I'm also pleased to report that our partner stations were back up on DISH beginning in January. Nexstar's record fourth quarter and full year distribution revenue confirm once again that our distribution partners and their customers continue to value the highly rated broadcast and fast-growing cable news network programming that we provide. The completion of these agreements give us solid visibility for our distribution revenues in 2024 and beyond. As we move into 2024 an election year, we look forward to once again demonstrating the value of broadcast television to both candidates and campaigns looking to communicate to the electorate through their political advertising on our television stations. More on that in just a moment. Our 2023 results extend Nexstar's long record of consistently generating substantial free cash flow a trend that we expect to continue.

On average for the 2022-2023 cycle Nexstar generated $1.8 billion of adjusted annual EBITDA and $1.2 billion of attributable free cash flow. Over that time frame, we returned an average of $910 million each year to shareholders in the form of dividends and share repurchases, representing approximately 77% of our attributable annual free cash flow and 16% of our annual market capitalization to boot. Our strong financial track record supports our commitment to our shareholder returns and the enhancement of our shareholder value. To that end in January, we announced an increase in our annual dividend of 25% our 13th consecutive annual increase. While there is and has been perpetual noise in our space we remain highly confident in our business model our growth opportunities and our competitive positioning.

And we've demonstrated time and again over the years that whatever is occurring in our industry or ecosystem, we are capable of managing Nexstar for free cash flow and the benefit of our shareholders. Broadcast television delivers broadcast – the broadest reach and the greatest share of viewership within a market, given our compelling offering of the most popular local and national sports news and entertainment programming. There's no better example of the power of broadcast television than this year's Super Bowl, which was the most watched television programming since the 1969 moon landing, which I also watched by the way. The enduring strength of the broadcast platform is further demonstrated by the extraordinary local viewership generated in Kansas City and San Francisco, which received a record-breaking 80-plus share of TV viewing and a more than 75% share of TV viewing across the top 34 metered markets.

And for all the hype surrounding the Peacock playoff game and it's 23 million viewers on broadcast, a less competitive wild card game that was moved to a Monday because of bad weather generated 31 million viewers and the Chiefs Bills playoff team generated 50 million viewers more than twice the Peacock game. That's the power of broadcast television. Mike with FOX alarm [ph] will share our sports on sports streaming, our thoughts on sports streaming in a moment. And while it's true the industry is constantly evolving the volatility in Nexstar's share price is not really reflective of what's actually going on in our business. And this has been the case for several years. We keep executing on our playbook making return-focused growth investments and decisions and delivering excellent results and returns for shareholders and we plan to continue to do so.

Before [indiscernible] some comments on 2024, I'll briefly review a few key highlights from the quarter and the year. NewsNation remains the fastest-growing cable news network in prime and has now surpassed MSNBC in cable distribution. The power and strength of our collective media assets enabled us to secure the final GOP Presidential primary debate last year before the Iowa caucuses for NewsNation, which we simulcast on the CW. That was an impressive feed for a 3-year old news network, especially considering that the prior debates were on FOX and NBC. The event delivered more than 4 million combined viewers with NewsNation garnering the largest audience in its history. NewsNation continued to add programming and news talent throughout the year and we're well on our way to become a 24/7 cable news network this year.

The Hill remains the number one website for political news and views with 32 million unique monthly visitors more than 50% bigger than each of our two largest competitors Axios and Politico. Year-over-year the Hill expanded its lead in competition – over its competition by 7 million uniques. During 2023, we also launched The Hill branded political issues news program on NewsNation at 6 o’clock each night. We expand and expect that our political momentum there will continue in 2024 during the Presidential election cycle. Turning to the CW. We made significant headway in 2023 on our path to profitability. First, we further streamlined the network operations, improving cash flow by almost $90 million versus 2022, which was under prior ownership or 3/4 of the year.

