3% ownership stake in TV Food Network. The Company’s portfolio of
digital assets, including its local TV station websites, The Hill and NewsNationNow.com, is collectively a Top 10 U.S. digital news
and information property, attracting almost 99 million unique users for December 2023 according to Comscore.
We are a Delaware corporation formed in 1996. Our principal offices are at 545 E. John Carpenter Freeway, Suite 700, Irving,
TX 75062. Our telephone number is (972) 373-8800 and our website is http://www.nexstar.tv. The information contained on, or
accessible through, our website is not part of this Annual Report on Form 10-K and is not incorporated herein by reference.
Competitive Strengths
Unique Combination of Scaled Local Audiences and Powerful National Reach. We are the largest local television
broadcasting company in the United States, generating $4.9 billion of revenue for the year ended December 31, 2023. Our and our
partners’ over 200 broadcast stations in 117 local markets reach approximately 70% of U.S. television households (without applying
the FCC UHF discount), which local reach is augmented by the national reach we have via our broadcast network, The CW, and our
cable news network, NewsNation. According to Nielsen, The CW Network reaches 125 million television households, equal to the
reach of the ABC, CBS, FOX and NBC broadcast networks, and NewsNation reaches approximately 69 million television households,
virtually equivalent to the reach of CNN, Fox News and MSNBC. Together, Nexstar can provide both national reach and activation of
local audiences at scale, representing a differentiated and attractive value proposition for advertisers and brands in an increasingly
fragmented marketplace.
Leading Local Franchises. We are focused on building and maintaining leading local franchises in our 117 local markets
which are core to our business model. In total, we employ approximately 6,000 journalists and 1,600 salespeople, produce over
310,000 hours of programming, and have developed relationships with over 40,000 advertisers. Each of the stations that we own,
operate, program, or provide sales and other services to creates a highly recognizable local brand, primarily through the quality of
local news programming, extensive local sports coverage, and community presence. We rank among the top two stations in local news
viewership in over 79% of our markets in which we produce local newscasts, according to Comscore f or November 2023 late news
ratings. In 2023, journalists at our stations won 545 awards for their reporting, including 42 Edward R. Murrow awards and 117
Emmy awards. We also employ a high-quality local sales force in each of our markets to increase revenue from local advertisers by
capitalizing on our investment in local programming and community websites. In even-numbered years, when most elections are held,
we historically have generated substantial revenue from locally driven political advertising. Given our diverse and expansive
geographic reach, we have television stations in more than 80% of markets where there were contested political elections in 2022. In
addition, we own or provide services to more than one station in certain markets to enable us to broaden our audience share, enhance
our revenue share and achieve significant operating efficiencies. For the year ended December 31, 2023, excluding our owned
network assets, the Company earned approximately 71% of its core and political advertising revenue from non-network programming.
Strong National Brands. We have a portfolio of scaled, strong national brands that enables us to engage with national
advertisers in more meaningful ways than we have in the past. Our primary national brands include The CW, NewsNation and The
Hill. The CW is America’s fifth national broadcast network. NewsNation is America’s fastest growing cable news network in
primetime attracting top on-air talent to its ranks given its mission of delivering fact-based, unbiased journalism. The Hill is the
nation’s leading, independent political digital media platform.
Diversified Revenue Streams. Our revenue streams are diversified by geography, affiliation and source. In 2023, we generated
55% of our revenue from distribution, 34% from core advertising (of which approximately 68% was from local sources), 1% from
political advertising and 10% from digital advertising and other sources. No single customer generated more than 15% of our revenue;
no single market generated more than 3% of our revenue; and our affiliations are diverse with no network representing more than 25%
of our 2023 combined core and political advertising net revenue.
5
Intense Operational Focus. We emphasize strict controls on operating and programming costs in order to increase net income,
EBITDA and free cash flow. We continually seek to identify and implement cost savings at each of our stations, the stations we
provide services to and other business units, and our overall size benefits each station or business unit with respect to negotiating
favorable terms with programming suppliers and other vendors. By leveraging our size and corporate management expertise, we are
able to achieve economies of scale by providing programming, financial, sales and marketing support to our stations, the stations we
provide services to and other business units. Our operational execution expertise is the direct result of our talented management team.
We seek to attract and retain corporate, business unit and station general managers with proven track records by providing equity
incentives.
Attractive Financial Profile. In 2023 and 2022, we generated total net revenue of $4.9 billion and $5.2 billion, respectively,
generated net cash flow from operating activities of nearly $1 billion and $1.4 billion, respectively, and returned a significant
percentage of that cash flow to shareholders in the form of share repurchases and dividends—$796 million in 2023 and $1.0 billion in
2022—while maintaining a corporate credit rating of Ba3 / BB+ as rated by Moody’s / S&P. We believe we have the financial
flexibility to invest in both organic and inorganic growth initiatives while continuing to return capital to our shareholders.
Growth Strategies
We continually seek to generate revenue, net income, EBITDA and cash flow growth through the following strategies:
Leverage Our Scale. As the largest local television broadcaster with significant, scaled national media properties, we believe
we are an important partner for the major broadcast networks, multichannel video programming distributors (“MVPDs”) and online
video distributors (“OVDs”), and advertisers. We believe we are one of the largest affiliate groups for each of our major broadcast
network partners and we are an important partner for the MVPDs and OVDs which include our content in their consumer offerings.
For national advertisers we have a collection of national networks/properties including The CW, NewsNation, Antenna TV and The
Hill as well as television stations covering 70% of the country (without applying the FCC UHF discount) including 8 of the top 10 and
18 of the top 25 DMAs. Our digital assets attract an audience that makes us a top ten digital news and information property, according
to Comscore. Our scale provides us with unique operating advantages in the form of services we can provide to our advertisers,
audience and employees, a platform for growth and operating expense synergies and access to capital. As part of this strategy, in 2023,
we centralized our national advertising sales in house in order to drive advertising sales across our diversified media portfolio by
further emphasizing our client-first approach, combined with a new data-driven, multi-platform focus.
Continue to Grow Distribution and Advertising Revenues. We believe our core business of distribution and advertising
revenue has the potential to continue to grow. We believe that the share of audience that our content generates for MVPDs and OVDs
is greater than the share of fees those platforms pay us and that broadcast advertising continues to provide commercial and political
advertisers with access to the broadest television audience available. In addition, we are focused on better monetizing our digital
content and audience and growing our portfolio of digital products, services and content and associated revenue streams, including
apps for NewsNation, The Hill and other local television station content.
Improve and Expand National Broadcast and Cable Networks. We seek to continue to increase the viewership, revenues and
profitability of our national television network assets, The CW and NewsNation.
The CW. As the largest affiliate of The CW, we acquired the network in September 2022 (for no consideration) in order to
sustain and grow our CW-related revenue streams and to improve this underexploited national broadcast network asset. Our growth
strategy for The CW is to cost efficiently improve and diversify the programming to better align with broadcast audiences with the
intention of improving ratings and revenue (both distribution and advertising) and reducing programming and other operating costs.
Recognizing the importance of live sports and other sports programming to broadcast audiences, in 2023, we launched CW Sports,a
sports programming division of The CW. Since then, we have added sports programming to the network’s primetime line-up
including Inside the NFL, 100 Days to Indy, and our exclusive broadcast rights to WWE NXT beginning in 2024. CW Sports also
expanded the number of hours of network programming on the weekend in 2023 to offer LIV Golf, ACC college football and
basketball games, and the future launch of NASCAR Xfinity Series on Saturdays beginning in 2025. We also introduced new, less
costly, primetime programming beginning on a limited basis in the summer of 2023 and more substantially with the 2023/2024
broadcast season which began in October 2023. We believe there is potential for The CW to improve its profitability and, together
with Nexstar’s CW station affiliates, the overall net profit contribution to Nexstar. In 2023, The CW renewed and expanded its
affiliation agreements with key station operators and launched CW Network affiliations on four Nexstar-owned and operated
television stations, three of which are in the top-15 television markets.
6
NewsNation. NewsNation is America’s fastest growing cable news network in primetime and has been recognized by
independent watchdog groups such as Ad Fontes Media, NewsGuard and AllSides for its independent, unbiased reporting of national
and local news. Currently, NewsNation provides 24 hours of news content each weekday which we expect to expand to seven days a
week in 2024. NewsNation was launched in 2020, when we initiated the conversion of WGN America to NewsNation, leveraging our
core competency in news and profitable foundation to build a network focused on providing unbiased, fact-based news. We believe
there is significant growth potential for NewsNation as news networks are among the most watched and profitable cable networks.
Develop New Revenue Streams. We seek to generate new revenue streams leveraging the platform and assets of our company.
Given our extensive station portfolio and geographic coverage, we are in the process of converting the technology used by our stations
to a new standard, ATSC 3.0, which will enable us to provide new high speed data transmission services to businesses and consumers.
In February 2024, we achieved our goal of reaching 50% of U.S. television households with ATSC 3.0. We anticipate that this
conversion will enable us to develop a new business and generate additional revenue in the future.
Acquire and Invest in New and Complementary Businesses. We selectively pursue acquisitions where we believe we can
improve revenue, operating income, net income, EBITDA and cash flow through active management. We selectively pursue
acquisitions of businesses that leverage our platform, scale and capabilities and are complementary to our vision of providing local
news, entertainment, and sports content through broadcast and digital platforms. In addition, we will continue to pursue television
station acquisitions in markets where permitted by the current regulatory framework.
Stations
As of January 2024, we owned, operated, programmed or provided sales and other services to 201 full power television stations
in 117 markets in 40 states and the District of Columbia, reaching approximately 39% of all U.S. television households (reflecting our
owned stations only and after applying the Federal Communications Commission’s (“FCC”) ultra-high-frequency (“UHF”) discount)
and approximately 70% of all U.S. television households reflecting ours and our partners’ stations and excluding the FCC UHF
discount. The stations are affiliates of CBS, FOX, NBC, ABC, The CW, MyNetworkTV (“MNTV”) and other broadcast television
networks and provide television programming to consumers in our markets, including network programing, content that the stations
produce, including local news, and syndicated programs that the stations acquire. In 2023, we acquired KUSI-TV, a full-power
independent station in San Diego, CA, WSNN-LD, a low power independent station in Tampa, FL, which is now affiliated with
MNTV; and in 2024 we entered into a time brokerage agreement with KAZT, a full power independent station in Phoenix, AZ, which
is now affiliated with The CW. These stations are included in the table below and the full-power stations and included in our station
count. We also own and operate one AM radio station in Chicago, IL.
Of the 201 full power television stations, 37 are 100% independently owned by VIEs. We consolidate 35 of these VIEs (the
“consolidated VIEs”) in our financial statements. In compliance with FCC regulations for all the parties, all VIEs maintain complete
responsibility for and control over programming, finances, personnel and operations of their stations. For the consolidated VIEs, we
are deemed under U.S. GAAP to have controlling financial interests in these entities because of Nexstar’s (i) local service agreements
with the consolidated VIEs’ stations, (ii) guarantee (excluding The CW) of the obligations incurred under the senior secured credit
facility of Mission Broadcasting, Inc. (“Mission”), a consolidated VIE, (iii) power over significant activities affecting the consolidated
VIEs’ economic performance, including budgeting for advertising revenue, certain advertising sales and, in some cases, hiring and
firing of sales force personnel and (iv) renewable, exercisable and assignable purchase options granted by each consolidated VIE
which permit Nexstar to acquire the assets and assume the liabilities of all of the consolidated VIEs’ stations at any time, subject to
FCC consent. For additional information on VIEs, see Note 2 to our Consolidated Financial Statements in Part IV, Item 15(a) of this
Annual Report on Form 10-K.
The following table sets forth general information about the television stations (full power, low power and multicast channels)
we own, operate, program or provide sales and other services to as of January 2024.
7
Market
Rank
(1)
Market Status
(2)
Full Power
Stations
Primary
Affiliation
(3)
Low Power Stations /
Multicast Channels
Other Affiliation
(3)(4)
FCC License
Expiration Date
1
N
ew York, NY LSA WPIX
(5)
The CW WPIX-D2, D4 Antenna TV, Rewind TV
(23)
2 Los Angeles, CA O&O KTLA The CW KTLA-D2, D3, D4, D5 Antenna TV, GRIT, TBD, Rewind TV
(23)
3 Chicago, IL O&O WGN Independent WGN-D2, D3, D4, D5 Antenna TV, GRIT, Rewind TV, TBD 4/1/2030
4 Philadelphia, PA O&O WPHL
(6)
The CW WPHL-D2, D3, D4 Antenna TV/MNTV, GRIT, Comet
(23)
5 Dallas, TX O&O KDAF The CW KDAF-D2, D3, D4, D5 Antenna TV, GRIT, Charge!, Rewind TV 8/1/2030
6 Houston, TX O&O KIAH The CW KIAH-D2, D3, D4, D5 Antenna TV, Comet, TBD, Court TV
(23)
9 DC/Hagerstown, MD O&O
O&O
WDCW
WDVM
(7)
The CW
Independent
WDCW-D2, D3, D4
WDVM-D2, D3, D4
Antenna TV, WDVM, Univision
ION Mystery, Rewind TV, ShopLC
10/1/2028
10/1/2028
10 San Francisco, CA O&O KRON
(6)
The CW/
MNTV
KRON-D2, D3, D4, D5 Antenna TV, Rewind TV, Charge!, ShopLC
(23)
11 Phoenix, AZ LSA KAZT
(8)
The CW KAZT-D2, D3, D 4, D5 MeTV, HSN, Charge!, AZTV 10/1/2030
12 Tampa, FL O&O
O&O
O&O
WFLA
WTTA
(6)(9)
NBC
The CW
WFLA-D2, D3
WTTA-D2
WSNN-LD
(10)
,D2,D3,D4
Charge!, Antenna TV
Cozi TV
MNTV, GRIT, Laff, Court TV
2/1/2029
2/1/2029
2/1/2029
17 Denver, CO O&O
O&O
O&O
KDVR
KFCT
KWGN
FOX
FOX
The CW
KDVR-D2, D3
KWGN-D2, D3, D4
Antenna TV, TBD
getTV, Comet, Charge!
(23)
(23)
4/1/2030
19 Cleveland, OH O&O WJW FOX WJW-D2, D3, D4 Antenna TV, Comet, Charge! 10/1/2029
20 Sacramento, CA O&O KTXL FOX KTXL-D2, D3, D4 Antenna TV, GRIT, TBD
(23)
21 Charlotte, NC O&O
O&O
WJZY
WMYT
FOX
MNTV
WJZY-D3, D4, D5, D6,
D7, D8
Charge!, GRIT, TheGrio, ION,
Antenna TV, Rewind TV
12/1/2028
12/1/2028
22 Raleigh, NC O&O WNCN CBS WNCN-D2, D3, D4 Rewind TV, GRIT, Antenna TV 12/1/2028
23 Portland, OR O&O
O&O
KOIN
KRCW
CBS
The CW
KOIN-D2, D3
KRCW-D2, D3, D4
getTV, Rewind TV
Antenna TV, GRIT, TBD
(23)
24 St. Louis, MO O&O
O&O
KTVI
KPLR
FOX
The CW
KTVI-D2, D3, D4
KPLR-D2, D3, D4
Antenna TV, GRIT, Dabl
Court TV, Comet, Rewind TV
(23)
2/1/2030
25 Indianapolis, IN O&O
O&O
O&O
WTTV
WTTK
WXIN
CBS
CBS
FOX
WTTV-D2, D3, D4
WTTK-D2, D3
WXIN-D2, D3, D4
Independent, Comet, TBD
Independent, Cozi TV
Antenna TV, Rewind TV, Charge!
8/1/2029
8/1/2029
8/1/2029
26
N
ashville, TN O&O WKRN ABC WKRN-D2, D3, D4 ION Mystery, True Crime, Rewind TV 8/1/2029
27 Salt Lake City, UT O&O
O&O
KTVX
KUCW
ABC
The CW
KTVX-D2, D3, D4
KUCW-D2, D3, D4
MeTV, Rewind TV, TheGrio
ION Mystery, Quest, ShopLC
(23)
30 San Diego, CA O&O
O&O
KSWB
KUSI
(11)
FOX
Independent
KSWB-D2, D3, D4
KUSI-D2
Antenna TV, Court TV, ION
Rewind TV
(23)
12/1/2030
32
N
ew Haven, CT O&O
O&O
WTNH
WCTX
(9)
ABC
MNTV
WTNH-D2
WCTX-D2
Rewind TV
Comet
(23)
33 Columbus, OH O&O WCMH NBC WCMH-D2, D3, D4 GRIT, ION, Laff 10/1/2029
34 Kansas City, MO O&O WDAF FOX WDAF-D2, D3, D4 Antenna TV, Rewind TV, TBD
(23)
35 Austin, TX O&O
O&O
LSA
KXAN
KBVO
KNVA
(12)
NBC
MNTV
The CW
KXAN-D2, D3, D4
KBVO-D2, D3, D4
KNVA-D2, D3, D4
Cozi TV, ION, Rewind TV, Defy
Bounce, Antenna TV, D efy
GRIT, Laff, Court TV
(23)
(23)
8/1/2030
36 Spartanburg, SC O&O
O&O
WSPA
WYCW
(9)
CBS
The CW
WSPA-D3
WYCW-D3
ION
Rewind TV
12/1/2028
12/1/2028
40 Las Vegas, NV O&O KLAS CBS KLAS-D2, D3, D4 Rewind TV, getTV, ShopLC
(23)
42 Grand Rapids, MI O&O
O&O
O&O
WOOD
WOTV
NBC
ABC
WOOD-D2, D3
WOTV-D2, D3, D4
WXSP-CD, D2, D3
Rewind TV, TheGrio
The CW, Charge!, DABL
MNTV, Nest, Comet
10/1/2029
10/1/2029
10/1/2029
43 Portsmouth, VA O&O
O&O
WAVY
WVBT
NBC
FOX
WAVY-D2, D3, D4
WVBT-D2, D3
Nest, getTV, ShopLC
Cozi TV, Rewind TV
10/1/2028
10/1/2028
44 Harrisburg, PA O&O WHTM ABC WHTM-D2, D3, D4, D5 ION, GRIT, Laff, WLYH
(23)
45 Greensboro, NC O&O WGHP FOX WGHP-D2, D3, D4 Antenna TV, GRIT, Dabl 12/1/2028
46 Birmingham, AL O&O WIAT CBS WIAT-D2, D3, D4 ION Mystery, GRIT, Defy 4/1/2029
47 Oklahoma City, OK O&O
O&O
KFOR
KAUT
(6)
NBC
The CW
KFOR-D2, D3, D4
KAUT-D2, D3, D4
Antenna TV, True Crime, Dabl
Rewind TV, ION Mystery, Cozi TV
(23)
49 Albuquerque, NM O&O
O&O
O&O
LSA
LSA
LSA
KRQE
KREZ
(13)
KBIM
(13)
KRWB
(5)
KWBQ
(5)
KASY
(5)
CBS
CBS
CBS
The CW
The CW
MNTV
KRQE-D2, D3
KREZ-D2
KBIM-D2
KRWB-D2
KWBQ-D2, D3, D4, D5
KASY-D2, D3, D4, D5
FOX, Bounce
FOX
FOX
MNTV
GRIT, Laff, ION, Rewind TV
ION Mystery, getTV, Court TV, Antenna TV
(23)
50 Memphis, TN O&O WREG CBS WREG-D2, D3 News3, Antenna TV 8/1/2029
8
Market
Rank
(1)
Market Status
(2)
Full Power
Stations
Primary
Affiliation
(3)
Low Power Stations /
Multicast Channels
Other Affiliation
(3)(4)
FCC License
Expiration Date
51
N
ew Orleans, LA O&O
O&O
WGNO
WNOL
ABC
The CW
WGNO-D2, D3, D4
WNOL-D2, D3, D4
Antenna TV, Rewind TV, TBD
GRIT, Comet, Charge!
(23)
6/1/2029
52 Fresno, CA O&O
O&O
KSEE
KGPE
NBC
CBS
KSEE-D2, D3, D4
KGPE-D2, D3, D4
Bounce, GRIT, Rewind TV
ION Mystery, TheGrio, Court TV
(23)
53 Providence, RI O&O
LSA
WPRI
WNAC
(5)
CBS
FOX
WPRI-D2, D3, D4
WNAC-D2, D3, D4
MNTV, True Crime, Dabl
The CW, Rewind TV, Antenna TV
(23)
54 Buffalo, NY O&O
O&O
WIVB
(9)
WNLO
CBS
The CW
WIVB-D2
WNLO-D2
QVC
Rewind TV
(23)
56 Richmond, VA O&O WRIC ABC WRIC-D2, D3, D4 Rewind TV, Cozi TV, Laff 10/1/2028
57 Mobile, AL O&O
O&O
WKRG
WFNA
CBS
The CW
WKRG-D2, D3, D4
WFNA-D2, D3, D4
ION, MeTV, Court TV
Bounce, True Crime, GRIT
4/1/2029
4/1/2029
58 Wilkes Barre, PA O&O
LSA
WBRE
WYOU
(5)
NBC
CBS
WBRE-D2, D3, D4
WYOU-D2, D3, D4
Laff, Rewind TV, True Crime
ION Mystery, getTV, Cozi TV
(23)
59 Little Rock, AR O&O
O&O
LSA
LSA
KARK
KARZ
KLRT
(5)
KASN
(5)
NBC
MNTV
FOX
The CW
KARK-D2, D3, D4
KARZ-D2
KLRT-D2
KASN-D2, D3, D4, D5
Laff, GRIT, Antenna TV
Bounce
ION Mystery
Rewind TV, ION, Defy, GRIT
6/1/2029
6/1/2029
6/1/2029
6/1/2029
60 Albany, NY O&O
LSA
WTEN
WXXA
(5)
ABC
FOX
WTEN-D2, D3, D4
WXXA-D2, D3, D4, D5
Cozi TV, Antenna TV, ION Mystery
OTB-TV, GRIT, Rewind TV, True Crime
(23)
61 Knoxville, TN O&O WATE ABC WATE-D2, D3, D4 Antenna TV, Rewind TV, Cozi TV 8/1/2029
63 Lexington, KY O&O WDKY FOX WDKY-D2, D3, D4 Rewind TV, Charge!, Comet 8/1/2029
66 Dayton, OH O&O
LSA
WDTN
WBDT
(9)(14)
NBC
The CW
WDTN-D2, D3
WBDT-D2
ION Mystery, ION
Bounce
10/1/2029
10/1/2029
67 Des Moines, IA O&O WHO NBC WHO-D2, D3, D4 Rewind TV, Antenna TV, Iowa’s Weather
Channel
2/1/2030
68 Honolulu, HI O&O
O&O
O&O
O&O
O&O
O&O
KHON
KHAW
(15)
KAII
(15)
KGMD
(15)
KGMV
(15)
KHII
FOX
FOX
FOX
MNTV
MNTV
MNTV
KHON-D2, D3, D4
KHAW-D2, D3, D4
KAII-D2, D3, D4
The CW, GRIT, Rewind TV
The CW, GRIT, Rewind TV
The CW, GRIT, Rewind TV
(23)
69 Green Bay, WI O&O WFRV CBS WFRV-D2, D3, D4 Bounce, True Crime, Rewind TV 12/1/2029
70 Roanoke, VA O&O
O&O
WFXR
WWCW
FOX
The CW
WFXR-D2, D3, D4
WWCW-D2, D3, D4
The CW, Bounce, Quest
FOX, Rewind TV, GRIT
10/1/2028
10/1/2028
72 Wichita, KS O&O
O&O
O&O
O&O
O&O
KSNW
KSNC
(16)
KSNG
(16)
KSNK
(16)
NBC
NBC
NBC
NBC
KSNW-D2, D3, D4
KSNG-D2
KSNL-LD
Telemundo, ION, True Crime
Telemundo
NBC
6/1/2030
(23)
(23)
(23)
6/1/2030
73 Springfield, MO O&O
O&O
LSA
KRBK
KOZL
KOLR
(5)
FOX
MNTV
CBS
KRBK-D2, D3, D4
KOZL-D2, D3, D4
KOLR-D2, D3, D4
Antenna TV, Dabl, ION
ION Mystery, Bounce, Rewind TV
Laff, GRIT, ShopLC
(23)
2/1/2030
2/1/2030
76 Rochester, NY O&O WROC CBS WROC-D2, D3, D4 Bounce, GRIT, ION Mystery
(23)
79 Charleston, WV O&O WOWK CBS WOWK-D2, D3, D4 ION Mystery, GRIT, Rewind TV 10/1/2028
81 Huntsville, AL O&O
O&O
WHNT
WHDF
CBS
The CW
WHNT-D2, D3
WHDF-D2, D3, D4
The CW, Antenna TV
Court TV, Rewind TV, Charge!
4/1/2029
4/1/2029
82 Brownsville, TX O&O
O&O
KVEO
KGBT
NBC
MNTV
KVEO-D2
KGBT-D2, D3, D4, D5, D6
CBS
Rewind TV, Comet, Estrella, ION
Mystery, GRIT
8/1/2030
(23)
83 Waco-Bryan, TX O&O
O&O
KWKT
KYLE
FOX
MNTV
KWKT-D2, D3, D4
KYLE-D2, D3, D4
MNTV, Antenna TV, Bounce
FOX, Antenna TV, Laff
(23)
85 Savannah, GA O&O WSAV NBC WSAV-D2, D3, D4 The CW, Court TV/MNTV, Laff
(23)
86 Colorado Springs, CO O&O
O&O
KXRM FOX KXRM-D2, D3, D4
KXTU-LD, D2, D3, D4
The CW, ION, ION Mystery
The CW, Bounce, Laff, Antenna TV
(23)
87 Syracuse, NY O&O WSYR ABC WSYR-D2, D3, D4 Antenna TV, Bounce, Laff
(23)
88 Charleston, SC O&O WCBD NBC WCBD-D2, D3, D4 The CW, ION, Laff 12/1/2028
89 El Paso, TX O&O KTSM NBC KTSM-D2, D3, D4 Estrella, ION Mystery, Laff
(23)
91 Champaign, IL O&O
O&O
WCIA
WCIX
CBS
MNTV
WCIA-D2, D3, D4
WCIX-D2, D3, D4
MNTV, Bounce, GRIT
CBS, ION Mystery, Laff
(23)
12/1/2029
92 Shreveport, LA O&O
O&O
LSA
KTAL
KSHV
KMSS
(5)
NBC
MNTV
FOX
KTAL-D2, D3, D4
KSHV-D2, D3, D4
KMSS-D2
Laff, Cozi TV, HSN
ION Mystery, ION, Quest
Rewind TV
(23)
6/1/2029
6/1/2029
9
Market
Rank
(1)
Market Status
(2)
Full Power
Stations
Primary
Affiliation
(3)
Low Power Stations /
Multicast Channels
Other Affiliation
(3)(4)
FCC License
Expiration Date
93 Burlington, VT O&O
LSA
WFFF
WVNY
(5)
FOX
ABC
WFFF-D2, D3,D4
WVNY-D2, D3, D4
ION Mystery, Bounce, Antenna TV
Laff, GRIT, Quest
(23)
95 Baton Rouge, LA O&O
O&O
O&O
LSA
WGMB
WVLA
(17)
FOX
NBC
WGMB-D2, D3
WBRL-CD
KZUP-CD
WVLA-D2, D3
The CW, Cozi TV
The CW
Independent
Laff, ION
6/1/2029
(23)
6/1/2029
6/1/2029
96 Fayetteville, AR O&O
O&O
O&O
KFTA
KNWA
KXNW
FOX
NBC
MNTV
KFTA-D2, D3, D4, D5
KNWA-D2, D3, D4
KXNW-D2, D3, D4
NBC, ION Mystery, Court TV, MNTV
FOX, Laff, GRIT
Rewind TV, Comet, Bounce
(23)
(23)
6/1/2029
98 Jackson, MS O&O WJTV CBS WJTV-D2, D3, D4 The CW, ION, Court TV 6/1/2029
99 Myrtle Beach-Florence, SC O&O WBTW CBS WBTW-D2, D3, D4 MNTV/Antenna TV, ION, ION Mystery 12/1/2028
101 Tri-Cities, TN-VA O&O WJHL CBS WJHL-D2, D3 ABC, Antenna TV 8/1/2029
102 Greenville, NC O&O WNCT CBS WNCT-D2, D3, D4 The CW, Rewind TV, ION Mystery 12/1/2028
104 Quad Cities, IL O&O
O&O
LSA
WHBF
KGCW
KLJB
(5)
CBS
The CW
FOX
WHBF-D2, D3, D4
KGCW-D2, D3, D4
KLJB-D2, D3, D4
Court TV, GRIT, ION Mystery
ThisTV, Laff, CBS
MeTV, Rewind TV, Bounce
12/1/2029
2/1/2030
(23)
107 Evansville, IN O&O
LSA
WEHT
WTVW
(5)
ABC
The CW
WEHT-D2, D3, D4
WTVW-D2, D3, D4
Laff, Cozi TV, Rewind TV
Bounce, ION Mystery, ION
8/1/2029
8/1/2029
108 Ft. Wayne, IN O&O WANE CBS WANE-D2, D3, D4 ION, Laff, ION Mystery 8/1/2029
109 Tyler-Longview, TX O&O
O&O
LSA
KETK
KFXK
(17)
NBC
FOX
KETK-D2, D3, D4
KTPN-LD
KFXK-D2, D3, D4
GRIT, ION, Antenna TV
MNTV
MNTV, ION Mystery, Laff
(23)
8/1/2030
110 Augusta, GA O&O WJBF ABC WJBF-D2, D3, D4 MeTV, ION, ION Mystery 4/1/2029
111 Sioux Falls, SD O&O
O&O
O&O
KELO
KDLO
(18)
KPLO
(18)
CBS
CBS
CBS
KELO-D2, D3, D4
KDLO-D2, D4
KPLO-D2
MNTV, ION, The CW
MNTV, The CW
MNTV
4/1/2030
(23)
4/1/2030
112 Altoona, PA O&O WTAJ CBS WTAJ-D2, D3, D4 ION Mystery, Laff, GRIT
(23)
113 Lansing, MI O&O
LSA
WLNS
(9)
WLAJ
(5)
CBS
ABC
WLAJ-D2 The CW 10/1/2029
10/1/2029
115 Springfield, MA O&O WWLP NBC WWLP-D2, D3, D4 The CW, ION, ION Mystery
(23)
117 Youngstown, OH O&O
O&O
LSA
WKBN
(9)
WYTV
(14)
CBS
ABC
WKBN-D2
WYFX-LD, D2, D3, D4,
D5, D6
WYTV- D2
FOX
FOX, MNTV, ION, Bounce, Laff,
Antenna TV
MNTV
10/1/2029
10/1/2029
10/1/2029
123 Peoria, IL O&O
LSA
WMBD
WYZZ
(19)
CBS
FOX
WMBD-D2, D3, D4 Bounce, Laff, ION Mystery 12/1/2029
(23)
124 Bakersfield, CA O&O
O&O
KGET NBC KGET-D2, D3, D4
KKEY-LP
The CW, Telemundo, Laff
Telemundo
(23)
125 Lafayette, LA O&O KLFY CBS KLFY-D2, D3, D4 Dabl, ION, Laff 6/1/2029
126 Columbus, GA O&O WRBL CBS WRBL-D2, D3, D4 Rewind TV, ION, Laff 4/1/2029
129 La Crosse, WI O&O
O&O
WLAX
WEUX
(20)
FOX
FOX
WLAX-D2, D3, D4
WEUX-D2, D3, D4
Antenna TV, Laff, GRIT
Antenna TV, ION Mystery, Bounce
12/1/2029
12/1/2029
131 Amarillo, TX O&O
O&O
LSA
KAMR
KCIT
(5)
NBC
FOX
KAMR-D2, D3, D4
KCPN-LP-D2
KCIT-D2, D3, D4
MNTV, Laff, Antenna TV
MNTV, Rewind TV
GRIT, ION Mystery, Bounce
(23)
137 Rockford, IL O&O
LSA
WQRF
WTVO
(5)
FOX
ABC
WQRF-D2, D3, D4
WTVO-D2, D3, D4
Bounce, ION Mystery, Rewind TV
MNTV, Laff, GRIT
12/1/2029
12/1/2029
140 Topeka, KS O&O
O&O
LSA
KSNT
KTKA
(14)
NBC
ABC
KSNT-D2, D3, D4
KTMJ-CD, D2, D3, D4
KTKA-D2, D3, D4
FOX, ION, Bounce
FOX, ION Mystery, GRIT, Laff
Rewind TV, The CW, Antenna TV
6/1/2030
(23)
6/1/2030
141 Lubbock, TX O&O
LSA
KLBK
KAMC
(5)
CBS
ABC
KLBK-D2, D3, D4
KAMC-D2, D3, D4
Court TV, Antenna TV, Rewind TV
ION Mystery, Bounce, QVC2
8/1/2030
(23)
142 Monroe, LA O&O
LSA
KARD
KTVE
(5)
FOX
NBC
KARD-D2, D3, D4
KTVE-D2, D3, D4
Bounce, GRIT, Antenna TV
KARD, Laff, ION Mystery
6/1/2029
6/1/2029
145 Minot-Bismarck, ND O&O
O&O
O&O
O&O
KXMB
(21)
KXMC
KXMD
(21)
KXMA
CBS
CBS
CBS
The CW
KXMB-D2, D3, D4
KXMC-D2, D3, D4
KXMD-D2, D3, D4
KXMA-D2, D3, D4
The CW, Laff, ION Mystery
The CW, Laff, ION Mystery
The CW, Laff, ION Mystery
CBS, Laff, ION Mystery
4/1/2030
4/1/2030
4/1/2030
(23)
147 Midland, TX O&O
LSA
KMID
KPEJ
(5)
ABC
FOX
KMID-D2, D3, D4
KPEJ-D2, D3
Laff, ION Mystery, GRIT
Estrella, Rewind TV, Antenna TV
8/1/2030
(23)
148 Panama City, FL O&O WMBB ABC WMBB-D2, D3, D4 The CW, Laff, ION Mystery 2/1/2029
149 Wichita Falls, TX O&O
O&O
LSA
KFDX
KJTL
(5)
NBC
FOX
KFDX-D2, D3, D4
KJBO-LP
KJTL-D2, D3, D4
MNTV, Laff, Antenna TV
MNTV
GRIT, Bounce, ION Mystery
(23)
150 Sioux City, IA O&O KCAU ABC KCAU-D2, D3, D4 ION Mystery, Laff, Bounce 2/1/2030
151 Joplin, MO O&O
LSA
KSNF
KODE
(5)
NBC
ABC
KSNF-D2, D3, D4
KODE-D2, D3, D4
Laff, ION Mystery, Antenna TV
GRIT, Bounce, ION
2/1/2030
2/1/2030
10
Market
Rank
(1)
Market Status
(2)
Full Power
Stations
Primary
Affiliation
(3)
Low Power Stations /
Multicast Channels
Other Affiliation
(3)(4)
FCC License
Expiration Date
153 Erie, PA O&O
LSA
WJET
WFXP
(5)
ABC
FOX
WJET-D2, D3, D4
WFXP-D2, D3, D4
Laff, ION Mystery, Cozi TV
GRIT, Bounce, Antenna TV
(23)
159 Terre Haute, IN O&O
LSA
WTWO
WAWV
(5)
NBC
ABC
WTWO-D2, D3, D4
WAWV-D2, D3, D4
Laff, ION Mystery, Antenna TV
GRIT, Bounce, Rewind TV
8/1/2029
8/1/2029
162 Binghamton, NY O&O
O&O
WIVT ABC WIVT-D2, D3, D4
WBGH-CD, D2
NBC, Laff, ION Mystery
NBC, ABC
(23)
163 Wheeling, WV O&O WTRF CBS WTRF-D2, D3, D4 MNTV, ABC, ION Mystery 10/1/2028
165 Billings, MT O&O
LSA
KSVI
KHMT
(5)
ABC
FOX
KSVI-D2
(6)
,D3,D4
KHMT-D2, D3, D4
The CW, ION Mystery, Antenna TV
Court TV, Laff, ION
4/1/2030
(23)
166 Beckley, WV O&O WVNS CBS WVNS-D2 FOX 10/1/2028
167 Abilene, TX O&O
LSA
KTAB
KRBC
(5)
CBS
NBC
KTAB-D2, D3, D4
KRBC-D2, D3, D4
Telemundo, ION Mystery, ION
GRIT, Laff, Bounce
(23)
168 Hattiesburg, MS O&O WHLT CBS WHLT-D2, D3, D4 The CW, ION, ION Mystery 6/1/2029
169 Rapid City, SD O&O KCLO CBS KCLO-D2, D3, D4 The CW, ION, ION Mystery
(23)
170 Dothan, AL O&O WDHN ABC WDHN-D2, D3, D4 ION Mystery, Laff, Antenna TV 4/1/2029
171 Utica, NY O&O
O&O
LSA
WFXV
WUTR
(5)
FOX
ABC
WFXV-D2, D3
WPNY-LP
WUTR-D2, D3, D4
ION Mystery, Laff
MNTV
MNTV, GRIT, Bounce
(23)
172 Clarksburg, WV O&O WBOY NBC WBOY-D2, D3, D4 ABC, ION Mystery, Laff 10/1/2028
175 Jackson, TN O&O WJKT FOX WJKT-D2, D3, D4 ION Mystery, Laff, GRIT 8/1/2029
178 Elmira, NY O&O WETM NBC WETM-D2, D3, D4 Antenna TV, Laff, ION Mystery
(23)
179 Watertown, NY O&O WWTI ABC WWTI-D2, D3, D4 The CW, Laff, ION Mystery
(23)
181 Marquette, MI O&O WJMN MNTV WJMN-D2, D3, D4 ION Mystery, Laff, Bounce 10/1/2029
182 Alexandria, LA O&O WNTZ FOX WNTZ-D2, D3, D4 Bounce, ION Mystery, Laff 6/1/2029
187 Grand Junction, CO O&O
O&O
O&O
LSA
KREX
KREY
(22)
KFQX
(5)
CBS
CBS
FOX
KREX-D2, D3, D4
KREY-D2, D3, D4
KGJT-CD
KFQX-D2, D3, D4
Laff, MNTV, Bounce
FOX, ION Mystery, GRIT
MNTV
CBS, ION Mystery, GRIT
4/1/2030
4/1/2030
4/1/2030
(23)
197 San Angelo, TX O&O
LSA
KLST
KSAN
(5)
CBS
NBC
KLST-D2, D3, D4
KSAN-D2, D3, D4
ION Mystery, GRIT, Antenna TV
Laff, Bounce, ION
(23)
6/1/2029
(1)
Market rank refers to ranking the size of the DMA in which the station is located in relation to other DMAs. Source: 2023-2024 Nielsen Local
Television Market Universe Estimates, as published by The Nielsen Company.
(2)
O&O refers to stations that we own and operate. LSA, or local service agreement, is the general term we use to refer to a contract under which
we provide services utilizing our employees to a station owned and operated by an independent third-party. Local service agreements include
TBAs, SSAs, JSAs, LMAs and outsourcing agreements. For further information regarding the LSAs to which we are a party, see Note 2 to our
Consolidated Financial Statements in Part IV, Item 15(a) of this Annual Report on Form 10-K.
(3)
Affiliation denoted “The CW” reflects affiliation with The CW or The CW Plus.
(4)
Antenna TV and Rewind TV are digital multicast networks owned and operated by Nexstar. The other affiliations for our digital multicast
channels are owned by independent third parties.
(5)
These stations and related multicast channels are owned by Mission.
(6)
WPHL, KRON, WTTA, KAUT and KSVI-D2 became affiliates of the CW Network on September 1, 2023.
(7)
Although WDVM is located within the Washington, D.C. DMA, its signal does not reach the entire Washington, D.C. metropolitan area.
WDVM serves the Hagerstown, MD sub-market within the DMA. WDVM is the only commercial station licensed in the city of Hagerstown.
(8)
In January 2024, Nexstar entered into a time brokerage agreement with KAZT-TV. KAZT became an affiliate of the CW Network on
February 1, 2024.
(9)
These stations are operating under channel sharing arrangements with another Company station in the same market.
(10)
Nexstar acquired WSNN-LD on July 20, 2023.
(11)
Nexstar acquired KUSI-TV from McKinnon Broadcasting on August 31, 2023.
(12)
KNVA is owned by 54 Broadcasting, a subsidiary of Vaughan Media LLC (“Vaughan”).
(13)
KREZ and KBIM operate as satellite stations of KRQE.
(14)
These stations and related multicast channels are owned by Vaughan.
(15)
KHAW and KAII operate as satellite stations of KHON. KGMD and KGMV are satellites of KHII.
(16)
KSNC, KSNG and KSNK operate as satellite stations of KSNW.
(17)
These stations and related multicast channels are owned by White Knight Broadcasting (“White Knight”).
(18)
KDLO and KPLO operate as satellite stations of KELO.
(19)
WYZZ is owned by Cunningham Broadcasting Corporation.
(20)
WEUX operates as a satellite station of WLAX.
(21)
KXMB and KXMD operate as satellite stations of KXMC.
(22)
KREY operates as a satellite station of KREX.
(23)
Application for renewal of license was submitted timely to the FCC. Under the FCC’s rules, the license expiration date is automatically
extended pending FCC review of and action on the renewal application.