We also implemented a compelling programming lineup including a diversified mix of entertainment, unscripted programming, sports and events. In fact in the last few months, the CW has had a number of 1 million plus viewer nights, representing the highest levels reached in the recent history for the network and clearly demonstrating that we deliver compelling programming viewers will watch. For example in November, the ACC Florida state in the ACC, the Florida state versus North Alabama football telecast, delivered the network's highest-rated Saturday night ever and the highest rating in more than five years across all days with more than 1.3 million average viewers peaking at 1.9 million viewers. In early December, as I mentioned, our RNC debate simulcast with NewsNation delivered more than 2.6 million viewers on the CW, peaking at over 3 million and beating NBC and Fox in one of their two primetime hours, generating the highest ratings on the CW since 2018.

Later that month, the Arizona Bowl averaged 1.1 million viewers and we beat CBS in the time period. In mid-January, the Critics' Choice Award delivered more than 1 million total viewers, up 14% over 2023, making it the most-watched show on the CW since 2020. And a week and a half ago, the CW's Sunday Night Prime beat Fox head-to-head a feat repeated again this past week. You'll notice a returning theme of growth as we start to beat our much larger network competitors with more frequency, driving the value of the network for advertisers and affiliates alike. We're excited for the future, particularly as we look at the launch of WWE NXT on October 1 of this year and bringing the NASCAR Xfinity Series to FOX in -- I'm sorry to the CW in 2025. On the distribution front, we launched the CW network affiliations on Nexstar owned and operated stations in five markets, including three of the nation's top 15, and we expanded and extended the CW network affiliation agreements with several of our broadcast partners.

In terms of advertising, we continue to focus on leveraging our collective media assets to increase monetization. In 2023, we completed our first upfront as a consolidated entity for all Nexstar national properties, including NewsNation, The CW, Antenna TV, and The Hill, as well as our digital offerings. We added 47 new advertisers across all platforms. Last quarter, we discussed our intention to bring our national sales in-house, and we successfully transitioned all 117 local television markets to our internal national sales organization. We're executing well on this initiative so far in 2024, and we look forward to sharing our successes in future calls. We also continue to lead the industry in the deployment of ATSC 3.0 or Next Gen TV, achieving our goal of reaching over 50% of the US television households that now receive a Next Gen TV signal from a Nexstar-owned or partner station.

Looking ahead to 2024, Nexstar is in a strong position to benefit from the anticipated record level of political spending in the presidential election cycle. First, with the broadest reach and the greatest share of local viewership, broadcast television continued to be the medium of choice for campaigns and PACs to efficiently reach and influence voters. Second, the voter demo is now the broadcast demo, with 64% of the people who voted in 2022 aged 50-plus, according to Pew Research. We expect, thirdly, to see contested congressional races, more of them actually than ever before in both the House and the Senate, with both chambers up for grabs and several retirements creating new open seats to be contested. Finally, Nexstar's scale leaves us well-positioned regardless of where the money flows.

We have stations covering 91% of this year's gubernatorial and Senate races and 82% of the House races. This election cycle is projected to generate in excess of $10 billion in political advertising reported on a gross revenue basis based on ad impact and DIVX CMAC estimates, with about $5 billion of that total expected to be spent on television. Historically, Nexstar has captured a low teens percentage of local television broadcast spending, which we will book on a net basis after agency commissions. We have a well-established playbook for maximizing political revenue that our teens advance and refine with every election cycle. As America's largest local television broadcasting company, we have the scale and resources to produce and distribute the most comprehensive political news and live debate coverage in our market and across the nation.

Further enhancing our political opportunity in early January, we entered into a multiyear time brokerage agreement with KAZT-TV in Phoenix, the nation's 11th largest DMA [ph] in one of the more critical important markets in the 2024 election cycle. Content synergies between our local and national assets including NewsNation, The Hill and the CW will also be positive contributors to these efforts. Together the distinct competitive advantage reforce our confidence that Nexstar will deliver a strong political advertising revenue in 2024. In terms of guidance, we are initiating 2024 adjusted EBITDA guidance of $2.085 billion to $2.195 billion. Lee Ann will discuss the details shortly, but we've changed the form of our guidance to be more aligned with other companies in our industry and other companies of our scale.

We have a track record of meeting or exceeding our guidance and believe the new EBITDA guidance will be more useful to shareholders who tend to value us on this metric. Even though the form has changed as always, we will continue to provide you with our unvarnished take on the prospects for our business model, which we expect to continue to generate a significant amount of free cash flow for the foreseeable future. I trust that you share my enthusiasm in looking forward to 2024 and Nexstar Media Group's bright future. Our continued growth and our success are predicated on the unique strength and durability of our high profitable operating model with the experience of our leadership team and our more than 13,000 talented and diverse employees across the country.

We expect to build momentum through 2024 given the successful renegotiation of our distribution contracts in 2023, significant presidential election year political advertising, continuing to reduce the losses related to the CW network and an improving economic environment. Nexstar has a clear set of objectives for creating the greatest long-term value for our shareholders and we will continue to deploy cash in a manner that will deliver the highest returns. So with that said, let me turn the call over to Mike Biard. Mike?

Mike Biard: Thank you, Perry, and good morning everyone. Before reviewing our operating results in more detail, I'll briefly address the sports focused streaming product announced by FOX ESPN and Warner Bros. Discovery. As we and many industry analysts believe there was a significant misinterpretation in market overreaction, which appears to have abated somewhat as more information and understanding of the product has become available. First with respect to the composition of the proposed product, we have confirmation that it will function in the same manner as other vMVPDs that distribute our FOX and ABC affiliated stations. To be clear, Nexstar will have the option of opting in to secure carriage and compensation for our ABC and FOX affiliated stations.

As such this would be an additive incremental revenue stream for Nexstar. The fact that the networks O&O and affiliate stations are a core piece of the product is no surprise and it reaffirms the critical importance of the broadcast platform to sports rights and distribution. Moreover, we believe the three JV partners understand the value of the linear ecosystem as pay-TV revenues remain vital to each of them. They've demonstrated this in their respective approaches to D2C, largely avoiding the strategies of some of their peers that have undermined the value of their own core linear networks. We note that Lachlan Murdoch clearly stated that the sole purpose of the sports product is to target cord nevers those already outside of the pay TV ecosystem in order to expand the audience for their sports programming and not shrink linear cash flows.

The rumored pricing for the service supports this assertion, as it would not undervalue the linear services that carry and pay for the marquee sports that are the core of the offering, like some other D2C products in the marketplace do. And since the product is focused on core nevers, we would welcome the opportunity to make Nexstar's local programming available to a new audience. All that said, to date we have more questions than answers about the proposed product, including assurance that will actually launch. We know launching a new streaming startup will be challenging, including potential regulatory hurdles, lawsuits and other complicating factors surrounding the JV. So we'll have to see how this all plays out. But there is no question that the bundled linear video, particularly broadcast continues to be the most effective distribution platform for sports content and the most attractive value proposition to customers for access to the most compelling sports, news and entertainment, all in one place.

As an aside, we believe these marketplace developments combined with our recent ratings successes, further validate our strategy for CW Sports and the investments we've made to acquire sports rights, which we can see are beginning to take root already. Now, turning to the operating review. We delivered fourth quarter net revenue of $1.3 billion compared to $1.5 billion in the prior year quarter. The net revenue comparison primarily reflects the year-over-year variance in cyclical political advertising, offset in part by growth in distribution revenue. Excluding political advertising, net revenue increased 4.3% year-over-year. Core television advertising, which includes both our station group and our national networks, but excludes any digital advertising revenue declined 5.9% year-over-year to approximately $449 million.

Excluding the CW for consistent comparison purposes, core advertising declined 5.6%, marking a sequential improvement from the 2023 third quarter, which was down 6.8%. We continue to be impacted by a challenging national advertising market and our relatively high concentration of large market stations continue to perform more like the national advertising market. To that point, excluding our networks and top 10 markets and including digital ad revenue as many of our peers do, our station core television advertising revenue for the quarter was slightly up. On a consolidated basis, in Q1 2024, we are seeing a slightly greater rate of decline of our overall core television advertising over what we saw in the fourth quarter, again primarily as a result of weak national advertising and due to the Super Bowl airing on CBS versus box, which is not as favorable for us.