11
Network Affiliations
All, except three, of the full power television stations that we own and operate, program or provide sales and other services to
are currently affiliated with a network pursuant to an affiliation agreement. The agreements with CBS, FOX, NBC, ABC, and The CW
are the most significant to our operations. The current terms of these agreements expire as discussed below:
Network
Affiliation Expiration Date
CBS 49 agreements expire in June 2024.
NBC 35 agreements expire in December 2024.
The CW Of the 28 agreements, 27 expire in August 2025 and one
(1)
expires in December 2026.
MNTV 15 agreements expire in August 2025.
FOX Of the 42 agreements, 41 expire in August 2026 and one
(1)
expires in December 2024.
ABC 29 agreements expire in December 2026.
(1)
This affiliation agreement is owned by a station to which we provide sales and other services. We do not consolidate this station in our
financial statements due to lack of a deemed controlling financial interest under U.S. GAAP.
Each affiliation agreement provides the affiliated station with the right to broadcast all programs transmitted by the network
with which it is affiliated. In exchange, the network receives affiliation fees from us and has the right to sell a substantial majority of
the advertising time during these broadcasts. We expect the network affiliation agreements listed above to be renewed upon
expiration.
Networks
We own, operate or have an ownership interest in the following:
Network / Entity
Network
Type Description
%
Owned
by
Nexstar
U.S. TV
Households
Reached
(1)
(in millions)
%of
U.S. TV
Households
(1)
(Broadcast)
%of
Multi-channel
Households
(1)
(PayTV)
The CW Network Broadcast Fifth major broadcast network in the U.S. 75% 125 100% --
NewsNation PayTV National cable news network 100% 69 -- 92%
Antenna TV Broadcast Multicast entertainment network 100% 125 100% --
REWIND TV Broadcast Multicast entertainment network 100% 66
(2)
53%
(2)
--
TV Food Network PayTV Food Network and Cooking Channel 31.3% 70 and 34 -- 94% and 45%
(1)
Source: Nielsen, December 2023
(2)
Source: Internal estimates
The CW. The CW is one of America’s major broadcast networks and reaches 100% of US television households. The CW
delivers 15 hours of primetime entertainment programming and three hours of children’s programming per week in addition to over
300 hours of sports per year as the broadcast home to LIV Golf, ACC football and basketball games, Inside the NFL, WWE NXT
beginning in 2024 and NASCAR Xfinity Series beginning in 2025. For its smaller market affiliates, CWPlus supplements The CW
programming with additional syndicated content to provide 24 hours of programming, seven days per week. The fully ad-supported
CW App, with more than 100 million downloads to date, is available for free to consumers on all major platforms and is home to the
latest episodes and seasons of The CW’s primetime programming, live streaming of LIV Golf tournaments and a library of
entertaining film and television content for on-demand viewing.
NewsNation. NewsNation is a national cable news network which primarily delivers national news programming supplemented
by quality television series. NewsNation is the fastest-growing national cable news network in primetime reaching 69 million
television households across the United States. Validated by independent watchdog groups, NewsNation is America’s source for
engaging and unbiased news, which reflects the full range of perspectives across the country. The network draws on the local and
national expertise of Nexstar’s 6,000 journalists in 110 newsrooms across the country. NewsNation is available on every major cable
and satellite provider, streaming platforms including YouTubeTV, Hulu, DirecTV Stream, FuboTV and Sling, online at
www.newsnationnow.com, and on the NewsNationNow app available on Android and iOS.
Antenna TV and REWIND TV. Antenna TV and REWIND TV are multicast networks reaching 100% and over 50% of U.S.
television households. The networks primarily air sitcom hits from the 1950s through the 1990s.
12
TV Food Network. We also hold a 31.3% interest in TV Food Network, which annually distributes significant cash flow to us.
TV Food Network operates two 24-hour television networks, Food Network and Cooking Channel, offering quality television, video,
internet and mobile entertainment and information focusing on food and entertaining. During 2023, we received cash distributions
from TV Food Network totaling $270 million. Our partner in TV Food Network is Warner Bros. Discovery, Inc., which owns a 68.7%
interest in TV Food Network and operates the networks on behalf of the partnership.
Digital Assets
Our digital businesses include video and display advertising platforms that are delivered locally or nationally through our own
and various third-party websites, mobile and over-the-top (“OTT”) applications, other digital media solutions to media publishers and
advertisers and a consumer product reviews platform. Our digital assets include 140 local websites, 278 mobile applications, 25
connected television applications, six free-ad supported television (“FAST”) channels representing content from our local television
stations, The CW, NewsNation, The Hill, and BestReviews, and a suite of advertising solutions.
The Hill. The Hill is the nation’s leading digital-first political news brand and the definitive source for non-partisan political
news and information. Inside the Beltway it’s known as an essential, agenda-setting read for lawmakers and influencers. Beyond the
Capitol, millions of Americans turn to The Hill to decode how events in Washington will impact their communities and lives.
BestReviews. BestReviews is a leading consumer product recommendations company which simplifies the way consumers buy
products and services across thousands of categories by independently researching, analyzing, and testing products and recommending
the best picks. BestReviews monetizes its content through a revenue share model with its retail partners against all sales generated by
BestReviews.
Operating Model
Our primary sources of revenue include contractual distribution revenue from retransmission consent and carriage agreements
with MVPDs, such as cable and satellite providers, and OVDs, companies that provide video content through internet streaming either
directly or via our network affiliation partners, as well as affiliation fees from local affiliates of The CW; the sale of commercial air
time by the stations to local advertisers; the sale of commercial airtime by the stations and by our broadcast and cable networks to
national advertisers; the sale of advertising on the stations’ websites, on our other owned or third party websites, and through mobile
and OTT applications and other digital advertising solutions.
Our primary operating expenses include programming, newsgathering, production and promotion, employee salaries and
benefits, sales commissions, digital cost of goods sold and content creation costs, and other administrative and corporate expenses. A
large percentage of the costs involved in our operations is relatively fixed.
We seek to grow our revenue, net income, EBITDA and cash flow by continuing to provide high quality programming that
attracts and engages audiences as our reach and consumer engagement are important to our distribution partners and advertisers. We
use our industry-leading scale to assist us in securing distribution revenue streams, to provide advertisers with solutions across
geographies and media types to engage both local and national audiences at scale and to leverage costs against a broader platform. In
addition, we plan to continue to acquire or invest in businesses that can benefit from our scale, asset mix and record of management
and cost discipline.
Distribution
We receive compensation from cable, satellite and other MVPDs and OVDs in return for our consent to the retransmission of
the signals of our television stations and the carriage of NewsNation. Distribution revenues primarily represent payments from the
MVPDs and OVDs and are typically based on the number of subscribers they have. Our successful negotiations related to these
distribution agreements produce meaningful recurring revenue streams. We also generate distribution revenues from programmers
who lease the use of our spectrum in selected local markets to air their content on our multicast streams.
13
Advertising
Our advertising revenue is primarily derived from the sale of local and national advertising on our stations, networks, websites,
apps and other digital platforms or via third party media.
Advertising revenue is positively affected by a strong economy. Conversely, declines in advertising budgets of advertisers,
particularly in recessionary periods, adversely affect the broadcast industry and, as a result, may contribute to a decrease in our
advertising revenue. In even-numbered years we generate substantial advertising revenue from the political advertising we sell to
candidates, political action committees and political parties. Advertising revenue is also positively affected by certain events such as
the Olympic Games or the Super Bowl. Advertising revenue is generally highest in the second and fourth quarters of each year, due in
part to increases in consumer advertising in the spring and retail advertising in the period leading up to, and including, the holiday
season.
Local advertising is sold by each station’s local sales staff who call upon advertising agencies and local businesses. Compared to
revenue from national advertising accounts, revenue from local advertising is generally more stable and predictable. In 2023, national
and political advertising was sold through third party national sales representative firms which call upon advertising agencies.
Beginning in January 2024, our national advertising is sold through our national sales division. We continue to sell our political
advertising inventory through third party national sales representative firms. Digital advertising that is not sold through our local and
national sales teams is typically sold via programmatic exchanges.
Competition
Competition in the television industry takes place on several levels: competition for audience, competition for programming and
competition for advertising.
Audience. We compete for audience based on program popularity. The popularity of our programming has an effect on the rates
we can secure from our distributors and a direct effect on the advertising rates we can charge our advertisers. We compete against
other broadcast television programming, cable and satellite television programming as well as the direct-to-consumer programming
provided via a variety of streaming services, including some of the broadcast television networks with which our stations are
affiliated. Other sources of competition for audience include the internet, gaming devices, home entertainment systems and video-on-
demand. The CW, our broadcast television network, competes with other broadcast networks and other video programming for
viewers and NewsNation, our growing national cable news network, competes with other established national news networks such as
CNN, FOX News and MSNBC for viewers.
Programming. Our local television stations compete for syndicated programming from national program distributors or
syndicators and compete to secure broadcast rights for regional and local sporting events. We compete against in-market broadcast
station operators, cable networks and streaming services for exclusive access to this programming in our markets. In a different way,
our local stations also compete with other stations in their markets to provide exclusive news stories and unique features such as
investigative reporting and coverage of community events to their local audience. The CW competes against other broadcast television
and cable networks as well as other video providers, such as direct-to-consumer streaming platforms for television content.
NewsNation competes against other cable news networks for talent and stories.
Advertising. Our stations compete for advertising revenue with other television stations in their respective markets and other
advertising media such as online media (e.g., Google, Meta, Tiktok, Snapchat, etc.), OVDs, MVPDs, radio stations, newspapers,
outdoor advertising, and direct mail, among others. Competition for advertising dollars in the broadcasting industry occurs primarily
within individual markets. Generally, a television broadcast station in a particular market does not compete with stations in other
market areas. The CW also competes for advertising revenue with other broadcast networks and other distribution technologies.
NewsNation also competes for advertising revenue with other advertising media and with other established national networks such as
CNN, FOX News and MSNBC.
14
Federal Regulation
Television broadcasting is subject to the jurisdiction of the Federal Communications Commission (the “FCC”) under the
Communications Act of 1934, as amended (the “Communications Act”). The following is a brief discussion of certain provisions of
the Communications Act and the FCC’s regulations and policies that affect our operations. These rules are subject to change, which
may affect our operations.
FCC Licenses, Renewals and Transfers
License Grant and Renewal. The Communications Act requires broadcast stations to operate under licenses issued by the FCC.
Television broadcast licenses are granted for a maximum term of eight years and may be renewed upon application to the FCC. The
FCC grants an application for license renewal if the station served the public interest, the licensee did not commit any serious
violations of the Communications Act or the FCC’s rules and the licensee committed no other violations which, taken together, would
constitute a pattern of abuse. A majority of renewal applications are routinely granted under this standard. We consistently have
received renewals and approvals in the past and are permitted to continue operations when renewal is delayed; however, there are no
assurances that this will be the case in the future.
Station Transfer. The Communications Act prohibits the assignment or the transfer of control of a broadcast station’s FCC
license without prior FCC approval.
Foreign Ownership Restrictions
The Communications Act limits the extent of non-U.S. ownership of companies that own U.S. broadcast stations, generally
prohibiting more than 20% non-U.S. ownership (by vote and by equity) in a U.S. broadcast licensee or more than 25% indirect foreign
ownership or control of such licensee through a parent company. The FCC will entertain and may authorize, on a case-by-case basis,
proposals to exceed the 25% indirect foreign ownership limit in broadcast licensees.
Multiple Ownership Rules
The FCC multiple ownership rules restrict the number of television stations in which a single person or entity may have an
“attributable interest.”
Ownership Attribution. For purposes of determining compliance with the multiple ownership rules, the FCC rules consider the
“attributable interests” in a broadcast station licensee held by an individual or entity. The following are considered “attributable
interests”: (i) for corporations, officership, directorship and voting stock interests of 5% or more (20% or more in the case of certain
passive investors), (ii) for partnerships and limited liability companies, any limited partnership interest or limited liability company
interest, unless properly “insulated” from involvement in the partnership’s media activities, and any general partnership interest, and
(iii) more than 33% of a licensee’s total assets (defined as total debt plus total equity), if the holder of such interest also provides over
15% of the station’s total weekly broadcast programming or has an attributable interest in another media entity in the same market
which is subject to the FCC’s ownership rules. If a shareholder of Nexstar holds a voting stock interest of 5% or more (20% or more in
the case of certain passive investors), we must report that shareholder, its parent entities, and attributable individuals and entities of
both, as attributable interest holders in Nexstar.
Local Television Multiple Ownership (Duopoly) Rule. Under the local television multiple ownership, or “duopoly,” rule, a
single entity is allowed to own or have attributable interests in two television stations in a DMA if (i) the two stations do not have
overlapping service areas, or (ii) at least one of the two stations is not ranked among the top four stations in the DMA in terms of
audience share (subject to certain exceptions based on a case-by-case determination). The duopoly rule also allows the FCC to
consider waivers to permit the ownership of a second station, where otherwise prohibited, where the second station has failed or is
failing or unbuilt.
In certain markets, the Company owns and operates both full-power and low-power television (“LPTV”) broadcast stations. The
FCC’s rules and policies regarding ownership of television stations in the same market and nationally generally apply only to full-
power television stations. In 2023, the FCC extended the duopoly rule to prohibit, in certain circumstances, the acquisition of a
network affiliation that would establish a “top four” combination involving a network-affiliated LPTV station or digital multicast
stream.
National Television Multiple Ownership Rule. The FCC’s rules limit the percentage of U.S. television households which a party
may reach through its attributable interests in television stations to 39%. When calculating a party’s nationwide aggregate audience
coverage, the ownership of a UHF station is counted as 50% of a market’s percentage of total national audience. In December 2017,
the FCC initiated a proceeding to broadly reexamine its national television ownership rule and the proceeding remains open.
15
Local Service Agreements. The FCC applies the local television ownership limits to a non-owned station when the owner of a
station in the same market provides more than 15% of the second station’s weekly broadcast programming. However, local marketing
agreements entered into prior to November 5, 1996 (“grandfathered LMAs”) are exempt from this attribution rule until the FCC
determines otherwise. This “grandfathering” is subject to possible extension or termination in a future FCC review. Nexstar is
currently a party to certain grandfathered LMAs.
Under current FCC rules, joint sales agreement (“JSAs”) and shared services agreements (“SSAs”) between independently
owned television stations that do not exceed the programming threshold noted above are non-attributable but must be publicly
disclosed, and the FCC may in the future consider regulations with respect to such agreements. Nexstar is currently a party to certain
JSA and SSA agreements whereby it provides services to independently owned stations.
Quadrennial Review of Media Ownership Rules. The FCC is required to review its media ownership rules every four years and
to eliminate those rules it finds are no longer “necessary in the public interest as a result of competition.” In December 2023, the FCC
issued an order concluding its 2018 quadrennial review. The order retained the local television ownership rule without deregulatory
changes while extending the rule to prohibit, in certain circumstances, the acquisition of a network affiliation that would establish a
“top four” combination involving a network affiliated LPTV station or digital multicast stream. The FCC’s 2018 quadrennial review
order is subject to appeal, and in addition, the 2022 quadrennial review is currently pending. Thus, the media ownership rules may be
subject to change in response to current or future quadrennial reviews or other proceedings.
Distribution by Multichannel Video Programming Distributors (“MVPDs”) and Online Video Distributors (“OVDs”)
MVPD Carriage of Local Television Signals. Broadcasters may obtain carriage of their television stations’ signals on cable,
satellite and other MVPDs through either mandatory carriage or through “retransmission consent.” Every three years all stations must
formally elect either mandatory carriage (“must-carry” for cable distributors and “carry one-carry all” for satellite television providers)
or retransmission consent. The next election must be made by October 1, 2026 and will be effective January 1, 2027. Mandatory
carriage elections require that the MVPD carry one station programming stream and related data in the station’s local market, subject
to limited exceptions. MVPDs do not pay a fee to stations that elect mandatory carriage. We and our partners have elected
“retransmission consent” for all of our stations.
A broadcaster, like Nexstar, that elects retransmission consent waives its mandatory carriage rights, and the broadcaster and the
MVPD must negotiate terms for carriage of the station’s signal. If a broadcaster elects to negotiate retransmission terms, it is possible
that the broadcaster and the MVPD will not reach agreement and that the MVPD will not carry the station’s signal. Pursuant to the
FCC rules and federal statutory law all broadcasters and MVPDs must conduct retransmission consent negotiations in “good faith,”
and a broadcaster may not undertake such negotiations for third parties including VIEs in markets where that broadcaster also owns a
television station. MVPDs and broadcasters may file FCC complaints against each other for violations of the good faith negotiation
rules, and such complaints have been filed against Nexstar in the past. We cannot predict the impact that any such complaints may
have on our operations.
MVPDs have actively sought to change the regulations under which retransmission consent is negotiated before both the U.S.
Congress and the FCC in order to increase their bargaining leverage with television stations, and there are still-open FCC proceedings
to review these regulations.
Certain OVDs stream broadcast programming over the internet. In December 2014, the FCC issued a Notice of Proposed
Rulemaking proposing to interpret the term “MVPD” to encompass OVDs that make available for purchase multiple streams of video
programming distributed at a prescheduled time and seeking comment on the effects of applying MVPD rules to such OVDs. The
proceeding remains open.
Broadcast Transmission Standard (ATSC 3.0)
In November 2017, the FCC adopted rules to permit television broadcasters to voluntarily broadcast using a new broadcast
television transmission standard developed by the Advanced Television Systems Committee, Inc., also referred to as “ATSC 3.0” or
“NEXTGEN TV.” The ATSC 3.0 standard provides for a more efficient use of spectrum, which could enable us to provide additional
services to consumers and businesses, including additional content, interactive television, signal encryption and data transmission
services. Nexstar and its partners have adopted the ATSC 3.0 technology in their stations covering over 50% of U.S. television
households.
16
Because ATSC 3.0 is not compatible with existing television equipment, the FCC requires the stations which have adopted the
ATSC 3.0 technology to continue broadcasting a substantially similar signal in the existing standard until the FCC phases out the
requirement. In June 2023, the FCC issued a Third Report and Order and Fourth Further Notice of Proposed Rulemaking that extends
the sunset for certain transition requirements from July 2023 to July 2027. In addition, in June 2020, the FCC adopted a Declaratory
Ruling and Notice of Proposed Rulemaking declaring that local and national ownership restrictions do not apply to non-video services
provided on a broadcaster’s ATSC 3.0 spectrum.
Other FCC Broadcast Regulations and Enforcement
The FCC continues to strictly enforce its regulations concerning indecency, sponsorship identification, political advertising,
good faith retransmission consent negotiation, unauthorized assignments and transfers of control, multiple ownership, children’s
television, environmental concerns, emergency alerting and information, equal employment opportunity, technical operating matters,
antenna tower maintenance, and other matters. The FCC may impose substantial forfeitures or, in extreme cases, revoke licenses if it
determines that its rules have been violated.
Human Capital Management
Values. Our key human capital management objectives are to attract, develop, and retain top industry talent that reflects the
diversity of the communities in which we operate and provide services. We encourage every individual’s contribution and personal
growth and foster work environments that provide personal pride through job satisfaction and a balanced life. We embrace the
communities in which we operate and promote open communications, innovation and creativity.
Engagement and Opportunities. With markets ranging from small to large to national, we offer a broad range of opportunities
for every experience level, including for those who are just starting their broadcasting career or are ready to move to a larger market or
onto the national stage. Our market diversity allows us to give our employees room to grow and progress in their careers. Our
management team supports a culture of developing future leaders from our existing workforce, enabling us to promote from within for
many leadership positions. As of December 31, 2023, our voluntary retention rate for employees was approximately 82%.
Compensation and Benefits. We offer our employees a broad range of company-paid benefits and we believe our
compensation package and benefits are competitive with others in our industry. Our employee wages are competitive and consistent
with employee positions, experience, knowledge and location. Annual wage increases and incentive payments are based on merit and
are communicated to employees as a part of the annual review process.
Diversity and Inclusion. We value diversity at all levels and continue to focus on extending our diversity and inclusion
initiatives across our entire workforce. We believe a diverse workforce fosters innovation and cultivates an environment of unique
perspectives. We encourage a culture of diversity and inclusion so our employees feel respected and do not feel discriminated against.
To help us achieve our diversity goals, our Diversity and Inclusion Council, a ten-member group of rotating members, regularly meets
and advises senior management on ideas and initiatives to help diverse and inclusive workplace, where diverse talent can flourish and
build a career. In addition, we have five Employee Resource Groups in the categories of Latinx, Women, African American, Veterans
and LGBTQ+ designed to bring together employees who share similar cultures, backgrounds, and/or interests, as well as those
employees who wish to provide support to that group. In order to ensure accountability in making progress in our diversity goals, a
portion of our managers’ bonuses are tied to diversity metrics in their markets.
As of December 31, 2023, approximately 41% and 30% of our employees and our management (Vice Presidents and above),
respectively, were women. In the U.S., approximately 26% and 11% of our employees and our management, respectively, were
racially/ethnically diverse. This compares to approximately 40% of the U.S. population which is racially/ethnically diverse (source:
2020 United States Census Bureau population).
17
Training and Mentorship. We are committed to developing the talents of our employees and provide our employees workplace
training. Our catalog of courses includes harassment prevention, diversity/equity/inclusion, ethics, managing bias, supervisor/manager
skills, and health-related safety. In addition, we have a mentorship program that matches mentors and mentees across the company and
provides the pairs with a 12-topic curriculum covering skills such as communications, networking, work/life balance, and goal setting.
Selected Nexstar employees also participate in annual training to ensure understanding of antitrust laws and how they apply to Nexstar
and media sales training program provided by The Center for Sales Strategy, a third-party vendor.
Safety and Health. We are committed to providing a safe and healthy workplace for our employees. All employees are required
to comply with our safety rules and are expected to actively contribute to making our company a safer place to work. Employees must
immediately report accidents, injuries, and unsafe equipment, practices or conditions to a supervisor or other designated person.
Threats or acts of violence or physical intimidation are prohibited and subject to disciplinary action up to and including termination of
employment.
Employees. As of December 31, 2023, we had a total of 13,294 employees, comprised of 11,877 full-time and 1,417 part-time
employees. As of December 31, 2023, 1,944 of our employees were covered by collective bargaining agreements. We believe that our
employee relations are satisfactory, and we have not experienced any work stoppages at any of our facilities. However, we cannot
assure you that our collective bargaining agreements will be renewed in the future, or that we will not experience a prolonged labor
dispute, which could have a material adverse effect on our business, financial condition or results of operations.
Community Outreach. We pride ourselves on the opportunities we provide for our employees to give back to their
communities. At the local level, our stations are actively involved in over 1,775 community outreach initiatives in 2023. Nexstar and
its partner stations work with local community groups to increase awareness, raise money and otherwise assist these local groups with
their missions. Stations run promotions and air content related to the initiative and station employees participate in local events. On a
companywide basis, Nexstar engages in a variety of initiatives as well, including, among others, partnering with Feeding America, the
nation’s largest domestic hunger relief organization by providing air-time and financial support from 2021 – 2023; Project Roadblock,
a national multiplatform program aimed at preventing drunk driving, by donating airtime and news coverage to the issue; and
Remarkable Women, Nexstar’s own initiative to celebrate local women to inspire, lead and pave the way for other women to succeed,
by airing content and contributing to the winners’ charitable organizations of her choice. In addition, since our 20th anniversary in
June 2016 (with the exception of 2020), we organized an annual Founder’s Day of Caring, an employee-driven effort focused on local
non-profits and charities. Across the country our employees take the day to contribute thousands of hours of community services. In
2023, our Founder’s Day initiatives provided nearly 17,500 hours of service in one day to the communities served by Nexstar TV
stations.
Legal Proceedings
From time to time, we are involved in litigation that arises from the ordinary operations of business, such as contractual or
employment disputes or other general actions. In the event of an adverse outcome of these proceedings, we believe the resulting
liabilities would not have a material adverse effect on our financial condition or results of operations. See Note 16 to our Consolidated
Financial Statements included in Part IV, Item 15(a) of this Annual Report on Form 10-K, which is incorporated herein by reference.
Available Information
We file annual, quarterly and current reports, proxy statements and other information with the SEC. The SEC maintains a
website that contains reports, proxy and information statements and other information regarding issuers, including us, that file
electronically with the SEC. The address for the SEC’s website is http://www.sec.gov. Due to the availability of our filings on the
SEC website, we do not currently make available our filings on our internet website. Upon request, we will provide free copies of our
annual reports on Form 10-K, quarterly reports on Form 10-Q and any other filings with the SEC. Requests can be sent to Nexstar
Media Group, Inc., Attn: Investor Relations, 545 E. John Carpenter Freeway, Suite 700, Irving, TX 75062. Additional information
about us, our stations and the stations we program or provide services to can be found on our website at http://www.nexstar.tv.Wedo
not incorporate the information contained on or accessible through our corporate website into this Annual Report on Form 10-K.
18
Item 1A. Risk Factors
You should carefully consider the risks described below and all of the information contained in this document. The risks and
uncertainties described below are not the only risks and uncertainties that the Company faces. Additional risks and uncertainties not
presently known to the Company or that the Company currently deems immaterial may also impair the Company’s business
operations. If any of those risks occur, the Company’s business, financial condition and results of operations could suffer. The risks
discussed below also include forward-looking statements, and the Company’s actual results may differ substantially from those
discussed in these forward-looking statements. See “Cautionary Note Regarding Forward-Looking Statements” for further
information.
Summary Risk Factors
Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may
adversely affect our business, financial condition, results of operations, cash flows, and prospects. These risks are discussed more fully
below and include, but are not limited to:
Risks Related to Our Operations
• Our distribution revenues and operating results may be adversely affected by, among other factors, declining MVPD
subscribers and our inability to renew expiring distribution agreements on favorable terms or at all;
• Our station revenues and operating results may be adversely affected if we are unable to renew our network affiliation
agreements on favorable terms, or at all;
• Our revenue and operating results may be adversely affected if we are unable to retain our largest customers, which
account for a significant percentage of our total revenue, on favorable terms, or at all;
• Our advertising revenue and operating results may be affected by economic downturns, geopolitical events and other
factors outside of our control;
• Because a significant percentage of our operating expenses are fixed, a relatively small decrease in revenue could have a
significant negative impact on our operating results;
• Our growth may be limited if we are unable to implement an acquisition strategy and our operating results may be
adversely affected if we are unable to successfully integrate any future acquisition;
• Our substantial debt and related interest expense could limit our ability to reinvest in the business, make acquisitions
and/or return capital to shareholders;
• We may not be able to generate sufficient cash flow to meet our debt service requirements;
• We may be required to cease certain station operations if the FCC denies renewal of any of our station licenses.
• The financial performance of our equity method investments and the performance of third-party services providers, upon
which we rely but do not control, could adversely impact our results of operations;
• The loss of the services of our chief executive officer could disrupt management of our business and impair the execution
of our business strategies;
• Our operating results could be adversely affected if the owners of the VIEs make decisions regarding the operation of
their respective stations that adversely impact their operating results and reduce payments due to us under our local
service agreements;
• Future impairment charges could adversely affect our operating results;
• Changes in deferred tax asset assets or valuation allowances as a result of tax law changes could affect our operating
results;
• We may face additional tax liabilities stemming from proposed and ongoing tax audits;
• Our pension and postretirement benefit plan obligations may be increased by a declining stock market and lower interest
rates;
• Adverse results from litigation or governmental investigations involving us could impact our business practices and
operating results;
19
• Any decrease in our dividend payments or suspension of our dividend payments or stock repurchases could cause our
stock price to decline;
• We may not be able to adequately protect the intellectual property and other proprietary rights that are material to our
business; and
• Cybersecurity risks could adversely affect our operating effectiveness and operating results.
Risks Related to Our Industry
• Intense competition in the television industry and alternative forms of media could limit our growth and profitability;
• New or changed federal statutes, legislation and regulations could significantly impact our operations or the television
broadcasting industry as a whole; and
• We are subject to foreign ownership limitations which limit foreign investments in us.
Risks Related to Tribune Publishing’s Spin-Off
• Tribune may be required to pay substantial U.S. federal income taxes if the Tribune Publishing spin-off does not qualify
as a tax-free distribution under Section 355 of the Internal Revenue Code;
20
Risks Related to Our Operations
Our distribution revenues and operating results may be adversely affected by, among other factors, declining MVPD
subscribers and our inability to renew expiring distribution agreements on favorable terms or at all.
A significant portion of Nexstar’s revenue comes from its retransmission consent and carriage agreements with MVPDs (mainly
cable and satellite television providers) and OVDs. These agreements permit the distributors to retransmit our stations’ and our cable
and broadcast networks’ signals to their subscribers in exchange for the payment of compensation to us. If we are unable to
renegotiate these agreements on favorable terms, or at all, the failure to do so could have an adverse effect on our business, financial
condition, and results of operations. In addition, occasionally these negotiations result in a temporary removal of our stations from the
distributor’s service which disruption could have an adverse effect on our operating results.
Though we are typically able to renegotiate our retransmission consent agreements on favorable terms, the payments due to us
under these agreements are customarily based on a price per subscriber of the applicable distributor. In the past several years, the
number of subscribers to MVPDs has declined as the growth of direct internet streaming of video programming to televisions and
mobile devices has led consumers to discontinue their cable or satellite service subscriptions. As our retransmission consent
agreements include payment terms by subscriber numbers, if the rate of reductions in the number of MVPD subscribers increases, this
could also have an adverse effect on our business revenues, financial condition and results of operations. Also, refer to “Risks Related
to Our Industry—Intense competition in the television industry and alternative forms of media could limit our growth and
profitability.”
Our affiliation agreements with the “Big 4” broadcast networks (ABC, CBS, NBC and FOX) include terms that limit our ability
to grant retransmission consent rights to OVDs and other service providers that provide video streaming to consumers. As a result, the
Big 4 networks generally negotiate directly with OVDs for carriage of their local affiliate stations, including certain of our stations.
The terms the networks negotiate may be unfavorable or unacceptable to us, as a result of which we may receive reduced revenue
from our stations’ carriage on OVDs or may choose not to permit an OVD’s carriage of our stations at all, which could materially
reduce this revenue source to the Company if we cannot reduce network affiliation fees or generate additional revenue streams from
other relationships we have with the Big 4 networks and OVDs, and could have an adverse effect on our business, financial condition
and results of operations.
Our station revenues and operating results may be adversely affected if we are unable to renew our network affiliation
agreements on favorable terms, or at all.
Due to the quality of the programming provided by the networks, stations that are affiliated with a network generally have
higher ratings than unaffiliated independent stations in the same market. As a result, it is important for stations to maintain their
network affiliations. All but three of the stations that we operate or provide services to have network affiliation agreements which
have expiration/renewal dates at various times through December 2026. In order to renew certain of our affiliation agreements, we
may be required to make increased payments to the networks and to accept other modifications of existing affiliation agreements. If
any of our stations cease to maintain affiliation agreements with their networks for any reason, we would need to find alternative
sources of programming, which may be less attractive to our audiences and more expensive to obtain. In addition, a loss of a specific
network affiliation for a station may affect our retransmission consent payments, resulting in us receiving less retransmission consent
fees. Further, some of our network affiliation agreements are subject to earlier termination by the networks under specified
circumstances. For more information regarding these network affiliation agreements, see Item 1, “Business—Network Affiliations.”
Our revenue and operating results may be adversely affected if we are unable to retain our largest customers, which account
for a significant percentage of our total revenue, on favorable terms, or at all.
During the years ended December 31, 2023, 2022 and 2021, the Company’s revenues from two customers exceeded 10%. Each
of these customers represented approximately 12% and 14% for 2023, 10% and 11% for 2022, and 12% and 13% for 2021, of the
Company’s consolidated net revenues. The loss of or disruption in our relationship with one or more of our major customers could
have a material adverse effect on our business, operating results, or financial condition. In addition, any consolidation of our
customers could reduce the number of customers to whom our services could be sold and increase our revenue concentration.
21
Our advertising revenue and operating results may be affected by economic downturns, geopolitical events and other factors
outside of our control.
We derive a significant amount of our revenue from the sale of television and digital advertising. Our ability to sell advertising
time depends on numerous factors that may be beyond our control, including: the health of the economy; the popularity of our
programming, including trust in news organizations; fluctuations in pricing for advertising; the activities of our competitors; and the
amount of demand for political advertising in election years. Because businesses generally reduce their advertising budgets during
economic recessions or downturns, our reliance upon advertising revenue makes our operating results susceptible to prevailing
economic conditions. In addition, our programming may not attract sufficient targeted viewership, and we may not achieve favorable
ratings. Our ratings depend partly upon unpredictable and volatile factors beyond our control, such as viewer preferences, competing
programming and the availability of other entertainment activities. A shift in viewer preferences could cause our programming not to
gain popularity or to decline in popularity, which could cause our advertising revenue to decline. Further, we and the programming
providers upon which we rely may not be able to anticipate, and effectively react to, shifts in viewer tastes and interests in our
markets.
In addition, the Company may experience a loss of advertising revenue and incur additional broadcasting expenses due to
preemption of our regularly scheduled programming by network coverage of a major global news event such as a war or terrorist
attack or by coverage of local disasters such as tornados and hurricanes.
Because a significant percentage of our operating expenses are fixed, a relatively small decrease in revenue could have a
significant negative impact on our operating results.
Our business is characterized generally by high fixed costs, primarily for debt service, broadcast rights and personnel. Other
than commissions paid to our sales staff and outside sales agencies, our expenses do not vary significantly with an increase or decrease
in advertising revenue. As a result, a relatively small change in advertising prices could have a disproportionate effect on our financial
results. Accordingly, a minor shortfall in expected revenue could have a significant negative impact on our financial results.
Our growth may be limited if we are unable to implement an acquisition strategy and our operating results may be adversely
affected if we are unable to successfully integrate any future acquisition.
Historically, we achieved much of our growth through acquisitions. We intend to continue our growth by selectively pursuing
acquisitions of businesses that leverage our platform, scale and capabilities. Some of our competitors may have greater financial or
management resources with which to pursue acquisition targets. Therefore, even if we are successful in identifying attractive
acquisition targets, we may face considerable competition and our acquisition strategy may not be successful.
Current and future changes to rules and policies of the FCC and other regulatory authorities which limit the ownership of
television stations may also make it more difficult for us to acquire additional television stations. Additionally, our television
acquisitions over the past several years have significantly increased our national audience reach to a level that is at the national
television ownership limit imposed by the Communications Act and FCC rules. This may restrict our future television station
acquisitions and may require us to divest current stations in connection with any acquisition in order to comply with the national
television ownership limit. For more information see “Federal Regulation.”
There are a number of risks associated with growing our business through acquisitions. For example, with any past or future
acquisition, there is the possibility that: we may not be able to manage the increased reporting and administrative demands; we may
not be able to successfully reduce costs, increase revenue or audience or realize anticipated synergies and economies of scale with
respect to any acquired business; we may not be able to generate adequate returns on our acquisitions or investments; we may
encounter and fail to address risks or other problems associated with or arising from our reliance on the representations and warranties
and related indemnities, if any, provided to us by the sellers of acquired companies; an acquisition may increase our leverage and debt
service requirements or may result in our assuming unexpected liabilities; our management may be reassigned from overseeing
existing operations by the need to integrate the acquired business; we may experience difficulties integrating operations and systems,
as well as company policies and cultures; we may be unable to retain and grow relationships with the acquired company’s key
customers; we may fail to retain and assimilate employees of the acquired business; and problems may arise in entering new markets
in which we have little or no experience. The occurrence of any of these events could have a material adverse effect on our operating
results, particularly during the period immediately following any acquisition.
22
Our substantial debt and related interest expense could limit our ability to reinvest in the business, make acquisitions and/or
return capital to shareholders.
As of December 31, 2023, the Company had $6.8 billion of debt, which represented 74.8% of the total combined
capitalization. Of the Company’s $6.8 billion of debt, $4.1 billion is floating rate debt for which the Company pays interest based on a
spread to current SOFR rates. As SOFR has increased, the Company’s interest expense has also increased, reducing the amount of
cash flow from operations the Company has available to reinvest in its operations, make acquisitions or return to shareholders. The
Company’s high level of debt could have other important consequences for its business, including: limiting the Company’s ability to
borrow additional funds or obtain additional financing in the future; using cash from operations to reduce indebtedness instead of
reinvesting in the business, making acquisitions or returning capital to shareholders; limiting the Company’s flexibility to plan for and
react to changes in its business and its industry; and impairing our ability to withstand a general downturn in our business and place us
at a disadvantage compared to our competitors that are less leveraged. See Item 7, “Management’s Discussion and Analysis of
Financial Condition and Results of Operations—Material Cash Requirements” for disclosure of the approximate aggregate amount of
principal indebtedness scheduled to mature.
The terms of the Company’s debt instruments contain various maintenance or other restrictive covenants customary for
arrangements of these types. The restrictive covenants restrict our ability to, among other things incur additional debt and issue
preferred stock; pay dividends and make other distributions; make investments and other restricted payments; make acquisitions;
merge, consolidate or transfer all or substantially all of our assets; enter into sale and leaseback transactions; create liens; sell assets or
stock of our subsidiaries; and enter into transactions with affiliates. Nexstar’s senior secured credit facility requires us to maintain or
meet certain financial ratios, including a maximum consolidated first lien net leverage ratio of 4.25 to 1.00. Future financing
agreements may contain similar, or even more restrictive, provisions and covenants. Because of these restrictions and covenants,
management’s ability to operate our business at its discretion is limited, and we may be unable to compete effectively, pursue
acquisitions or take advantage of new business opportunities, any of which could harm our business.
If we fail to comply with the restrictions in present or future financing agreements, a default may occur. A default could allow
creditors to accelerate the related debt as well as any other debt to which a cross-acceleration or cross-default provision applies. A
default could also allow creditors to foreclose on any collateral securing such debt.
The Company could also incur additional debt in the future. The terms of the Company’s senior secured credit facilities, as well
as the indentures governing Nexstar’s senior unsecured notes, limit, but do not prohibit the Company from incurring substantial
amounts of additional debt. To the extent the Company incurs additional debt, it would become even more susceptible to the leverage-
related risks described above.
We may not be able to generate sufficient cash flow to meet our debt service requirements.
The Company’s ability to service its debt depends on its ability to generate the necessary cash flow. Generation of the necessary
cash flow is partially subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond the
Company’s control. The Company cannot assure you that its business will generate cash flow from operations, that future borrowings
will be available to the Company under its current or any replacement credit facilities, or that it will be able to complete any necessary
financings, in amounts sufficient to enable the Company to fund its operations or pay its debts and other obligations, or to fund its
liquidity needs. If the Company is not able to generate sufficient cash flow to service its debt obligations, it may need to refinance or
restructure its debt, sell assets, reduce or delay capital investments, or seek to raise additional capital. Additional financing may not be
available in sufficient amounts, at times or on terms acceptable to the Company, or at all. If the Company is unable to meet its debt
service obligations, its lenders may determine to stop making loans to the Company, and/or the Company’s lenders or other holders of
its debt could accelerate and declare due all outstanding obligations under the respective agreements, all of which could have a
material adverse effect on the Company.
We may be required to cease certain station operations if the FCC denies renewal of any of our station licenses.
The FCC generally grants an application for license renewal if, during the preceding term, the station served the public interest,
the licensee did not commit any serious violations of the Communications Act or the FCC’s rules, and the licensee committed no other
violations of the Communications Act or the FCC’s rules which, taken together, would constitute a pattern of abuse. While a majority
of renewal applications are routinely granted under this standard, if we fail to meet this standard the FCC may condition or shorten
renewal or, in a worst case, deny a station’s license renewal application, resulting in termination of the station’s authority to broadcast.
The Company expects the FCC to grant pending and future renewal applications for its stations in due course but cannot provide any
assurances that the FCC will do so. See “Federal Regulation—FCC Licenses, Renewals and Transfers.”
23
The financial performance of our equity method investments and the performance of third-party services providers, upon
which we rely but do not control, could adversely impact our results of operations.
We have significant investments in businesses (primarily our 31.3% interest in TV Food Network) that we account for under the
equity method of accounting. For the year ended December 31, 2023, our income from equity investments from TV Food Network
was $177 million and we received cash distributions of $270 million. If the change in earnings and distributions from our equity
investments are material in any year, those changes may have a material effect on our net income, cash flows, financial condition and
liquidity. We do not control the day-to-day operations of our equity method investments or have the ability to cause them to pay
dividends or make other payments or advances to their stockholders, including us, and thus the management of these businesses could
impact our results of operations and cash flows. Additionally, these businesses are subject to laws, regulations, market conditions and
other risks inherent in their operations. Any of these factors could adversely impact our results of operations, our cash flows and the
value of our investment.
In addition, we rely on a number of third parties service providers, including software providers and large technology
companies, to enable or perform many core business operations, some of which are specialized services provided by small
companies. If these providers are unable to meet our needs or change the way they perform their services, we could be adversely
affected.
The loss of the services of our chief executive officer could disrupt management of our business and impair the execution of
our business strategies.
We believe that our success depends upon our ability to retain the services of Perry A. Sook, our founder and Chief Executive
Officer. Mr. Sook has been instrumental in determining our strategic direction and focus. The loss of Mr. Sook’s services could
adversely affect our ability to manage effectively our overall operations and successfully execute current or future business strategies.
On August 1, 2022, we extended Mr. Sook’s appointment as our Chief Executive Officer through March 31, 2026, with automatic
renewal for successive one-year periods.
Our operating results could be adversely affected if the owners of the VIEs make decisions regarding the operation of their
respective stations that adversely impact their operating results and reduce payments due to us under our local service
agreements.