Including the CW, consistency of comparison purposes, our top-performing categories in the quarter, for home repair manufacturing, packaged goods and air conditioning heating. Automotive, our largest advertising category in terms of dollars spent was essentially flat, given a challenging year-over-year comparison. The category is most responsible for the core advertising revenue decline for gaming sports betting, insurance and radio TV cable newspaper. Turning to political. Q4 political advertising of $30 million was ahead of Q4, 2021 political of $19 million and just behind Q4, 2019 political of $36 million. With the primary election cycle, slightly less active versus 2019, as Perry mentioned, we remain optimistic, nonetheless, about our growth prospects for political advertising revenue in the 2024 election cycle which we expect to exceed each of 2022 and 2020.

Given our extensive footprint, covering over 80% of contested elections, we are extraordinarily well positioned to take share and dollars locally and nationally. Moving on to distribution. Nexstar delivered fourth quarter distribution revenue of approximately $704 million, up 14.3% versus the prior year. Distribution revenue growth was driven by the renewal of our distribution agreements in 2022 and 2023 on approved terms and annual rate escalators as well as growth in virtual MVPD revenue offset in part by continued traditional MVPD subscriber attrition and a removal of partner stations from certain MVPDs. Subscribers grew in the quarter in the low single-digit range excluding the impact of the ongoing removal of partner stations from certain MVPDs, reflecting the benefit of the increased carriage of our CW, MyNetwork and independent stations on YouTube TV and other MVPDs and the addition of new CW affiliations at Nexstar stations and recent station acquisitions.

Looking forward, we have no significant distribution renewals and only one major affiliation agreement up during the year that will impact 2024. With our partner stations back on DISH and an easier comparison later in the year as we lap the DirecTV service disruption in the third quarter. We expect continued growth of our distribution revenues, tempered by subscriber attrition in line with the overall pay TV marketplace. Specifically, we expect the full year growth rate for our distribution revenue to be in the high single-digit range and the full year growth rate for our net distribution revenue to be in the low-teens. Fourth quarter digital revenue increased 5.4% year-over-year to approximately $106 million. Digital revenue was impacted primarily by weakness in national digital advertising, partially offset by year-over-year increases in Nexstar's local digital advertising revenue and Agency Services business.

As Perry mentioned, the strides we are making at the CW are noteworthy and underscore our optimism for the value that can be created from this asset. Q4 revenue of $55 million declined from last year's $66 million given weakness in the overall advertising market and the impact of the rider strike. However, adjusted EBITDA improved by $14 million compared to the prior year to an adjusted EBITDA loss of $50 million. As Perry mentioned, in 2023, we reduced the CW losses by nearly $90 million over the year and remain on track to continue to bend the cost and revenue curves favorably in 2024 toward breakeven in the next couple of years. The CW remains one of the most exciting long-term growth opportunities at the company, and we expect our programming and sales strategies to drive viewer ship and increase the overall value proposition to our affiliates, distributors and advertisers.

For example, the simulcast of the News Nation presidential debate on the CW was a success for both brands, and we expect to leverage additional organic synergies across our station and network portfolio going forward. As we mentioned on the last call, our CW affiliated stations are the most profitable of our network relationships, both in terms of margin and gross dollars. We are laser focused on fortifying that performance for the long term by acquiring more CW affiliations for Nexstar stations and focusing our programming investments in content that matters to the broadcast viewer, including live sports. With that, it's my pleasure to turn the call over to Lee Ann for the remainder of the financial review and update. Lee Ann?

Lee Ann Gliha: Thank you, Mike and good morning everyone. Mike gave you most of the details on the revenue side and on the CW. So, I'll provide a review of the expenses, adjusted EBITDA, attributable free cash flow, along with a review of our capital allocation activities in our 2024 guidance. Together fourth quarter direct operating and SG&A expenses excluding depreciation and amortization and corporate expenses increased by $4 million. There were a couple of one-time items in Q4 2022 which impacted the comparison. Excluding those items, direct operating and SG&A expenses before corporate increased by $16 million, primarily due to increases in affiliation fees and other programming expenses, the expansion of new programming and expenses related to our in-house national sales force launch, offset by reduced commissions from the reduction of political revenue in a non-election year.

Also included in our calculation of adjusted EBITDA, but not included in direct operating and SG&A expenses above, are the payments for broadcast rights of our stations and networks excluding the CW, which declined by $10 million in Q4, due primarily to reduced reliance on syndicated content. In addition there was $20 million of savings or a 22% reduction in amortization of broadcast rights as the CW as were able to reduce programming costs at the start of the 2023-2024 broadcast season as part of our cost reduction strategy. In Q4 2023, total corporate expense was approximately $45 million including non-cash compensation expense of $16 million compared to $49 million including non-cash compensation expense of $18 million in the fourth quarter of 2022.

Q4 2023 depreciation and amortization was $210 million versus $231 million in the prior year quarter, due primarily to the reduction in programming expenses at the CW I mentioned a moment ago. Please note that the CW programming costs, which are included in our definitions of adjusted EBITDA and attributable free cash flow, are accounted for in this line item as amortization of broadcast rights. For more information on this amount, please refer to the schedules in our earnings release. We've received $12 million in Q4 distributions from equity investments related primarily to our 31% ownership in TV Food Network, which represents a 20% decrease from prior year quarter. Our Q4 distribution for TV Food Network is a tax-related distribution. The reduced amount reflects lower income at the TV Food Network related primarily to lower advertising revenue.

So, putting it all together on a consolidated basis fourth quarter adjusted EBITDA was $411 million, representing a 31.5% margin. Excluding the CW losses, fourth quarter adjusted EBITDA was $461 million, representing approximately a 36.6% margin. Fourth quarter CapEx was $36 million, a reduction of $10 million from our expectations, primarily due to timing of payments which moved to 2024. Fourth quarter CapEx of $36 million compared to $57 million of CapEx in the fourth quarter last year. For the year, CapEx was $149 million versus $156 million last year excluding a small amount of CapEx associated with repack. Fourth quarter net interest expense increased $115 million from $103 million in the prior year quarter due to the impact of higher silver rates applicable to our floating rate debt.

Cash interest expense was $113 million for the quarter, slightly lower than our expectations given lower silver rate. Fourth quarter operating cash taxes were $26 million. And putting this all together, consolidated fourth quarter attributable free cash flow was $265 million. Together with the free cash flow generated in the quarter and cash on hand, we returned $137 million to shareholders, comprised of $46 million in dividends and the repurchase of $91 million of stock at an average purchase price of $145.13. This is a smaller amount of repurchases versus the prior quarter as we used the cash available to accelerate repurchases in the prior quarter given the dislocation in the stock price. For the full year, we repurchased $605 million of stock at an average price of $160.4 taking advantage of the low prices we saw during the last two quarters of the year and reducing shares outstanding for the year by 8.7%.

This compares to 9.7% reduction in shares outstanding that we were able to accomplish last year. Including dividends for the full year we returned $796 million, or 94% of attributable free cash flow in 2023 and compared to 68% of attributable free cash flow in 2022. As Perry mentioned for the 2022-2023 cycle, we returned $910 million of capital to shareholders on average per year, representing a dollar average of 77% of our attributable free cash flow and an actual 16% cash return on our average market capitalization over the period. In 2023, we also repaid $125 million of debt and acquired two stations for $38 million. Nexstar's outstanding debt as of December 31, 2023 was $6.8 billion, down slightly for the quarter as we made quarterly amortization payments of $32 million.

Our cash balance at quarter end was $135 million, including $52 million of cash related to the CW. Because we have designated the CW with an unrestricted subsidiary the losses associated with the CW are not accounted for in our calculation of leverage for purposes of our credit agreement. As such our net first lien covenant ratio for Nexstar excluding CW as of December 31 2023 was 2.25 times, which is well below our first lien and only covenant of 4.25 times. Our total net leverage for Nexstar excluding the CW was 3.76 times at quarter end. As typically announced the last few years, we expect leverage which we calculate on an LTM basis versus the two-year average but not our quantum of debt to tick up in 2023 but to fall again in 2024 as EBITDA will grow with the return of political advertising.

Our plan this year which is a political year is to repay a portion of our debt -- a portion of that incrementals were mandatory payments, while we continue to use cash for dividend and repurchases. In January 2024, we announced our 13th consecutive increase in our dividend increasing the 2024 quarterly dividend rate by 25%, which based on our stock price as of yesterday is now more than a 4% dividend yield achieving our goal of a greater than a 3% yield. Even at this yield the dividend represents less than a 20% claim on our free cash flow this year. As we move forward, we will continually -- we'll continue to strategically deploy our cash in a manner that is consistent with our commitment to creating the highest shareholder value. Now turning to guidance.