The VIEs are each 100% owned by independent third parties. We have entered into local service agreements with the VIEs,
pursuant to which we provide services to their stations. In return for the services we provide, we receive substantially all of the
consolidated VIEs’ available cash, after satisfaction of their operating costs and any debt obligations. In addition, Nexstar (excluding
The CW) guarantees the full payment of all of the obligations incurred under one of our VIEs’ (Mission) senior secured credit facility
in the event of default. See “Stations.”
In compliance with FCC regulations, the VIEs maintain complete responsibility for and control over programming, finances and
personnel for their respective stations. As a result, the VIEs’ boards of directors and officers can make decisions with which we
disagree and which could reduce the cash flow generated by these stations and, as a consequence, the amounts we receive under our
local service agreements with the VIEs.
Future impairment charges could adversely affect our operating results.
As of December 31, 2023, $8.0 billion, or 66.2%, of the Company’s combined total assets consisted of goodwill and intangible
assets, including FCC licenses and network affiliation agreements. During the fourth quarter of 2023, Nexstar recorded a $35 million
impairment of goodwill and finite-lived intangible assets attributable to a digital business. The Company regularly tests its goodwill
and other intangible assets for impairment. If the carrying amount of goodwill and intangible assets is revised downward due to
impairment, such non-cash charge could materially affect the Company’s financial position and results of operations. See “Critical
Accounting Estimates—Valuation of Goodwill and Intangible Assets.”
24
Changes in deferred tax assets or valuation allowances as a result of tax law changes could affect our operating results.
The Company currently has significant net deferred tax assets resulting from tax credit carryforwards, net operating losses and
other deductible temporary differences that are available to reduce taxable income in future periods. Based on our assessment of the
Company’s deferred tax assets, we determined that as of December 31, 2023, based on projected future income, approximately $185
million of the Company’s deferred tax assets, net of valuation allowance, primarily related to NOLs attributable to a consolidated VIE,
will more likely than not be realized in the future. Should we determine in the future that these assets will not be realized, the
Company will be required to record a valuation allowance in connection with these deferred tax assets and the Company’s operating
results would be adversely affected in the period such determination is made. In addition, tax law changes could negatively impact the
Company’s deferred tax assets. See “Critical Accounting Estimates—Income Taxes.”
We may face additional tax liabilities stemming from proposed and ongoing tax audits.
While we believe our tax positions and reserves are reasonable, the resolutions of certain tax issues related to a past transaction
of Tribune Media Company (“Tribune”) are unpredictable and could negatively impact our effective tax rate, net income or cash flows
for the period or periods in question. Specifically, we may be faced with additional tax liabilities as a result of our acquisition of
Tribune for the transactions contemplated by an agreement, dated August 21, 2009, between Tribune and Chicago Entertainment
Ventures, LLC (formerly Chicago Baseball Holdings, LLC) (“CEV LLC”), and its subsidiaries (collectively, “New Cubs LLC”),
governing the contribution of certain assets and liabilities related to the business of the Chicago Cubs Major League Baseball
franchise then owned by Tribune and its subsidiaries to New Cubs LLC, and related agreements thereto (the “Chicago Cubs
Transactions”). We may also be faced with tax liabilities as a result of the federal income tax audits of Tribune for taxable years 2014
and 2015.
On June 28, 2016, the IRS issued Tribune a Notice of Deficiency which presented the IRS’s position that the gain with respect
to the Chicago Cubs Transactions should have been included in Tribune’s 2009 taxable income. Accordingly, the IRS proposed a
$182 million tax and a $73 million gross valuation misstatement penalty. During the third quarter of 2016, Tribune filed a petition in
U.S. Tax Court to contest the IRS’s determination. After-tax interest on the aforementioned proposed tax and penalty through
December 31, 2023 would be approximately $191 million. In addition, if the IRS prevails in its position, under the tax rules for
determining tax basis upon emergence from bankruptcy, the Company would be required to reduce its tax basis in certain assets. The
reduction in tax basis would be required to reflect the reduction in the amount of the Company’s guarantee of the New Cubs
partnership debt which was included in the reported tax basis previously determined upon emergence from bankruptcy and subject to
Tribune’s 2014 and 2015 federal income tax audits (described below).
On September 19, 2019, Tribune became a wholly owned subsidiary of Nexstar following Nexstar’s merger with Tribune.
Nexstar disagrees with the IRS’s position that the Chicago Cubs Transactions generated taxable gain in 2009, the proposed penalty
and the IRS’s calculation of the gain. If the IRS prevails in its position, the gain on the Chicago Cubs Transactions would be deemed
to be taxable in 2009. We estimate that the federal and state income taxes would be approximately $225 million before interest and
penalties. Any tax, interest and penalty due will be offset by tax payments made relating to this transaction subsequent to 2009.
Tribune made approximately $154 million of tax payments prior to its merger with Nexstar.
A bench trial in the U.S. Tax Court took place between October 28, 2019 and November 8, 2019, and closing arguments took
place on December 11, 2019. The Tax Court issued a separate opinion on January 6, 2020 holding that the IRS satisfied the procedural
requirements for the imposition of the gross valuation misstatement penalty. The judge deferred any litigation of the penalty until a
final determination was reached by the Tax Court or Court of Appeals.
On October 26, 2021, the Tax Court issued an opinion related to the Chicago Cubs Transactions, which held that Tribune’s
structure was, in substantial part, in compliance with partnership provisions of the Code and, as a result, did not trigger the entire 2009
taxable gain proposed by the IRS. On October 19, 2022, the Tax Court entered the decision that there is no tax deficiency or penalty
due in the 2009 tax year. On January 13, 2023, the IRS filed a notice of appeal to the U.S. Court of Appeals for the Seventh Circuit.
On February 3, 2023, the Company filed a notice of cross-appeal. On February 15, 2024, the case was argued before the U.S. Court of
Appeals for the Seventh Circuit. The Company expects a ruling from the Court of Appeals in the second half of 2024.
As of December 31, 2023, we believe the tax impact of applying the Tax Court opinion to 2009 and its impact on subsequent
years is not material to the Company’s accounting for uncertain tax positions or to its Consolidated Financial Statements. Although
management believes its estimates and judgments are reasonable, the timing and ultimate resolution are unpredictable and could
materially change.
25
Prior to Nexstar’s merger with Tribune in September 2019, Tribune was undergoing a federal income tax audit for taxable years
2014 and 2015. In the third quarter of 2020, the IRS completed its audit of Tribune and issued a Revenue Agent’s Report which
disallowed the reporting of certain assets and liabilities related to Tribune’s emergence from Chapter 11 bankruptcy on December 31,
2012. We disagree with the IRS’s proposed adjustments to the tax basis of certain assets and the related taxable income impact, and
we are contesting the adjustments through the IRS administrative appeal procedures. If the IRS prevails in its position and after taking
into account the impact of the Tax Court opinion, Nexstar would be required to reduce its tax basis in certain assets resulting in a $16
million increase in its federal and state taxes payable and a $70 million increase in deferred income tax liability as of December 31,
2023. In accordance with Accounting Standards Codification (“ASC”) Topic 740, the Company has reflected $11 million for certain
contested issues in its liability for uncertain tax positions at December 31, 2023 and December 31, 2022.
Our pension and postretirement benefit plan obligations may be increased by a declining stock market and lower interest
rates.
Nexstar has various funded, qualified non-contributory defined benefit retirement plans which cover certain employees and
former employees. As of December 31, 2023, the pension benefit obligations for these qualified retirement plans were $1.7 billion.
The qualified retirement plans also had $1.5 billion in total net assets available, or underfunded by approximately $171 million, to pay
benefits to participants enrolled in the plans as of December 31, 2023. Nexstar was not required and did not make contributions to its
qualified pension benefit plans in 2023.
Nexstar also has non-contributory unfunded supplemental executive retirement and ERISA excess plans which supplement the
coverage of the defined benefit retirement plans to certain employees and former employees. During 2023, Nexstar contributed $4
million to these plans. As of December 31, 2023, the total liability was $40 million. Nexstar also has various retiree medical savings
account plans which reimburse eligible retired employees for certain medical expenses and unfunded plans that provide certain health
and life insurance benefits to certain retired employees. Although Nexstar has frozen participation and benefits under all plans, two
significant elements in determining the pension expense or credit are the expected return on plan assets and the discount rate used in
projecting obligations. Large declines in the stock market and lower discount rates increase the expense and may necessitate higher
cash contributions to the qualified retirement plans.
Adverse results from litigation or governmental investigations involving us can impact our business practices and operating
results.
We are party to various litigation and regulatory, environmental and other proceedings with governmental authorities and
administrative agencies. Adverse outcomes in lawsuits or investigations may result in significant monetary damages or injunctive
relief that may adversely affect our operating results or financial condition as well as our ability to conduct our businesses as they are
presently being conducted.
Any decrease in our dividend payments or suspension of our dividend payments or stock repurchases could cause our stock
price to decline.
Our common stockholders are only entitled to receive the dividends declared by our board of directors. Our board of directors
declared in 2023 a total cash dividend of $5.40 per share (in equal quarterly installments of $1.35 per share) to the outstanding shares
of our common stock. In January 2024, our board of directors approved a 25% increase in the quarterly cash dividend to $1.69 per
share beginning with the dividend declared in the first quarter of 2024. We expect to continue to pay quarterly cash dividends at the
rate set forth in our current dividend policy. However, future cash dividends, if any, will be at the discretion of our board of directors
and can be changed or discontinued at any time. Dividend determinations (including the amount of the cash dividend, the record date
and date of payment) will depend upon, among other things, our future operations and earnings, targeted future acquisitions, capital
requirements and surplus, general financial condition, contractual restrictions and other factors as our board of directors may deem
relevant. In addition, the Company’s senior secured credit facilities and the indentures governing our existing notes limit our ability to
pay dividends. Given these considerations, our board of directors may increase or decrease the amount of the dividend at any time and
may also decide to suspend or discontinue the payment of cash dividends in the future.
We engage in share repurchases of our common stock from time to time in accordance with authorizations from our board of
directors. Our repurchase program does not have an expiration date and does not obligate us to repurchase any specific dollar amount
or to acquire any specific number of shares. Further, our share repurchases could affect our share trading prices or increase their
volatility and may be suspended or terminated at any time, which may result in a decrease in the trading prices of our common stock.
26
We may not be able to adequately protect the intellectual property and other proprietary rights that are material to our
business, or to defend successfully against intellectual property infringement claims by third parties.
Our business relies on a combination of patented and patent-pending technology, trademarks, trade names, copyrights, and other
proprietary rights, as well as contractual arrangements, including licenses, to establish and protect its technology, intellectual property
and brand names. We believe our proprietary technology, trademarks and other intellectual property rights are important to our
continued success and our competitive position. Any impairment of any such intellectual property or brands could adversely impact
the results of our operations or financial condition.
We seek to limit the threat of content piracy; however, policing unauthorized use of our broadcasts, products and services and
related intellectual property is often difficult and the steps taken by us may not in every case prevent infringement by unauthorized
third parties. Developments in technology increase the threat of content piracy by making it easier to duplicate and widely distribute
pirated material. Our use of contractual provisions, confidentiality procedures and agreements, and trademark, copyright, unfair
competition, trade secret and other laws to protect our intellectual property rights and proprietary technology may not be adequate.
Litigation may be necessary to enforce our intellectual property rights and protect our proprietary technology, or to defend against
claims by third parties that the conduct of our businesses or our use of intellectual property infringes upon such third party’s
intellectual property rights. Protection of our intellectual property rights is dependent on the scope and duration of our rights as
defined by applicable laws in the U.S. and abroad and the manner in which those laws are construed. If those laws are drafted or
interpreted in ways that limit the extent or duration of our rights, or if existing laws are changed, our ability to generate revenue from
intellectual property may decrease, or the cost of obtaining and maintaining rights may increase. There can be no assurance that our
efforts to enforce our rights and protect our products, services and intellectual property will be successful in preventing content piracy.
Furthermore, any intellectual property litigation or claims brought against us, whether or not meritorious, could result in
substantial costs and diversion of our resources, and there can be no assurances that favorable final outcomes will be obtained in all
cases. The terms of any settlement or judgment may require us to pay substantial amounts to the other party or cease exercising our
rights in such intellectual property. In addition, we may have to seek a license to continue practices found to be in violation of a third
party’s rights, which may not be available on reasonable terms, or at all. Our business, financial condition or results of operations may
be adversely affected as a result.
Cybersecurity risks could adversely affect the Company’s operating effectiveness and operating results.
The Company uses computers in substantially all aspects of its business operations. Its revenues are increasingly dependent on
digital products. Such use exposes the Company to potential cyber incidents resulting from deliberate attacks or unintentional events.
While we have not experienced cybersecurity incidents that materially impacted our operating results and financial condition, it is not
uncommon for a company such as ours to be subjected to continuous attempted cyber-attacks or other malicious efforts to cause a
cyber incident. These incidents can include, but are not limited to, gaining unauthorized access to digital systems for purposes of
misappropriating assets or sensitive information, corrupting data or causing operational disruption. The changes in our work
environment as a result of health-related events and the subsequent transition to increased remote work could also impact the security
of our systems, as well as our ability to protect against attacks and detect and respond to them quickly. The adoption of some third-
party services designed to enable remote work also may introduce additional security risks. We may face additional cyber-attacks as
threat actors use supply chain or third-party attacks as a method for penetrating our computer systems. The possible consequences of
such an attack include but are not limited to loss of data, damage to the Company’s reputation, interruptions to our operations, and/or
the need to pay ransom. The results of these incidents could include, but are not limited to, business interruption, disclosure of
nonpublic information, decreased advertising revenues, misstated financial data, liability for stolen assets or information, increased
cybersecurity protection costs, litigation and reputational damage adversely affecting customer or investor confidence.
27
Risks Related to Our Industry
Intense competition in the television industry and alternative forms of media could limit our growth and profitability.
As a television broadcasting company, we face a significant level of competition, both directly and indirectly. We compete for
our audience against other video services in addition to all the other leisure activities in which one could choose to engage rather than
watch television.
Many of our current and potential competitors have greater financial, marketing, programming and broadcasting resources than
we do. The markets in which we operate are also in a constant state of change arising from, among other things, technological
improvements and economic and regulatory developments. Technological innovation and the resulting proliferation of television
entertainment, such as streaming video, cable television, wireless cable, satellite-to-home distribution services, home video and
entertainment systems and the internet have fractionalized television viewing audiences and have subjected television broadcast
networks, cable networks and television stations to increased competition and declining viewership. In recent years, demand for
television advertising has been declining and demand for advertising in alternative media has been increasing, and we expect this trend
to continue. We may not be able to compete effectively or adjust our business plans to meet changing market conditions. Also, refer to
“Risks Related to Our Industry––Intense competition in the television industry and alternative forms of media could limit our growth
and profitability.”
New or changed federal statutes, legislation and regulations or changes in the application of existing regulations could
significantly impact our operations or the television broadcasting industry as a whole.
The FCC has open proceedings to determine whether to standardize TV stations’ reporting of programming responsive to local
needs and interests; whether to modify its network non-duplication and syndicated exclusivity rules; whether to modify its standards
for “good faith” retransmission consent negotiations; whether to broaden the definition of “MVPD” to include online video
programming distributors; and the appropriate substance and scope of its indecency enforcement policy; and the FCC has initiated a
review of the broadcast ownership rules. In addition, changes in FCC and DOJ/FTC rules around owning or providing services to
multiple stations in a local market, or other rules, could adversely impact us. The FCC also may decide to initiate other new rule-
making proceedings on its own or in response to requests from outside parties, any of which might impact our business or operations.
The U.S. Congress may also act to amend the Communications Act in a manner that could impact our stations and the stations we
provide services to or the television broadcast industry in general. For more information about the regulations that we are subject to
see—“Federal Regulation.”
We are subject to foreign ownership limitations which limit foreign investments in us.
The Communications Act limits the extent of non-U.S. ownership of companies that own U.S. broadcast stations. Under these
restrictions, the holder of a U.S. broadcast license may have no more than 20% non-U.S. ownership (by vote and by equity). The
Communications Act prohibits more than 25% indirect foreign ownership or control of a licensee through a parent company if the
FCC determines the public interest will be served by enforcement of such restriction. The FCC has interpreted this provision to require
an affirmative public interest showing before indirect foreign ownership of a broadcast licensee may exceed 25%. Therefore, certain
investors may be prevented from investing in us if our foreign ownership is at or near the FCC limits.
28
Risks Related to Tribune Publishing’s Spin-Off
If the Tribune Publishing Company (“Tribune Publishing”) spin-off does not qualify as a tax-free distribution under Section
355 of the Code, including as a result of subsequent acquisitions of stock of Tribune or Tribune Publishing, then Tribune may
be required to pay substantial U.S. federal income taxes.
On August 4, 2014, Tribune completed a separation transaction, resulting in the spin-off of the assets (other than owned real
estate and certain other assets) and certain liabilities of the businesses primarily related to Tribune’s then principal publishing
operations through a tax-free, pro rata dividend to its stockholders and warrant holders of 98.5% of the shares of common stock of
Tribune Publishing. At that time, Tribune retained 1.5% of the outstanding common stock of Tribune Publishing. The publishing
operations consisted of newspaper publishing and local news and information gathering functions that operated daily newspapers and
related websites, as well as a number of ancillary businesses that leveraged certain of the assets of those businesses. As a result of the
completion of the spin-off, Tribune Publishing operates the publishing business as an independent, publicly-traded company. On
January 31, 2017, Tribune sold its remaining Tribune Publishing shares.
In connection with the Tribune Publishing spin-off, Tribune received a private letter ruling (the “IRS Ruling”) from the IRS to
the effect that the distribution and certain related transactions qualified as tax-free to Tribune, its then stockholders and warrant
holders and Tribune Publishing for U.S. federal income tax purposes. Although a private letter ruling from the IRS generally is
binding on the IRS, the IRS Ruling did not rule that the distribution satisfies every requirement for a tax-free distribution, and the
parties have relied on the opinion of special tax counsel, Debevoise & Plimpton LLP, to the effect that the distribution and certain
related transactions qualified as tax-free to Tribune and its then stockholders and warrant holders. The opinion of the special tax
counsel relied on the IRS Ruling as to matters covered by it.
The IRS Ruling and the opinion of the special tax counsel were based on, among other things, certain representations and
assumptions as to factual matters made by Tribune and certain of its then stockholders. The failure of any factual representation or
assumption to be true, correct and complete in all material respects could adversely affect the validity of the IRS Ruling or the opinion
of the special tax counsel. An opinion of counsel represents counsel’s best legal judgment and is not binding on the IRS or the courts,
and the IRS or the courts may not agree with the opinion. In addition, the IRS Ruling and the opinion of the special tax counsel were
based on the current law then in effect, and cannot be relied upon if current law changes with retroactive effect. If the Tribune
Publishing spin-off is ultimately determined not to be tax-free, we could be liable for the U.S. federal and state income taxes imposed
as a result of the transaction. Furthermore, events subsequent to the distribution could cause us to recognize a taxable gain in
connection therewith. Although Tribune Publishing is required to indemnify us against taxes on the distribution that arise after the
distribution as a result of actions or failures to act by Tribune Publishing or any member thereof, Tribune Publishing’s failure to meet
such obligations and our administrative and legal costs in enforcing such obligations may have a material adverse effect on our
financial condition.
29
Item 1B. Unresolved Staff Comments
None.
Item 1C. Cybersecurity
Cybersecurity Governance, Risk Management and Strategy
In the current digital environment, companies like ours may be the target of cyber-attacks or other malicious efforts to cause a
cyber incident. These cyber incidents can include, but are not limited to, gaining unauthorized access to digital systems for purposes of
misappropriating assets or sensitive information, corrupting data or causing operational disruption. The possible consequences of such
an attack include but are not limited to loss of data, damage to the Company’s reputation, interruptions to our operations, and/or the
need to pay ransom. Historically, we have not experienced cybersecurity incidents that materially impacted our business strategy,
operating results and financial condition but we cannot guarantee a future cybersecurity incident would not materially impact us.
We recognize the importance of maintaining the confidence and trust of our customers, suppliers, employees, audience, and
communities by maintaining our data and information security. In managing our cyber risk, we utilize the National Institute of
Standards and Technology Framework for Improving Critical Infrastructure Cybersecurity (the “NIST Framework”) issued by the
U.S. government as a guideline to manage our cybersecurity-related risk. In addition, we have established security control
requirements for our third party vendors based on global standards.
Our day-to-day cybersecurity efforts are led operationally by our Chief Technology and Digital Officer and Senior Vice
President, Technology who have over 10 and 25 years, respectively, of networking and information technology management or
executive experience, and oversee a team of in-house cybersecurity specialists. Our Cybersecurity Committee, comprised of
representatives from key management groups including accounting, finance, legal, internal audit, and information technology, also
supports our cybersecurity efforts. The Cybersecurity Committee consults with representatives from senior management and retains
third-party contractors as needed. The role of the Cybersecurity Committee is to oversee cyber risk assessments, monitor applicable
key risk indicators, review cybersecurity training procedures, establish cybersecurity policies and procedures, and implement
enhancements to our cybersecurity infrastructure. The Cybersecurity Committee meets monthly, or more regularly as necessary, and
ensures that senior management, and ultimately, the Board, is given the information required to manage and exercise proper oversight
over cybersecurity risks and ensure that escalation procedures are followed in the event of a cybersecurity incident.
As part of its role as independent oversight of the key risks facing Nexstar, the Board itself and through its Audit Committee
devotes regular and thorough attention to our cybersecurity risk. The Audit Committee receives quarterly (or more frequent as
necessary) reports from senior financial executives and Nexstar’s Chief Technology and Digital Officer to evaluate cybersecurity and
data risks. Such reporting includes updates on the Company’s cybersecurity program, the external threat environment, and the
Company’s programs to address and mitigate the risks associated with the evolving cybersecurity threat landscape. In accordance with
our Cyber Incident Response Plan, the Audit Committee is promptly informed of any cybersecurity incidents that could potentially
materially adversely affect the Company or its information systems and is regularly updated about incidents with lesser impact
potential. The Audit Committee and management regularly brief the full Board on these matters as well.
For additional discussion of certain risks associated with cybersecurity, see “Risk Factors” under the heading “Cybersecurity
risks could affect the Company’s operating effectiveness.”
30
Item 2. Properties
We have office space for our corporate headquarters in Irving, TX, which is leased through 2033. Each of our markets has
facilities consisting of offices, studios, sales offices and tower and transmitter sites. We own approximately 53% of our office and
studio locations and approximately 55% of our tower and transmitter locations. The remaining properties that we utilize in our
operations are leased. We consider all of our properties, together with equipment contained therein, to be adequate for our present
needs. We continually evaluate our future needs and from time to time will undertake significant projects to replace or upgrade
facilities.
While none of our owned or leased properties is individually material to our operations, if we were required to relocate any
towers, the cost could be significant. This is because the number of sites in any geographic area that permit a tower of reasonable
height to provide good coverage of the market is limited, and zoning and other land use restrictions, as well as Federal Aviation
Administration and FCC regulations, limit the number of alternative locations or increase the cost of acquiring them for tower sites.
See Item 1, “Business—The Stations” for a complete list of stations by market.
Item 3. Legal Proceedings
The information set forth under Note 16 to our Consolidated Financial Statements included in Part IV, Item 15(a) of this Annual
Report on Form 10-K is incorporated herein by reference. For additional discussion of certain risks associated with legal proceedings,
see “Risk Factors” above.
Item 4. Mine Safety Disclosures
None.
31
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Prices; Record Holders and Dividends
Our common stock trades on The NASDAQ Global Select Market (“NASDAQ”) under the symbol “NXST.”
As of February 27, 2024, there were approximately 180,000 shareholders of record of our common stock, including shares held
in nominee names by brokers and other institutions.
Pursuant to our current dividend policy, our board of directors declared in 2023, 2022 and 2021 total annual cash dividends of
$5.40 per share, $3.60 per share and $2.80 per share, respectively, with respect to outstanding shares of our common stock. The
dividends were paid in equal quarterly installments.
On January 26, 2024, our board of directors approved a 25% increase in the quarterly cash dividend to $1.69 per share of
outstanding common stock beginning with the first quarter of 2024. Dividend determinations will depend upon, among other things,
our future operations and earnings, targeted future acquisitions, capital requirements and surplus, general financial condition,
contractual restrictions and other factors as our board of directors may deem relevant. Additionally, the Company’s senior secured
credit facilities and the indentures governing Nexstar’s existing notes limit our ability to pay dividends. Given these considerations,
our board of directors may increase or decrease the amount of dividends at any time and may also decide to suspend or discontinue the
payment of cash dividends in the future.
Recent Sales of Unregistered Securities
None.
Issuer Purchases of Equity Securities
The following is a summary of Nexstar’s repurchases of its common stock by month during the fourth quarter of 2023 (in
millions, except for share and per share information):
Total Number of Shares Approximate Dollar Value
Purchased as Part of of Shares That May Yet Be
Total Number Average Price Publicly Announced Purchased Under the
of Shares Purchased Paid per Share Plans or Programs Plans or Programs
October 4 ̶ 25, 2023 267,321 $ 140.27 267,321 $ 706
N
ovember 15 ̶ 30, 2023 132,390 $ 148.18 132,390 687
December 1 ̶ 29, 2023 229,758 $ 149.01 229,758 652
629,469 $ 145.13 629,469
On July 27, 2022, our board of directors approved a new share repurchase program authorizing the Company to repurchase up to
an additional $1.5 billion of its common stock, of which $1.258 billion remained available as of December 31, 2022. During the year
ended December 31, 2023, Nexstar repurchased a total of 3,782,104 shares of its common stock for $605 million, funded by cash on
hand, which were accounted for as treasury stock. As of December 31, 2023, the remaining available amount under the share
repurchase authorization was $652 million.
Share repurchases are executed from time to time in open market transactions, block trades or in private transactions, including
through Rule 10b5-1 plans. There is no minimum number of shares that Nexstar is required to repurchase. The repurchase program
does not have an expiration date and may be suspended or discontinued at any time without prior notice.
32
Securities Authorized for Issuance Under Equity Compensation Plans as of December 31, 2023
Number of securities Number of securities
to be issued upon Weighted average remaining available
exercise of outstanding exercise price of for future issuance
options and vesting of outstanding excluding securities
Plan Category restricted stock units options reflected in column (a)
(a) (b) (c)
Equity compensation plans approved by security holders
(1)
1,232,959 $ 47.17 1,562,447
Equity compensation plans not approved by security holders - - -
1,232,959 $ 47.17 1,562,447
(1)
The 1,232,959 securities to be issued consist of 244,068 outstanding stock options, with a weighted average exercise price of $47.17 and
988,891 time-based and performance-based restricted stock units.
For a more detailed description of our equity plans and grants, we refer you to Note 13 to the Consolidated Financial Statements
included in Part IV, Item 15(a) of this Annual Report on Form 10-K.
Comparative Stock Performance Graph
The following graph compares the total return of our common stock based on closing prices for the period from December 31,
2018 through December 31, 2023 with the total return of the NASDAQ Composite Index and our peer index of comparable television
companies. Our peer group index consists of the following publicly traded companies: Gray Television, Inc., Tegna, Inc., Sinclair, Inc.
(“Sinclair”), The E.W. Scripps Company, Fox Corporation and Paramount Global. The graph assumes the investment of $100 in our
common stock and in both of the indices on December 31, 2018, with the reinvestment of dividends into shares of our common stock
or the indices, as applicable. The performance shown is not necessarily indicative of future performance.
12/31/2018 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023
Nexstar Media Group, Inc. (NXST) $ 100.00 $ 151.87 $ 145.00 $ 204.37 $ 241.77 $ 223.71
NASDAQ Composite Index $ 100.00 $ 136.69 $ 198.10 $ 242.03 $ 163.28 $ 236.17
Peer Group $ 100.00 $ 109.58 $ 96.01 $ 97.64 $ 72.12 $ 65.21
Item 6. Reserved
33
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis should be read in conjunction with our Consolidated Financial Statements and related
Notes included in Part IV, Item 15(a) of this Annual Report on Form 10-K.
As a result of our deemed controlling financial interests in the consolidated VIEs in accordance with U.S. GAAP, we
consolidate the financial position, results of operations and cash flows of these VIEs as if they were wholly-owned entities. We believe
this presentation is meaningful for understanding our financial performance. Refer to Note 2 to our Consolidated Financial
Statements for a discussion of our determinations of VIE consolidation under the related authoritative guidance. The following
discussion of our financial position and results of operations includes the consolidated VIEs’ financial position and results of
operations.
Executive Summary
2023 Highlights
• Net revenue was $4.9 billion for the year ended December 31, 2023.
• Returned approximately $796 million of capital to shareholders through repurchases of common stock of $605 million and
dividends of $191 million, funded by cash on hand.
• Reduced our debt by $125 million, funded by cash on hand.
• Reached multi-year distribution agreements for all agreements up for renewal in 2023.
• Renewed and extended multi-year affiliation agreements with Fox Network and MyNetwork.
• Launched The CW affiliations for three of its stations in the top 15 television markets, including WPHL-TV in
Philadelphia (DMA #4), KRON-TV in San Francisco (DMA #10), and WTTA-TV in Tampa (DMA #12).
• Acquired several exclusive sports programming licenses at the CW including exhibition rights to the WWE NXT
beginning in October 2024 through September 2029, broadcast rights to the NASCAR Xfinity Series beginning in 2025
through the 2031 racing season and broadcast rights to 50 Atlantic Coast Conference (ACC) college football and
basketball games beginning in 2023 through the 2027 season.
• Expanded and extended CW network affiliation agreements with Hearst Television, Sinclair, Inc., and Gray Television,
Inc.
• Expanded news programming at NewsNation, America’s fastest growing cable news network in primetime, to 24 hours
per weekday of national news, analysis, and talk.
• Created a new advertising sales structure and to implement Nexstar’s new data and technology-driven, multi-platform
strategy and accelerate the monetization of the Company’s platforms.
• Acquired certain assets of WSNN-LD, an MNTV-affiliated low power television station serving the Tampa, Florida
market and KUSI-TV, an independent full power television station serving the San Diego, CA market, for a combined
total purchase price of $38 million in cash.
• Filed the certificate of its amended and restated certificate of incorporation to reflect the amendments to its certificate of
incorporation approved by its shareholders at the 2023 annual meeting, to, among other things, declassify its Board of
Directors beginning at the 2024 annual meeting.
34
Overview of Operations
As of January 2024, we owned, operated, programmed or provided sales and other services to 201 full power television stations
and one AM radio station, including those owned by VIEs, in 117 markets in 40 states and the District of Columbia. The stations are
affiliates of ABC, NBC, FOX, CBS, The CW, MNTV and other broadcast television networks.
Through various local service agreements, we provided sales, programming and other services to 37 full power television
stations owned by independent third parties, of which 35 full power television stations are VIEs that are consolidated into our financial
statements. See Note 2 to our Consolidated Financial Statements included in Part IV, Item 15(a) of this Annual Report on Form 10-K
for a discussion of the local service agreements we have with these independent third parties. We do not own the consolidated VIEs or
their television stations. However, we are deemed under U.S. GAAP to have controlling financial interests for financial reporting
purposes in these entities because of (i) the local service agreements we have with their stations, (ii) our (excluding The CW)
guarantee of the obligations incurred under Mission’s senior secured credit facility, (iii) our power over significant activities affecting
the VIEs’ economic performance, including budgeting for advertising revenue, advertising sales and, in some cases, hiring and firing
of sales force personnel and (iv) purchase options granted by each consolidated VIE which permit us to acquire the assets and assume
the liabilities of each of these VIEs’ stations, subject to FCC consent. In compliance with FCC regulations for all the parties, each of
the consolidated VIEs maintains complete responsibility for and control over programming, finances and personnel for its stations.
We also own a 75.0% ownership interest in The CW, the fifth major broadcast network in the U.S., NewsNation, a national
cable news network, two digital multicast networks, Antenna TV and Rewind TV, multicast network services provided to third parties,
and a 31.3% ownership stake in TV Food Network. Our digital assets include 140 local websites, 278 mobile applications, 25
connected television applications, and six FAST channels representing products of our local television stations, The CW, NewsNation,
The Hill, and BestReviews and a suite of advertising solutions.
The largest portion of operating revenue of our Company is derived from distribution revenue, which relates to retransmission
of Company stations’ signals and the carriage of our cable and broadcast networks by cable, satellite and other MVPDs and OVDs
and, in the case of The CW, its local affiliates. For the year ended December 31, 2023, the Company’s distribution revenue
represented 55.3% of total net revenue. Distributors generally pay for retransmission rights of local stations and for carriage of our
networks on a per subscriber basis. Distribution revenue is affected positively or negatively by the rate of growth or decline of
subscribers and the growth in the per subscriber fee due to contract renegotiations or annual escalators in existing contracts. Nexstar
anticipates that retransmission fees will continue to increase until there is a more balanced relationship between viewers delivered and
fees paid for delivery of such viewers. We also generate distribution revenues from the affiliation fees that CW’s third-party local
station affiliates pay to the network and from programmers who lease the use of our spectrum in selected local markets to air their
content on our multicast streams.
We also generate revenue from core television advertising and digital advertising. For the year ended December 31, 2023, the
Company generated 33.7% of its net revenue from core advertising and 8.0% from digital advertising. Advertisers typically pay for
advertising on our television and digital assets based on the number of impressions our programming or digital content delivers. As a
result, our core television and digital advertising is affected by a number of factors, including the size and demographics of the
audience viewing our programming and digital content, economic conditions, demand for advertising and our sales effort. Digital
advertising that is not directly sold to advertisers through our in-house and third party sales teams, is sold via programmatic
exchanges. In addition, we generate digital advertising revenue from the sale of advertising on third party sites and other local and
national services.
In even years, we generate a substantial amount of revenue from political advertising. For the years ended December 31, 2023
and 2022, the Company generated 1.3% and 9.7%, respectively, of our net revenue from political advertising. Political advertising is
affected by the number of competitive races there are and the extent to which the Company’s stations are located in the relevant
competitive markets, the amount of funds raised by candidates, PACs and others, the availability and pricing of television advertising
inventory and the availability of alternative media. Because of the scale of Nexstar, we typically have a presence in the substantial
majority of markets with competitive political races. All national revenue is derived from advertisements placed through advertising
agencies.
Our primary operating expenses include programming, newsgathering, production and promotion, employee salaries and
benefits, sales commissions, digital cost of goods sold and content creation costs, and other administrative and corporate expenses.
Programming costs are primarily related to fees paid to networks with which ours and our partners’ stations are affiliated and license
fees for original and sports programming, in the case of The CW, and syndicated programming in the case of the stations and our
networks. A large percentage of the costs involved in our operations is relatively fixed.
35
Regulatory Developments
As a television broadcaster, the Company is highly regulated, and its operations require that it retain or renew a variety of
government approvals and comply with changing federal regulations. On April 1, 2021, the U.S. Supreme Court issued a decision that
reversed a lower court of appeals ruling and upheld the FCC’s elimination or modification of certain of its media ownership rules in
the agency’s 2010/2014 quadrennial review of those rules. Among the regulations eliminated in 2021 as a result of the Supreme Court
ruling was a rule providing that a television station licensee which sells more than 15 percent of the weekly advertising inventory of
another television station in the same market under a JSA is deemed to have an attributable ownership interest in that station, as well
as a requirement that at least eight independently owned television stations remain in a local television market for a party to acquire a
second station in that market. While these restrictions are no longer in effect, the FCC’s 2022 quadrennial media ownership review
and an FCC proceeding to review the current national limit on television ownership are currently pending. The FCC could reinstitute
its earlier restrictions or impose other limitations in these or any future reviews.
Seasonality
Advertising revenue is positively affected by a strong economy. Conversely, declines in advertising budgets of advertisers,
particularly in recessionary periods, adversely affect the broadcast industry and, as a result, may contribute to a decrease in our
advertising revenue. In even-numbered years we generate substantial advertising revenue from the political advertising we sell to
candidates, political action committees and political parties. Advertising revenue is also positively affected by certain events such as
the Olympic Games or the Super Bowl. Advertising revenue is generally highest in the second and fourth quarters of each year, due in
part to increases in consumer advertising in the spring and retail advertising in the period leading up to, and including, the holiday
season.
Historical Performance
Revenue
The following table sets forth the amounts of the Company’s principal types of revenue (dollars in millions) and each type of
revenue as a percentage of total net revenue for the years ended December 31:
2023 2022 2021
Amount % Amount % Amount %
Core advertising $ 1,660 33.7 $ 1,718 33.0 $ 1,762 37.9
Political advertising 66 1.3 506 9.7 45 1.0
Distribution 2,727 55.3 2,571 49.3 2,473 53.2
Digital 395 8.0 365 7.0 322 6.9
Other 85 1.7 51 1.0 46 1.0
Total net revenue $ 4,933 100.0 $ 5,211 100.0 $ 4,648 100.0
Results of Operations
The following table sets forth a summary of the Company’s operations for the years ended December 31 (dollars in millions),
and each component of operating expense as a percentage of net revenue:
2023 2022 2021
Amount % Amount % Amount %
N
et revenue $ 4,933 100.0 $ 5,211 100.0 $ 4,648 100.0
Operating expenses (income):
Direct operating 2,153 43.6 2,005 38.5 1,862 40.0
Selling, general and administrative, excluding
corporate 903 18.3 904 17.3 848 18.2
Corporate 193 3.9 198 3.8 176 3.8
Depreciation and amortization 941 19.1 662 12.7 589 12.7
Goodwill and other long-lived asset impairments 35 0.7 133 2.6 23 0.5
Reimbursement from the FCC related to station
repack - - (3) (0.1) (20) (0.4)
Other - - - - (5) (0.1)
Total operating expenses 4,225 3,899 3,473
Income from operations $ 708 $ 1,312 $ 1,175
36
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022
The period-to-period comparability of our consolidated operating results is affected by acquisitions. For each quarter we present,
our legacy business units include those business units that we owned or consolidated into our financial statements for the complete
quarter in the current and prior years. For our annual and year to date presentations, we combine the legacy business unit amounts
presented in each quarter.
Revenue
Core advertising revenue was $1.66 billion for the year ended December 31, 2023 compared to $1.72 billion for the same period
in 2022, a decrease of $58 million, or 3.4%. Excluding the $63 million of incremental core advertising revenue from our acquisition of
The CW (acquired on September 30, 2022), core advertising revenue decreased by 7.0% primarily due to a weaker advertising market
and the absence of first quarter advertising revenue from the Olympics on our NBC affiliate stations, partially offset by an increase in
advertising revenue during the first quarter from the Super Bowl aired on FOX, where we have more FOX-affiliated stations versus
NBC-affiliated stations in the prior year.
Political advertising revenue was $66 million for the year ended December 31, 2023 compared to $506 million for the same
period in 2022, a decrease of $440 million, as 2023 is not an election year.
Distribution revenue was $2.73 billion for the year ended December 31, 2023 compared to $2.57 billion for the same period in
2022, an increase of $156 million, or 6.1%. Excluding the $53 million of incremental distribution revenue from our acquisition of The
CW and the combined effect of the temporary disruption of a large MVPD for 76 days in the third quarter of 2023 and the impact of
the removal of partner stations from certain MVPDs related to continued negotiation (5.6% decrease in revenue), distribution revenue
increased by 9.6% primarily due to renewals of contracts in 2022 providing for higher rates per subscriber and scheduled annual
escalation of rates per subscriber, partially offset by continued MVPD subscriber attrition. We anticipate continued increase of
retransmission fees until there is a more balanced relationship between viewers delivered and fees paid for delivery of such viewers. In
January 2024, our partner stations have successfully renewed one of the distribution agreements and have been restored on the
MVPD’s service.
Digital revenue, representing advertising revenue on our stations’ web and mobile sites and other internet-based revenue, was
$395 million for the year ended December 31, 2023 compared to $365 million for the same period in 2022, an increase of $30 million,
or 8.2%, primarily due to incremental revenue from our acquisition of The CW (acquired on September 30, 2022) of $32 million.
Operating Expenses
Direct operating expenses, consisting primarily of programming, news, and technical expenses, and selling, general and
administrative expenses were $3.06 billion for the year ended December 31, 2023 compared to $2.91 billion for the same period in
2022, an increase of $147 million, or 5.1%. Excluding the incremental $74 million of operating expenses from our acquisition of The
CW, direct operating and selling, general and administrative expenses increased by 2.6% primarily due to an increase in station
programming costs from network affiliation renewals and annual increases in network affiliation costs, increased news programming
at NewsNation and our local stations as well as increased digital sales and administrative expenses, partially offset by a decrease in
commission incurred from national representation due to a decrease in political advertising revenue.
Corporate expenses, related to costs associated with the centralized management of our stations, were $193 million for the year
ended December 31, 2023 compared to $198 million for the same period in 2022, a decrease of $5 million, or 2.5% (no significant
change).
Depreciation and amortization expense was $941 million for the year ended December 31, 2023 compared to $662 million for
the same period in 2022, an increase of $279 million, or 42.1%. Depreciation and amortization expense consists of the following:
• Amortization of broadcast rights was $453 million for the year ended December 31, 2023 compared to $193 million for
the same period in 2022, an increase of $260 million, or 134.7%, primarily due to incremental programming expenses
from our acquisition of The CW (acquired on September 30, 2022) of $286 million, partially offset by a reduction in the
television stations’ broadcast rights costs of $26 million.
• Amortization of intangible assets was $311 million for the year ended December 31, 2023 compared to $309 million for
the same period in 2022, an increase of $2 million, or 0.6% (no significant change).
• Depreciation of property and equipment was $176 million for the year ended December 31, 2023 compared to $160
million for the same period in 2022, an increase of $16 million, or 10.0%. The increase was primarily due to newly
capitalized assets.
37
In 2023 and 2022, we recorded $35 million and $96 million, respectively, of goodwill and intangible assets impairment on our
product review and recommendation platform reporting unit. The Company’s assessment indicated that the reporting unit’s carrying
amount exceeded its fair value, and therefore an impairment loss was identified and recorded in the fourth quarter of 2023 and 2022,
respectively. As of December 31, 2023, this reporting unit has no remaining goodwill balance.
In 2022 certain real estate properties located in Chicago were sold and written down to their estimated fair value, less cost to
sell, resulting in the Company’s recognition of impairment charges of $37 million in the fourth quarter of 2022.
Income from equity method investments, net
Income from equity method investments, net was $104 million for the year ended December 31, 2023, compared to $153
million for the same period in 2022, a decrease of $49 million. Our largest equity method investment is TV Food Network in which
we own a 31.3% interest. We record our equity in TV Food Network’s net income, less our share in the amortization of basis
difference related to the investment, as income from equity method investments. In 2023, TV Food Network’s net income decreased
by $159 million resulting to our share in its income to decrease by $50 million. TV Food Network’s lower net income was primarily
due to a decrease in its advertising revenue driven by a weaker advertising market. There was no significant change to our share in the
amortization of basis difference associated with our investment in TV Food Network. For additional information on our investment in
TV Food Network, including the accounting for basis difference, refer to Note 6 to our Consolidated Financial Statements.
Interest Expense, net
Interest expense, net was $447 million for the year ended December 31, 2023 compared to $337 million for the same period in
2022, an increase of $110 million, or 32.6%, primarily due to increases in interest rates in the Company’s outstanding loans under its
senior secured credit facilities, partially offset by decreases in interest expense from debt repayments and lower interest rates obtained
in connection with the refinancing of certain of our term loans in June 2022. Interest rates on outstanding loans under the Company’s
senior secured credit facilities ranged from 6.85% to 7.85% as of December 31, 2023, compared to interest rates ranging from 5.86%
to 6.89% as of December 31, 2022. These interest rates were a mixture of Secured Overnight Financing Rate (“SOFR”) plus Credit
Spread Adjustment (“CSA”) used to account for the difference between SOFR and London Interbank Offered Rate (“LIBOR”), plus
applicable margin in 2023 compared to a mixture of SOFR plus CSA plus applicable margin and U.S. LIBOR plus applicable margin
in 2022.
Pension and other postretirement plans credit, net
Pension and other postretirement plans credit, net was $36 million for the year ended December 31, 2023 compared to $43
million for the same period in 2022, a decrease of $7 million (no significant change).
Income Taxes
Income tax expense was $131 million for the year ended December 31, 2023 compared to an income tax expense of $274
million for the same period in 2022, a decrease of $143 million. The effective tax rates during the years ended December 31, 2023 and
2022 were 32.7% and 22.5%, respectively. Nexstar reported permanent differences, including an adjustment for losses related to the
minority interest in The CW, resulting in an incremental income tax expense of $44 million or 7.2% increase to the effective tax rate.
Also, changes in the valuation allowance resulted in an incremental income tax expense of $15 million, or a 2.9% increase to the
effective tax rate in 2023.
38
Year Ended December 31, 2022 Compared to Year Ended December 31, 2021
The period-to-period comparability of our consolidated operating results is affected by acquisitions. For each quarter we present,
our legacy business units include those business units that we owned or consolidated into our financial statements for the complete
quarter in the current and prior years. For our annual and year to date presentations, we combine the legacy business unit amounts
presented in each quarter.
Revenue
Core advertising revenue was $1.72 billion for the year ended December 31, 2022 compared to $1.76 billion for the same period
in 2021, a decrease of $44 million, or 2.5%, primarily due to a weaker national advertising market, the absence of third quarter
advertising revenue from the Olympics on our NBC affiliate stations and changes in the mix between our core and political advertising
revenues of $70 million, partially offset by incremental revenue from our acquisition of The CW of $27 million.
Political advertising revenue was $506 million for the year ended December 31, 2022 compared to $45 million for the same
period in 2021, an increase of $461 million, as 2022 was a mid-term election year.
Distribution revenue was $2.57 billion for the year ended December 31, 2022 compared to $2.47 billion for the same period in
2021, an increase of $98 million, or 4.0%. The increase was primarily due to scheduled annual escalation of rates per subscriber,
renewals of contracts in 2021 providing for higher rates per subscriber and incremental revenue from our acquisition of The CW of
$17 million, partially offset by continued MVPD subscriber attrition, a few periods during the negotiation of new contracts with our
MVPD partners where our partners’ stations were not available and a settlement of a dispute in connection with a new contract with
one of our distributors. We anticipate continued increase of retransmission fees until there is a more balanced relationship between
viewers delivered and fees paid for delivery of such viewers.
Digital revenue, representing advertising revenue on our stations’ web and mobile sites and other internet-based revenue, was
$365 million for the year ended December 31, 2022 compared to $322 million for the same period in 2021, an increase of $43 million,
or 13.0%, primarily due to growth in our television stations digital advertising and services revenue, incremental revenue from our
acquisitions of The CW in September 2022 of $17 million and a digital business we acquired in the third quarter of 2021 of $22
million, offset by weakness in the national digital advertising market and ecommerce.
Operating Expenses
Direct operating expenses, consisting primarily of news, engineering and programming, and selling, general and administrative
expenses were $2.91 billion for the year ended December 31, 2022 compared to $2.71 billion for the same period in 2021, an increase
of $197 million, or 7.3%. This was primarily due to an increase in cost related to incremental operating expenses from our acquisitions
of The CW in September 2022 of $70 million and a digital business we acquired in the third quarter of 2021 of $16 million, an
increase in variable costs associated with the increase in net revenue, an increase in station programming costs due to network
affiliation renewals and annual increases in network affiliation costs, and increased promotion costs, partially offset by a reversal of an
accrual in connection with a settlement of a dispute in connection with a new contract with one of our distributors and some
administrative savings, primarily related to healthcare.
Corporate expenses, related to costs associated with the centralized management of our stations, were $198 million for the year
ended December 31, 2022 compared to $176 million for the same period in 2021, an increase of $22 million, or 12.9%, primarily due
to an increase in stock-based compensation of $15 million.
Depreciation and amortization expense was $662 million for the year ended December 31, 2022 compared to $589 million for
the same period in 2021, an increase of $73 million, or 12.5%. Depreciation and amortization expense consists of the following:
• Amortization of broadcast rights was $193 million for the year ended December 31, 2022 compared to $121 million for
the same period in 2021, an increase of $72 million, or 59.3%. The increase was primarily due to incremental amortization
from our acquisition of The CW of $90 million, partially offset by a reduction in NewsNation’s costs of $9 million as it
continues to shift its focus from syndicated programming to national news programs.
• Amortization of intangible assets was $309 million for the year ended December 31, 2022 compared to $301 million for
the same period in 2021, an increase of $8 million, or 2.8% (no significant change).
• Depreciation of property and equipment was $160 million for the year ended December 31, 2022 compared to $167
million for the same period in 2021, a decrease of $7 million, or 4.0% (no significant change).
39
In the fourth quarter of 2022, we recorded a $96 million goodwill and intangible assets impairment on our product review and
recommendation platform reporting unit. The Company’s assessment indicated that the reporting unit’s carrying amount exceeded its
fair value, and therefore an impairment loss was identified.
In 2022 and 2021, certain real estate properties located in Chicago were classified as held for sale. Due to designations as held
for sale assets, the properties’ carrying amounts were written down to their estimated fair value, less estimated cost to sell, resulting in
the Company’s recognition of impairment charges of $37 million and $23 million in the fourth quarter of 2022 and 2021, respectively.
Gain on bargain purchase
Gain on bargain purchase of $56 million for the year ended December 31, 2022 pertains to our acquisition of The CW,
representing the excess of the fair value of the net assets acquired over the $0 purchase consideration and the fair value of
noncontrolling interests. For additional information on this acquisition, see Note 3, “Acquisitions and Dispositions” to our
Consolidated Financial Statements included in Part IV, Item 15(a) of this Annual Report on Form 10-K.
Income from equity method investments, net
Income from equity method investments, net was $153 million for the year ended December 31, 2022, compared to $125
million for the same period in 2021, an increase of $28 million. Our largest equity method investment is TV Food Network in which
we own a 31.3% interest. We record our equity in TV Food Network’s net income, less our share in the amortization of basis
difference related to the investment, as income from equity method investments. In 2022, certain components of such basis difference
reached the end of the estimated amortization life resulting to a decrease in our share in the amortization of $55 million (increase in
income). This was partially offset by a decrease in our share in TV Food Network’s net income of $27 million. For additional
information on our investment in TV Food Network, including the accounting for basis difference, refer to Note 6 to our Consolidated
Financial Statements.
Interest Expense, net
Interest expense, net was $337 million for the year ended December 31, 2022 compared to $283 million for the same period in
2021, an increase of $54 million, or 19.1%, primarily due to increases in interest rates in the Company’s outstanding loans under its
senior secured credit facilities, partially offset by decreases in interest expense from debt repayments and lower interest rates obtained
in connection with the refinancing of certain of our term loans in June 2022. Interest rates on outstanding loans under the Company’s
senior secured credit facilities ranged from 5.86% to 6.89% as of December 31, 2022, compared to interest rates ranging from 1.60%
to 2.60% as of December 31, 2021. These interest rates were a mixture of SOFR plus CSA used to account for the difference between
SOFR and LIBOR, plus applicable margin and U.S. LIBOR plus applicable margin in 2022 compared to U.S. LIBOR plus applicable
margin only in 2021.
Pension and other postretirement plans credit, net
Pension and other postretirement plans credit, net was $43 million for the year ended December 31, 2022 compared to $81
million for the same period in 2021, a decrease of $38 million, primarily due to lower estimated expected return on plan assets of $19
million, higher estimated interest cost of $7 million and a $13 million settlement gain from the purchase of an annuity contract related
to certain participants of a qualified pension plan during the fourth quarter of 2021.
Income Taxes
Income tax expense was $274 million for the year ended December 31, 2022 compared to an income tax expense of $263
million for the same period in 2021, an increase of $11 million. The effective tax rates during the years ended December 31, 2022 and
2021 were 22.5% and 24.1%, respectively. The decrease in the effective tax rate is primarily related to changes in the valuation
allowance resulting in an incremental income tax benefit of $24 million, or a 2.1% decrease to the effective tax rate in 2022. The gain
on bargain purchase arising from the acquisition of The CW resulted in a 1.1% decrease to the effective tax rate.
40
Liquidity and Capital Resources
The Company is leveraged, which makes it vulnerable to changes in general economic conditions. The Company’s ability to
repay or refinance its debt will depend on, among other things, financial, business, market, competitive and other conditions, many of
which are beyond the Company’s control. The Company’s primary sources of liquidity include cash on hand, borrowing capacity
under its revolving credit facilities (with a maturity date of June 2027) and cash generated from operations. The Company believes
these sources of liquidity are sufficient to meet its business operating requirements, its capital expenditures and to continue to service
its debt for at least the next 12 months as of the filing date of this Annual Report on Form 10-K. As of December 31, 2023, the
Company was in compliance with the financial covenants contained in the amended credit agreements governing its senior secured
credit facilities.
Any future adverse economic conditions, including those resulting from heightened and sustained inflation and higher interest
rates, could adversely affect the Company’s future operating results, cash flows and financial condition.
Cash Flow Summary
The following tables present the Company’s total operating, investing and financing activity cash flows for the three years
ended December 31 (in millions):
2023 2022 2021
N
et cash provided by operating activities $ 999 $ 1,403 $ 1,215
N
et cash provided by (used in) investing activities
(1)
(173) 125 (232)
N
et cash used in financing activities (899) (1,515) (945)
N
et increase (decrease) in cash, cash equivalents and restricted cash $ (73) $ 13 $ 38
Cash paid for interest $ 437 $ 330 $ 273
Income taxes paid, net of refunds
(2)
$ 169 $ 370 $ 320
(1)
In 2023, 2022 and 2021, the investing activities included total capital expenditures of $149 million, $157 million and $151 million,
respectively, of which none, $1 million and $10 million, respectively, were reimbursed from the FCC in connection with the station repack.
(2)
In 2022, income taxes paid, net of refunds, includes $48 million in tax payments related to various sales of real estate properties.
As of December 31,
2023 2022
Cash, cash equivalents and restricted cash $ 147 $ 220
Cash Flows—Operating Activities
Net cash provided by operating activities decreased by $404 million during the year ended December 31, 2023 compared to the
same period in 2022. This was primarily due to a decrease in operating income (excluding non-cash transactions) of $417 million, an
increase in payments for broadcast rights of $173 million, higher interest payments of $107 million and timing of accounts receivable
collections of $42 million. These decreases were partially offset by sources of cash resulting from timing of payments to our vendors
of $110 million, lower income tax payments of $201 million and an increase in distribution from our equity investment in TV Food
Network of $20 million. The increase in payments for broadcast rights was due to incremental payments from our acquisition of The
CW (acquired on September 30, 2022) of $211 million, partially offset by a decrease in payments for our syndicated programming of
$38 million. The increase in interest payments was primarily due to higher interest rates, partially offset by decreases in interest
expense from debt repayments and lower interest rates obtained in connection with the refinancing of certain of our term loans in June
2022.
Net cash provided by operating activities increased by $188 million during the year ended December 31, 2022 compared to the
same period in 2021. This was primarily due to an increase in operating income (excluding non-cash transactions) of $357 million,
sources of cash resulting from timing of accounts receivable collections of $108 million, and an increase in distributions from our
equity investment in TV Food Network of $10 million. These increases were partially offset by an increase in payments for broadcast
rights of $77 million, use of cash from timing of payments to our vendors of $107 million, higher interest payments of $57 million,
higher tax payments of $50 million and other items. The increase in payments for broadcast rights was due to incremental payments
from our acquisition of The CW of $119 million, partially offset by a decrease in payments for our syndicated programming of $42
million.
41
Cash paid for interest increased primarily due to increases in the effective interest rates in the Company’s outstanding floating
rate loans under its senior secured credit facilities due to the increase in SOFR and LIBOR, partially offset by decreases in interest
expense from debt repayments and lower interest rates obtained in connection with the refinancing of certain of our term loans in June
2022. The increase in tax payments was primarily due to the sale of certain real estate properties in 2022 resulting in tax payments of
$48 million.
Cash Flows—Investing Activities
Net cash used in investing activities was $173 million and $232 million during the years ended December 31, 2023 and 2021,
respectively. Net cash provided by investing activities during the year ended December 31, 2022 was $125 million.
In 2023, we spent a total of $149 million in capital expenditures and $38 million in the acquisitions of KUSI-TV and WSNN-
LD, partially offset by a deposit received associated with a proposed sale of a real estate asset of $10 million.
In 2022, we received proceeds from the sale of certain real estate properties of $241 million, received a deposit associated with a
proposed sale of real estate property of $10 million and recorded cash acquired from The CW acquisition of $29 million, partially
offset by capital expenditures of $157 million.
In 2021, we spent a total of $151 million in capital expenditures and $138 million to acquire television stations, a digital
business and certain license assets. These decreases were partially offset by the proceeds from the sale of stations and business units
and asset disposals of $20 million, reimbursements from the FCC related to station repack of $20 million and deposits received
associated with the sale of real estate assets of $13 million.
Cash Flows—Financing Activities
Net cash used in financing activities for the years ended December 31, 2023, 2022 and 2021 was $899 million, $1,515 million
and $945 million, respectively.
In 2023, the Company repaid scheduled principal maturities of $125 million of our term loans, paid dividends to our common
stockholders of $191 million ($1.35 per share per quarter), repurchased common shares of $605 million, paid cash for taxes in
exchange for shares of common stock withheld of $24 million resulting from net share settlements of certain stock-based
compensation, and paid for capitalized software of $19 million. These outflows were partially offset by a contribution from
noncontrolling interests amounting to $62 million. We also borrowed $20 million under our revolving credit facilities which was
repaid in full in 2023.
In 2022, we received $2,420 million of proceeds (net of capitalized lenders’ fees of $5 million) from the issuance of a Term
Loan A, due June 2027 and used $2,414 million to repay our then outstanding Term Loan A, due October 2023, Term Loan A, due
September 2024, Term Loan B, due January 2024 and a portion of Term Loan B, due September 2026. We prepaid a portion of the
outstanding principal balance of our Term Loan B of $333 million, made scheduled principal payments on term loans of $84 million,
repurchased and cancelled $71 million of our senior unsecured notes all funded by cash on hand, paid dividends to our common
stockholders of $142 million ($0.90 per share per quarter), repurchased common shares of $881 million, paid for software obligations
of $16 million, paid contingent consideration in connection with a past acquisition of $14 million, and paid cash for taxes in exchange
for shares of common stock withheld of $13 million resulting from net share settlements of certain stock-based compensation. These
decreases were partially offset by contribution from noncontrolling interests of $30 million. Mission also drew $62 million under its
2022 revolving credit facility and utilized the proceeds to repay all of its $62 million of outstanding borrowings under its then
outstanding 2018 revolving loan.
In 2021, we prepaid a portion of the outstanding principal balance of our Term Loan B, due January 2024 of $280 million and
made scheduled principal payments on our Term Loan A, due September 2024 of $21 million, paid dividends to our common
stockholders of $118 million ($0.70 per share during each quarter), repurchased common shares of $537 million, paid cash for taxes in
exchange for shares of common stock withheld of $11 million resulting from net share settlements of certain stock-based
compensation, and paid finance lease and software obligations of $18 million. These outflows were partially offset by the proceeds
from the exercise of stock options during the year amounting to $8 million. Mission also received $299 million (net of $2 million
discount) from its new Term Loan B, due June 2028 and utilized $268 million to repay a portion of its revolving loans. We also
borrowed $20 million under our revolving credit facilities which was repaid in full in 2021.
42
Material Cash Requirements
The Company is a party to many contractual obligations involving commitments to make payments to third parties. Certain
contractual obligations are recorded on the Consolidated Balance Sheet as of December 31, 2023, while others are considered future
commitments. The following summarizes the Company’s contractual obligations as of December 31, 2023, and the effect such
obligations are expected to have on the Company’s short-term and long-term liquidity and capital resource needs (in millions):
Payments Due by Period
Total 2024 2025 - 2026 2027 - 2028 Thereafter
Recorded contractual obligations:
Nexstar senior secured credit facility $ 3,804 $ 122 $ 1,803 $ 1,879 $ -
Mission senior secured credit facility 354 2 6 346 -
5.625% senior unsecured notes due 2027 1,714 - - 1,714 -
4.75% senior unsecured notes due 2028 1,000 - - 1,000 -
Operating lease obligations 369 60 86 70 153
Finance lease obligations 21 2 2 3 14
Broadcast rights current cash commitments
(1)
160 135 25 - -
Other
(2)(3)
25 13 12 - -
Unrecorded contractual obligations:
Network affiliation agreements
(4)
1,915 789 1,126 - -
Cash interest on debt
(5)
1,665 455 973 237 -
Executive employee contracts
(6)
127 58 65 4 -
Broadcast rights future cash commitments
(7)
1,110 169 305 276 360
Other 182 59 89 34 -
$ 12,446 $ 1,864 $ 4,492 $ 5,563 $ 527
(1)
Future minimum payments for license agreements for which the license period has begun and liabilities have been recorded.
(2)
As of December 31, 2023, we had $30 million of unrecognized tax benefits, inclusive of interest and certain deduction benefits. This liability
represents an estimate of tax positions that the Company has taken in its tax returns, which may ultimately not be sustained upon examination
by the tax authorities. The resolution of these tax positions may not require cash settlement due to the existence of federal and state NOLs. As
such, our contractual obligations table above excludes this liability.
(3)
As of December 31, 2023, we had $212 million and $21 million of funding obligations with respect to our pension benefit plans and other
postretirement benefit plans, respectively, which are not included in the table above. See Note 10 to our Consolidated Financial Statements
included in Part IV, Item 15(a) of this Annual Report on Form 10-K for further information regarding our funding obligations for these benefit
plans.
(4)
Future minimum payments for network affiliation agreements during the contract period. Excludes network affiliation agreements between the
Company’s stations and The CW as the related fees are eliminated in consolidation.
(5)
Estimated interest payments due as if all debt outstanding as of December 31, 2023 remained outstanding until maturity, based on interest
rates in effect at December 31, 2023.
(6)
Includes the employment contracts for all corporate executive employees and general managers of our stations and entities. We expect our
contracts will be renewed or replaced with similar agreements upon their expiration. Amounts included in the table above assume that
contracts are not terminated prior to their expiration.
(7)
Future minimum payments for license agreements for which the license period has not commenced and no liability has been recorded.
In January 2024, we entered into a multi-year time brokerage agreement with KAZT, L.L.C., the owner of television station
KAZT-TV in Phoenix, Arizona, and acquired the station’s non-license assets.
From January 1 to February 27, 2024, we repurchased 190,297 shares of our common stock for $32 million, funded by cash on
hand. As of the date of filing this Annual Report on Form 10-K, the remaining available amount under the share repurchase
authorization was $620 million.
On January 26, 2024, our board of directors approved a 25% increase in the quarterly cash dividend to $1.69 per share of our
common stock beginning with the dividend declared for the first quarter of 2024. The dividend was paid on February 23, 2024 to
stockholders of record on February 9, 2024.
In February 2024, we received $40 million in cash in connection with Broadcast Music Inc.’s sale to New Mountain Capital.
43
Long-term debt
As of December 31, 2023, the Company had total outstanding debt of $6.8 billion, net of unamortized financing costs, discounts
and premium, which represented 74.8% of the Company’s combined capitalization. The Company’s high level of debt requires that a
substantial portion of cash flow be dedicated to pay principal and interest on debt, which reduces the funds available for working
capital, capital expenditures, acquisitions and other general corporate purposes.
As of December 31,
(dollars in millions) 2023 2022
N
exstar senior secured credit facility $ 3,804 $ 3,925
Mission senior secured credit facility 354 358
5.625% Notes, due July 2027 1,714 1,714
4.75% Notes, due November 2028 1,000 1,000
Total outstanding principal 6,872 6,997
Less: Unamortized financing costs, discounts and premium, net (35) (46)
Total outstanding debt $ 6,837 $ 6,951
Unused revolving loan commitments under senior secured credit facilities
(1)
$ 544 $ 543
(1)
Based on the covenant calculations as of December 31, 2023, all of the $530 million (net of outstanding standby letters of credit of $20
million) and $14 million unused revolving loan commitments under the respective Nexstar and Mission senior secured credit facilities were
available for borrowing.
We (excluding The CW) guarantee full payment of all obligations incurred under Mission’s senior secured credit facility in the
event of its default. Mission is a guarantor of our senior secured credit facility, our 5.625% Notes, due July 2027 and our 4.75% Notes,
due November 2028. In consideration of our guarantee of Mission’s senior secured credit facility, Mission has granted us purchase
options to acquire the assets and assume the liabilities of each Mission station, subject to FCC consent. These option agreements
(which expire on various dates between 2024 and 2033) are freely exercisable or assignable by us without consent or approval by
Mission or its shareholders. We expect these option agreements to be renewed upon expiration.
We make semiannual interest payments on the 5.625% Notes, due July 2027 on January 15 and July 15 of each year. We make
semiannual interest payments on our 4.75% Notes, due November 2028 on May 1 and November 1 of each year. Interest payments on
our and Mission’s senior secured credit facilities are generally paid every one to three months and are payable based on the type of
interest rate selected.
The terms of our and Mission’s senior secured credit facilities, as well as the indentures governing our 5.625% Notes, due July
2027 and 4.75% Notes, due November 2028, limit, but do not prohibit us or Mission from incurring substantial amounts of additional
debt in the future. Our senior secured credit facilities and the indentures governing our existing notes may limit the amount of
dividends we may pay to stockholders and share repurchases we may make over the term of the agreement.
The Company does not have any rating downgrade triggers that would accelerate the maturity dates of its debt. However, a
downgrade in the Company’s credit rating could adversely affect its ability to renew the existing credit facilities, obtain access to new
credit facilities or otherwise issue debt in the future and could increase the cost of such debt.
The Company’s ability to access funds under its senior secured credit facilities depends, in part, on its compliance with certain
financial covenants. Any additional drawings under the senior secured credit facilities will reduce the Company’s future borrowing
capacity and the amount of total unused revolving loan commitments. Any future adverse economic conditions, including those
resulting from heightened and sustained inflation and higher interest rates, could adversely affect our future operating results and cash
flows and may cause us to seek alternative sources of funding, including accessing capital markets, subject to market conditions. Such
alternative sources of funding may not be available on commercially reasonable terms or at all.
Our credit agreement contains a covenant which requires us to comply with a maximum consolidated first lien net leverage ratio
of 4.25 to 1.00. The financial covenant, which is formally calculated on a quarterly basis, is based on the Company’s combined
results. The Mission amended credit agreement does not contain financial covenant ratio requirements but does provide for default in
the event we do not comply with all covenants contained in our credit agreement. As of December 31, 2023, we were in compliance
with our financial covenants. We believe the Company will be able to maintain compliance with all covenants contained in the credit
agreements governing its senior secured facilities and the indentures governing Nexstar’s 5.625% Notes, due July 2027 and Nexstar’s
4.75% Notes, due November 2028 for a period of at least the next 12 months as of the filing date of this Annual Report on Form 10-K.
44
Off-Balance Sheet Arrangements
As of December 31, 2023, we did not have any relationships with unconsolidated entities or financial partnerships, such as
entities often referred to as structured finance or VIEs, which would have been established for the purpose of facilitating off-balance
sheet arrangements or other contractually narrow or limited purposes. All of our arrangements with our VIEs in which we are the
primary beneficiary are on-balance sheet arrangements. Our variable interests in other entities are obtained through local service
agreements, which have valid business purposes and transfer certain station activities from the station owners to us. We are, therefore,
not materially exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in such relationships.
As of December 31, 2023, we have outstanding standby letters of credit with various financial institutions amounting to $20
million. The outstanding balance of standby letters of credit is deducted against our unused revolving loan commitment under our
senior secured credit facility and would not be available for withdrawal.
Issuer and Guarantor Summarized Financial Information
Nexstar Media Inc. (the “Issuer”) is the issuer of 5.625% Notes, due July 2027 and 4.75% Notes, due November 2028. These
notes are fully and unconditionally guaranteed, jointly and severally, by Nexstar Media Group, Inc. (“Parent”), Mission (a
consolidated VIE) and the Subsidiary Guarantors (as defined below). The Issuer, Subsidiary Guarantors, Parent and Mission are
collectively referred to as the “Obligor Group” for the 5.625% Notes, due July 2027 and 4.75% Notes, due November 2028.
“Subsidiary Guarantors” refers to certain of the Issuer’s restricted subsidiaries (excluding The CW) that guarantee these notes. The
guarantees of the notes are subject to release in limited circumstances upon the occurrence of certain customary conditions set forth in
the indentures governing the 5.625% Notes, due July 2027 and the 4.75% Notes, due November 2028. The 5.625% Notes, due July
2027 and 4.75% Notes, due November 2028 are not registered with the SEC.
The following combined summarized financial information is presented for the Obligor Group after elimination of intercompany
transactions between Parent, Issuer, Subsidiary Guarantors and Mission in the Obligor Group and amounts related to investments in
any subsidiary that is a non-guarantor. This information is not intended to present the financial position or results of operations of the
consolidated group of companies in accordance with U.S. GAAP.
Summarized Balance Sheet Information for the Obligor Group as of December 31 (in millions):
December 31, 2023 December 31, 2022
Current assets – external
(1)
$ 1,246 $ 1,358
Current assets – due from consolidated entities outside of Obligor Group 7 39
Total current assets $ 1,253 $ 1,397
N
oncurrent assets – external
(1)(2)
9,429 9,748
N
oncurrent assets – due from consolidated entities outside of Obligor Group 75 74
Total noncurrent assets $ 9,504 $ 9,822
Total current liabilities
(1)
$ 818 $ 742
Total noncurrent liabilities
(1)
$ 8,775 $ 8,994
N
oncontrolling interests $ - $ -
(1)
Excludes the assets and liabilities of The CW as it is not a guarantor of the 4.75% Notes, due November 2028 and 5.625% Notes, due July
2027. On September 30, 2022, Nexstar acquired a 75.0% ownership interest in The CW (see Note 3, “Acquisitions” to our Consolidated
Financial Statements included in Part IV, Item 15(a) of this Annual Report on Form 10-K for additional information).
(2)
Excludes Issuer’s equity investments of $958 million and $1,119 million as of December 31, 2023 and 2022, respectively, in unconsolidated
investees. These unconsolidated investees do not guarantee the 4.75% Notes, due November 2028 and 5.625% Notes, due July 2027. For
additional information on equity investments, refer to Note 6 to our Consolidated Financial Statements included in Part IV, Item 15(a) of this
Annual Report on Form 10-K for additional information.
45
Summarized Statements of Operations Information for the Obligor Group (in millions):
Year Ended
December 31, 2023
N
et revenue – external $ 4,694
N
et revenue – from consolidated entities outside of Obligor Group 19
Total net revenue 4,713
Costs and expenses – external 3,683
Costs and expenses – to consolidated entities outside of Obligor Group 37
Total costs and expenses 3,720
Income from operations $ 993
N
et income $ 450
N
et income attributable to Obligor Group $ 450
Income from equity method investments, net $ 104
Critical Accounting Estimates
Our Consolidated Financial Statements have been prepared in accordance with U.S. GAAP, which requires us to make estimates
and assumptions that affect the reported amounts of assets and liabilities, revenue and expenses and related disclosures. On an ongoing
basis, we base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the
circumstances. Actual results may differ from those estimates, and any such differences could be material to our Consolidated
Financial Statements.
For a summary of our significant accounting policies, we refer you to Note 2 to our Consolidated Financial Statements in Part
IV, Item 15(a) of this Annual Report on Form 10-K.
We believe the following critical accounting estimates are those that are the most important to the presentation of our
Consolidated Financial Statements, affect our more significant estimates and assumptions, and require the most subjective or complex
judgments by management.
Consolidation of Variable Interest Entities
We regularly evaluate our local service agreements and other arrangements where we may have variable interests to determine
whether we are the primary beneficiary of a VIE. Under U.S. GAAP, a company must consolidate an entity when it has a “controlling
financial interest” resulting from ownership of a majority of the entity’s voting rights. Accounting rules expanded the definition of
controlling financial interest to include factors other than equity ownership and voting rights.
In applying accounting and disclosure requirements, we must base our decision to consolidate an entity on quantitative and
qualitative factors that indicate whether or not we have the power to direct the activities of the entity that most significantly affect its
economic performance and whether or not we have the obligation to absorb losses of the entity or the right to receive benefits from the
entity that could potentially be significant to the VIE. Our evaluation of the “power” and “economics” model must be an ongoing
process and may alter as facts and circumstances change.
Mission and the other consolidated VIEs are included in our Consolidated Financial Statements because we are deemed to have
controlling financial interests in these entities as VIEs for financial reporting purposes as a result of (i) local service agreements we
have with the stations they own, (ii) Nexstar’s (excluding The CW) guarantee of the obligations incurred under Mission’s senior
secured credit facility, (iii) our power over significant activities affecting these entities’ economic performance, including budgeting
for advertising revenue, advertising sales and, in some cases, hiring and firing of sales force personnel and (iv) purchase options
granted by each consolidated VIE which permit Nexstar to acquire the assets and assume the liabilities of all of these VIEs’ stations at
any time, subject to FCC consent. These purchase options are freely exercisable or assignable by Nexstar without consent or approval
by the VIEs. These option agreements expire on various dates between 2024 and 2033. We expect to renew these option agreements
upon expiration. Therefore, these VIEs are consolidated into these financial statements.
46
Valuation of Goodwill and Intangible Assets
Intangible assets represented $8.0 billion, or 66.2%, of our total assets as of December 31, 2023. Intangible assets consist
primarily of goodwill, indefinite-lived intangible assets (such as FCC licenses), and definite-lived intangible assets (such as network
affiliation agreements).
The purchase prices of acquired businesses are allocated to the assets and liabilities acquired at estimated fair values at the date
of acquisition using various valuation techniques, including discounted projected cash flows, the replacement cost approach and other
income, market or cost approaches.
The estimated fair value of an FCC license acquired in a business combination is calculated using a discounted projected cash
flow model referred to as the Greenfield Method. The Greenfield Method attempts to isolate the income that is attributable to the
license alone. This approach is based upon modeling a hypothetical start-up station and building it up to a normalized operation that,
by design, lacks an affiliation with a network (commonly known as an independent station), lacks inherent goodwill and whose other
assets have essentially been added as part of the build-up process. The Greenfield Method assumes annual cash flows over a
projection period model. Inputs to this model include, but are not limited to, (i) a four-year build-up period for a start-up station to
reach a normalized state of operations, (ii) television market long-term revenue growth rate over a projection period, (iii) estimated
market revenue share for a typical market participant without a network affiliation, (iv) estimated profit margins based on industry
data, (v) capital expenditures based on the size of market and the type of station being constructed, (vi) estimated tax rates in the
appropriate jurisdiction, and (vii) an estimated discount rate using a weighted average cost of capital analysis. The Greenfield Method
also includes an estimated terminal value by discounting an estimated annual cash flow with an estimated long-term growth rate.
The assumptions used in estimating the fair value of a network affiliation agreement acquired in a business combination are
similar to those used in the valuation of an FCC license. The Greenfield Method is also utilized in the valuation of network affiliation
agreements except that the estimated market revenue share, estimated profit margins, capital expenditures and other assumptions
reflect a market participant premium based on the programming of a network affiliate relative to an independent station. This approach
would result in an estimated collective fair value of the FCC license and a network affiliation agreement. The excess of the estimated
fair value in this model over the estimated value of an FCC license of an independent station under the Greenfield Method represents
the estimated fair value of a network affiliation agreement.
Goodwill represents the excess of the purchase price of a business over the fair value of the net assets acquired.
Subsequent to acquisition, goodwill and FCC licenses are tested for impairment in the fourth quarter each year, or more
frequently whenever events or changes in circumstances indicate that such assets might be impaired. For purposes of goodwill
impairment tests, the Company has one aggregated television stations reporting unit, because of the stations’ similar economic
characteristics, one cable network reporting unit and two digital business reporting units. The Company’s impairment review for FCC
licenses is performed at the television station market level.
The Company first assesses the qualitative factors to determine the likelihood of goodwill and FCC licenses being impaired. The
qualitative impairment test includes, but is not limited to, assessing the changes in macroeconomic conditions, regulatory
environment, industry and market conditions, and the financial performance versus budget of the reporting units, as well as any other
events or circumstances specific to the reporting unit or the FCC licenses. If it is more likely than not that the fair value of a reporting
unit or an FCC license is greater than its respective carrying amount, no further testing will be required. Otherwise, the quantitative
impairment test method is applied.
The quantitative impairment test for goodwill is performed by comparing the fair value of a reporting unit with its carrying
amount. If the fair value of the reporting unit exceeds its carrying value, goodwill is not impaired and no further testing is required. If
the fair value of the reporting unit is less than the carrying value, an impairment charge is recognized for the amount by which the
carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill
allocated to that reporting unit. The quantitative impairment test for FCC licenses consists of a market-by-market comparison of the
carrying amounts of FCC licenses with their fair values, using the Greenfield Method of discounted cash flow analysis. An
impairment is recorded when the carrying value of an FCC license exceeds its fair value.
47
We test our definite-lived intangible assets and other long-lived assets to be held and used for impairment whenever events or
circumstances indicate that their carrying amount may not be recoverable, relying on certain factors including operating results,
business plans, economic projections and anticipated future cash flows. The carrying value of a long-lived asset or asset group is
considered impaired when the projected future undiscounted cash flows to be generated from the asset or asset group over its
remaining life, or primary asset’s life, plus any proceeds from the eventual disposition are less than its carrying value. The Company
measures impairment based on the amount by which the carrying value exceeds the estimated fair value of the long-lived asset or asset
group. The fair value is determined primarily by using the projected future cash flows discounted at a rate commensurate with the risk
involved as well as market valuations.
In the fourth quarter of 2023, using the qualitative impairment test, the Company performed its annual impairment assessment
on goodwill attributable to its aggregated television stations reporting unit. Based on the results of such qualitative impairment tests,
the Company concluded that it was more likely than not that the reporting unit’s fair value would sufficiently exceed the related
carrying amount.
With respect to goodwill allocated to the cable network reporting unit and the two digital reporting units, the Company elected
to perform quantitative impairment tests due to recent performance and uncertain economic conditions.
The Company’s assessment indicated that the cable network reporting unit’s fair value exceeded the related carrying amount by
approximately 14%, therefore no impairment was recorded. Goodwill allocated to this reporting unit was $400 million as of December
31, 2023. The fair value estimate is management’s estimate based on a valuation report prepared by a third-party valuation firm who
used a combination of an income approach, which employs a discounted cash flow model, and a market approach, which consider
earnings multiples of comparable publicly traded businesses and comparable market transactions. The income approach was based on
a five-year projection model which included assumptions regarding continued growth of viewership at a declining rate of growth over
time and monetization thereof, continued growth in distribution revenues and annual increases in operating expenses. The income
approach utilized the Company’s income tax rate, a 10% discount rate based on an analysis of comparable companies and a modest
terminal growth rate typical of mature cable network businesses. The market approach market based the valuation on earnings
multiples of comparable publicly traded businesses with cable networks and comparable cable network transactions. The likelihood of
a material impairment is mitigated by the maturity of the network and its significant contractual distribution revenue.
With respect to digital reporting units, the Company’s assessment indicated that one of the digital reporting units exceeded the
carrying amount by 2.5%, and therefore no goodwill impairment was identified. Goodwill associated with this reporting was $69
million as of December 31, 2023. The fair value estimate is management’s estimate based on a valuation report prepared by a third-
party valuation firm who used a combination of an income approach, which employs a discounted cash flow model, and market
approach. The income approach was based on a three-year projection model which included assumptions regarding the recovery of the
business from a low in 2023 due to market and other factors to a full recovery to 2022 levels between year 2 and year 3 and then
growth thereafter. The income approach utilized the Company’s income tax rate, a 11.5% discount rate based on an analysis of
comparable companies and a modest terminal growth rate typical of mature digital businesses. The market approach based the
valuation on earnings multiples of comparable publicly traded digital media businesses and market net revenue multiples of
comparable digital media transactions. The likelihood of a material impairment is mitigated by the amount of goodwill recorded.
In the second digital reporting unit, the Company identified a goodwill impairment of $19 million (and $16 million impairment
on definite-lived intangible assets) and a goodwill impairment of $91 million (and $5 million impairment on definite-lived intangible
assets) during the fourth quarter of each calendar years 2023 and 2022. As of December 31, 2023, this second digital reporting unit
has no remaining goodwill and no material long-lived intangible assets balance.
Our quantitative goodwill impairment tests are sensitive to changes in key assumptions used in our analysis. In our income
approach models, if our projections of revenue growth rates and margins are not realized, if market factors outside of our control, such
as increases in discount rates, occur, or if management’s expectations or plans change, including changes to a reporting unit’s long-
term operating plans, the Company’s goodwill and other key assets could be impaired in the future. With respect to net revenue and
earnings multiples, the key uncertainties are determining the reporting unit’s comparable public companies, comparable transactions
and the selection of the market multiples.
The Company performed its annual impairment assessment on FCC licenses for each television station market using the
qualitative impairment test. Except for three station markets that indicated unfavorable trends, the Company concluded that it was
more likely than not that their fair values exceeded the respective carrying amounts. For the stations that indicated unfavorable trends,
management extended its procedures and performed a quantitative impairment test. As of December 31, 2023, the FCC licenses of
these stations had a total balance of $64 million, none of such individual FCC licenses had carrying value that were material. The
Company’s quantitative impairment test of these assets indicated that each of their estimated fair values (Greenfield Method)
exceeded the respective carrying amounts. Thus, no impairment was recorded.
48
The Company also evaluated its definite-lived intangible assets and other long-lived assets whether events or changes in
circumstances indicate that such assets may be impaired. Based on our estimate of undiscounted future pre-tax cash flows expected to
result from the use and eventual disposition of these assets, the Company determined that the carrying amounts are recoverable other
than the long-lived intangible assets of a digital reporting unit for which an impairment was recognized (discussed above). No other
events or circumstances were noted in 2023 that would indicate impairment.
Valuation of Investments
We account for investments in which we own at least 20% of an investee’s voting securities or we have significant influence
over an investee under the equity method of accounting. We record equity method investments at cost. For investments acquired in a
business combination, the cost is the estimated fair value allocated to the investment.
We evaluate our equity method investments for other-than temporary impairment (“OTTI”) on at least a quarterly basis, and
more frequently when economic or market conditions warrant such an evaluation. In 2023, the Company evaluated its equity method
investments for OTTI and none was identified. The Company will continue to evaluate its equity method investments for OTTI in
future periods.