This year we are initiating 2024 adjusted EBITDA guidance in a range of $2.085 billion to $2.195 billion. We note that 2024 Street estimates averaged $2.18 billion on average for 2024. Mike and Perry already provided some of the key assumptions that are embedded in our guidance, which include: one that we expect Nexstar's share of total television political advertising to be in line with historical levels or a low teens percentage. And please note that the industry closed these figures on a growth basis, but we book revenue on a net basis after agency commission. Two, our expectation for growth in net distribution revenue growth to be in the high single digits and low teens areas respectively; and three we continue to expect to get the CW to break even in the next couple of years.

The guidance also considers our current expectations for the year for the amount of political fundraising spend allocated to television advertising in our markets the rate of attrition of pay television subscribers, the health of the local and national advertising market, the ability to renegotiate affiliation agreements on favorable terms, and the level of distributions related to our 31.3% ownership stake in TV Food Network among other things. We do not intend to update this guidance on a quarterly basis going forward. We changed the form of our guidance this year for a number of reasons. First, no other company in our industry provides a two-year outlook for their financial performance. In fact, most limit their outlook to the next quarter or fiscal year with many providing no guidance at all.

Second, when we establish the two-year average free cash flow guidance, literally a decade ago in February 2014, we were trying to better educate the market on the strength of our free cash flow generation by smoothing out the impact of the two-year political cycle. We were also doing a lot of debt and the anticipation of M&A over that time frame. That was difficult to pro forma and this guidance was helpful to investors in understanding the financial impact on current and future periods and how quickly we'd be able to deleverage. Today, the market understands the political cycle and we have not done a material M&A transaction since Tribune, which closed in September 2019. We have a healthy balance sheet, relatively low leverage and three full years of clean historical data for investors to look at.

Third, while most large and mid-cap media companies do not provide guidance at all, we felt it was important to continue to offer some level of guidance. We've done extensive research on best practices within and outside our sector and believe that annual adjusted EBITDA guidance is the metric most investors use for us, better aligns us with other companies of our scale and track record and is more reliable measure of our operating performance and strength in the current interest rate environment. This change in form of guidance is by no way a change in what we believe to be the future prospects of Nexstar. We understand that some naysayers may take the opportunity to "read into this guidance change that we somehow don't believe in the future of Nexstar." Don't let them do it.

We continue to have confidence in our business model, growth opportunities and expectations for significant free cash flow generation for the foreseeable future as evidenced by our capital allocation strategy, which prioritizes delivering strong and joint shareholders time. We pride ourselves on our transparency and we'll continue to provide our fair and honest assessment of our businesses and growth prospects. And for those of you projecting free cash flow, which we hope is all of you, we will continue to provide color on how we model our free cash flow. So with respect to free cash flow, we're currently projecting CapEx of $135 million to $145 million for the full year. We project Nexstar's cash interest expense using the spread on our floating rate debt instruments and the current SOFR forward curve and the coupons on our fixed rate debt along with expectations for debt repayments which includes our mandatory amortization of approximately $125 million plus a modest amount of additional optional repayment giving excess cash flow in a political year.

For cash taxes, we use a 26.5% tax rate when calculating our estimated tax after one-time and other adjustments. As a reminder, the first quarter only includes a very small amount of state income tax payments. And for those of you wondering, we did receive $40 million from the BMI sale in February. Finally, a few comments on our ESG initiatives. While we are executing well on our business, ESG also remains the priority for Nexstar and we continue to take action to evolve our practices and disclosures to improve our profile. This year our Board of Directors adopted a new policy, separating the role of Chairperson and CEO, Perry's departure from the company and the Board. And in preparation for Nexstar's 2024 proxy and Annual Meeting, we'll be launching our annual shareholder outreach initiative shortly, where we discuss our initiatives and hear feedback from our top shareholders.

And as in the past, we will provide the results of this process in our annual proxy statement. And with that I'll open the call for questions. Operator, can you go to our first question?

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