Pension plans and other postretirement benefits
A determination of the liabilities and cost of Nexstar’s pension and other postretirement plans (“OPEB”) requires the use of
assumptions. The actuarial assumptions used in the pension and postretirement reporting are reviewed annually with independent
actuaries and are compared with external benchmarks, historical trends and Nexstar’s own experience to determine that its
assumptions are reasonable. The assumptions used in developing the required estimates include the following key factors:
• discount rates
• expected return on plan assets
• mortality rates
• retirement rates
• expected contributions
As of December 31, 2023, the effective discount rates used for determining pension benefit obligations were 4.78% to 4.79%.
During 2023, the assumptions utilized in determining net periodic benefit credit on our pension plans were (i) 5.53% to 6.38%
expected rate of return on plan assets and (ii) 4.98% to 4.99% effective discount rates. As of December 31, 2023, our pension plans’
benefit obligations were $1.7 billion. For the year ended December 31, 2023, our pension plans’ net periodic benefit credit was $36
million. As of December 31, 2023, a 1% change in the discount rates would have the following effects (in millions):
1% Increase 1% Decrease
Projected impact on net periodic benefit credit $ 2 $ (3)
Projected impact on pension benefit obligations (132) 154
For additional information on our pension and OPEB, see Note 10 to our Consolidated Financial Statements included in Part IV,
Item 15(a) of this Annual Report on Form 10-K.
Distribution Revenue
We earn revenues from MVPDs and OVDs for the retransmission of our broadcasts and the carriage of NewsNation. These
revenues are generally earned based on a price per subscriber of the distributor within the retransmission or carriage area. The
distributors report their subscriber numbers to us generally on a 30- to 60-day lag, generally upon payment of the fees due to us. Prior
to receiving the reports, we record revenue based on management’s estimate of the number of subscribers, utilizing historical levels
and trends of subscribers for each distributor. Adjustments associated with the resolution of such estimates have, historically, been
inconsequential.
49
Income Taxes
We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and
liabilities for the expected future tax consequences of temporary differences between the carrying amounts and tax basis of assets and
liabilities. A valuation allowance is applied against net deferred tax assets if, based on the weight of available evidence, it is more
likely than not that some or all of the deferred tax assets will not be realized. While we have considered future taxable income in
assessing the need for a valuation allowance, in the event that we were to determine that we would not be able to realize all or part of
our deferred tax assets in the future, an adjustment to the valuation allowance would be charged to income in the period such a
determination was made.
We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be
sustained on examination by the taxing authorities. The determination is based on the technical merits of the position and presumes
that each uncertain tax position will be examined by the relevant taxing authority that has full knowledge of all relevant information.
The estimate of the Company’s tax liabilities relating to uncertain tax positions requires management to assess uncertainties and to
make judgments about the application of complex tax laws and regulations. We recognize interest and penalties relating to income
taxes as components of income tax expense.
Recent Accounting Pronouncements
Refer to Note 2 of our Consolidated Financial Statements in Part IV, Item 15(a) of this Annual Report on Form 10-K for a
discussion of recently issued accounting pronouncements, including our expected date of adoption and effects on results of operations
and financial position.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Interest Rate Risk
The Company’s exposure to market risk for changes in interest rates relates primarily to its long-term debt obligations.
The term loan borrowings under the Company’s senior secured credit facilities bear interest at rates ranging from 6.85% to
7.85% as of December 31, 2023, which represent (i) the base rate, the SOFR plus (ii) a credit spread adjustment, and (iii) the
applicable margin, as defined. Interest is payable in accordance with the credit agreements.
Based on the outstanding balances of the Company’s senior secured credit facilities (term loans and revolving loans) as of
December 31, 2023, an increase in each of SOFR by 100 basis points would increase our annual interest expense and decrease our
cash flow from operations by $42 million (excluding tax effects). A decrease in each of SOFR by 100 basis points would decrease our
annual interest expense and increase our cash flow from operations by $42 million (excluding tax effects). Our 5.625% Notes due July
2027 and 4.75% Notes due November 2028 are fixed rate debt obligations and therefore are not exposed to market interest rate
changes. As of December 31, 2023, the Company has no financial instruments in place to hedge against changes in the benchmark
interest rates on its senior secured credit facilities.
Item 8. Financial Statements and Supplementary Data
Our Consolidated Financial Statements are filed with this report. The Consolidated Financial Statements and Supplementary
Data are included in Part IV, Item 15(a) of this Annual Report on Form 10-K.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
50
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Nexstar’s management, with the participation of its Chairman and Chief Executive Officer along with its Chief Financial
Officer, conducted an evaluation as of the end of the period covered by this Annual Report of the effectiveness of the design and
operation of Nexstar’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act.
Based upon that evaluation, Nexstar’s Chairman and Chief Executive Officer and its Chief Financial Officer concluded that as
of December 31, 2023, Nexstar’s disclosure controls and procedures were effective in providing reasonable assurance that information
required to be disclosed in the reports that it files or submits under the Exchange Act (i) is recorded, processed, summarized and
reported within the time periods specified in the SEC’s rules and forms and (ii) is accumulated and communicated to Nexstar’s
management, including its Chairman and Chief Executive Officer and its Chief Financial Officer, as appropriate to allow timely
decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
During the quarterly period as of the end of the period covered by this report, there have been no changes in Nexstar’s internal
control over financial reporting that have materially affected, or are reasonably likely to materially affect, its internal control over
financial reporting.
Management’s Report on Internal Control over Financial Reporting
Nexstar’s management is responsible for establishing and maintaining adequate internal control over financial reporting as
defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control over financial reporting is a process designed to
provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with U.S. GAAP. Management assessed the effectiveness of our internal control over financial reporting as of
December 31, 2023 based upon the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission
(COSO) in Internal Control—Integrated Framework (2013).
Based on management’s assessment, we have concluded that our internal control over financial reporting was effective as of
December 31, 2023.
PricewaterhouseCoopers LLP, an independent registered public accounting firm, has audited the effectiveness of our internal
control over financial reporting as of December 31, 2023 as stated in their report which appears herein.
Item 9B. Other Information
Rule 10b5-1 Trading Plans
On December 26, 2023, Perry Sook, our Chairman and Chief Executive Officer, adopted a 10b5-1 Trading Plan (“Sook Sales
Plan”) that is intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act. The Sook Sales Plan provides for
the exercise and sale of 100,000 stock options (such stock options were awarded on January 14, 2015 and are scheduled to expire on
January 14, 2025). The Sook Sales Plan, which was entered into during an open trading window under the Company’s insider trading
policy, will be in effect until the earlier of (a) November 13, 2024, and (b) the date on which the total shares subject to the Sook Sales
Plan have been sold.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
51
PART III
Item 10. Directors, Executive Officers and Corporate Governance
Information concerning directors that is required by this Item 10 will be set forth in the Proxy Statement to be provided to
stockholders in connection with our 2024 Annual Meeting of Stockholders (the “Proxy Statement”) or in an amendment to this Annual
Report on Form 10-K under the headings “Directors,” “Corporate Governance,” and “Delinquent Section 16(a) Report,” which
information is incorporated herein by reference.
Item 11. Executive Compensation
Information required by this Item 11 will be set forth in the Proxy Statement under the headings “Compensation of Named
Executive Officers” and “Compensation of Directors,” which information is incorporated herein by reference. Information specified in
Items 402(k) and 402(l) of Regulation S-K and set forth in the Proxy Statement is incorporated by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management, and Related Stockholder Matters
Information required by this Item 12 will be set forth in the Proxy Statement under the headings “Beneficial Ownership of
Nexstar Common Stock” and “Compensation of Named Executive Officers,” which information is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions, and Director Independence
Information required by this Item 13 will be set forth in the Proxy Statement under the heading “Certain Relationships and
Related Person Transactions,” which information is incorporated herein by reference.
Item 14. Principal Accountant Fees and Services
Information required by this Item 14 will be set forth in the Proxy Statement under the heading “Independent Registered Public
Accounting Firm Fees and Other Matters,” which information is incorporated herein by reference.
52
PART IV
Item 15. Exhibits and Financial Statement Schedules
(a) Documents filed as part of this report:
(1) Consolidated Financial Statements. The Consolidated Financial Statements of Nexstar Media Group, Inc. listed on the
index on page F-1 have been included beginning on page F-4 of this Annual Report on Form 10-K.
(2) Financial Statement Schedules. The schedule of Valuation and Qualifying Accounts appears in Note 18 to the
Consolidated Financial Statements filed as part of this report.
(3) Exhibits. The exhibits listed on the accompanying Index to Exhibits on this Annual Report on Form 10-K are filed,
furnished or incorporated into this Annual Report on Form 10-K by reference, as applicable.
Item 16. Form 10-K Summary
Not applicable.
53
Exhibit Index
Exhibit
Number
Exhibit Description
2.1 Agreement and Plan of Merger, dated as of January 27, 2016, by and between Nexstar Media Group, Inc., Media General,
Inc., and Neptune Merger Sub, Inc. (Incorporated by reference to Exhibit 2.1 to Current Report on Form 8-K (File No.
000-50478) filed by Nexstar Media Group, Inc. on January 28, 2016).+
2.2 Agreement and Plan of Merger, dated as of November 30, 2018, by and between Nexstar Media Group, Inc., Tribune
Media Company and Titan Merger Sub, Inc. (Incorporated by reference to Exhibit 2.1 to Current Report on Form 8-K
(File No. 000-50478) filed by Nexstar Media Group, Inc. on December 4, 2018).
2.3 Asset Purchase Agreement, dated as of March 20, 2019, by and among Nexstar Media Group, Inc., Belo Holdings, Inc.
and TEGNA Inc. (Incorporated by reference to Exhibit 2.1 to Current Report on Form 8-K (File No. 000-50478) filed by
Nexstar Media Group, Inc. on March 26, 2019).
2.4 Asset Purchase Agreement, dated as of March 20, 2019, by and among Nexstar Media Group, Inc., Scripps Media, Inc.
and Scripps Broadcasting Holdings, LLC. (Incorporated by reference to Exhibit 2.2 to Current Report on Form 8-K (File
No. 000-50478) filed by Nexstar Media Group, Inc. on March 26, 2019).
3.1 Certificate of Amended and Restated Certificate of Incorporation of Nexstar Media Group, Inc. (Incorporated by reference
to Exhibit 3.1 to Current Report on Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on June 21, 2023).
3.2 Second Amended and Restated Bylaws of Nexstar Media Group, Inc. (Incorporated by reference to Exhibit 3.1 to Current
Report on Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on January 30, 2023).
4.1 Specimen Class A Common Stock Certificate. (Incorporated by reference to Exhibit 4.1 to Amendment No. 6 to
Registration Statement on Form S-1 (File No. 333-86994) filed by Nexstar Media Group, Inc.).
4.2 Indenture, dated as of July 3, 2019, between Nexstar Escrow, Inc., as issuer, and Citibank, N.A., as trustee (Incorporated
by reference to Exhibit 4.1 to Current Report on Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on
July 3, 2019).
4.3 Form of 5.625% Senior Note due 2027 (Incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K (File No.
000-50478) filed by Nexstar Media Group, Inc. on July 3, 2019).
4.4 First Supplemental Indenture, dated as of September 19, 2019, by and among Nexstar Broadcasting, Inc., as issuer, the
guarantors party thereto, and Citibank, N.A. as trustee (Incorporated by reference to Exhibit 4.3 to Current Report on
Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on September 20, 2019).
4.5 Second Supplemental Indenture, dated as of November 22, 2019, by and among Nexstar Broadcasting, Inc., as issuer, the
guarantors party thereto, and Citibank, N.A. as trustee (Incorporated by reference to Exhibit 4.3 to Current Report on
Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on November 22, 2019).
4.6 Indenture, dated as of September 25, 2020, by and among Nexstar Broadcasting, Inc., as issuer, the guarantors party
thereto, and Citibank, N.A., as trustee (Incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K (File No.
000-50478) filed by Nexstar Media Group, Inc. on September 25, 2020).
4.7 Form of 4.750% Senior Notes due 2028 (Incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K (File
No. 000-50478) filed by Nexstar Media Group, Inc. on September 25, 2020).
4.8 Description of the Registrant’s Securities registered under Section 12 of the Securities Exchange Act of 1934.*
10.1 Contingent Value Rights Agreement, dated as of January 13, 2017, by and between Nexstar Media Group, Inc. and
American Stock Transfer & Trust Company, LLC as rights agent (Incorporated by reference to Exhibit 10.1 to Current
Report on Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on January 17, 2017).
10.2 Stock Option Agreement, dated as of November 29, 2011, by and among Mission Broadcasting, Inc., Nancie J. Smith,
Dennis Thatcher and Nexstar Broadcasting, Inc. (Incorporated by reference to Exhibit 10.44 to Annual Report on Form
10-K for the year ended December 31, 2011 (File No. 000-50478) filed by Nexstar Media Group, Inc.).
10.3 Amendment, dated as of November 15, 2019, to Stock Option Agreement, dated as of November 29, 2011, by and
between Mission Broadcasting, Inc., Dennis Thatcher, Nancie J. Smith, and Nexstar Broadcasting, Inc. (Incorporated by
reference to Exhibit 10.87 to Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 (File No. 000-50478)
filed by Nexstar Media Group, Inc.).
10.4 Amendment, dated as of November 30, 2020, to Stock Option Agreement, dated as of November 29, 2011, as amended
November 15, 2019, by and between Mission Broadcasting, Inc., Dennis Thatcher, Nancie J. Smith, and Nexstar
Broadcasting, Inc.(Incorporated by reference to Exhibit 10.4 to Annual Report on Form 10-K for the year ended
December 31, 2020 (File No. 000-50478) filed by Nexstar Media Group, Inc. on March 1, 2021).
10.5 Credit Agreement, dated as of January 17, 2017, by and among Nexstar Media Group, Inc., as a holding company,
Nexstar Broadcasting, Inc., as the borrower, Bank of America, N.A., as the administrative agent, the collateral agent, a
letter of credit issuer and a swing line lender and other financial institutions from time to time party thereto (Incorporated
by reference to Exhibit 10.2 to Current Report on Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on
January 17, 2017).
10.6 Amendment No. 1, dated as of July 19, 2018, to Credit Agreement, dated as of January 17, 2017, by and among Nexstar
Broadcasting, Inc., Nexstar Media Group, Inc., Bank of America, N.A. and the several lenders party thereto (Incorporated
by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478) filed by Nexstar Broadcasting Group,
Inc. on July 25, 2017).
54
10.7 Amendment No. 2, dated as of October 26, 2018, to Credit Agreement, dated as of January 17, 2017, by and among
Nexstar Broadcasting, Inc., Nexstar Media Group, Inc., Bank of America, N.A. and the several lenders party thereto
(Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478) filed by Nexstar Media
Group, Inc. on November 1, 2018).
10.8 Amendment No. 3, dated as of September 19, 2019, to Credit Agreement, dated as of January 17, 2017, by and among
Nexstar Broadcasting, Inc., Nexstar Media Group, Inc., Bank of America, N.A. and the several lenders party thereto
(Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478) filed by Nexstar Media
Group, Inc. on September 20, 2019).
10.9 Amendment No. 4, dated as of September 3, 2020, to Credit Agreement, dated as of January 17, 2017, by and among
Nexstar Broadcasting, Inc., Nexstar Media Group, Inc., Bank of America, N.A. and the several lenders party thereto
(Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K/A (File No. 000-50478) filed by N exstar Media
Group, Inc. on September 9, 2020).
10.10 Amendment No. 5, dated as of June 21, 2022, to Credit Agreement, dated as of January 17, 2017, by and among Nexstar
Media Inc. (f/k/a Nexstar Broadcasting, Inc.), Nexstar Media Group, Inc., Bank of America, N.A. and the several lenders
party thereto (Incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q for the quarter ended June 30,
2022 (File No. 000-50478) filed by Nexstar Media Group, Inc.).
10.11 Amendment No. 6 dated as of June 6, 2023, to Credit Agreement, dated as of January 17, 2017, by and among Nexstar
Media Inc. (f/k/a Nexstar Broadcasting, Inc.), Nexstar Media Group, Inc., Bank of America, N.A. and the several lenders
party thereto (Incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q for the quarter ended June 30,
2023 (File No. 000-50478) filed by Nexstar Media Group, Inc.).
10.12 Credit Agreement, dated as of January 17, 2017, by and among Mission Broadcasting, Inc., as the borrower and Bank of
America, N.A., as the administrative agent and the collateral agent and other financial institutions from time to time party
thereto (Incorporated by reference to Exhibit 10.8 to Annual Report on Form 10-K for the period ended December 31,
2016 (File No. 333-62916-02) filed by Mission Broadcasting, Inc.).
10.13 Amendment No. 1, dated as of July 19, 2017, to Credit Agreement, dated as of January 17, 2017, by and among Mission
Broadcasting, Inc., Bank of America, N.A. and the several lenders party thereto (Incorporated by reference to Exhibit 10.1
to Current Report on Form 8-K (File No. 333-62916-02) filed by Mission Broadcasting, Inc. on July 25, 2017).
10.14 Amendment No. 2, dated as of October 26, 2018, to Credit Agreement, dated as of January 17, 2017, by and among
Mission Broadcasting, Inc., Bank of America, N.A. and the several lenders party thereto (Incorporate by reference to
Exhibit 10.1 to Current Report on Form 8-K (File No. 333-62916-02) filed by Mission Broadcasting, Inc. on November 1,
2018).
10.15 Amendment No. 3, dated as of September 3, 2020, to Credit Agreement, dated as of January 17, 2017, by and among
Mission Broadcasting, Inc., Bank of America, N.A. and the several lenders party thereto (Incorporated by reference to
Exhibit 10.2 to Current Report on Form 8-K/A (File No. 000-50478) filed by Nexstar Media Group, Inc. on September 9,
2020).
10.16 Amendment No. 4, dated as of June 3, 2021, to Credit Agreement, dated as of January 17, 2017, by and among Mission
Broadcasting, Inc., Bank of America, N.A. and the several lenders party thereto (Incorporated by reference to Exhibit 10.1
to Current Report on Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on June 4, 2021).
10.17 Amendment No. 5, dated as of June 3, 2021, to Credit Agreement, dated as of January 17, 2017, by and among Mission
Broadcasting, Inc., Bank of America, N.A. and the several lenders party thereto (Incorporated by reference to Exhibit 10.2
to Current Report on Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on June 4, 2021).
10.18 Amendment No. 6, dated as of June 21, 2022, to Credit Agreement, dated as of January 17, 2017, by among Mission
Broadcasting, Inc., Bank of America, N.A. and the several lenders party thereto (Incorporated by reference to Exhibit 10.1
to Quarterly Report on Form 10-Q for the quarter ended June 30, 2022 (File No. 000-50478) filed by Nexstar Media
Group, Inc.).
10.19 Amendment No. 7 dated as of June 6, 2023, to Credit Agreement, dated as of January 17, 2017, by among Mission
Broadcasting, Inc., Bank of America, N.A. and the several lenders party thereto
(Incorporated by reference to Exhibit
10.2 to Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 (File No. 000-50478) filed by Nexstar
Media Group, Inc.).
10.20 Executive Employment Agreement, dated as of January 5, 1998, by and between Perry A. Sook and Nexstar Media
Group, Inc., as amended on January 5, 1999. (Incorporated by reference to Exhibit 10.11 to Registration Statement on
Form S-4 (File No. 333-62916) filed by Nexstar Finance, L.L.C. and Nexstar Finance, Inc.).
10.21 Amendment to Employment Agreement, dated as of May 10, 2001, by and between Perry A. Sook and Nexstar Media
Group, Inc. (Incorporated by reference to Exhibit 10.12 to Registration Statement on Form S-4 (File No. 333-62916) filed
by Nexstar Finance, L.L.C. and Nexstar Finance, Inc.).
10.22 Modifications to Employment Agreement, dated as of September 26, 2002, by and between Perry A. Sook and Nexstar
Media Group, Inc. (Incorporated by reference to Exhibit 10.55 to Amendment No. 2 to Registration Statement on Form S-
1 (File No. 333-86994) filed by Nexstar Media Group, Inc.).
10.23 Addendum to Employment Agreement, dated as of August 25, 2003, by and between Perry A. Sook and Nexstar Media
Group, Inc. (Incorporated by reference to Exhibit 10.20 to Registration Statement on Form S-1 (File No. 333-86994) filed
by Nexstar Media Group, Inc.).
55
10.24 Addendum to Employment Agreement, dated as of July 2, 2007, by and between Perry A. Sook and N exstar Media
Group, Inc. (Incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q for the period ended June 30,
2007 (File No. 000-50478) filed by Nexstar Media Group, Inc. on August 8, 2007).
10.25 Addendum to Executive Employment Agreement between Perry A. Sook and Nexstar Media Group, Inc. (Incorporated by
reference to Exhibit 10.93 to Annual Report on Form 10-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on
March 31, 2009).
10.26 Addendum to Executive Employment Agreement, dated as of September 11, 2012, between Perry A. Sook and Nexstar
Broadcasting, Inc. (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478) filed
by Nexstar Media Group, Inc. on September 17, 2012).
10.27 Amendment to Executive Employment Agreement, dated as of January 29, 2015 between Perry A. Sook and Nexstar
Broadcasting, Inc. (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478) filed
by Nexstar Media Group, Inc. on February 5, 2015).
10.28 Amendment to Executive Employment Agreement, dated as of January 15, 2019 between Perry A. Sook and Nexstar
Broadcasting, Inc. (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478) filed
by Nexstar Media Group, Inc. on January 22, 2019).
10.29
Amendment to Executive Employment Agreement, dated as of August 1, 2022 between Perry A. Sook and Nexstar
Media Group, Inc. (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478)
filed by Nexstar Media Group, Inc. on August 4, 2022.
10.30 Executive Employment Agreement, dated as of July 13, 2009, by and between Thomas E. Carter and Nexstar Media
Group, Inc. (Incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q (File No. 000-50478) filed by
Nexstar Media Group, Inc. on August 12, 2009).
10.31 Amendment to the Executive Agreement between Thomas E. Carter and Nexstar Media Group, Inc. (Incorporated by
reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on
August 1, 2014).
10.32 Amendment to Executive Employment Agreement, dated as of January 9, 2017, between Thomas E. Carter and Nexstar
Media Group, Inc. (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478) filed
by Nexstar Media Group, Inc. on January 13, 2017).
10.33 Executive Employment Agreement, dated as of September 25, 2020, between Thomas E. Carter and Nexstar Media
Group, Inc. (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478) filed by
Nexstar Media Group, Inc. on October 1, 2020).
10.34 Executive Employment Agreement, effective as of August 21, 2023, between Michael Biard and Nexstar Media Group,
Inc. (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-50478/231119544) filed by
Nexstar Media Group, Inc. on July 28, 2023.
10.35 Executive Employment Agreement, dated July 26, 2021 between Lee Ann Gliha and Nexstar Media Group, Inc.
(Incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q for the quarter ended June 30, 2021 (File
No. 000-50478) filed by Nexstar Media Group, Inc.).
10.36 Amendment to Executive Employment Agreement, effective January 1, 2024, by and between Lee Ann Gliha and Nexstar
Media Group, Inc. (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-
50478/231502162) filed by Nexstar Media Group, Inc. on December 20, 2023.
10.37 Executive Employment Agreement, dated as of September 5, 2019, between Dana Zimmer and Nexstar Media Group, Inc.
(Incorporated by reference to Exhibit 10.7 to Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 (File
No. 000-50478) filed by Nexstar Media Group, Inc.).
10.38 Amendment to Executive Employment Agreement, effective as of September 19, 2023, between Dana Zimmer and
Nexstar Media Group, Inc. (Incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K (File No. 000-
50478/231092012) filed by Nexstar Media Group, Inc. on July 17, 2023.
10.39 Executive Employment Agreement, dated June 1, 2021 between Andrew Alford and Nexstar Media Group, Inc.
(Incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 (File
No. 000-50478) filed by Nexstar Media Group, Inc.).
10.40 Executive Employment Agreement, dated August 26, 2019 between Sean Compton and Nexstar Media Group, Inc.
(Incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 (File
No. 000-50478) filed by Nexstar Media Group, Inc.).
10.41 Amendment to Executive Employment Agreement, dated November 1, 2020 between Sean Compton and Nexstar Media
Group, Inc. (Incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q for the quarter ended March 31,
2022 (File No. 000-50478) filed by Nexstar Media Group, Inc.).
10.42 Amendment to Executive Employment Agreement, effective as of September 19, 2023, between Sean Compton and
Nexstar Media Group, Inc. (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K (File No. 000-
50478/231092012) filed by Nexstar Media Group, Inc. on July 17, 2023.
10.43 Amended and Restated Executive Employment Agreement, effective as of September 19, 2023 between Sean Compton
and Nexstar Media Group, Inc. (Incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q for the
quarter ended September 30, 2023 (File No. 000-50478) filed by Nexstar Media Group, Inc.).
10.44 Nexstar Media Group, Inc. 2012 Long-Term Equity Incentive Plan (Incorporated by reference to Exhibit 10.1 to Current
Report on Form 8-K (File No. 000-50478) filed by Nexstar Media Group, Inc. on October 2, 2012).
56
10.45 Nexstar Media Group, Inc. 2015 Long-Term Equity Incentive Plan (Incorporated by reference to Definitive Proxy
Statement on Schedule 14A (File No. 000-50478) filed by Nexstar Media Group, Inc. on April 24, 2015).
10.46 Nexstar Media Group, Inc. 2019 Long-Term Equity Incentive Plan (Incorporated by reference to Definitive Proxy
Statement on Schedule 14A (File No. 000-50478) filed by Nexstar Media Group, Inc. on April 26, 2019).
10.47 Nexstar Media Group, Inc.’s Restricted Stock Unit Agreement Form (Incorporated by reference to Exhibit 10.88 to
Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 (File No. 000-50478) filed by Nexstar Media
Group, Inc.).
14.1 Nexstar Media Group, Inc. Code of Ethics. (Incorporated by reference to Exhibit 14.1 to the Annual Report on Form 10-K
for the year ended December 31, 2003 (File No. 000-50478) filed by Nexstar Media Group, Inc.).
21.1 Subsidiaries of the Registrant.*
23.1 Consent issued by PricewaterhouseCoopers LLP.*
31.1 Certification of Perry A. Sook pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2 Certification of Lee Ann Gliha pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1 Certification of Perry A. Sook pursuant to 18 U.S.C. ss. 1350.*
32.2 Certification of Lee Ann Gliha pursuant to 18 U.S.C. ss. 1350.*
97.1
Clawback Policy, Nexstar Media Group, Inc.*
101.INS Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL
tags are embedded within the Inline XBRL document.
101.SCH Inline XBRL Taxonomy Extension Schema With Embedded Linkbases Document.
104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
+ Schedules have been omitted from this filing pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule will be furnished to the
Securities and Exchange Commission upon request.
* Filed herewith.
57
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned thereunto duly authorized.
N
EXSTAR MEDIA GROUP, INC.
By: /s/ PERRY A. SOOK
Perry A. Sook
Chairman and Chief Executive Officer
By: /s/ LEE ANN GLIHA
Lee Ann Gliha
Chief Financial Officer (Principal Accounting and
Financial Officer)
Dated: February 28, 2024
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on
behalf of the Registrant and in the capacities indicated on February 28, 2024.
Name
Title
/s/ PERRY A. SOOK Chairman and Chief Executive Officer
Perry A. Sook (Principal Executive Officer)
/s/ LEE ANN GLIHA Chief Financial Officer
Lee Ann Gliha (Principal Financial and Accounting Officer)
/s/ GEOFF ARMSTRONG Director
Geoff Armstrong
/s/ BERNADETTE AULESTIA Director
Bernadette Aulestia
/s/ DENNIS J. FITZSIMONS Director
Dennis J. FitzSimons
/s/ JAY M. GROSSMAN Director
Jay M. Grossman
/s/ C. THOMAS MCMILLEN Director
C. Thomas McMillen
/s/ LISBETH MCNABB Director
Lisbeth McNabb
/s/ JOHN R. MUSE Director
John R. Muse
/s/ I. MARTIN POMPADUR Director
I. Martin Pompadur
/s/ ROYCE A. WELLS Director
Royce A. Wells
F-1
NEXSTAR MEDIA GROUP, INC.
INDEX TO FINANCIAL STATEMENTS
Report of Independent Registered Public Accounting Firm (PCAOB ID Number 238)................................................................. F-2
Consolidated Balance Sheets as of December 31, 2023 and 2022................................................................................................... F-4
Consolidated Statements of Operations and Comprehensive Income for the years ended December 31, 2023, 2022 and 2021.... F-5
Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 31, 2023, 2022 and 2021 .............. F-6
Consolidated Statements of Cash Flows for the years ended December 31, 2023, 2022 and 2021 ................................................ F-7
N
otes to Consolidated Financial Statements
Note 1: Organization and Business Operations.......................................................................................................................... F-8
Note 2: Summary of Significant Accounting Policies ............................................................................................................... F-8
Note 3: Acquisitions ................................................................................................................................................................... F-17
Note 4: Property and Equipment ................................................................................................................................................ F-19
Note 5: Intangible Assets and Goodwill..................................................................................................................................... F-19
Note 6: Investments.................................................................................................................................................................... F-21
Note 7: Accrued Expenses.......................................................................................................................................................... F-22
Note 8: Debt ............................................................................................................................................................................... F-23
Note 9: Leases ............................................................................................................................................................................ F-26
Note 10: Retirement and Postretirement Plans........................................................................................................................... F-27
Note 11: Fair Value Measurements............................................................................................................................................ F-31
Note 12: Common Stock ............................................................................................................................................................ F-32
Note 13: Stock-Based Compensation......................................................................................................................................... F-33
Note 14: Income Taxes............................................................................................................................................................... F-35
Note 15: FCC Regulatory Matters.............................................................................................................................................. F-37
Note 16: Commitments and Contingencies................................................................................................................................ F-38
Note 17: Segment Data .............................................................................................................................................................. F-41
Note 18: Valuation and Qualifying Accounts ............................................................................................................................ F-43
Note 19: Subsequent Events....................................................................................................................................................... F-43
F-2
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders of Nexstar Media Group, Inc.
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheets of Nexstar Media Group, Inc. and its subsidiaries (the “Company”) as
of December 31, 2023 and 2022, and the related consolidated statements of operations and comprehensive income, of changes in
stockholders’ equity and of cash flows for each of the three years in the period ended December 31, 2023, including the related notes
(collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over
financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued
by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of
the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the
period ended December 31, 2023 in conformity with accounting principles generally accepted in the United States of America. Also in
our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31,
2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.
Basis for Opinions
The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over
financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s
Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the
Company’s consolidated financial statements and on the Company’s internal control over financial reporting based on our audits. We
are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules
and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits
to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to
error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the
consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such
procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial
statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well
as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting
included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and
testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included
performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable
basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the
maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the
company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect
on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may deteriorate.
F-3
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements
that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are
material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The
communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a
whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or
on the accounts or disclosures to which it relates.
Uncertain Tax Position Related to the Chicago Cubs Transactions
As described in Notes 14 and 16 to the consolidated financial statements, the Company has recorded liabilities for uncertain tax
positions of $27.0 million as of December 31, 2023. As disclosed by management, the estimate of the Company’s tax liabilities
relating to uncertain tax positions requires management to assess uncertainties and to make judgments about the application of
complex tax laws and regulations. On June 28, 2016, the Internal Revenue Service (“IRS”) issued Tribune Media Company (a
subsidiary of the Company, “Tribune”) a Notice of Deficiency which presented the IRS’s position that a gain with respect to a
contribution of certain assets and liabilities related to the businesses of the Chicago Cubs Major League Baseball franchise (“the
Chicago Cubs Transactions”) should have been included in Tribune’s 2009 taxable income. Accordingly, the IRS proposed a $182.0
million tax and a $73.0 million gross valuation misstatement penalty. After-tax interest on the aforementioned proposed tax and
penalty through December 31, 2023 would be approximately $191.0 million. During the third quarter of 2016, Tribune filed a petition
in U.S. Tax Court to contest the IRS’s determination. On October 26, 2021, the Tax Court issued an opinion related to the Chicago
Cubs Transactions, which held that Tribune’s structure was, in substantial part, in compliance with partnership provisions of the
Internal Revenue Code (“IRC”) and, as a result, did not trigger the entire 2009 taxable gain proposed by the IRS. As of December 31,
2023, management believes the tax impact of applying the Tax Court opinion is not material to the Company’s Consolidated Financial
Statements.
The principal considerations for our determination that performing procedures relating to the uncertain tax position related to the
Chicago Cubs Transactions is a critical audit matter are (i) the significant judgment by management when assessing the measurement
of the uncertain tax position related to the Chicago Cubs Transactions; (ii) a high degree of auditor judgment, subjectivity, and effort
in performing procedures and evaluating the audit evidence related to the measurement of the uncertain tax position related to the
Chicago Cubs Transactions; (iii) the audit effort involved the use of professionals with specialized skill and knowledge.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion
on the consolidated financial statements. These procedures included testing the effectiveness of controls related to measurement of the
uncertain tax position related to the Chicago Cubs Transactions. These procedures also included, among others (i) testing the
information used in the calculation of the liability for the uncertain tax position related to the Chicago Cubs Transactions, including
federal filing positions and the related final tax returns; (ii) testing the calculation of the liability for the uncertain tax position related
to the Chicago Cubs Transactions, including management’s assessment of the technical merits of the tax position; (iii) testing
management’s assessment of the possible outcomes of the uncertain tax position related to the Chicago Cubs Transactions; and (iv)
evaluating the status and results of income tax audits with the relevant tax authorities. Professionals with specialized skill and
knowledge were used to assist in the evaluation of the measurement of the uncertain tax position related to the Chicago Cubs
Transactions, including evaluating the reasonableness of management’s assessment of the amount of potential tax benefit to be
realized, and the application of relevant tax laws.
/s/ PricewaterhouseCoopers LLP
Dallas, Texas
February 28, 2024
We have served as the Company’s auditor since 1997.
F-4
NEXSTAR MEDIA GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(in millions, except for share and per share information)
December 31,
2023 2022
ASSETS
Current assets:
Cash and cash equivalents $ 135 $ 204
Restricted cash and cash equivalents 12 16
Accounts receivable, net of allowance for credit losses of $20 and $18, respectively 1,095 1,080
Broadcast rights 136 194
Prepaid expenses and other current assets 88 121
Total current assets 1,466 1,615
Property and equipment, net 1,269 1,262
Goodwill 2,946 2,961
FCC licenses 2,929 2,910
Network affiliation agreements, net 1,683 1,871
Other intangible assets, net 441 563
Investments 958 1,119
Other noncurrent assets, net 386 378
Total assets
(1)
$ 12,078 $ 12,679
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of debt $ 124 $ 124
Accounts payable 235 198
Broadcast rights payable 136 151
Accrued expenses 350 319
Operating lease liabilities 47 50
Other current liabilities 69 51
Total current liabilities 961 893
Debt 6,713 6,827
Deferred tax liabilities 1,520 1,606
Other noncurrent liabilities 571 584
Total liabilities
(1)
9,765 9,910
Commitments and contingencies (Note 16)
Stockholders’ equity:
Preferred stock - $0.01 par value, 200,000 shares authorized; none issued and outstanding at each
of December 31, 2023 and December 31, 2022 - -
Common stock - $0.01 par value, 100,000,000 shares authorized; 47,282,823 shares issued,
33,600,926 shares outstanding as of December 31, 2023 and 47,282,823 shares issued,
36,810,186 shares outstanding as of December 31, 2022 - -
Additional paid-in capital 1,283 1,288
Accumulated other comprehensive income 1 27
Retained earnings 3,188 3,033
Treasury stock - at cost; 13,681,897 and 10,472,637 shares as of December 31, 2023 and
December 31, 2022, respectively (2,173) (1,607)
Total Nexstar Media Group, Inc. stockholders’ equity 2,299 2,741
Noncontrolling interests 14 28
Total stockholders’ equity 2,313 2,769
Total liabilities and stockholders’ equity $ 12,078 $ 12,679
The accompanying Notes are an integral part of these Consolidated Financial Statements.
(1) The consolidated total assets as of December 31, 2023 and 2022 include certain assets held by consolidated VIEs of $300 million and $304
million, respectively, which are not available to be used to settle the obligations of Nexstar. The consolidated total liabilities as of December
31, 2023 and 2022 include certain liabilities of consolidated VIEs of $152 million and $148 million, respectively, for which the creditors of
the VIEs have no recourse to the general credit of Nexstar. See Note 2 for additional information.
F-5
NEXSTAR MEDIA GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(in millions, except for share and per share information)
Years Ended December 31,
2023 2022 2021
N
et revenue $ 4,933 $ 5,211 $ 4,648
Operating expenses (income):
Direct operating, excluding depreciation and amortization 2,153 2,005 1,862
Selling, general and administrative, excluding depreciation and amortization 1,096 1,102 1,024
Depreciation and amortization 941 662 589
Goodwill and long-lived asset impairments 35 133 23
Reimbursement from the FCC related to station repack - (3) (20)
Other - - (5)
Total operating expenses 4,225 3,899 3,473
Income from operations 708 1,312 1,175
Gain on bargain purchase - 56 -
Income from equity method investments, net 104 153 125
Interest expense, net (447) (337) (283)
Loss on extinguishment of debt - (3) (3)
Pension and other postretirement plans credit, net 36 43 81
Other expenses, net - (7) (2)
Income before income taxes 401 1,217 1,093
Income tax expense (131) (274) (263)
N
et income 270 943 830
N
et loss attributable to noncontrolling interests 76 28 4
N
et income attributable to Nexstar Media Group, Inc. $ 346 $ 971 $ 834
N
et income per common share attributable to Nexstar Media Group, Inc.:
Basic $ 9.78 $ 24.68 $ 19.81
Diluted $ 9.64 $ 24.16 $ 18.98
Weighted average number of common shares outstanding:
Basic (in thousands) 35,317 39,349 42,133
Diluted (in thousands) 35,834 40,187 43,982
N
et income $ 270 $ 943 $ 830
Other comprehensive income (loss):
Change in unrecognized amounts included in pension and other postretirement benefit
obligations, net of tax benefit (expense) of $9 in 2023, $39 in 2022, and ($37) in 2021
(26) (114) 107
Total comprehensive income 244 829 937
Total comprehensive loss attributable to noncontrolling interests 76 28 4
Total comprehensive income attributable to Nexstar Media Group, Inc. $ 320 $ 857 $ 941
The accompanying Notes are an integral part of these Consolidated Financial Statements.
F-6
NEXSTAR MEDIA GROUP, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
For the Three Years Ended December 31, 2023
(in millions, except for share and per share information)
Accumulated
Additional Other Total
Common Stock Paid-In Retained Comprehensive Treasury Stock Noncontrolling Stockholdersʼ
Shares Amount Capital Earnings Income Shares Amount interests Equity
Balances as of December 31, 2020 47,291,463 $ - $ 1,363 $ 1,488 $ 34 (4,034,635) $ (367) $ 19 $ 2,537
Purchase of treasury stock - - - - - (3,575,568) (537) - (537)
Stock-based compensation expense - - 47 - - - - - 47
Vesting of restricted stock units and exercise of stock options - - (100) - - 1,076,169 97 - (3)
Dividends declared on common stock ($2.80 per share) - - - (118) - - - - (118)
Change in reporting entity resulting from common control
transactions
- - 1 - - - - (7) (6)
Change in pension and other postretirement benefit obligations,
net of tax
- - - - 107 - - - 107
N
et income (loss) - - - 834 - - - (4) 830
Balances as of December 31, 2021 47,291,463 - 1,311 2,204 141 (6,534,034) (807) 8 2,857
Purchase of treasury stock - - - - - (5,055,304) (881) - (881)
Stock-based compensation expense - - 62 - - - - - 62
Vesting of restricted stock units and exercise of stock options
- - (85) - - 1,116,701 81 - (4)
Dividends declared on common stock ($3.60 per share) - - - (142) - - - - (142)
Contribution from noncontrolling interests - - - - - - - 30 30
N
oncontrolling interests from a business combination (see Note 3) - - - - - - - 24 24
Distribution to a noncontrolling interest - - - - - - - (6) (6)
Change in pension and other postretirement benefit obligations,
net of tax
- - - - (114) - - - (114)
Other (8,640) - - - - - - - -
N
et income (loss) - - - 971 - - - (28) 943
Balances as of December 31, 2022 47,282,823 - 1,288 3,033 27 (10,472,637) (1,607) 28 2,769
Purchase of treasury stock - - - - - (3,782,104) (611) - (611)
Stock-based compensation expense - - 60 - - - - - 60
Vesting of restricted stock units and exercise of stock options
- - (65) - - 572,844 45 - (20)
Dividends declared on common stock ($5.40 per share) - - - (191) - - - - (191)
Contribution from noncontrolling interests - - - - - - - 62 62
Change in pension and other postretirement benefit obligations,
net of tax
- - - - (26) - - - (26)
N
et income (loss) - - - 346 - - - (76) 270
Balances as of December 31, 2023 47,282,823 $ - $ 1,283 $ 3,188 $ 1 (13,681,897) $ (2,173) $ 14 $ 2,313
The accompanying Notes are an integral part of these Consolidated Financial Statements.
F-7
NEXSTAR MEDIA GROUP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
Years Ended December 31,
2023 2022 2021
Cash flows from operating activities:
Net income $ 270 $ 943 $ 830
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 941 662 589
Goodwill and other long-lived asset impairments 35 133 23
Stock-based compensation expense 60 62 47
Amortization of debt financing costs, debt discounts and premium 11 13 15
Deferred income taxes (77) (103) 5
Spectrum repack reimbursements - (3) (20)
Payments for broadcast rights (417) (244) (167)
Gain on bargain purchase - (56) -
Income from equity method investments, net (104) (153) (125)
Distribution from equity method investments—return on capital 270 250 239
Changes in operating assets and liabilities, net of acquisitions and dispositions:
Accounts receivable (13) (12) (109)
Prepaid expenses and other current assets (4) 10 (5)
Other noncurrent assets (24) (1) 35
Accounts payable 32 (50) 28
Accrued expenses and other current liabilities 29 (19) 4
Income tax payable 37 10 (48)
Other noncurrent liabilities (48) (52) (118)
Other 1 13 (8)
N
et cash provided by operating activities 999 1,403 1,215
Cash flows from investing activities:
Purchases of property and equipment (149) (157) (151)
Payments for acquisitions, net of cash acquired (38) - (138)
Deposits received associated with the sale of real estate assets 10 10 13
Proceeds from disposals of assets 8 241 18
Cash acquired on business acquisition - 29 -
Spectrum repack reimbursements - 3 20
Other investing activities, net (4) (1) 6
N
et cash provided by (used in) investing activities (173) 125 (232)
Cash flows from financing activities:
Proceeds from debt issuance, net of debt discounts 20 2,480 321
Repayments of long-term debt (145) (2,960) (590)
Purchase of treasury stock (605) (881) (537)
Common stock dividends paid (191) (142) (118)
Contribution from noncontrolling interests 62 30 -
Payments for capitalized software obligations (19) (16) (17)
Cash paid for shares withheld for taxes (24) (12) (11)
Payments for contingent consideration in connection with a past acquisition - (14) -
Other financing activities, net 3 - 7
N
et cash used in financing activities (899) (1,515) (945)
N
et increase (decrease) in cash, cash equivalents and restricted cash (73) 13 38
Cash, cash equivalents and restricted cash at beginning of period 220 207 169
Cash, cash equivalents and restricted cash at end of period $ 147 $ 220 $ 207
Supplemental information:
Interest paid $ 437 $ 330 $ 273
Income taxes paid, net of refunds $ 169 $ 370 $ 320
Non-cash investing and financing activities:
Accrued and noncash purchases of property and equipment $ 13 $ 10 $ 11
Right-of-use assets obtained in exchange for operating lease obligations $ 54 $ 50 $ 45
The accompanying Notes are an integral part of these Consolidated Financial Statements.
F-8
NEXSTAR MEDIA GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1: Organization and Business Operations
As used in these Consolidated Financial Statements and unless the context indicates otherwise, “Nexstar” refers to Nexstar
Media Group, Inc., a Delaware corporation, and its consolidated wholly-owned and majority-owned subsidiaries; the “Company”
refers to Nexstar and the variable interest entities (“VIEs”) required to be consolidated in our financial statements under authoritative
guidance related to the consolidation of VIEs; and all references to “we,” “our,” “ours,” and “us” refer to Nexstar.
Nexstar is a leading diversified media company with television broadcasting, television network and digital media assets
operating in the United States. As of December 31, 2023, we owned, operated, programmed or provided sales and other services to
200 full power television stations and one AM radio station, including those television stations owned by VIEs, in 116 markets in
39 states and the District of Columbia. The stations are affiliates of CBS, FOX, NBC, ABC, The CW, MyNetworkTV, and other
broadcast television networks. As of December 31, 2023, Nexstar’s stations reached approximately 39% of all U.S. television
households (after applying the Federal Communications Commission’s (“FCC”) ultra-high frequency (“UHF”) discount). Through
various local service agreements, we provided sales, programming, and other services to 35 television stations owned by consolidated
VIEs and one television station owned by an unconsolidated VIE. Nexstar also owns a 75.0% ownership interest in The CW Network,
LLC, the fifth major broadcast network in the U.S. (“The CW”), NewsNation, a national cable news network, two digital multicast
networks, Antenna TV and Rewind TV, multicast network services provided to third parties, and a 31.3% ownership stake in
Television Food Network, G.P. (“TV Food Network”). Our digital assets include more than 140 local websites, 278 mobile
applications, 25 connected television applications, six free-ad supported television channels representing products of our local
television stations, The CW, NewsNation, The Hill and BestReviews, and a suite of advertising solutions.
Note 2: Summary of Significant Accounting Policies
Principles of Consolidation
The Consolidated Financial Statements include the accounts of Nexstar, subsidiaries consolidated through voting interests and
VIEs for which we are the primary beneficiary (See “Variable Interest Entities” section below). Noncontrolling interests represent the
minority owners’ share in profit or loss and equity of The CW and the VIE owners’ share in profit or loss and equity in the
consolidated VIEs. Noncontrolling interests are presented as a component separate from Nexstar’s stockholders’ equity in the
accompanying Consolidated Balance Sheets and Consolidated Statements of Changes in Stockholders’ Equity. All intercompany
account balances and transactions have been eliminated in consolidation. Nexstar management evaluates each arrangement that may
include variable interests and determines the need to consolidate an entity where it determines Nexstar is the primary beneficiary of a
VIE in accordance with related authoritative literature and interpretive guidance.
Liquidity
The Company is leveraged, which makes it vulnerable to changes in general economic conditions. The Company’s ability to
repay or refinance its debt will depend on, among other things, financial, business, market, competitive and other conditions, many of
which are beyond the Company’s control. The Company believes it has sufficient unrestricted cash on hand, positive working capital,
and availability to access additional cash under its revolving credit facilities (with a maturity date of June 2027) to meet its business
operating requirements, its capital expenditures and to continue to service its debt for at least the next 12 months as of the filing date
of this Annual Report on Form 10-K. As of December 31, 2023, the Company was in compliance with the financial covenants
contained in the amended credit agreements governing its senior secured credit facilities.
Variable Interest Entities
Nexstar may determine that an entity is a VIE as a result of local service agreements entered into with that entity. The term local
service agreement generally refers to a contract whereby the owner-operator of a television station contracts with a third party
(typically another television station owner-operator) to provide it with administrative, sales and other services required for the
operation of its station. Nevertheless, the owner-operator of each station retains control of and responsibility for the operation of its
station, including ultimate responsibility over all programming broadcast on its station. A local service agreement can be (i) a time
brokerage agreement (“TBA”) or a local marketing agreement (“LMA”) which allows Nexstar to program most of a station’s
broadcast time, sell the station’s advertising time and retain the advertising revenue generated in exchange for monthly payments,
frequently based on the station’s monthly operating expenses, (ii) a shared services agreement (“SSA”) which allows Nexstar to
provide services to a station including news production, technical maintenance and security, in exchange for Nexstar’s right to receive
certain payments as described in the SSA, or (iii) a joint sales agreement (“JSA”) which permits Nexstar to sell certain of the station’s
advertising time and retain a percentage of the related revenue, as described in the JSA.
F-9
Consolidated VIEs
Nexstar consolidates entities in which it is deemed under accounting principles generally accepted in the United States (“U.S.
GAAP”) to have controlling financial interests for financial reporting purposes as a result of (i) local service agreements Nexstar has
with the stations owned by these entities, (ii) Nexstar’s (excluding The CW) guarantee of the obligations incurred under Mission
Broadcasting, Inc.’s (“Mission”) senior secured credit facility (see Note 8), (iii) Nexstar having power over significant activities
affecting these VIEs’ economic performance, including budgeting for advertising revenue, certain advertising sales and, in some
cases, hiring and firing of sales force personnel and (iv) purchase options granted by each consolidated VIE which permit Nexstar to
acquire the assets and assume the liabilities of each of these VIEs’ stations, subject to FCC consent.
The following table summarizes the various local service agreements Nexstar had in effect as of December 31, 2023 with its
consolidated VIEs:
Owner Service Agreements Full Power Stations
Mission TBA WFXP, KHMT and KFQX
SSA & JSA KJTL, KLRT, KASN, KOLR, KCIT, KAMC, KRBC,
KSAN, WUTR, WAWV, WYOU, KODE, WTVO,
KTVE, WTVW, WVNY, WXXA, WLAJ, KMSS, KPEJ,
KLJB, KASY, KWBQ and KRWB
LMA WNAC and WPIX
White Knight Broadcasting (“White Knight”) SSA & JSA WVLA and KFXK
Vaughan Media, LLC (“Vaughan”) SSA & JSA WBDT, WYTV and KTKA
LMA KNVA
Nexstar’s ability to receive cash from the consolidated VIEs is governed by the local service agreements. Under these
agreements, Nexstar has received substantially all of the consolidated VIEs’ available cash, after satisfaction of operating costs and
debt obligations. Nexstar anticipates it will continue to receive substantially all of the consolidated VIEs’ available cash, after
satisfaction of operating costs and debt obligations. In compliance with FCC regulations for all the parties, each VIE maintains
complete responsibility for and control over programming, finances, personnel and operations of its stations.
As of December 31, the carrying amounts and classification of the assets and liabilities, excluding intercompany amounts, of the
VIEs which have been included in the Consolidated Balance Sheets were as follows (in millions):
2023 2022
Current assets:
Cash and cash equivalents $ 6 $ 6
Accounts receivable, net 17 26
Prepaid expenses and other current assets 5 6
Total current assets
28 38
Property and equipment, net 58 59
Goodwill 151 151
FCC licenses 200 200
N
etwork affiliation agreements, net 68 76
Other noncurrent assets, net 67 80
Total assets
$ 572 $ 604
Current liabilities:
Current portion of debt $ 2 $ 3
Other current liabilities 38 30
Total current liabilities
40 33
Debt 350 353
Deferred tax liabilities 36 35
Other noncurrent liabilities 78 85
Total liabilities
$ 504 $ 506
F-10
As of December 31, the following are assets of consolidated VIEs, excluding intercompany amounts, that are not available to
settle the obligations of Nexstar and the liabilities of consolidated VIEs, excluding intercompany amounts, for which their creditors do
not have recourse to the general credit of Nexstar (in millions):
2023 2022
Current assets $ 3 $ 4
Property and equipment, net 11 11
Goodwill 62 62
FCC licenses 200 200
N
etwork affiliation agreements, net 22 26
Other noncurrent assets, net 2 1
Total assets
$ 300 $ 304
Current liabilities $ 38 $ 28
N
oncurrent liabilities 114 120
Total liabilities
$ 152 $ 148
Non-Consolidated VIEs
Nexstar has an outsourcing agreement with Cunningham Broadcasting Corporation (“Cunningham”), which continues through
December 31, 2025. Under the outsourcing agreement, Nexstar provides certain engineering, production, sales and administrative
services for WYZZ, the FOX affiliate in the Peoria, Illinois market, through WMBD, the Nexstar television station in that market.
During the term of the outsourcing agreement, Nexstar retains the broadcasting revenue and related expenses of WYZZ and is
obligated to pay a monthly fee to Cunningham based on the combined operating cash flow of WMBD and WYZZ, as defined in the
agreement. Nexstar has determined that it has a variable interest in WYZZ. Nexstar has also evaluated its arrangements with
Cunningham and has determined that it is not the primary beneficiary of the variable interest in this station because it does not have
the ultimate power to direct the activities that most significantly impact the station’s economic performance, including developing the
annual operating budget, programming and oversight and control of sales management personnel. Therefore, Nexstar has not
consolidated WYZZ under authoritative guidance related to the consolidation of VIEs. There were no significant transactions arising
from Nexstar’s outsourcing agreement with Cunningham. Cunningham does not guarantee Nexstar’s debt.
Basis of Presentation
Certain prior year financial statement amounts have been reclassified to conform to the current year presentation. These
reclassifications had no effect on net income or stockholders’ equity as previously reported.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and use
assumptions that affect the reported amounts of assets and liabilities and the disclosure for contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenue and expenses during the reporting period. The more significant
estimates made by management include, but are not limited to, those relating to allowance for credit losses, valuation of assets
acquired and liabilities assumed in business combinations, distribution revenue recognized, deferred income tax asset valuation
allowances, fair value of stock-based compensation, the recoverability of goodwill, FCC licenses and long-lived assets, pension and
postretirement obligations, the recoverability of investments, the recoverability of broadcast rights and the useful lives of property and
equipment and intangible assets. As of December 31, 2023, the Company is not aware of any specific event or circumstance that
would require an update to its estimates or judgments or revision of the carrying value of its assets or liabilities. However, these
estimates and judgments may change as new events occur and additional information is obtained, which may result in changes being
recognized in the Company’s consolidated financial statements in future periods. Such judgments and assumptions could result in a
meaningful impact on the Company’s consolidated financial statements in future periods. Actual results could differ from those
estimates and any such differences may have a material impact on the Company’s consolidated financial statements.
F-11
Cash and Cash Equivalents
The Company considers all highly liquid investments purchased with an original maturity of ninety days or less to be cash
equivalents.
Accounts Receivable and Allowance for Credit Losses
The Company’s accounts receivable consist primarily of billings to its customers for advertising broadcast on its stations or
placed on its websites, for retransmission consent or network carriage by cable or satellite operators, and for digital publishing and
content management, digital video advertising, social media advertising and related services. Trade receivables normally have terms
of 30 days and the Company has no interest provision for customer accounts that are past due. The Company maintains an allowance
for estimated losses resulting from the inability of customers to make required payments. Management periodically evaluates the
collectability of accounts receivable based on a combination of factors, including customer payment history, known customer
circumstances, the overall aging of customer balances and trends. In circumstances where management is aware of a specific
customer’s inability to meet its financial obligations, an allowance is recorded to reduce the receivable amount to an amount estimated
to be collectable.
Concentration of Credit Risk
Financial instruments which potentially expose the Company to a concentration of credit risk consist principally of cash and
cash equivalents, restricted cash, and accounts receivable. Cash deposits are maintained with several financial institutions. Deposits
held with banks may exceed the amount of insurance provided on such deposits; however, the Company believes these deposits are
maintained with financial institutions of reputable credit and are not subject to any unusual credit risk. A significant portion of the
Company’s accounts receivable is due from multichannel video programming distributors (“MVPDs”) and local and national
advertising agencies. The Company does not require collateral from its customers but maintains reserves for potential credit losses.
Management believes that the allowance for credit losses is adequate, but if the financial condition of the Company’s customers were
to deteriorate, additional allowances may be required. The Company has not experienced significant losses related to receivables from
individual customers or by geographical area.
Revenue Recognition
The Company recognizes revenues when control of the promised goods or services is transferred to the Company’s customers in
an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The
Company’s revenue is primarily derived from the sale of advertising and the compensation received from traditional MVPDs, such as
cable and satellite providers, as well as online video distributors (“OVDs”), companies that provide video content through internet
streaming, in return for the Company’s consent to the retransmission of the signals of its television stations or the carriage of
NewsNation. Total revenue includes advertising revenue, distribution revenue, digital revenue and other broadcast related revenues.
The Company’s contracts with customers may include multiple performance obligations. For such arrangements, the Company
allocates revenue to each performance obligation based on its relative standalone selling price, which is generally determined based on
the price charged to customers. The Company also determines whether gross or net presentation is appropriate based on its
relationship in the applicable transaction with its ultimate customer. Any amounts paid by customers but not earned as of the balance
sheet date are recorded as a contract liability (deferred revenue). The lag between billing the customers and when the payment is due
is not significant.
Core and Political Advertising Revenues—The Company generates revenue by delivering advertising on the Company’s
television stations, cable and broadcast networks, and radio station. The advertising contracts are short-term in nature and include a
number of spots that are delivered over the term of the arrangement. For broadcast of commercials (local and national advertising, or
core advertising, and political advertising), the performance obligation is identified at the contract level as it represents a promise to
deliver an agreed number of spots, an agreed price per spot and other specifications. Each performance obligation is satisfied over
time as the advertiser receives and consumes benefits when its commercial is aired.
Distribution Revenues—The Company’s retransmission consent and carriage agreements with MVPDs and OVDs generally
provide revenue based on a monthly amount the Company is entitled to receive per subscriber. These revenues are considered arising
from the licensing of functional intellectual property. As such, the Company applies the exception for sales- or usage-based royalty for
the accounting of variable consideration and recognizes revenue (distribution revenue) at the point in time the broadcast signal is
delivered to the distributors. The distributors report their subscriber numbers to the Company on a 30- to 60-day lag, which coincides
with their payment of the fees due to the Company. Prior to receiving the report, the Company records revenue based on an estimated
number of subscribers and the monthly amount the Company is entitled to receive per subscriber. Adjustments associated with the
resolution of such estimates have, historically, been inconsequential. Other distribution revenue includes affiliate compensation
revenue in accordance with certain affiliation agreements, which is recognized ratably over the term of the agreement.
F-12
Digital Revenues—For station digital advertising, the performance obligation is a station’s promise to place an advertisement on
its website and is satisfied either based on impressions or the placement of ads over an agreed period of time. Advertising revenue is
recognized, for the amount the Company is entitled to receive, when the advertisements are broadcast or delivered on the stations’
websites. Other digital advertising includes revenue from video and display advertising platforms that are delivered locally or
nationally through our own and various third party websites and mobile applications. Revenue is recognized at the time advertising is
delivered through these platforms. Revenue from other digital businesses includes a consumer product reviews platform, which is
recognized upon performance of services. The Company applies the right to invoice practical expedient to certain transactions where
the invoice amount corresponds directly with the value to its customers. Most of the arrangements with customers are short-term in
nature.
Contract Costs—The Company does not capitalize costs incurred to obtain contracts for advertising due to their short-term
nature. Additionally, the incremental benefit from efforts in acquiring these contracts is not considered significant. Thus, the Company
records sales commissions as an expense when incurred.
Contract Liabilities—The Company’s contract liabilities, which are included in its Consolidated Financial Statements as other
current liabilities, consist primarily of customer payments received for products or services before the transfer of control to the
customer occurs (deferred revenue). The performance primarily involves the delivery of advertisements to the customers.
The Company does not disclose the value of unsatisfied performance obligations on its contracts with customers because they
are either (i) contracts with an original expected term of one year or less, (ii) contracts for which the sales- or usage-based royalty
exception was applied, or (iii) contracts for which revenue is recognized in proportion to the amount the Company has the right to
invoice for services performed.
See Note 17 for disaggregated revenue information.
Investments
The Company accounts for investments in which it owns at least 20% of an investee’s voting securities or has significant
influence over an investee under the equity method of accounting. The Company records equity method investments at cost. For
investments acquired in a business combination, the cost is the estimated fair value allocated to the investment. The amounts initially
recognized are subsequently adjusted for the Company’s appropriate share of the net earnings or losses of the investee. The Company
records any investee losses up to the carrying amount of the investment plus any advances and loans made to the investee and any
financial guarantees made on behalf of the investee. The Company recognizes its share in earnings and losses of the investee as
“Income from equity method investments, net” in the Consolidated Statements of Operations and Comprehensive Income.
Investments are also increased by contributions made to and decreased by distributions from the investee. The Company evaluates
equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such
investments may be impaired. The Company evaluates equity method investments for other-than temporary impairment (“OTTI”) on
at least a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. For the years ended
December 31, 2023, 2022 and 2021, the Company did not identify any events or changes in circumstances which indicated that the
carrying amount of investments may be impaired. See Note 6 for additional information on the Company’s investments.
Leases
The Company determines if a contract is a lease at inception. We determine that a contract contains a lease if we obtain
substantially all of the economic benefits of, and the right to direct the use of, an asset identified in the contract. For leases with terms
greater than 12 months, we record right-of-use (“ROU”) asset and lease liability which are both measured at the present value of the
future lease payments over the lease term. The lease payments exclude any executory costs as they are not significant. The lease term
may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. When
determining if a renewal option is reasonably certain of being exercised, the Company considers several factors, including but not
limited to the significance of leasehold improvements incurred on the property, whether the asset is difficult to replace, and specific
characteristics unique to the particular lease that would make it reasonably certain that the Company would exercise such option. As
most of the Company’s leases do not provide an implicit rate, the incremental borrowing rate was used in determining the present
value of future lease payments. The discount rate represents a risk-adjusted rate on a secured basis and is the rate at which the
Company would borrow funds to satisfy the scheduled lease liability payment streams commensurate with the lease term. ROU assets
and lease liabilities arising from operating leases are included in other noncurrent assets, other current liabilities and other noncurrent
liabilities in the accompanying Consolidated Balance Sheets. Lease expense for lease payments is recognized on a straight-line basis
over the lease term.
See Note 9 for additional disclosures on leases as of December 31, 2023.
F-13
Broadcast Rights and Broadcast Rights Payable
The Company acquires licenses to broadcast programs from national program syndicators and from certain production
companies. The Company records these contracts as an asset and a liability when the following criteria are met: (i) the license period
has begun, (ii) the cost of each program is known or reasonably determinable, (iii) the program material has been accepted in
accordance with the license agreement, and (iv) the program is produced and available for broadcast. Broadcast rights are initially
recorded at the contract cost and are amortized on a straight-line basis over the period the programming airs. The current portion of
broadcast rights represents those rights available for broadcast which will be amortized in the succeeding year. The Company
periodically evaluates the net realizable value, calculated using the average historical rates for the programs or the time periods the
programming will air, of broadcast rights and adjusts the amortization for any deficiency calculated. As of December 31, 2023 and
2022, programming costs included $64 million and $66 million, respectively, that were contractually due related to episodes that had
been completed by certain production companies but not yet delivered to the Company. Such episodes are typically delivered within a
few weeks of completion.
The Company also acquired exclusive rights to broadcast various live sports games in exchange for rights fees paid over the
season associated with the live sports games. The Company amortizes these programming rights as an expense over each season based
upon contractually stated rates which align with the projected revenue over the contractual term. Amortization is evaluated
periodically, based on revenue projections, and adjusted as necessary.
For the years ended December 31, 2023, 2022 and 2021, amortization of broadcast rights of $453 million, $193 million and
$121 million, respectively, were included in Depreciation and amortization expense in the accompanying Consolidated Statements of
Operations and Comprehensive Income.
Property and Equipment, Net
Property and equipment is stated at cost or at estimated fair value if acquired through a business combination. The cost and
related accumulated depreciation applicable to assets sold or retired are removed from the accounts and the gain or loss on disposition
is recognized. Major renewals and betterments are capitalized, and ordinary repairs and maintenance are charged to expense in the
period incurred. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets (see Note 4).
Intangible Assets, Net
Intangible assets consist primarily of goodwill, FCC licenses, network affiliation agreements, developed technology, brand
value and customer relationships arising from acquisitions.
The Company accounts for acquired businesses using the acquisition method of accounting, which requires that purchase prices,
including any contingent consideration, are measured at acquisition date fair values. These purchase prices are allocated to the assets
acquired and liabilities assumed at estimated fair values at the date of acquisition using various valuation techniques, including the
income approach, such as discounted projected cash flows, and other income, market or cost approaches.
The estimated fair value of an FCC license acquired in a business combination is calculated using a discounted projected cash
flow model referred to as the Greenfield Method. The Greenfield Method attempts to isolate the income that is attributable to the
license alone. This approach is based upon modeling a hypothetical start-up station and building it up to a normalized operation that,
by design, lacks an affiliation with a network (commonly known as an independent station), lacks inherent goodwill and whose other
assets have essentially been added as part of the build-up process. The Greenfield Method assumes annual cash flows over a
projection period model. Inputs to this model include, but are not limited to, (i) a four-year build-up period for a start-up station to
reach a normalized state of operations, (ii) television market long-term growth rate over a projection period, (iii) estimated market
revenue share for a typical market participant without a network affiliation, (iv) estimated profit margins based on industry data, (v)
capital expenditures based on the size of market and the type of station being constructed, (vi) estimated tax rates in the appropriate
jurisdiction, and (vii) an estimated discount rate using a weighted average cost of capital analysis. The Greenfield Method also
includes an estimated terminal value by discounting an estimated annual cash flow with an estimated long-term growth rate.
The assumptions used in estimating the fair value of a network affiliation agreement acquired in a business combination are
similar to those used in the valuation of an FCC license. The Greenfield Method is also utilized in the valuation of network affiliation
agreements except that the estimated market revenue share, estimated profit margins, capital expenditures and other assumptions
reflect a market participant premium based on the programming of a network affiliate relative to an independent station. This approach
would result in an estimated collective fair value of the FCC license and a network affiliation agreement. The excess of the estimated
fair value in this model over the estimated value of an FCC license of an independent station under the Greenfield Method represents
the estimated fair value of a network affiliation agreement.
F-14
Goodwill represents the excess of the purchase price over the fair value of the identifiable net assets acquired. During the
measurement period, which may be up to one year from the acquisition date of a business, the Company records adjustments related to
the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period
or final determination of the values of assets acquired and liabilities assumed, whichever comes first, any subsequent adjustments are
recognized in the Company’s Consolidated Statements of Operations and Comprehensive Income.
The Company’s goodwill and FCC licenses are considered to be indefinite-lived intangible assets. Subsequent to acquisition,
these assets are not amortized but are tested for impairment annually in the Company’s fourth quarter, or more frequently if events or
changes in circumstances indicate that such assets might be impaired. The use of an indefinite life for FCC licenses contemplates the
Company’s historical ability to renew its licenses such that renewals generally may be obtained indefinitely and at little cost.
Therefore, cash flows derived from the FCC licenses are expected to continue indefinitely. Network affiliation agreements are subject
to amortization computed on a straight-line basis over the estimated useful life of 15 years. The 15-year life assumes affiliation
contracts will be renewed upon expiration. Changes in the likelihood of renewal could require a change in the useful life of such assets
and cause an acceleration of amortization. The Company evaluates the remaining lives of its network affiliations whenever changes
occur in the likelihood of affiliation contract renewals, and at least on an annual basis.
For purposes of goodwill impairment tests, the Company has one aggregated television stations reporting unit because of the
stations’ similar economic characteristics, one cable network reporting unit, and two digital business reporting units. The Company’s
impairment review for FCC licenses is performed at the television station market level.
The Company first assesses the qualitative factors to determine the likelihood of the goodwill and FCC licenses being impaired.
The qualitative analysis includes, but is not limited to, assessing the changes in macroeconomic conditions, regulatory environment,
industry and market conditions, and the financial performance versus budget of the reporting units, as well as any other events or
circumstances specific to the reporting units or the FCC licenses. If it is more likely than not that the fair value of a reporting unit’s
goodwill or a station’s FCC license is greater than its carrying amount, no further testing will be required. Otherwise, the Company
will apply the quantitative impairment test method.
The quantitative impairment test for goodwill is performed by comparing the fair value of a reporting unit with its carrying
amount. If the fair value of the reporting unit exceeds its carrying value, goodwill is not impaired and no further testing is required. If
the fair value of the reporting unit is less than the carrying value, an impairment charge is recognized for the amount by which the
carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill
allocated to that reporting unit. The quantitative impairment test for FCC licenses consists of a market-by-market comparison of the
carrying amounts of FCC licenses with their fair values, using the Greenfield Method of discounted cash flow analysis. An
impairment is recorded when the carrying value of an FCC license exceeds its fair value.
Determining the fair value of reporting units and FCC licenses requires management to make judgments about assumptions and
estimates that are highly subjective and that are based on unobservable inputs. The actual results may differ from these assumptions
and estimates, and it is possible that such differences could have a material impact on the Company’s Consolidated Financial
Statements. In addition to the various inputs (e.g. revenue growth, operating profit margins, capital expenditures, discount rates) used
to calculate the fair value of reporting units, the Company evaluates the reasonableness of its assumptions by comparing the total fair
value of all its reporting units to its total market capitalization and by comparing the fair values of its reporting units to recent market
sale transactions.
The Company tests definite-lived intangible assets and other long-lived assets to be held and used for impairment whenever
events or changes in circumstances indicate that their carrying amount may not be recoverable, relying on certain factors, including
operating results, business plans, economic projections and anticipated future cash flows. The carrying value of a long-lived asset or
asset group is considered impaired when the projected future undiscounted cash flows to be generated from the asset or asset group
over its remaining life, or primary asset’s life, plus any proceeds from the eventual disposition are less than its carrying value. The
Company measures impairment based on the amount by which the carrying value exceeds the estimated fair value of the long-lived
asset or asset group. The fair value is determined primarily by using the projected future cash flows discounted at a rate commensurate
with the risk involved as well as market valuations.
F-15
Debt Financing Costs
Debt financing costs represent direct costs incurred to obtain long-term financing and are amortized to interest expense over the
term of the related debt using the effective interest method. Previously capitalized debt financing costs are expensed and included in
loss on extinguishment of debt if the Company determines that there has been a substantial modification of the related debt. Debt
financing costs related to term loans and senior unsecured notes are combined with debt discounts and presented as a direct deduction
from the carrying amount of debt. Debt financing costs related to revolving credit facilities are included in other noncurrent assets.
Comprehensive Income
The Company’s comprehensive income consists of net income and unrecognized actuarial gains and losses on its pension and
postretirement liabilities, net of income tax adjustments.
Advertising Expense
The cost of advertising is expensed as incurred. The Company incurred advertising costs in the amount of $14 million, $24
million, and $21 million for the years ended December 31, 2023, 2022 and 2021, respectively.
Pension plans and postretirement benefits
A determination of the liabilities and cost of Nexstar’s pension and other postretirement plans requires the use of assumptions.
The actuarial assumptions used in the pension and postretirement reporting are reviewed annually with independent actuaries and are
compared with external benchmarks, historical trends and Nexstar’s own experience to determine that its assumptions are reasonable.
The assumptions used in developing the required estimates include the following key factors: discount rates, expected return on plan
assets, mortality rates, retirement rates and expected contributions. The amount by which the projected benefit obligation exceeds the
fair value of the pension plan assets is recorded in other noncurrent liabilities in the accompanying Consolidated Balance Sheets.
The net periodic benefit credit, which consists of expected return on plan assets and interest costs, is disclosed on a separate line
item below income from operations in the accompanying Consolidated Statements of Operations and Comprehensive Income.
Stock-Based Compensation
Nexstar maintains stock-based employee and non-employee compensation plans which are described more fully in Note 13. The
fair values of time-based and performance-based restricted stock units are based on the number of shares awarded and market price of
the stock on the date of award. These amounts are recognized into selling, general and administrative expense over the vesting period
of the time-based restricted stock units and when it is probable that the performance conditions will be achieved for performance-
based restricted stock units. The excess or shortage of tax deductions over the compensation cost of stock-based payments is
recognized as income tax benefit or income tax expense, respectively. The Company calculates the grant-date fair value of employee
and non-employee stock options using the Black-Scholes model, but no compensation expense was recorded during the years 2023,
2022 and 2021 as the options are fully vested and there were no additional stock option grants during these years.
Income Taxes
The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax
assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and tax basis of
assets and liabilities. A valuation allowance is applied against net deferred tax assets if, based on the weight of available evidence, it is
more likely than not that some or all of the deferred tax assets will not be realized. Nexstar files a consolidated federal income tax
return. Mission, White Knight and 54 Broadcasting, Inc. (a subsidiary of Vaughan and owner of station KNVA) file their own separate
federal income tax returns. The CW and Vaughan are disregarded entities for tax purposes and do not incur tax within the consolidated
financial statements.
The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will
be sustained on examination by the taxing authorities. The determination is based on the technical merits of the position and presumes
that each uncertain tax position will be examined by the relevant taxing authority that has full knowledge of all relevant information.
The Company recognizes interest and penalties relating to income taxes within income tax expense.
F-16
Income Per Share
Basic income per share is computed by dividing the net income attributable to Nexstar by the weighted-average number of
common shares outstanding during the period. Diluted income per share is computed using the weighted-average number of common
shares and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares are calculated using
the treasury stock method. They consist of stock options and restricted stock units outstanding during the period and reflect the
potential dilution that could occur if common shares were issued upon exercise of stock options and vesting of restricted stock units.
The following table shows the amounts used in computing the Company’s diluted shares during the years ended December 31 (in
thousands):
2023 2022 2021
Weighted average shares outstanding - basic 35,317 39,349 42,133
Dilutive effect of equity incentive plan instruments 517 838 1,849
Weighted average shares outstanding - diluted 35,834 40,187 43,982
The Company has outstanding stock options and restricted stock units to acquire 69,000, 26,000 and zero weighted average
shares of common stock for the years ended December 31, 2023, 2022 and 2021, respectively, the effects of which are excluded from
the calculation of dilutive income per share, as their inclusion would have been anti-dilutive for the periods presented.
Segment Presentation
The Company assesses its operating segments in accordance with Accounting Standards Codification (“ASC”) Topic 280,
“Segment Reporting.” Nexstar operates in two reportable segments, Broadcast and The CW. The other activities of the Company
include (i) digital businesses focused on the national marketplace, (ii) the management of certain real estate assets, including revenues
from leasing certain owned office and production facilities, (iii) corporate functions, and (iv) eliminations. See Note 17 for additional
segment information.
Recent Accounting Pronouncements
New Accounting Standards Adopted
In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2021-
08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”
(“ASU 2021-08”). The amendments in ASU 2021-08 require that an entity (acquirer) recognize and measure contract assets and
contract liabilities acquired in a business combination in accordance with Topic 606. At the acquisition date, an acquirer should
account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. The accounting update also
provides certain practical expedients for acquirers when recognizing and measuring acquired contract assets and contract liabilities
from revenue contracts in a business combination. ASU 2021-08 is effective for fiscal years beginning after December 15, 2022,
including interim periods within those fiscal years. The Company adopted this accounting update for interim periods and fiscal years
beginning on January 1, 2023 and the adoption did not impact its Condensed Consolidated Financial Statements.
New Accounting Standards Not Yet Adopted
In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”
(“ASU 2023-09”). ASU 2023-09 applies to all entities that are subject to Topic 740, Income Taxes and is intended to enhance the
transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 address investor requests for
enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. The
amendments in ASU 2023-09 will be effective for annual periods beginning after December 15, 2024. Early adoption is permitted.
The Company is currently evaluating the potential impacts ASU 2023-09 may have on its Consolidated Financial Statements upon its
adoption on the effective date as it relates to future income tax disclosures.
In November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable
Segment Disclosures” (“ASU 2023-07”), which expands annual and interim disclosure requirements for reportable segments,
primarily through enhanced disclosures about significant segment expenses for all public entities. The amendments in ASU 2023-07
are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15,
2024. Early adoption is permitted. A public entity should apply the amendments in ASU 2023-07 retrospectively to all prior periods
presented in the financial statements. The Company is currently evaluating the potential impacts ASU 2023-07 may have on its
Consolidated Financial Statements upon its adoption on the effective date as it relates to future segment disclosures.
F-17
Note 3: Acquisitions
2023 Acquisitions
On July 20, 2023, Nexstar acquired certain assets of WSNN-LD, a MyNetworkTV affiliated low power television station
serving the Tampa, Florida market, from Citadel Communications, LLC. On August 31, 2023, Nexstar acquired certain assets of
KUSI-TV, an independent full power television station serving the San Diego, CA market, from McKinnon Broadcasting Company
and Channel 51 of San Diego, Inc. The total purchase price of these acquisitions was $38 million, including working capital
adjustments. The acquired assets and assumed liabilities were recorded at fair value as of the closing dates of the transactions and
consisted primarily of $13 million in property and equipment and $19 million in FCC licenses.
2022 Acquisition of The CW
On September 30, 2022, Nexstar acquired a 75.0% ownership interest in The CW from affiliates of Paramount Global and
Warner Bros. Discovery (collectively the “Sellers”) for no purchase consideration. Each of the Sellers retained a 12.5% ownership
interest and produced 12 original, scripted series for The CW primarily aired during the 2022/2023 broadcast season. The Sellers have
granted Nexstar a call right and Nexstar has granted each of the Sellers a put right for such Seller’s ownership interests beginning in
August 2024 and June 2026, respectively. The acquisition solidifies Nexstar’s revenue opportunities as the largest owner of The CW-
affiliated stations, diversifies its content outside of news, improves its national advertising opportunities, establishes it as a participant
in advertising video-on-demand services via The CW App and is expected to create value by improving The CW’s ratings, revenue,
and profitability.
The transaction was accounted for under the acquisition method of accounting. The fair values of the assets acquired, liabilities
assumed and the noncontrolling interests are as follows (in millions):
Assets acquired Purchase Price Allocation
Cash and cash equivalents $ 29
Accounts receivable 56
Prepaid expenses and other current assets 3
Broadcast rights 124
Intangible assets 17
Other noncurrent assets 6
Total assets acquired 235
Liabilities assumed:
Accounts payable and accrued expenses (26)
Broadcast rights payable (97)
Deferred tax liabilities (19)
Other liabilities (13)
Total liabilities assumed (155)
Net assets acquired 80
Consideration paid -
Noncontrolling interests (24)
Gain on bargain purchase $ 56
Programming costs and accrued programming costs pertain to The CW’s costs of acquiring programming from the Sellers and
were valued using the replacement cost method as of Nexstar’s acquisition due to their short-term nature.
As a result of the acquisition, Nexstar recognized a gain on bargain purchase of $56 million representing the excess of the fair
value of the net assets acquired over the $0 purchase consideration paid and the fair value of the noncontrolling interests. This gain is
presented as a separate line item in the accompanying Consolidated Statements of Operations and Comprehensive Income during the
year ended December 31, 2022. Nexstar believes it was able to acquire The CW for $0 purchase consideration due to the recurring
losses of The CW and Nexstar’s position as the largest owner of The CW-affiliated television stations, which it believes limited the
number of interested acquirers, Nexstar’s agreement to commit The CW to acquire additional programming from the Sellers for the
2022/2023 broadcast season, and Nexstar’s agreement to allow the Sellers to distribute certain short and long-term accounts receivable
related to previously-aired programming to the Sellers prior to closing.
The intangible assets are amortized over an estimated useful life of 4.5 years.
The CW’s net revenue of $66 million and operating loss of $95 million from the acquisition date to December 31, 2022 have
been included in the accompanying Consolidated Statements of Operations and Comprehensive Income.
F-18
Transaction costs related to this acquisition, including severance costs, retention bonuses and legal and professional fees totaling
$13 million and $33 million for the years ended December 31, 2023 and 2022, respectively, were included in selling, general and
administrative expense, excluding depreciation and amortization in the accompanying Consolidated Statements of Operations and
Comprehensive Income.
2021 Acquisitions
Acquisition of The Hill
On August 20, 2021, pursuant to a merger agreement, Nexstar acquired 100% of the outstanding equity of News
Communications, Inc. (“NCI”), then a Nevada corporation, for a total cash consideration of approximately $138 million, including
working capital adjustments, funded by cash on hand. NCI is the owner of “The Hill,” an independent political digital media platform.
On August 27, 2021, NCI received approval for its conversion from a Nevada corporation to a Delaware corporation. The acquisition
marked the continuation of Nexstar’s content-first strategy, focused primarily on news, designed to further leverage and monetize its
expansive digital reach.
The net revenue of $22 million from the acquisition date to December 31, 2021 has been included in the accompanying
Consolidated Statements of Operations and Comprehensive Income. The operating income and transaction costs from the acquisition
date to December 31, 2021 have also been included in the accompanying Consolidated Statements of Operations and Comprehensive
Income but were not material.
Unaudited Pro Forma Financial Information
The following unaudited pro forma financial information has been presented for the periods indicated as if Nexstar’s acquisition
of The CW had occurred on January 1, 2021 (in millions):
Years Ended December 31,
2022 2021
N
et revenue $ 5,514 $ 5,107
Income before income taxes 917 786
N
et income 689 592
N
et income attributable to Nexstar 781 690
The unaudited pro forma financial information combines the historical results of operations, adjusted for business combination
accounting effects including transaction costs, the gain on bargain purchase, the amortization charges from acquired intangible assets
and the related tax effects.
The unaudited pro forma financial information is for informational purposes only and is not indicative of the results of
operations that would have been achieved if the acquisition of The CW had taken place on January 1, 2021, because the pro forma
results do not reflect expected synergies.
The acquisitions during 2023 and 2021 are not significant for pro forma financial information reporting purposes, both
individually and in aggregate. Therefore, pro forma financial information has not been provided for those transactions.
Proposed Acquisition
On May 10, 2023, Mission entered into a definitive agreement to acquire the assets of WADL-TV serving the Detroit, Michigan
market from Adell Broadcasting Corporation for $75 million in cash, subject to customary working capital adjustments. The proposed
acquisition is subject to regulatory and other customary approvals, is expected to close once Mission receives regulatory approval, and
would be Mission’s second entry into the state of Michigan.
F-19
Note 4: Property and Equipment
Property and equipment consisted of the following, as of December 31 (dollars in millions):
Estimated
useful life,
in years 2023 2022
Buildings and improvements 39 $ 409 $ 393
Land N/A 249 241
Leasehold improvements term of lease 119 101
Studio and transmission equipment 5-15 1,095 1,054
Computer equipment 3-5 151 152
Furniture and fixtures 7 32 30
Vehicles 5 64 61
Construction in progress N/A 60 65
2,179 2,097
Less: accumulated depreciation and amortization
(910) (835)
Property and equipment, net $ 1,269 $ 1,262
For the years ended December 31, 2023, 2022 and 2021, depreciation expense of $176 million, $160 million and $167 million,
respectively, was included in Depreciation and amortization expense in the accompanying Consolidated Statements of Operations and
Comprehensive Income.
Note 5: Intangible Assets and Goodwill
The Company’s definite-lived intangible assets consisted of the following, as of December 31 (dollars in millions):
2023 2022
Estimated Accumulated Accumulated
useful life, Amortization Amortization
in years Gross and Impairment Net Gross and Impairment Net
N
etwork affiliation agreements 15 $ 3,125 $ (1,442) $ 1,683 $ 3,125 $ (1,254) $ 1,871
Other definite-lived intangible assets 1-20 1,093 (652) 441 1,077 (514) 563
Definite-lived intangible assets $ 4,218 $ (2,094) $ 2,124 $ 4,202 $ (1,768) $ 2,434
The decrease in definite-lived intangible assets was primarily due to amortization.
For the years ended December 31, 2023, 2022 and 2021, amortization expense of $311 million, $309 million and $301 million,
respectively, was included in Depreciation and amortization expense in the accompanying Consolidated Statements of Operations and
Comprehensive Income.
The following table presents the Company’s estimate of amortization expense for each of the five succeeding fiscal years and
thereafter for definite-lived intangible assets as of December 31, 2023 (in millions):
2024 $ 291
2025 284
2026 265
2027 252
2028 237
Thereafter 795
$ 2,124
F-20
The changes in the carrying amounts of goodwill and FCC licenses for the years ended December 31, 2023 and 2022 are as
follows (in millions):
Goodwill FCC Licenses
Accumulated Accumulated
Gross Impairment Net Gross Impairment Net
Balances as of December 31, 2022 $ 3,141 $ (180) $ 2,961 $ 2,958 $ (48) $ 2,910
Current year acquisitions (see Note 3) 4 - 4 19 - 19
Impairment loss - (19) (19) - - -
Balances as of December 31, 2023 $ 3,145 $ (199) $ 2,946 $ 2,977 $ (48) $ 2,929
As discussed in Note 2, the Company has one aggregated television stations reporting unit, one cable network reporting unit,
and two digital reporting units for purposes of annual goodwill impairment review as of December 31, 2023. The Company’s annual
impairment review of FCC licenses is performed at the station market level. Management conducts an impairment test annually in the
fourth quarter, or whenever events or changes in circumstances indicate that goodwill or FCC licenses might be impaired.
In the fourth quarter of 2023, using the qualitative impairment test, the Company performed its annual impairment assessment
on goodwill attributable to its aggregated television stations reporting unit. Based on the results of such qualitative impairment tests,
the Company concluded that it was more likely than not that each reporting unit’s fair value would sufficiently exceed the related
carrying amount.
With respect to goodwill allocated to the cable network reporting unit and the two digital reporting units, the Company elected
to perform quantitative impairment tests due to recent performance and uncertain economic conditions.
The Company’s assessment indicated that the cable network reporting unit’s fair value exceeded the related carrying amount by
approximately 14%, therefore no impairment was recorded. Goodwill allocated to this reporting unit was $400 million as of December
31, 2023. The fair value estimate is management’s estimate based on a valuation report prepared by a third-party valuation firm who
used a combination of an income approach, which employs a discounted cash flow model, and a market approach, which consider
earnings multiples of comparable publicly traded businesses and comparable market transactions. The income approach was based on
a five-year projection model which included assumptions regarding continued growth of viewership at a declining rate of growth over
time and monetization thereof, continued growth in distribution revenues and annual increases in operating expenses. The income
approach utilized the Company’s income tax rate, a 10% discount rate based on an analysis of comparable companies and a modest
terminal growth rate typical of mature cable network businesses. The market approach market based the valuation on earnings
multiples of comparable publicly traded businesses with cable networks and comparable cable network transactions. The likelihood of
a material impairment is mitigated by the maturity of the network and its significant contractual distribution revenue.
With respect to digital reporting units, the Company’s assessment indicated that one of the digital reporting units exceeded the
carrying amount by 2.5%, and therefore no goodwill impairment was identified. Goodwill associated with this reporting was $69
million as of December 31, 2023. The fair value estimate is management’s estimate based on a valuation report prepared by a third-
party valuation firm who used a combination of an income approach, which employs a discounted cash flow model, and market
approach. The income approach was based on a three-year projection model which included assumptions regarding the recovery of the
business from a low in 2023 due to market and other factors to a full recovery to 2022 levels between year 2 and year 3 and then
growth thereafter. The income approach utilized the Company’s income tax rate, a 11.5% discount rate based on an analysis of
comparable companies and a modest terminal growth rate typical of mature digital businesses. The market approach based the
valuation on earnings multiples of comparable publicly traded digital media businesses and market net revenue multiples of
comparable digital media transactions. The likelihood of a material impairment is mitigated by the amount of goodwill recorded.
In the second digital reporting unit, the Company identified a goodwill impairment of $19 million (and $16 million impairment
on definite-lived intangible assets) and a goodwill impairment of $91 million (and $5 million impairment on definite-lived intangible
assets) during the fourth quarter of each calendar years 2023 and 2022, respectively. As of December 31, 2023, this second digital
reporting unit has no remaining goodwill and no material long-lived intangible assets balance.
The Company’s quantitative goodwill impairment tests are sensitive to changes in key assumptions used in our analysis, such as
expected future cash flows and market trends. If the assumptions used in our analysis are not realized, it is possible that an impairment
charge may need to be recorded in the future. The Company cannot accurately predict the amount and timing of any impairment of
goodwill or other intangible assets.
F-21
The Company performed its annual impairment assessment on FCC licenses for each television station market using the
qualitative impairment test. Except for three station markets that indicated unfavorable trends, the Company concluded that it was
more likely than not that their fair values exceeded the respective carrying amounts. For the stations that indicated unfavorable trends,
management extended its procedures and performed a quantitative impairment test. As of December 31, 2023, the FCC licenses of
these stations had a carrying value of $64 million, none of such individual FCC licenses had carrying value that were material. The
Company’s quantitative impairment test of these assets indicated that each of their estimated fair values (Greenfield Method)
exceeded the respective carrying amounts. Thus, no impairment was recorded on the associated goodwill and FCC licenses.
The Company also evaluated its definite-lived intangible assets and other long-lived assets whether events or changes in
circumstances indicate that such assets may be impaired. Based on the estimate of undiscounted future pre-tax cash flows expected to
result from the use and eventual disposition of such assets, the Company determined that the carrying amounts are recoverable other
than the long-lived intangible assets of a digital reporting unit for which an impairment was recorded (discussed above). No other
events or circumstances were noted in 2023 that would indicate impairment.
Note 6: Investments
Investments in the Company’s Consolidated Balance Sheets as of December 31 consisted of the following (in millions):
2023 2022
Equity method investments $ 953 $ 1,115
Other equity investments 5 4
Total investments $ 958 $ 1,119
Equity Method Investments
During the years ended December 31, 2023, 2022 and 2021, the Company received cash distributions from its equity method
investments, primarily from its investment in TV Food Network, as discussed below.
Income from equity method investments, net reported in the Company’s Consolidated Statements of Operations and
Comprehensive Income for the years ended December 31 consisted of the following (in millions):
2023 2022 2021
Income on equity investments, net, before amortization of basis
difference $ 174 $ 223 $ 250
Amortization of basis difference (70) (70) (125)
Income on equity investments, net $ 104 $ 153 $ 125
At acquisition date, the Company measured its estimated share of the differences between the estimated fair values and carrying
values (the “basis difference”) of the investees’ tangible assets and amortizable intangible assets had the fair value of the investments
been allocated to the identifiable assets of the investees in accordance with ASC Topic 805, “Business Combinations.” Additionally,
the Company measured its estimated share of the basis difference attributable to investees’ goodwill. The Company amortizes its share
of the basis differences attributable to tangible assets and intangible long-lived assets of investees, including TV Food Network, and
records the amortization (the “amortization of basis difference”) as a reduction of income from equity method investments, net in the
accompanying Consolidated Statements of Operations and Comprehensive Income. The Company’s share in these basis differences
and related amortization is primarily attributable to its investment in TV Food Network (discussed in more detail below).
There were no other-than-temporary impairments (“OTTI”) during the years ended December 31, 2023, 2022 and 2021.
Investment in TV Food Network
Nexstar acquired its 31.3% equity investment in TV Food Network through its acquisition of Tribune Media Company
(“Tribune”) on September 19, 2019. Nexstar’s partner in TV Food Network is Warner Bros. Discovery, Inc.(“WBD”), which owns a
68.7% interest in TV Food Network and operates the network on behalf of the partnership.
TV Food Network operates two 24-hour television networks, Food Network and Cooking Channel, offering quality television,
video, internet and mobile entertainment and information focusing on food and entertaining.
F-22
The partnership agreement governing TV Food Network provides that the partnership shall, unless certain actions are taken by
the partners, dissolve and commence winding up and liquidating TV Food Network upon the first to occur of certain enumerated
liquidating events, one of which is a specified date of December 31, 2024. Nexstar intends to renew its partnership agreement with
WBD for TV Food Network before expiration. In the event of a liquidation, Nexstar would be entitled to its proportionate share of
distributions to partners, which the partnership agreement provides would occur as promptly as is consistent with obtaining fair market
value for the assets of TV Food Network. The partnership agreement also provides that the partnership may be continued or
reconstituted in certain circumstances.
As of December 31, 2023, Nexstar’s investment in TV Food Network had a book value of $936 million, compared to $1.099
billion as of December 31, 2022.
As of December 31, 2023 and 2022, Nexstar had a remaining share in amortizable basis difference of $397 million and $467
million, respectively, related to its investment in TV Food Network. The remaining amortizable basis difference as of December 31,
2023 had a remaining useful life of approximately 5.7 years. As of December 31, 2023, Nexstar’s share in the basis difference related
to the investee’s goodwill was $500 million (no change in 2023).
Nexstar had the following transactions related to its investment in TV Food Network during the years ended December 31,
2023, 2022 and 2021, respectively:
• received cash distributions totaling $270 million, $249 million and $239 million,
• recognized shares in TV Food Network’s net income of $177 million, $227 million and $253 million, and
• recorded amortization of basis difference (expense) of $69 million, $70 million and $125 million.
Summarized financial information for TV Food Network is as follows (in millions):
Years Ended December 31,
2023 2022 2021
N
et revenue $ 1,124 $ 1,298 $ 1,340
Costs and expenses 571 583 537
Income from operations 554 716 803
N
et income 565 724 810
N
et income attributable to Nexstar Media Group, Inc. 177 227 253
As of December 31
2023 2022
Current assets $ 383 $ 728
N
oncurrent assets 484 421
Current liabilities 102 85
N
oncurrent liabilities - -
Note 7: Accrued Expenses
Accrued expenses consisted of the following, as of December 31 (in millions):
2023 2022
Compensation and related taxes $ 113 $ 113
Interest payable 55 56
N
etwork affiliation fees 85 50
Other 97 100
$ 350 $ 319
F-23
Note 8: Debt
Long-term debt consisted of the following, as of December 31 (dollars in millions):
2023 2022
N
exstar
Term Loan A, due June 2027 $ 2,243 $ 2,364
Term Loan B, due September 2026 1,561 1,561
5.625% Notes, due July 2027 1,714 1,714
4.75% Notes, due November 2028 1,000 1,000
Mission
Term Loan B, due June 2028 292 296
Revolving loans, due June 2027 62 62
Total outstanding principal 6,872 6,997
Less: unamortized financing costs and discount - Nexstar Term Loan A, due June 2027 (6) (8)
Less: unamortized financing costs and discount - Nexstar Term Loan B, due September 2026 (24) (33)
Add: unamortized premium, net of financing costs - Nexstar 5.625% Notes, due July 2027 3 4
Less: unamortized financing costs and discount - Nexstar 4.75% Notes, due November 2028 (6) (7)
Less: unamortized financing costs and discount - Mission Term Loan B, due June 2028 (2) (2)
Total outstanding debt 6,837 6,951
Less: current portion (124) (124)
Long-term debt, net of current portion $ 6,713 $ 6,827
Senior Secured Credit Facilities
2023 Activities
On December 6, 2023, Nexstar borrowed $20 million under its revolving credit facility used for additional working capital,
which it repaid in full on December 19, 2023, funded by cash on hand.
On June 6, 2023, Nexstar and Mission, an independently owned VIE consolidated by Nexstar, amended their respective credit
agreements. The amendments to the respective credit agreements pertain to replacement of the London Interbank Offered Rate
(“LIBOR”)-based interest rate applicable to the Term Loan B, due September 2026 of Nexstar and Term Loan B, due June 2028 of
Mission with the term Secured Overnight Financing Rate (“SOFR”)-based interest rate. Under each amendment, the term SOFR is
defined to mean the sum of the term SOFR screen rate published by the CME Group Benchmark Administration Limited term SOFR
administrator and a spread adjustment of 0.11448% for an interest period of one month’s duration, 0.26161% for an interest period of
three months’ duration and 0.42826% for an interest period of six months’ duration. The term SOFR is subject to a floor of 0%.
In addition, during the year ended December 31, 2023, the Company repaid scheduled principal maturities of $125 million of its
term loans.
Interest rates are selected at Nexstar’s or Mission’s option, as applicable, and the applicable margin is adjusted quarterly as
defined in the applicable amended credit agreement. Interest is payable periodically based on the type of interest rate selected. As of
December 31, the interest rates of the outstanding loans under the senior secured credit facilities were:
• 6.85% and 5.86% in 2023 and 2022, respectively, for Nexstar’s Term Loan A, due June 2027 (based on an applicable
margin of 1.50%)
• 7.85% and 6.89% in 2023 and 2022, respectively, for Nexstar’s Term Loan B, due September 2026 (based on an
applicable margin of 2.50% in both years)
• 7.85% and 6.89% in 2023 and 2022, respectively, for Mission’s Term Loan B, due June 2028 (based on an applicable
margin of 2.50% in both years)
• 6.85% and 5.86% in 2023 and 2022, respectively, for Mission’s outstanding revolving loans, due June 2027 (based on an
applicable margin of 1.50%)
F-24
5.625% Notes, due July 2027
On July 3, 2019, Nexstar completed the sale and issuance of $1.120 billion 5.625% senior unsecured notes due 2027 (the
“5.625% Notes, due July 2027”) at par.
On November 22, 2019, Nexstar completed the issuance and sale of $665 million aggregate principal amount of additional
5.625% Notes, due July 2027. These additional notes were issued at a price of 104.875%. These additional notes are treated as a single
series with the 5.625% Notes, due July 2027 issued on July 3, 2019.
Interest on the 5.625% Notes, due July 2027 is payable semiannually in arrears on January 15 and July 15 of each year. The
5.625% Notes, due July 2027 were issued pursuant to an indenture dated July 3, 2019 (the “5.625% Indenture due 2027”).
At any time on or after July 15, 2022, Nexstar may redeem the 5.625% Notes, due July 2027, in whole or in part, at the
redemption prices set forth in the 5.625% Indenture due 2027 plus accrued and unpaid interest to the redemption date. Upon the
occurrence of a change of control (as defined in the 5.625% Indenture due 2027), each holder of the 5.625% Notes, due July 2027 may
require Nexstar to repurchase all or a portion of the notes in cash at a price equal to 101.0% of the aggregate principal amount to be
repurchased, plus accrued and unpaid interest, if any, thereon to the date of repurchase.
The 5.625% Notes, due July 2027 contain covenants that limit, among other things, Nexstar’s ability to (1) incur additional debt,
(2) pay dividends or make other distributions or repurchases or redeem its capital stock, (3) make certain investments, (4) create liens,
(5) merge or consolidate with another person or transfer or sell assets, (6) enter into restrictions affecting the ability of Nexstar’s
restricted subsidiaries to make distributions, loans or advances to it or other restricted subsidiaries, (7) prepay, redeem or repurchase
certain indebtedness and (8) engage in transactions with affiliates.
The 5.625% Indenture due 2027 provides for customary events of default (subject in certain cases to customary grace and cure
periods), which include nonpayment, breach of covenants, payment defaults or acceleration of other indebtedness, a failure to pay
certain judgments and certain events of bankruptcy and insolvency. Generally, if an event of default occurs, the trustee or holders of at
least 25% in principal amount of the then outstanding 5.625% Notes, due July 2027 may declare the principal of and accrued but
unpaid interest, including additional interest, on all the 5.625% Notes, due July 2027 to be due and payable.
4.75% Notes, due November 2028
On September 25, 2020, Nexstar completed the sale and issuance of $1.0 billion 4.75% senior unsecured notes due 2028
(“4.75% Notes, due November 2028”) at par. The 4.75% Notes, due November 2028 were issued under an indenture dated as of
September 25, 2020 (“4.75% Notes, due November 2028 Indenture”).
Interest on the 4.75% Notes, due November 2028 is payable semiannually in arrears on May 1 and November 1 of each year.
The 4.75% Notes, due November 2028 are guaranteed by Nexstar, Mission and certain of Nexstar’s and Mission’s existing and future
restricted subsidiaries, subject to certain customary release provisions.
The 4.75% Notes, due November 2028 are senior unsecured obligations of Nexstar and the guarantors, rank equal in right of
payment with our and the guarantors’ existing and future senior indebtedness, including Nexstar’s 5.625% Notes, due July 2027, its
term loans and its revolving credit facilities, but effectively junior to our and the guarantors’ secured debt, including the term loans
and revolving credit facilities, to the extent of the value of the assets securing such debt.
Nexstar has the option to redeem all or a portion of the 4.75% Notes, due November 2028 at any time prior to November 1,
2023 at a price equal to 100% of the principal amount redeemed plus accrued and unpaid interest, if any, to, but excluding, the
redemption date plus a make-whole premium as of the date of redemption. At any time prior to November 1, 2023, Nexstar may also
redeem up to 40% of the aggregate principal amount at a redemption price of 104.75%, plus accrued and unpaid interest, if any, to, but
excluding, the date of redemption, with the net cash proceeds from certain equity offerings. At any time on or after November 1, 2023,
Nexstar may redeem the 4.75% Notes, due November 2028, in whole or in part, at the redemption prices set forth in the 4.75% Notes,
due November 2028 Indenture.
Upon the occurrence of a change in control (as defined in the 4.75% Notes, due November 2028 Indenture), each holder of the
4.75% Notes, due November 2028 may require Nexstar to repurchase all or a portion of the notes in cash at a price equal to 101.0% of
the aggregate principal amount to be repurchased, plus accrued and unpaid interest, if any, thereon to, but excluding, the date of
repurchase.
F-25
The 4.75% Notes, due November 2028 Indenture contains covenants that limit, among other things, Nexstar’s and the
guarantors’ ability to (1) incur additional debt, (2) pay dividends or make other distributions or repurchases or redeem its capital stock,
(3) make certain investments, (4) transfer or sell assets, (5) create liens, (6) enter into restrictions affecting the ability of Nexstar’s
restricted subsidiaries to make distributions, loans or advances to it or other restricted subsidiaries, (7) guarantee certain indebtedness
and (8) engage in transactions with affiliates.
The 4.75% Notes, due November 2028 Indenture provides for customary events of default (subject in certain cases to customary
grace and cure periods), which include nonpayment, breach of covenants, payment defaults or acceleration of other indebtedness, a
failure to pay certain judgments and certain events of bankruptcy and insolvency. Generally, if an event of default occurs and is
continuing, the trustee or holders of at least 25% in principal amount of the then outstanding 4.75% Notes, due November 2028 may
declare the principal of, premium, and accrued but unpaid interest, including additional interest, on all the 4.75% Notes, due
November 2028 to be due and payable. Upon such a declaration, such principal, premium and accrued and unpaid interest will be due
and payable immediately.
Unused Commitments and Borrowing Availability
Nexstar and Mission had $530 million (net of outstanding standby letters of credit of $20 million) and $14 million, respectively,
of unused revolving loan commitments under their senior secured credit facilities, all of which were available for borrowing, based on
the covenant calculations as of December 31, 2023. The Company’s ability to access funds under the senior secured credit facilities
depends, in part, on its compliance with certain financial covenants. As of December 31, 2023, the Company was in compliance with
its financial covenants.
Collateralization and Guarantees of Debt
The Company’s credit facilities described above are collateralized by a security interest in substantially all the combined assets,
excluding FCC licenses, the other assets of consolidated VIEs unavailable to creditors of Nexstar (see Note 2) and the assets of The
CW. Nexstar (excluding The CW) guarantees full payment of all obligations incurred under the Mission senior secured credit facility
in the event of Mission’s default. Mission is a guarantor of Nexstar’s senior secured credit facility, Nexstar’s 5.625% Notes, due July
2027 and Nexstar’s 4.75% Notes, due November 2028.
In consideration of Nexstar’s guarantee of the Mission senior secured credit facility, Mission has granted Nexstar purchase
options to acquire the assets and assume the liabilities of each Mission station, subject to FCC consent. These option agreements,
which expire on various dates between 2024 and 2033, are freely exercisable or assignable by Nexstar without consent or approval by
Mission. The Company expects these option agreements to be renewed upon expiration.
Debt Covenants
The Nexstar credit agreement (senior secured credit facility) contains a covenant which requires Nexstar to comply with a
maximum consolidated first lien net leverage ratio of 4.25 to 1.00. The financial covenant, which is formally calculated on a quarterly
basis, is based on the combined results of the Company. The Mission amended credit agreement does not contain financial covenant
ratio requirements but does provide for default in the event Nexstar does not comply with all covenants contained in its credit
agreement. As of December 31, 2023, the Company was in compliance with its financial covenants.
Debt Maturities
The scheduled principal maturities of the Company’s debt as of December 31, 2023 are summarized as follows (in millions):
2024 $ 124
2025 124
2026 1,685
2027 3,658
2028 1,281
Thereafter -
$ 6,872
F-26
Note 9: Leases
The Company as a Lessee
The Company has operating leases for office spaces, tower facilities, antenna sites, studios and other real estate properties and
equipment. The operating leases have remaining lease terms of one to 91 years, some of which may include options to extend the
leases from one year to 99 years, and some of which may include options to terminate the leases within one year. Lease contracts that
the Company has executed but which have not yet commenced as of December 31, 2023 were not material.
Supplemental balance sheet information related to operating leases as of December 31 was as follows (in millions, except lease
term and discount rates):
Balance Sheet Classification 2023 2022
Operating leases
Operating lease right-of-use assets, net Other noncurrent assets, net $ 290 $ 288
Current operating lease liabilities Operating lease liabilities $ 47 $ 50
Noncurrent operating lease liabilities Other noncurrent liabilities $ 246 $ 238
Weighted Average Remaining Lease Term of Operating leases 8 years 8 years
Weighted Average Discount Rate of Operating leases 5.0% 5.1%
Operating lease expenses for the year ended December 31, 2023 were $65 million, of which $28 million and $37 million were
included in Direct operating and Selling, general and administrative expenses, respectively, excluding depreciation and amortization,
in the accompanying Consolidated Statements of Operations and Comprehensive Income.
Operating lease expenses for the year ended December 31, 2022 were $62 million, of which $28 million and $34 million were
included in Direct operating and Selling, general and administrative expenses, respectively, excluding depreciation and amortization,
in the accompanying Consolidated Statements of Operations and Comprehensive Income.
Operating lease expenses for the year ended December 31, 2021 were $57 million, of which $27 million and $30 million were
included in Direct operating and Selling, general and administrative expenses, respectively, excluding depreciation and amortization,
in the accompanying Consolidated Statements of Operations and Comprehensive Income.
Cash paid for operating leases included in the operating cash flows was $64 million, $60 million and $52 million for the years
ended December 31, 2023, 2022 and 2021, respectively.
Future minimum lease payments under non-cancellable leases as of December 31, 2023 were as follows (in millions):
Operating Leases
2024 $ 60
2025 47
2026 39
2027 37
2028 33
Thereafter 153
Total future minimum lease payments 369
Less: imputed interest (76)
Total $ 293
F-27
Note 10: Retirement and Postretirement Plans
Nexstar has various funded, qualified non-contributory defined benefit retirement plans which cover certain employees and
former employees. As of December 31, 2023, the combined pension benefit obligations for these qualified retirement plans were $1.7
billion. Combined plan assets were $1.5 billion at December 31, 2023 which represents funding of approximately 90% (resulting in a
combined plans being underfunded by $171 million). All these retirement plans are frozen in terms of pay and service, except for a
plan with immaterial pension benefit obligations.
The remaining pension obligations of $40 million relate to non-contributory unfunded supplemental executive retirement and
ERISA Excess plans for which Nexstar’s policy is to fund the benefits as claims and premiums are paid. Nexstar also has various
retiree medical savings account plans which reimburse eligible retired employees for certain medical expenses and unfunded plans
that provide certain health and life insurance benefits to certain retired employees.
Nexstar uses a December 31 measurement date for its pension and other postretirement benefit plans (“OPEB”). The overfunded
or underfunded status of these pension and other postretirement plans is recognized as an asset or liability in the accompanying
Consolidated Balance Sheets. The changes in the funded status are recorded in the year in which changes occur through
comprehensive income (loss). The funded status of a plan represents the difference between the fair value of plan assets and the
related plan projected benefit obligation.
As of and for the years ended December 31, the following table provides a reconciliation of the plans’ benefit obligations, plan
assets and funded status, along with the related amounts that are recognized in the Consolidated Balance Sheets (in millions):
Pension Benefits OPEB
2023 2022 2023 2022
Change in benefit obligations
Benefit obligations at beginning of period $ 1,779 $ 2,257 $ 21 $ 27
Service cost 1 1 - -
Interest cost 83 47 1 1
Plan amendments - 1 - -
Actuarial (gain) loss 32 (400) - (5)
ESOP transfer 3 3 - -
Benefit payments (191) (130) (2) (2)
Benefit obligations at end of period $ 1,707 $ 1,779 $ 20 $ 21
Change in plan assets
Fair value of plan assets at beginning of period $ 1,562 $ 2,152 $ - $ -
Actual return on plan assets 117 (467) - -
Employer contributions 4 4 2 2
ESOP transfer 3 3 - -
Benefit payments (191) (130) (2) (2)
Fair value of plan assets at end of period $ 1,495 $ 1,562 $ - $ -
A
mounts recognized in Consolidated Balance Sheets
Current liabilities $ (3) $ (4) $ (2) $ (2)
N
oncurrent liabilities (209) (213) (18) (19)
Funded status $ (212) $ (217) $ (20) $ (21)
In September 2023, a Nexstar defined benefit retirement plan offered certain terminated vested participants a voluntary and
limited time offer to receive their pension benefit in a single lump sum payment or to start a monthly payment, payable as of
December 1, 2023. To be eligible for this offer, participants must have terminated employment on or prior to July 1, 2023, remained
not a Nexstar employee through December 1, 2023 and the benefit must have a lump sum value of $115,000 or less. As of December
31, 2023, 1,087 participants elected to take the voluntary offer resulting in payouts from plan assets totaling $58 million (included in
Benefit Payments in the table above). The Company recognized no gain or loss related to this settlement.
Nexstar’s pension benefit plans were underfunded as of December 31 with accumulated benefit obligations exceeding the fair
value of plan assets. Information for the underfunded pension benefit plans is as follows (in millions):
2023 2022
Benefit obligations $ 1,707 $ 1,779
Accumulated benefit obligations 1,707 1,779
Fair value of plan assets 1,495 1,562
F-28
The plans’ benefit obligations were determined using the following assumptions:
Pension Benefits OPEB
2023 2022 2021 2023 2022 2021
Discount rate 4.78% - 4.79% 4.98% - 4.99% 2.69% - 2.70% 4.59% - 4.75% 4.79% - 4.94% 1.99% - 2.59%
Compensation increase rate - - - 2.00% 2.00% 2.00%
The decrease in the discount rates from December 31, 2022 to December 31, 2023 increased the projected benefit obligations of
qualified defined benefit pension plans by approximately $31 million at December 31, 2023.
The increase in the discount rates from December 31, 2021 to December 31, 2022 decreased the projected benefit obligations of
qualified defined benefit pension plans by approximately $416 million at December 31, 2022. Additionally, the updated mortality
projection scale decreased the plans’ projected pension obligations by approximately $2 million at December 31, 2022. The decreases
were partially offset by an approximately $26 million increase in pension obligations due to the updated census information and cash
balance crediting rate assumption.
Net Periodic Benefit Cost (Credit)
The following tables provide the components of net periodic benefit cost (credit) for the plans for the years ended December 31
(in millions):
Pension Benefits OPEB
2023 2022 2021 2023 2022 2021
Service cost $ 1 $ 1 $ 1 $ - $ - $ -
Interest cost 83 47 40 1 1 -
Expected return on plan assets (112) (91) (111) - - -
Amortization of net (gain) loss (8) - 1 - - 1
Settlement gain recognized - - (13) - - -
N
et periodic benefit cost (credit) $ (36) $ (43) $ (82) $ 1 $ 1 $ 1
Nexstar anticipates recording an aggregate net periodic benefit credit of $26 million for its pension and other postretirement
benefits in 2024, as the expected return on plan assets exceeds estimated interest cost.
The net periodic costs for Nexstar’s pension and other benefit plans were determined using the following assumptions:
Pension Benefits OPEB
2023 2022 2021 2023 2022 2021
Discount rate 4.98% - 4.99% 2.69% - 2.70% 2.16% - 2.29% 4.79% - 4.92% 1.96% - 2.49% 1.39% - 2.06%
Expected return on plan assets 5.53% - 6.38% 4.01% - 5.01% 5.15% - 5.90% - - -
Compensation increase rate - - - 2.00% 2.00% 2.00%
Cash balance interest crediting rate 3.50% - 3.75% 1.75% - 2.00% 2.20% - 2.50% - - -
The reasonableness of the expected return on the funded retirement plan assets was assessed with the assistance of an
investment consultant, but all assumptions were reviewed by management. Their proprietary model simulates possible capital market
scenarios based on the current economic environment and their capital market assumptions to come up with expected returns for the
portfolio based on the current asset allocation.
For purposes of measuring the related postretirement health care costs for 2023, we assumed a 6.0% - 8.5% annual rate of
increase in the per capita cost of covered health care benefits. The rate was assumed to decrease gradually to 4.5% for 2030 and
remain at that level thereafter. For purposes of measuring the related postretirement health care obligations at December 31, 2023, we
assumed a 6.2% - 10.0% annual rate of increase in the per capita cost of covered health care benefits. The rate was assumed to
decrease gradually to 4.5% for 2032 and remain at that level thereafter.
F-29
The following table provides a summary of Nexstar’s accumulated other comprehensive income (loss) related to pension and
other postretirement benefit plans prior to any deferred tax effects (in millions):
Pension Benefits OPEB
December 31, 2020 $ 49 $ (3)
Actuarial gain 142 2
December 31, 2021 $ 191 $ (1)
Prior service cost (1) -
Actuarial gain (loss) (158) 5
December 31, 2022 $ 32 $ 4
Actuarial loss (35) -
December 31, 2023 $ (3) $ 4
The asset allocation for Nexstar’s funded retirement plans at the end of 2023, and the asset allocation range for 2024, by asset
category, are as follows:
Asset Allocation
Percentage of Plan Assets
at Year End
Asset category: 2024 2023
Equity securities 20% - 40% 31%
Fixed income securities 60% - 80% 63%
Opportunistic - 6%
Total 100%
As the plan sponsor of the funded retirement plans, Nexstar’s investment strategy is to achieve a rate of return on the plans’
assets that, over the long term, will fund the plans’ benefit payments and will provide for other required amounts in a manner that
satisfies all fiduciary responsibilities. A determinant of the plans’ returns is the asset allocation policy. The investment policies for
plan assets provide ranges for the plans’ long-term asset mix, as follows:
• For plan assets with a total fair value of $1.2 billion as of December 31, 2023, the investment policy ranges are 8%-28%
U.S. equity, 0%-16% non-U.S. equity, 0%-13% emerging market equity, 0%-17% global equity, 0%-17% opportunistic
sub-asset classes, 50%-70% fixed income and 0%-5% cash.
• For plan assets with a total fair value of $287 million as of December 31, 2023, the investment policy ranges are 0%-18%
U.S. equity, 0%-12% non-U.S. equity, 0%-11% emerging market equity, 0%-15% global low volatility equity, 0%-14%
opportunistic sub-asset classes, 70%-90% fixed income and 0%-10% cash.
Nexstar also reviews the plans’ overall asset allocation to determine the proper balance of securities by market capitalization,
value or growth, U.S., international or global or the addition of other asset classes.
The investment policies are reviewed frequently and administered by an investment consultant. Periodically, Nexstar evaluates
each investment with the investment consultant to determine if the overall portfolio has performed satisfactorily when compared to the
defined objectives, similarly invested portfolios and specific market indices.
Investments in Common Collective Trust Funds do not have any unfunded commitments and do not have any applicable
liquidation periods or defined terms and periods to be held. The portfolios offer daily liquidity; however, they request 5 business days’
notice for both withdrawals and redemptions. Strategies of the Common Collective Trust Funds by major category are as follows:
• Equity Common Collective Trusts are primarily invested in funds seeking investment results that correspond to the total
return performance of their respective benchmarks in both the U.S. and international markets. Equity securities are
invested broadly in U.S. and non-U.S. companies and are diversified across countries, currencies, market capitalizations
and investment styles. These securities use the S&P 500 (U.S. large cap), Russell 2000 (U.S. small cap), Russell 2500
(U.S. mid cap) and MSCI All Country World Index ex-U.S. (non-U.S.) as their benchmarks.
F-30
• Fixed Income Common Collective Trusts are primarily invested in funds with an investment objective to provide
investment returns through fixed-income and commingled investment vehicles that seek to outperform their respective
benchmarks. Fixed income securities are invested in diversified portfolios that invest across the maturity spectrum and
include primarily investment-grade securities with a minimum average quality rating of A and insurance annuity
contracts. These securities use the Barclays Capital Aggregate (intermediate term bonds), Barclays Capital Long
Corporate and Barclays Capital Long Government/Credit (long bonds) U.S. Bond Indexes as their benchmarks.
• Real Estate and Real Asset Common Collective Trusts seek to achieve high current return and long-term capital growth by
investing in equity securities of real estate investment trusts that seek to outperform their respective benchmarks.
Other investments include investments in real estate funds, emerging market debt, high yield bonds, commodity index funds,
floating rate debt, and inflation-protected bonds. These investments use the National Council of Real Estate Investment Fiduciaries
Property Index or the FTSE NAREIT All Equity REIT Index (real estate), JPM EMBI Global Core Index (emerging market debt),
Barclays U.S. High Yield Ba/B 1% Issuer Capped Bond Index (high yield bonds), BBG Commodity Index (commodity index fund),
Morningstar LSTA US Loan (floating rate debt) and BBG 1-10 TIPS (inflation-protected bond) as their benchmarks.
The following table sets forth, by asset category, Nexstar’s pension plan assets as of December 31, 2023 and 2022, using the fair
value hierarchy established under ASC Topic 820 as described in Note 11. The fair value hierarchy in the tables excludes certain
investments which are valued using net asset value (“NAV”) as a practical expedient (in millions):
Pension Plan Assets as of December 31, 2023
Level 1 Level 2 Level 3 Total
Pension plan assets measured at fair value:
Registered investment companies $ 52 $ - $ - $ 52
Common collective trusts - 18 - 18
Other 2 - - 2
Pooled separate account - 6 - 6
Total pension plan assets measured at fair value $ 54 $ 24 $ - 78
Pension plan assets measured at NAV as a practical
expedient
1,412
Pension plan assets measured at contract value:
Insurance contracts 5
Total pension plan assets $ 1,495
Pension Plan Assets as of December 31, 2022
Level 1 Level 2 Level 3 Total
Pension plan assets measured at fair value:
Registered investment companies $ 41 $ - $ - $ 41
Common collective trusts - 24 - 24
Other 2 - - 2
Pooled separate account - 7 - 7
Total pension plan assets measured at fair value $ 43 $ 31 $ - 74
Pension plan assets measured at NAV as a practical
expedient
1,483
Pension plan assets measured at contract value:
Insurance contracts 5
Total pension plan assets $ 1,562
Registered investment companies are valued at exchange listed prices for exchange traded registered investment companies,
which are classified in Level 1 of the fair value hierarchy.
Common/collective trusts are valued on the basis of the relative interest of each participating investor in the fair value of the
underlying assets of each of the respective common/collective trusts. Common/collective trusts contain underlying assets valued based
on pricing from observable market information in a non-active market and are classified in Level 2 of the fair value hierarchy.
Certain common/collective trusts, investment companies and real estate that are measured at fair value using the NAV per share
practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in the table above are
intended to permit reconciliation of the fair value hierarchy to the total value of plan assets.
The pooled separate account represents an insurance contract under which plan assets are administered through pooled funds.
The PSA portfolio includes investments in money market instruments, government and corporate bonds and notes. The PSA is valued
daily based on the market value of the underlying net assets in the separate account. The majority of the underlying net assets have
observable Level 1 and/or 2 quoted pricing inputs which are used to determine the unit value of the PSA, which is not publicly quoted
and therefore classified as Level 2 of the fair value hierarchy.
F-31
Expected Cash Flows
The following table includes amounts that are expected to be contributed to the plans by Nexstar (in millions). It additionally
reflects benefit payments that are made from the plans’ assets as well as those made directly from Nexstar’s assets, and it includes the
participants’ share of the costs, which is funded by participant contributions. The amounts in the table are actuarially determined and
reflect Nexstar’s best estimate given its current knowledge including the impact of recent pension funding relief legislation. Actual
amounts could be materially different.
Pension Benefits OPEB
Employer Contributions
2024 to participant benefits $ 6 $ 2
Expected Benefit Payments
2024 $ 146 $ 2
2025 144 2
2026 142 2
2027 141 2
2028 139 2
2029-2033 639 8
Defined Contribution Plans
The Company has established retirement savings plans under Section 401(k) of the Internal Revenue Code (the “401(k) Plans”).
The 401(k) Plans cover substantially all Company employees who meet the minimum age and service requirements and allow
participants to defer a portion of their annual compensation on a pre-tax basis. Employer contributions to the 401(k) Plans may be
made at the discretion of management of the Company. During the years ended December 31, 2023, 2022 and 2021, Nexstar
contributed $18 million, $14 million and $16 million, respectively, to the 401(k) Plans.
The Company has a Supplemental Income Deferral Plan for which certain employees, including executive officers, are eligible.
The plan provides benefits to highly compensated employees in circumstances in which the maximum limits established under ERISA
and the Internal Revenue Code prevent them from receiving Company contributions. The amounts recorded by the Company for these
plans for 2023 are immaterial.
Note 11: Fair Value Measurements
The Company measures and records in its Consolidated Financial Statements certain assets and liabilities at fair value. ASC
Topic 820, “Fair Value Measurement and Disclosures,” establishes a fair value hierarchy for instruments measured at fair value that
distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable
inputs). This hierarchy consists of the following three levels:
• Level 1 – Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an
active market.
• Level 2 – Assets and liabilities whose values are based on inputs other than those included in Level 1, including quoted
market prices in markets that are not active; quoted prices of assets or liabilities with similar attributes in active markets;
or valuation models whose inputs are observable or unobservable but corroborated by market data.
• Level 3 – Assets and liabilities whose values are based on valuation models or pricing techniques that utilize unobservable
inputs that are significant to the overall fair value measurement.
The carrying values of cash and cash equivalents, restricted cash and cash equivalents, accounts receivable, accounts payable,
broadcast rights payable, and accrued expenses approximate fair value due to their short term nature.
F-32
As of December 31, the estimated fair values and carrying amounts of the Company’s long-term debt which are not measured at
fair value on a recurring basis were as follows (dollars in millions):
2023 2022
Carrying Fair Carrying Fair
Amount Value Amount Value
N
exstar
Term Loan A, due June 2027
(1)
$ 2,237 $ 2,217 $ 2,356 $ 2,275
Term Loan B, due September 2026
(1)
1,537 1,545 1,528 1,555
5.625% Notes, due July 2027
(2)
1,717 1,654 1,718 1,620
4.75% Notes, due November 2028
(2)
994 915 993 880
Mission
Term Loan B, due June 2028
(1)
290 288 294 291
Revolving loans due June 2027
(1)
62 60 62 60
(1)
The fair value of senior secured and revolving credit facilities is computed based on borrowing rates currently available to the Company for
bank loans with similar terms and average maturities. These fair value measurements are considered Level 3, as significant inputs to the fair
value calculation are unobservable in the market.
(2)
The fair value of the Company’s fixed rate debt is estimated based on bid prices obtained from an investment banking firm and are considered
Level 2.
During the year ended December 31, 2023, there were no events or changes in circumstance that triggered an impairment to the
Company’s significant assets, including equity method investments, indefinite-lived intangible assets, long-lived assets and goodwill,
other than those disclosed. See Notes 5 and 6 for additional information.
Certain investments held in the pension and other post retirement plans have been valued using net asset value (“NAV”) as a
practical expedient for fair value. In accordance with ASC 820, investments measured at NAV are excluded from the fair value
hierarchy. See Note 10 for fair value disclosures related to retirement and postretirement plans.
Note 12: Common Stock
The holders of common stock are entitled to one vote per share. The common stockholders are entitled to receive cash
dividends, subject to the rights of holders of any series of preferred stock, on an equal per share basis. Nexstar’s senior secured credit
facility provides limits on the amount of dividends the Company may pay to stockholders during the term of Nexstar’s credit
agreement.
On July 27, 2022, Nexstar’s board of directors approved a new share repurchase program authorizing Nexstar to repurchase up
to an additional $1.5 billion of its common stock, of which $1.258 billion remained available as of December 31, 2022. During 2023,
Nexstar repurchased a total of 3,782,104 shares of common stock for $605 million, funded by cash on hand. In 2022, Nexstar
repurchased a total of 5,055,304 shares of common stock for $881 million, funded by cash on hand. In 2021, Nexstar repurchased a
total of 3,575,568 shares of common stock for $537 million, funded by cash on hand. As of December 31, 2023, the remaining
available amount under the share repurchase authorization was $652 million.
Share repurchases are executed from time to time in open market transactions, block trades or in private transactions, including
through Rule 10b5-1 plans. There is no minimum number of shares that Nexstar is required to repurchase. The repurchase program
does not have an expiration date and may be suspended or discontinued at any time without prior notice.
Nexstar utilizes available treasury stock or issues new shares of its common stock when options are exercised or restricted stock
units vest. During the years ended December 31, 2023, 2022 and 2021, 572,844 shares, 1,116,701 shares and 1,076,169 shares,
respectively, of common stock were reissued from treasury to fulfill stock option exercises and vesting of restricted stock units, net of
any shares withheld to cover participant taxes.
During the years ended December 31, 2023, 2022 and 2021, total dividend payments were $191 million, $142 million, and $118
million, respectively.
F-33
On June 13, 2022, Nexstar’s shareholders approved certain amendments to Nexstar’s certificate of incorporation (the “Original
Certificate of Incorporation”) to eliminate Nexstar’s Class B common stock, par value $0.01 per share (the “Class B Common Stock”),
and Class C common stock, par value $0.01 per share (the “Class C Common Stock”), which classes of common stock had no shares
issued and outstanding prior to the date of shareholder approval of their elimination. The common stock (f/k/a Class A common stock)
has been the only class of shares outstanding since 2013. On June 27, 2022, Nexstar filed a Certificate of Amendment No. 2 (the
“Amendment”) to the Original Certificate of Incorporation with the Secretary of State of the State of Delaware to reflect the
elimination of Nexstar’s Class B Common Stock and Class C Common Stock and make related changes. The Amendment became
effective upon its filing with the Secretary of State of the State of Delaware on June 27, 2022.
On June 15, 2023, Nexstar’s shareholders approved certain amendments to Nexstar’s certificate of incorporation to, among
other things, declassify its board of directors beginning at the 2024 annual meeting. On June 20, 2023, Nexstar filed a Certificate of its
Amended and Restated Certificate of Incorporation (the “Amended and Restated Certificate of Incorporation”) with the Secretary of
State of the State of Delaware to reflect such amendments. The Amended and Restated Certificate of Incorporation became effective
immediately upon its filing with the Secretary of State of the State of Delaware on June 20, 2023.
For transactions and events involving the Company’s common stock after December 31, 2023, refer to Note 19.
Note 13: Stock-Based Compensation
Stock-Based Compensation Expense
The compensation cost related to time-based restricted stock units (“RSUs”) and performance-based restricted stock units
(“PSUs”) is based on the market price of the stock on the date of the award. The fair values of the stock options and RSUs are
recognized ratably over their respective vesting periods. The fair values of PSUs are recognized when it is probable that the
performance conditions will be achieved. The Company measures compensation cost related to stock options based on the grant-date
fair value of the awards, calculated using the Black-Scholes option-pricing model.
The Company recognized stock-based compensation expense of $60 million, $62 million and $47 million for the years ended
December 31, 2023, 2022 and 2021, respectively, all attributable to RSUs and PSUs. In 2023, 2022 and 2021, there was no stock-
based compensation attributable to stock options. As of December 31, 2023, there was $111 million of total unrecognized
compensation cost related to RSUs and PSUs, which is expected to be recognized over a weighted-average period of 2.2 years. There
is no remaining unrecognized compensation cost related to stock options.
Stock-Based Compensation Plans
As of December 31, 2023, Nexstar has two stock-based compensation plans that provide for the granting of stock options, stock
appreciation rights, RSUs and PSUs to directors, employees or consultants of Nexstar: the 2019 Long-Term Equity Incentive Plan,
approved by Nexstar’s majority stockholders on June 5, 2019 (the “2019 Plan”) and the 2015 Long-Term Equity Incentive Plan,
approved by Nexstar’s majority stockholders on June 11, 2015 (the “2015 Plan”). A maximum of 3,100,000 shares and 2,500,000
shares of Nexstar’s common stock can be issued under the 2019 Plan and 2015 Plan, respectively.
At December 31, 2023, 1,562,447 shares remained available for future grants, of which 1,557,156 shares and 5,291 shares were
available under the 2019 Plan and the 2015 Plan, respectively.
Stock Options
Options are granted with an exercise price at least equal to the fair market value of the underlying shares of common stock on
the date of the grant. As of December 31, 2023, all outstanding options are fully vested and expire ten years from the date of grant.
Upon the employee’s termination, any unexercised vested options are cancelled from 90 days to one year following the termination
date.
F-34
The following table summarizes activity and information related to stock options for the year ended December 31, 2023:
Outstanding Options Non-Vested Options
Weighted-
Weighted- Average Aggregate Weighted-
Average Remaining Intrinsic Average
Exercise Contractual Value Grant-Date
Shares Price Term (Years) (thousands) Shares Fair Value
Balances as of December 31, 2022 337,136 $ 46.87 1.65 $ 43,208 - $ -
Granted - $ - - - - $ -
Exercised (93,068) $ 46.06 - - - $ -
Vested - $ - - - - $ -
Forfeited/cancelled - $ - - - - $ -
Balances as of December 31, 2023 244,068 $ 47.17 0.88 $ 26,744 - $ -
Exercisable as of December 31, 2023 244,068 $ 47.17 0.88 $ 26,744
Fully vested and expected to vest as of
December 31, 2023
244,068 $ 47.17 0.88 $ 26,744
The $27 million aggregate intrinsic value represents the difference between the closing market price of Nexstar’s common stock
as of December 29, 2023 and the stock option exercise prices multiplied by the number of options outstanding. For the years ended
December 31, 2023, 2022 and 2021, the aggregate intrinsic value of options exercised, on their respective exercise dates, was $10
million, $110 million and $71 million, respectively.
Time-Based Restricted Stock Units
The RSUs vest over a range of two to four years from the date of the award. Unvested RSUs are generally forfeited immediately
upon the employee’s termination for any reason other than change of control. The following table summarizes activity and
information related to RSUs for the year ended December 31, 2023:
Weighted-
Average
Unvested Grant-Date
Shares Fair Value
Unvested as of December 31, 2022 914,897 $ 127.72
Awarded 413,388 $ 155.20
Vested (448,953) $ 119.81
Forfeited/cancelled (64,008) $ 145.49
Unvested as of December 31, 2023 815,324 $ 144.62
Performance-Based Restricted Stock Units
The vesting of the PSUs is contingent on the continued service of the grantee and the achievement of specific performance
metrics (generally over a range of two to four years) designated by Nexstar’s board of directors. Unvested PSUs are generally
forfeited immediately upon the employee’s termination for any reason other than change of control. The following table summarizes
activity and information related to PSUs for the year ended December 31, 2023:
Weighted-
Average
Unvested Grant-Date
Shares Fair Value
Unvested as of December 31, 2022 206,583 $ 136.49
Awarded 150,659 $ 173.98
Vested (170,550) $ 134.91
Forfeited/cancelled (13,125) $ 122.61
Unvested as of December 31, 2023 173,567 $ 171.63
F-35
Note 14: Income Taxes
The income tax expense (benefit) consisted of the following components for the years ended December 31 (in millions):
2023 2022 2021
Current tax expense:
Federal $ 170 $ 294 $ 219
State 37 82 38
207 376 257
Deferred tax expense (benefit):
Federal (60) (84) 2
State (16) (18) 4
(76) (102) 6
Income tax expense $ 131 $ 274 $ 263
The following is a reconciliation of the federal statutory income tax rate to income tax expense for the years ended December 31
(in millions):
2023 2022 2021
Federal income tax at the statutory rate $ 84 $ 256 $ 230
State and local taxes, net of federal benefit 18 47 43
N
ondeductible compensation 8 8 6
N
ondeductible meals and entertainment 3 2 2
Excess tax benefit on stock-based compensation (4) (26) (20)
Change in beginning of year valuation allowance 10 (4 ) 19
Uncertain tax positions - (4) (12)
Bargain purchase gain - (12) -
Minority interest 14 5 -
Other (2) 2 (5)
Income tax expense $ 131 $ 274 $ 263
On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Act”) was signed into law making significant changes to the
Internal Revenue Code. The Act reduced the federal corporate income tax rate from 35% to 21% effective for tax years beginning
after December 31, 2017. Although the federal corporate income tax rate reduction is only effective for tax periods beginning after
December 31, 2017, ASC 740 requires the Company to remeasure the existing net deferred tax liability in the period of enactment.
The Act also provides for immediate expensing of 100% of the costs of qualified property that are incurred and placed in service
during the period from September 27, 2017 to December 31, 2022. Beginning January 1, 2023, the immediate expensing provision is
phased down by 20% per year until it is completely phased out as of January 1, 2027. Additionally, effective January 1, 2018, the Act
modifies the executive compensation deduction limitation and imposes possible limitations on the deductibility of interest expense. As
a result of these provisions of the Act, the Company’s deduction related to executive compensation and interest expense could be
limited in future years.
F-36
The components of the net deferred tax asset (liability) were as follows, as of December 31 (in millions):
2023 2022
Deferred tax assets:
Net operating loss carryforwards $ 43 $ 45
Compensation 8 7
Rent 70 70
Pension 61 62
Other 51 53
Total deferred tax assets 233 237
Valuation allowance for deferred tax assets (48) (38)
Total deferred tax assets 185 199
Deferred tax liabilities:
Property and equipment (199) (208)
Other intangible assets (409) (490)
Goodwill (138) (133)
FCC licenses (666) (656)
Rent (73) (72)
Investments (177) (202)
Other (43) (44)
Total deferred tax liabilities (1,705) (1,805)
Net deferred tax liabilities $ (1,520) $ (1,606)
As of December 31, 2023, the Company’s reserve for uncertain tax positions totaled approximately $27 million. For the years
ended December 31, 2023, 2022 and 2021 there were $27 million, $28 million and $33 million of gross unrecognized tax benefits,
respectively, that would reduce the effective tax rate if the underlying tax positions were sustained or settled favorably. The Company
has not recorded any tax reserves related to the Chicago Cubs Transactions as further described in Note 16.
A reconciliation of the beginning and ending balances of the gross liability for uncertain tax positions is as follows (in millions):
2023 2022 2021
Uncertain tax position liability at the beginning of the year $ 28 $ 33 $ 46
Decreases related to settlements with taxing authorities - (2) (7)
Decreases related to expiration of statute of limitations (1) (3) (6)
Uncertain tax position liability at the end of the year $ 27 $ 28 $ 33
The Company’s liability for unrecognized tax benefits totaled $27 million and $28 million at December 31, 2023 and 2022,
respectively. If all of the unrecognized tax benefits at those dates had been recognized, there would have been a favorable $27 million
and $28 million impact on the Company’s reported income tax expense in 2023 and 2022, respectively.
As allowed by ASC Topic 740, the Company recognizes accrued interest and penalties related to uncertain tax positions in
income tax expense in the accompanying Consolidated Statements of Operations and Comprehensive Income. The Company’s
accrued interest and penalties related to uncertain tax positions were $9 million, $7 million and $6 million for the years ended
December 31, 2023, 2022 and 2021, respectively.
Although management believes its estimates and judgments are reasonable, the resolutions of the Company’s tax issues are
unpredictable and could result in tax liabilities that are significantly higher or lower than those which have been provided by the
Company. The Company believes it is reasonably possible that the total amount of unrecognized tax benefits could decrease by
approximately $1 million within the next twelve months due to the resolution of tax examination issues and statute of limitations
expirations.
There can be no assurance that the outcomes from any tax examinations will not have a significant impact on the amount of such
liabilities, which could have an impact on the operating results or financial position of the Company.
F-37
The Company files income tax returns in the U.S. federal jurisdiction and various state jurisdictions. The Tribune acquired
entities are currently undergoing federal audits for tax periods including 2014–2015 and 2018–2019. Protective claims for refund have
been filed for 2013, 2016 and 2017 to keep the periods open for specific issues relating to the potential Cubs resolution. Nexstar is
subject to U.S. federal tax examinations for years after 2019. The Company currently has various state income tax returns in the
process of examination or administrative appeal. Additionally, any NOLs that were generated in prior years and utilized in the current
year or future years may also be subject to examination by the Internal Revenue Service. Generally, the Company is subject to state
tax examination for years after 2018 and any NOLs that were generated in prior years and utilized in the current year or future years
may also be subject to examination.
The Company has gross federal and state income tax NOL carryforwards of $165 million and $164 million, respectively, which
are available to reduce future taxable income if utilized before their expiration. A valuation allowance has been recorded against $143
million of federal NOLs and $82 million of state NOLs attributable to one of the consolidated VIEs. The federal NOLs expire through
2037 if not utilized. Federal NOLs generated after 2017 carry forward indefinitely. State NOLs will expire through 2043 if not
utilized. Section 382 of the Internal Revenue Code of 1986, as amended, generally imposes an annual limitation on the amount of
NOLs that may be used to offset taxable income when a corporation has undergone significant changes in stock ownership. Ownership
changes are evaluated as they occur and could limit the ability to use NOLs. As of December 31, 2023, the Company does not expect
any NOLs to expire as a result of Section 382 limitations.
The ability to use NOLs is also dependent upon the Company’s ability to generate taxable income. The NOLs could expire
before the Company generates sufficient taxable income. To the extent the Company’s use of NOLs is significantly limited, the
Company’s income could be subject to corporate income tax earlier than it would if it were able to use NOLs, which could have a
negative effect on the Company’s financial results and operations.
Note 15: FCC Regulatory Matters
Television broadcasting is subject to the jurisdiction of the FCC under the Communications Act of 1934, as amended (the
“Communications Act”). The Communications Act prohibits the operation of television broadcasting stations except under a license
issued by the FCC and empowers the FCC, among other things, to issue, revoke and modify broadcasting licenses, determine the
location of television stations, regulate the equipment used by television stations, adopt regulations to carry out the provisions of the
Communications Act and impose penalties for the violation of such regulations. The FCC’s ongoing rule making proceedings could
have a significant future impact on the television industry and on the operation of the Company’s stations and the stations to which it
provides services. In addition, the U.S. Congress may act to amend the Communications Act or adopt other legislation in a manner
that could impact the Company’s stations, the stations to which it provides services and the television broadcast industry in general.
Media Ownership
FCC rules limit the Company’s ownership of television stations in local markets and nationally and govern certain local service
agreements between Nexstar and third parties. In general, FCC rules prohibit Nexstar from owning two of the top four stations in a
market in terms of audience share (unless a case-by-case exception is granted) and from owning stations that reach more than 39% of
U.S. television households (as calculated using a prescribed FCC methodology). Nexstar is also prohibited from providing more than
15 percent of the programming of a non-owned television station through a TBA or LMA if Nexstar also owns a station in the same
market, unless the applicable TBA or LMA was entered into prior to November 5, 1996.
The FCC is required to review its media ownership rules every four years and to eliminate those rules it finds are no longer
“necessary in the public interest as a result of competition.” In December 2023, the FCC issued an order concluding its 2018
quadrennial review. The order retained the local television ownership rule without deregulatory changes while extending the rule to
prohibit, in certain circumstances, the establishment of a “top four” combination involving a network-affiliated low power television
station or digital multicast stream. The FCC’s 2018 quadrennial review order is subject to appeal, and in addition, the 2022
quadrennial review is currently pending. The FCC also has an open proceeding to review the national television station ownership
limit. Thus, the media ownership rules are subject to change as a result of current and future quadrennial reviews and in other
proceedings.
F-38
Retransmission Consent
Broadcasters may obtain carriage of their stations’ signals on cable, satellite and other MVPDs through either mandatory
carriage or through “retransmission consent.” Every three years all stations must formally elect either mandatory carriage or
retransmission consent. The Company’s stations have timely opted to continue their elections of retransmission consent for the three-
year period from January 1, 2024 through December 31, 2026. Must-carry elections require that the MVPD carry one station
programming stream and related data in the station’s local market. However, MVPDs may decline a must-carry election in certain
circumstances. MVPDs do not pay a fee to stations that elect mandatory carriage.
A broadcaster that elects retransmission consent waives its mandatory carriage rights, and the broadcaster and the MVPD must
negotiate for carriage of the station’s signal. If a broadcaster elects to negotiate retransmission terms, it is possible that the broadcaster
and the MVPD will not reach agreement and that the MVPD will not carry the station’s signal.
FCC rules and federal statutory law require retransmission consent negotiations to be conducted in “good faith.” It is a per se
violation of the duty to negotiate in good faith for a television broadcast station to negotiate retransmission consent jointly with
another station in the same market if the stations are not commonly owned. Accordingly, the VIEs with which we have sharing
agreements must separately negotiate their retransmission consent agreements with MVPDs for stations in markets where we also own
a station.
MVPD operators have actively sought to change the regulations under which retransmission consent is negotiated before both
the U.S. Congress and the FCC in order to increase their bargaining leverage with television stations. There are still-open FCC
proceedings to review the “totality of the circumstances” test for good faith retransmission consent negotiations, and to eliminate or
modify the FCC’s non-duplication and syndicated exclusivity rules (which could permit MVPDs to import out-of-market television
stations in certain circumstances).
Certain OVDs stream broadcast programming over the internet. In December 2014, the FCC issued a Notice of Proposed
Rulemaking proposing to interpret the term “MVPD” to encompass OVDs that make available for purchase multiple streams of video
programming distributed at a prescheduled time and seeking comment on the effects of applying MVPD rules to such OVDs. The
proceeding remains open.
Note 16: Commitments and Contingencies
Broadcast Rights Commitments
Broadcast rights acquired for cash under license agreements are recorded as an asset and a corresponding liability at the
inception of the license period. Future minimum payments for license agreements for which the license period has not commenced and
no asset or liability has been recorded are as follows as of December 31, 2023 (in millions):
2024 $ 169
2025 153
2026 152
2027 141
2028 135
Thereafter 360
$ 1,110
Guarantee of Mission Debt
Nexstar (excluding The CW) guarantees full payment of all obligations incurred under the Mission senior secured credit facility.
In the event that Mission is unable to repay amounts due, Nexstar will be obligated to repay such amounts. The maximum potential
amount of future payments that Nexstar would be required to make under this guarantee would be generally limited to the outstanding
principal amounts. As of December 31, 2023, Mission had a maximum commitment of $368 million under its amended credit
agreement, of which $354 million principal balance of debt was outstanding.
F-39
Indemnification Obligations
In connection with certain agreements that the Company enters into in the normal course of its business, including local service
agreements, business acquisitions and borrowing arrangements, the Company enters into contractual arrangements under which the
Company agrees to indemnify the third party to such arrangement from losses, claims and damages incurred by the indemnified party
for certain events as defined within the particular contract. Such indemnification obligations may not be subject to maximum loss
clauses and the maximum potential amount of future payments the Company could be required to make under these indemnification
arrangements may be unlimited. Historically, payments made related to these indemnifications have been insignificant and the
Company has not incurred significant costs to defend lawsuits or settle claims related to these indemnification agreements.
Collective Bargaining Agreements
As of December 31, 2023, certain technical, production and news employees at 21 of the Company’s stations are covered by
collective bargaining agreements. The Company believes that employee relations are satisfactory and has not experienced any work
stoppages at any of its stations. However, there can be no assurance that the collective bargaining agreements will be renewed in the
future or that the Company will not experience a prolonged labor dispute, which could have a material adverse effect on its business,
financial condition, or results of operations.
Litigation
From time to time, the Company is involved in litigation that arises from the ordinary operations of business, such as contractual
or employment disputes or other general actions. In the event of an adverse outcome of these proceedings, the Company believes the
resulting liabilities would not have a material adverse effect on its financial condition or results of operations.
Local TV Advertising Antitrust Litigation—On March 16, 2018, a group of companies including Nexstar and Tribune (the
“Defendants”) received a Civil Investigative Demand from the Antitrust Division of the Department of Justice (“DOJ”) regarding an
investigation into the exchange of certain information related to the pacing of sales related to the same period in the prior year among
broadcast stations in some DMAs in alleged violation of federal antitrust law. Without admitting any wrongdoing, some Defendants,
including Tribune, entered into a proposed consent decree (referred to herein as the “consent decree”) with the DOJ on November 6,
2018. Without admitting any wrongdoing, Nexstar agreed to settle the matter with the DOJ on December 5, 2018. The consent decree
was entered in final form by the U.S. District Court for the District of Columbia on May 22, 2019. The consent decree, which settles
claims by the government of alleged violations of federal antitrust laws in connection with the alleged information sharing, does not
include any financial penalty. Pursuant to the consent decree, Nexstar and Tribune agreed not to exchange certain non-public
information with other stations operating in the same DMA except in certain cases, and to implement certain antitrust compliance
measures and to monitor and report on compliance with the consent decree.
Starting in July 2018, a series of plaintiffs filed putative class action lawsuits against the Defendants and others alleging that
they coordinated their pricing of television advertising, thereby harming a proposed class of all buyers of television advertising time
from one or more of the Defendants since at least January 1, 2014. The plaintiff in each lawsuit seeks injunctive relief and money
damages caused by the alleged antitrust violations. On October 9, 2018, these cases were consolidated in a multi-district litigation in
the District Court for the Northern District of Illinois captioned In Re: Local TV Advertising Antitrust Litigation, N o. 1:18-cv-06785
(“MDL Litigation”). On January 23, 2019, the Court in the MDL Litigation appointed plaintiffs’ lead and liaison counsel.
The MDL Litigation is ongoing. The Plaintiffs’ Consolidated Complaint was filed on April 3, 2019; Defendants filed a Motion
to Dismiss on September 5, 2019. Before the Court ruled on that motion, the Plaintiffs filed their Second Amended Consolidated
Complaint on September 9, 2019. This complaint added additional defendants and allegations. The Defendants filed a Motion to
Dismiss and Strike on October 8, 2019. The Court denied that motion on November 6, 2020. On March 16, 2022, the Plaintiffs filed
their Third Amended Complaint. The Third Amended Complaint adds two additional plaintiffs and an additional defendant, but does
not make material changes to the allegations.
The parties are in the discovery phase of litigation. The Court has not yet set a trial date. Nexstar and Tribune deny all
allegations against them and will defend their advertising practices.
F-40
In connection with Nexstar’s acquisition of Tribune on September 19, 2019, Nexstar assumed contingencies from certain legal
proceedings, as follows:
Tribune Chapter 11 Reorganization—On December 8, 2008, Tribune and 110 of its direct and indirect wholly-owned
subsidiaries (collectively, the “Debtors”) filed voluntary petitions for relief under chapter 11 (“Chapter 11”) of title 11 of the United
States Code in the U.S. Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). On July 23, 2012, the Bankruptcy
Court issued an order confirming the Fourth Amended Joint Plan of Reorganization for Tribune and its Subsidiaries (as such plan was
subsequently modified by its proponents, the “Plan”). The Plan became effective and the Debtors emerged from Chapter 11 on
December 31, 2012 (the “Effective Date”).
On July 11, 2023, the Bankruptcy Court entered final decrees closing the last of the Debtors’ Chapter 11 cases. Tribune is in the
process of making final distributions in connection with the Chapter 11 cases as well as the final distribution of reserve amounts and
payment of fees in accordance with the Plan and applicable orders of the Bankruptcy Court.
Chicago Cubs Transactions—On August 21, 2009, Tribune and Chicago Entertainment Ventures, LLC (formerly Chicago
Baseball Holdings, LLC) (“CEV LLC”), and its subsidiaries (collectively, “New Cubs LLC”), among other parties, entered into an
agreement (the “Cubs Formation Agreement”) governing the contribution of certain assets and liabilities related to the businesses of
the Chicago Cubs Major League Baseball franchise then owned by Tribune and its subsidiaries to New Cubs LLC. The transactions
contemplated by the Cubs Formation Agreement and the related agreements thereto (the “Chicago Cubs Transactions”) closed on
October 27, 2009. As a result of these transactions, Northside Entertainment Holdings LLC (f/k/a Ricketts Acquisition LLC) (“NEH”)
owned 95% and Tribune owned 5% of the membership interests in CEV LLC. The fair market value of the contributed assets
exceeded the tax basis and did not result in an immediate taxable gain as the transaction was structured to comply with the partnership
provisions of the Internal Revenue Code (“IRC”) and related regulations.
On June 28, 2016, the Internal Revenue Service (“IRS”) issued Tribune a Notice of Deficiency which presented the IRS’s
position that the gain with respect to the Chicago Cubs Transactions should have been included in Tribune’s 2009 taxable income.
Accordingly, the IRS proposed a $182 million tax and a $73 million gross valuation misstatement penalty. During the third quarter of
2016, Tribune filed a petition in U.S. Tax Court to contest the IRS’s determination. After-tax interest on the aforementioned proposed
tax and penalty through December 31, 2023 would be approximately $191 million. In addition, if the IRS prevails in its position,
under the tax rules for determining tax basis upon emergence from bankruptcy, the Company would be required to reduce its tax basis
in certain assets. The reduction in tax basis would be required to reflect the reduction in the amount of the Company’s guarantee of the
New Cubs partnership debt which was included in the reported tax basis previously determined upon emergence from bankruptcy and
subject to Tribune’s 2014 and 2015 Federal Income Tax Audits (described below).
On September 19, 2019, Tribune became a wholly owned subsidiary of Nexstar following Nexstar’s merger with Tribune.
Nexstar disagrees with the IRS’s position that the Chicago Cubs Transactions generated taxable gain in 2009, the proposed penalty
and the IRS’s calculation of the gain. If the IRS prevails in its position, the gain on the Chicago Cubs Transactions would be deemed
to be taxable in 2009. Nexstar estimates that the federal and state income taxes would be approximately $225 million before interest
and penalties. Any tax, interest and penalty due will be offset by tax payments made relating to this transaction subsequent to 2009.
Tribune made approximately $154 million of tax payments prior to its merger with Nexstar.
A bench trial in the U.S. Tax Court took place between October 28, 2019 and November 8, 2019, and closing arguments took
place on December 11, 2019. The Tax Court issued a separate opinion on January 6, 2020 holding that the IRS satisfied the procedural
requirements for the imposition of the gross valuation misstatement penalty. The judge deferred any litigation of the penalty until a
final determination was reached by the Tax Court or Court of Appeals.
On October 26, 2021, the Tax Court issued an opinion related to the Chicago Cubs Transactions, which held that Tribune’s
structure was, in substantial part, in compliance with partnership provisions of the Code and, as a result, did not trigger the entire 2009
taxable gain proposed by the IRS. On October 19, 2022, the Tax Court entered the decision that there is no tax deficiency or penalty
due in the 2009 tax year. On January 13, 2023, the IRS filed a notice of appeal to the U.S. Court of Appeals for the Seventh Circuit.
On February 3, 2023, the Company filed a notice of cross-appeal. On February 15, 2024, the case was argued before the U.S. Court of
Appeals for the Seventh Circuit. The Company expects a ruling from the Court of Appeals in the second half of 2024.
As of December 31, 2023, Nexstar believes the tax impact of applying the Tax Court opinion to 2009 and its impact on
subsequent tax years is not material to the Company’s accounting for uncertain tax positions or to its Consolidated Financial
Statements. Although management believes its estimates and judgments are reasonable, the timing and ultimate resolution are
unpredictable and could materially change.
F-41
Revenue Agent’s Report on Tribune’s 2014 to 2015 Federal Income Tax Audits— Prior to Nexstar’s merger with Tribune
in September 2019, Tribune was undergoing federal income tax audits for taxable years 2014 and 2015. In the third quarter of 2020,
the IRS completed its audits of Tribune and issued a Revenue Agent’s Report which disallows the reporting of certain assets and
liabilities related to Tribune’s emergence from Chapter 11 bankruptcy on December 31, 2012. Nexstar disagrees with the IRS’s
proposed adjustments to the tax basis of certain assets and the related taxable income impact, and Nexstar is contesting the
adjustments through the IRS administrative appeal procedures. If the IRS prevails in its position and after taking into account the
impact of the Tax Court opinion, Nexstar would be required to reduce its tax basis in certain assets resulting in a $16 million increase
in its federal and state taxes payable and a $70 million increase in deferred income tax liability as of December 31, 2023. In
accordance with ASC Topic 740, the Company has reflected $11 million for certain contested issues in its liability for uncertain tax
positions at December 31, 2023 and December 31, 2022.
Note 17: Segment Data
The Company’s reportable segments are Broadcast and The CW. Our Broadcast segment includes (i) television stations and
related local websites that Nexstar owns, operates, programs or provides sales and other services to in various markets across the
United States, (ii) NewsNation, a national cable news network, (iii) two owned and operated digital multicast networks and other
multicast network services, and (iv) WGN-AM, a Chicago radio station. The CW is the fifth major broadcast network in the U.S. The
other activities of the Company include (i) digital businesses focused on the national marketplace, (ii) the management of certain real
estate assets, including revenues from leasing certain owned office and production facilities, (iii) corporate functions, and (iv)
eliminations.
The Company evaluates the performance of its operating segments based on net revenue and segment profit (loss). Segment
profit includes net revenue, direct operating expenses and selling, general and administrative expenses (excluding corporate) and
payments for broadcast rights. Segment profit (loss) excludes depreciation and amortization, reimbursement from the FCC related to
station repack, impairment charges, gain on disposal of assets and business divestitures and non-operating income statement items.
The CW segment profit (loss) is also calculated in this manner except The CW includes amortization of broadcast rights and excludes
payments for broadcast rights.
Segment financial information is included in the following tables for the periods presented (in millions):
Years Ended December 31,
Net revenue 2023 2022 2021
Broadcast $ 4,611 $ 5,033 $ 4,534
The CW 250 66 -
Corporate (unallocated) and Other 72 112 114
Total net revenue $ 4,933 $ 5,211 $ 4,648
Years Ended December 31,
Operating income (loss) 2023 2022 2021
Broadcast segment profit $ 1,666 $ 2,166 $ 1,742
The CW segment loss
(1)
(202) (70) -
Corporate (unallocated) and Other (180) (180) (153)
Depreciation and amortization expense
(2)
(565) (572) (589)
Goodwill and other long-lived asset impairments (35) (133) (23)
Payments for broadcast rights
(3)
88 126 167
Loss attributable to noncontrolling owners of a segment (67) (23) -
Reimbursement from the FCC related to station repack - 3 20
Miscellaneous, net 3 (5) 11
Income from operations $ 708 $ 1,312 $ 1,175
As of December 31,
Assets 2023 2022
Broadcast
(4)
$ 11,203 $ 11,635
The CW 298 305
Corporate (unallocated) and Other 577 739
$ 12,078 $ 12,679
F-42
As of December 31,
Goodwill 2023 2022
Broadcast $ 2,877 $ 2,873
Corporate (unallocated) and Other 69 88
$ 2,946 $ 2,961
(1)
The CW’s segment loss presented at 75% during the years ended December 31, 2023 and 2022 (none in 2021).
(2)
Excludes amortization of The CW’s programming costs of $377 million and $90 million for the years ended December 31, 2023 and 2022,
respectively, which is included in “The CW segment loss”.
(3)
Excludes payments for The CW’s broadcast rights of $329 million and $118 million for the years ended December 31, 2023 and 2022,
respectively, which are not included in “The CW segment loss”.
(4)
While the Company’s investment in TV Food Network ($936 million at December 31, 2023 and $1.099 billion at December 31, 2022) has not
been allocated to a Company reporting unit or operating segment, such asset has been included in the Company’s disclosure of Broadcast
segment assets given the similar nature of the investment to that segment. For additional information on equity investments, see Note 6.
The following table presents the disaggregation of the Company’s revenue under ASC 606 for the periods presented (in
millions).
Year Ended December 31, 2023 Broadcast The CW
Corporate
(unallocated)
and Other Consolidated
Core advertising $ 1,571 $ 89 $ - $ 1,660
Political advertising 66 - - 66
Distribution 2,674 72 (19) 2,727
Digital 257 50 88 395
Other 43 39 3 85
Total net revenue $ 4,611 $ 250 $ 72 $ 4,933
Year Ended December 31, 2022 Broadcast The CW
Corporate
(unallocated)
and Other Consolidated
Core advertising $ 1,692 $ 26 $ - $ 1,718
Political advertising 506 - - 506
Distribution 2,553 20 (2) 2,571
Digital 240 17 108 365
Other 42 3 6 51
Total net revenue $ 5,033 $ 66 $ 112 $ 5,211
Year Ended December 31, 2021 Broadcast The CW
Corporate
(unallocated)
and Other Consolidated
Core advertising $ 1,762 $ - $ - $ 1,762
Political advertising 45 - - 45
Distribution 2,472 - 1 2,473
Digital 216 - 106 322
Other 39 - 7 46
Total net revenue $ 4,534 $ - $ 114 $ 4,648
The Company primarily derives its revenues from television and digital advertising and from distribution of its stations’ signals
and networks. During the years ended December 31, 2023, 2022 and 2021, revenues from these sources for two of the Company’s
customers exceeded 10%. The first customer represented approximately 12%, 10% and 12% of the Company’s consolidated net
revenue in 2023, 2022 and 2021, respectively. The second customer represented 14%, 11% and 13% of the Company’s consolidated
net revenue in 2023, 2022 and 2021, respectively.
F-43
Advertising revenue (core, political and digital) is positively affected by national and local political campaigns and certain
events such as the Olympic Games or the Super Bowl. Company stations’ advertising revenue is generally highest in the second and
fourth quarters of each year, due in part to increases in consumer advertising in the spring and retail advertising in the period leading
up to, and including, the holiday season. In addition, advertising revenue is generally higher during even-numbered years when
congressional and/or presidential elections occur and advertising is aired during the Olympic Games.
The Company receives compensation from MVPDs and OVDs in return for the consent to the retransmission of the signals of its
television stations and the carriage of NewsNation. Distribution revenue is recognized at the point in time the broadcast signal is
delivered to the distributors and is based on a price per subscriber.
Note 18: Valuation and Qualifying Accounts
Allowance for Credit Losses Rollforward (in millions):
Additions
Balance at Charged to Balance at
Beginning Costs and End of
of Period Expenses
Deductions
(1)
Period
Year Ended December 31, 2023
$ 18
$ 12 $ (10) 20
Year Ended December 31, 2022
23
5 (10) 18
Year Ended December 31, 2021
35
10 (22) 23
(1)
Uncollectible accounts written off, net of recoveries.
Note 19: Subsequent Events
On January 26, 2024, Nexstar’s board of directors declared a quarterly cash dividend of $1.69 per share on its outstanding
common stock. The dividend was paid on February 23, 2024 to stockholders of record on February 9, 2024.
From January 1 to February 27, 2024, we repurchased 190,297 shares of our common stock for $32 million, funded by cash on
hand. As of the date of filing this Annual Report on Form 10-K, the remaining available amount under the share repurchase
authorization was $620 million.
In January 2024, Nexstar borrowed $55 million under its revolving credit facility used for additional working capital, which it
repaid in full.
In February 2024, we received $40 million in cash in connection with Broadcast Music Inc.’s (“BMI”) sale to New Mountain
Capital.
Non-GAAP Financial Information
We utilize Adjusted EBITDA in our communications with investors. This financial measure is not defined under U.S. GAAP.
Adjusted EBITDA is calculated as net income, plus interest expense (net), loss on extinguishment of debt, income tax expense (benefit),
depreciation and amortization expense (excluding amortization of broadcast rights for The CW), (gain) loss on asset disposal, transaction and other
one-time expenses, impairment charges, (income) loss from equity method investments, distributions from equity method investments and other
expense (income), minus reimbursement from the FCC related to station repack and broadcast rights payments (excluding broadcast rights
payments for The CW). We consider Adjusted EBITDA to be an indicator of our assets’ operating performance and a measure of our ability to service
debt. It is also used by management to identify the cash available for strategic acquisitions and investments, maintain capital assets and fund
ongoing operations and working capital needs. We also believe that Adjusted EBITDA is useful to investors and lenders as a measure of valuation.
Adjusted EBITDA for Nexstar—Excluding The CW Network, LLC is calculated as Consolidated Adjusted EBITDA, less the Adjusted EBITDA of
The CW and Eliminations.
Nexstar Media Group, Inc.
Reconciliation of Adjusted EBITDA (Non-GAAP Measure)
($ in millions, unaudited)
Year Ended December 31, 2023 Year Ended December 31, 2022
Adjusted EBITDA:
Nexstar, Ex-
The CW The CW
Eliminations
and Other Consolidated
Nexstar, Ex-
The CW The CW
Eliminations
and Other Consolidated
Net income (loss) $ 543 $ (273) $— $ 270 $1,037 $ (94) $— $ 943
Add (Less):
Interest expense (income), net 450 (3) — 447 338 (1) — 337
Income tax expense 131 — — 131 274 — — 274
Depreciation and amortization expense
(1)
558 6 — 564 571 1 — 572
Stock-based compensation expense 60 — — 60 62 — — 62
Loss (gain) on asset disposal and operating lease
terminations, net (2) — — (2) 4 — — 4
Transaction and other one-time expenses 2 13 — 15 7 30 — 37
Goodwill and long-lived asset impairments 35 — — 35 133 — — 133
Income from equity method investments, net (104) — — (104) (153) — — (153)
Distributions from equity method investments
(2)
201 — — 201 250 — — 250
Pension and other postretirement plans credit, net (36) — — (36) (43) — — (43)
Other non-operating expenses, net — — — — 11 — — 11
Gain on bargain purchase — — — — (56) — — (56)
Reimbursement from the FCC related to station repack — — — — (3) — — (3)
Payments for broadcast rights
(1)
(88) — — (88) (126) — — (126)
Adjusted EBITDA before transaction, one-time and other
non-cash items 1,750 (257) — 1,493 2,306 (64) — 2,242
Margin % 37.2% (102.8%) — 30.3% 44.8% (97.0%) — 43.0%
Less: Transaction and other one-time expenses (2) (13) — (15) (7) (30) — (37)
Adjusted EBITDA before non-cash and other items 1,748 (270) — 1,478 2,299 (94) — 2,205
Margin % 37.1% (108.0%) — 30.0% 44.6% (142.4%) — 42.3%
Add (Less):
Stock-based compensation expense (60) — — (60) (62) — — (62)
Pension and other postretirement plans credit, net 36 — — 36 43 — — 43
Transaction and other one-time expenses 2 13 — 15 7 30 — 37
Adjusted EBITDA $1,726 $ (257) $— $1,469 $2,287 $ (64) $— $2,223
Margin % 36.6% (102.8%) — 29.8% 44.4% (97.0%) — 42.7%
Net revenue $4,710 $ 250 $(27) $4,933 $5,149 $ 66 $ (4) $5,211
(1) Only the columns including The CW do not adjust for amortization of broadcast rights (already deducted from Net Income) and payments for
broadcast rights (i.e. programming payments). Amortization of broadcast rights for The CW licenses original programming, the programming
payments precede the airing of the content as the content is being produced. Because these licenses are typically only on a season-by-season
basis, The CW does not adjust for these timing differences.
(2) Excludes Q1 2023 distribution received from our investment in TV Food Network LLC of $69 million related to its accounts receivable
securitization program.
i
Board of Directors
Perry A. Sook
Chairman
Geoff Armstrong
(1)
Chief Executive Officer of 310 Partners
Former Chief Financial Officer of AMFM
Bernadette S. Aulestia
(2)
Former President, Global Distribution at HBO
Dennis J. FitzSimons
(1)
Chairman of Robert R. McCormick Foundation
Former Chief Executive Officer of Tribune Company
Jay M. Grossman
(2)
Managing Partner and Co-Chief Executive Officer of
ABRY Partners, LLC
C. Thomas McMillen
(3)
President and Chief Executive Officer of
LEAD1 Association
Lisbeth McNabb
(1)
Former Chief Financial Officer and
Chief Operating Officer of Linux Foundation
John R. Muse
(3)
Investor and Former Board Member of
Media General
I. Martin Pompadur
(3)
Former News Corporation Executive
Tony Wells
(2)
Former Chief Media Officer of
Verizon Communications Inc.
Committee Membership:
(1)
Audit Committee
(2)
Compensation Committee
(3)
Nominating & Corporate Governance Committee
Officers
Perry A. Sook
Chief Executive Officer
Michael Biard
President, Chief Operating Officer
Lee Ann Gliha
Executive Vice President, Chief Financial Officer
Andrew Alford
President, Broadcasting
Sean Compton
President, Networks
Dana Zimmer
President, Distribution and Strategy
Brett Jenkins
Executive Vice President, Chief Technology and Digital Officer
Rachel Morgan
Executive Vice President, General Counsel
Blake Russell
Executive Vice President, Operations
Michael Strober
Executive Vice President, Chief Revenue Officer
Gary Weitman
Executive Vice President, Chief Communications Officer
Additional Information
Corporate Headquarters
Nexstar Media Group, Inc.
545 E. John Carpenter Freeway
Suite 700
Irving, TX 75062
(972) 373-8800 Phone
www.nexstar.tv
Annual Meeting of Stockholders
The 2024 Annual Meeting will be held
on Tuesday, June 18, 2024
at 10:00 a.m., CDT
at 545 E. John Carpenter Freeway,
Suite 120, Irving, TX 75062
Stock Exchange Listing
NASDAQ Symbol: NXST
Stock Transfer Agent and Registrar
Equiniti Trust Company, LLC
Legal Counsel
Kirkland & Ellis LLP
New York, NY
Independent Registered Public
Accounting Firm
PricewaterhouseCoopers LLP
Dallas, TX
