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    Playin to g WIN 2020 ANNUAL REPORT


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    LETTER TO SHAREHOLDERS SINCLAIR BROADCAST GROUP Dear Fellow Shareholders, We’re All in This Together This year has been one like no other and Despite the challenges, 2020 was a year that reminded us that we are has redefined what it stronger together. We have seen people go above and beyond to means to be grateful. help their friends and neighbors, a sentiment that Sinclair holds dear. Whether the overnight transition of From the COVID-19 pandemic that upended our way of life, to civil protests and an thousands of staff to a work-from- unprecedented presidential election, there is no doubt we are in a transformative home environment, a focus on moment in our nation’s history, as well as Sinclair’s. In the face of these changing automation, remote technologies, times, I am proud to say that our company rose to the occasion, adapting in ways and new business processes, or that were truly inspiring. Despite the challenges, we came out of the year focused ensuring the safest workplaces on ‘playing to win’ for the future. possible based upon CDC guidelines, the Sinclair community First and foremost, I want to extend my gratitude to the thousands of essential rose to the occasion. Sinclair employees who ensured our broadcasts remained on the air and continued to provide impoant news and COVID related information to the masses, as well as While we quickly moved to control other programming to distract from the perils. With national news oen dictating costs in multiple areas to offset the local narrative, your steadfast repoing has reminded our communities why the declines in our top line as a they can continue to trust us. This year has reinforced that through unfounate result of the pandemic’s impact weather and other disasters, it is broadcast television that remains a constant for on our business, we also took steps local communities. early on to suppo our workforce. These effos included a vacation Our commitment to the ethos ‘play to win’ is why I have such high optimism for buyback program, advances on our future. Whether it be our dedication to heightening the local spos viewing commissions, extra paid time off, experience, investing in digital transformation, developing new and exciting and advanced payments and loans ways to engage with consumers, or leading the advancement of broadcast to spos freelancers who were technologies, Sinclair continues to drive ahead. As we look forward, we may never without work due to the suspension return to business as usual, but I believe Sinclair is well-positioned to thrive despite of professional spos league play. an unpredictable, modern economy and an ever-changing technical and media And while we unfounately have landscape. It is that confidence in our future that led us to oppounistically had to make difficult decisions repurchase approximately 21% of our equity during 2020 at an average price of since then due to the pandemic’s less than $18.00 per share. No maer what curveball was thrown our way this year, continuing and even increasing Sinclair proved to be resilient, nimble, and ready to adapt to a new normal. spread, we believe we have acted with compassion, transparency and accountability. Our swi action to cut non-essential costs early on and throughout 2020, meant that our recent reduction in workforce could be minimized, impacting approximately 5% of our workforce.


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    SINCLAIR BROADCAST GROUP We continued our long-standing panership with the Salvation Army and the communities in which we operate, and with the suppo of our local TV stations, regional spos networks (RSNs) and digital propeies, helped raise over $35 million throughout 2020 to assist communities impacted by COVID, natural disasters and for other causes. In addition, Sinclair directly donated over $1 million to local organizations, awarded 10 scholarships through our Diversity Scholarship Fund and donated over 1,200 hours of aiime for public service announcements. This was in addition to the over 9 million pounds of food collected, more than 2 million meals provided, and the many toys, backpacks, school supplies, coats, and units of blood collected. In April 2021, our Board of Directors added our first female Director, increasing our diversity, strengthening our governance and adding more viewpoints, experience and skills. Award-Winning Relentless News Repoing Local news is, and always has been, the backbone of Sinclair. This is why we recommied ourselves to funding long-form, investigative journalism at a time when many news outlets have leaned into commentary-driven programming. This is just one reason Sinclair won more than 350 news awards in 2020 alone. Notable was work done by Project Baltimore for its investigations into local education issues that expose governmental neglect and lack of oversight. Once again, the Project Baltimore team was honored with the prestigious national Investigative Repoers and Editors Investigative award. Since the launch of our first investigative and nationally-esteemed segment, Project Baltimore, we have expanded our investigative repoing initiative to other markets that focus on topics of impoance to their communities, resulting in similar feedback and outcomes. KOMO-TV, our station in Seale, produced a 90-minute documentary, “The Fight for the Soul of Seale,” a bold program that shined a spotlight on the growing and systemic homeless and drug addiction problems in the city. For more than two years, our Seale newsroom has focused on these issues and the impact on the city’s quality of life. This thought-provoking documentary has been viewed by more than six million people on multiple plaorms. “The Fight for the Soul of Seale” followed the award-winning Sinclair documentary, “Seale is Dying,” which led to the creation of Project Seale, our on-going commitment to focus on Seale’s challenges. Our relentless repoing on maers of public concern is the foundation of our journalistic mission. Asking questions, digging deeper, holding officials accountable and being a voice for the voiceless members of our community is at the core of what we do. Another notewohy achievement during the year involved our TV station in Jefferson City, Missouri, KRCG-TV, which won the coveted National Edward R. Murrow Award for outstanding breaking news coverage of tornadoes that tore through the community. Their comprehensive coverage helped save countless lives during a storm that formed at one of the most vulnerable times, the dead of night. These are just three of the many recognitions Sinclair received this past year for its industry-defining news coverage. As the world continues to rely on local broadcast news to inform their daily lives, we continue to innovate while staying true to our local-first roots. For example, in early 2021, we launched “The National Desk,” a program that leverages our incredible local assets to create a new experience for millions of Americans. A commentary-free program, The National Desk elevates the most impoant stories occurring in cities and towns across the country, bringing them to a national audience. We believe this dynamic format is a model for the future, redefining how news is presented and consumed, and opening the door to a range of content that resonates with audiences across the country. A Spectrum of Oppounities Sinclair was built on a culture of innovation at our core and 2020 was no different, as we continued our legacy of moving the broadcasting industry forward. During the past year, we deployed NEXTGEN TV, powered by the ATSC 3.0 transmission standard, in


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    SINCLAIR BROADCAST GROUP 11 of our markets. By the end of 2021, the industry is on track to be broadcasting with the new technology in 45 markets, reaching over 60% of the U.S. television households. With over 20 models of NEXTGEN television sets available to consumers today and Sinclair’s MarkONE prototype mobile phone currently being tested, we expect consumer adoption to begin to accelerate. This technology, developed in pa by Sinclair, greatly improves signal receivability. It also improves the broadcast audio and video quality, enhances the viewer experience, and provides for mobility, personalization, addressability, and the distribution of data to vehicles, tablets and other devices. This will reposition the broadcast industry as a more dynamic and competitive service in the future. Sinclair stood as an early advocate of ATSC 3.0, and our continued commitment to this new Internet Protocol transmission technology shows how and why we remain a leader in broadcast. Local Focus, National Reach As a diversified media company with must-have local news, spos and popular general enteainment content, we have the added benefit of connecting adveisers with mass audiences across multiple plaorms through our digital agency business, Compulse. Whether linear, social, web or connected TVs, Compulse and our network of local and national marketing consultants offer adveisers an omni-channel, one-stop shop approach to optimizing campaigns. While the pandemic and shelter-in-place rules ceainly impacted Main Street and the many small and medium sized businesses our plaorms suppo, for those businesses that continued to adveise, our ‘360’ approach and unified distribution helped to deliver their messages in a more efficient, broad-based or targeted manner. While the pandemic caused a decline in core adveising in 2020, we experienced a record political adveising year, driven by the desire of political and issue campaigns to reach our coveted news audiences on all plaorms. As viewers broaden their interest in consuming content from multiple sources, Sinclair’s STIRR and NewsON apps have become top contenders in the streaming game, landing as top-3 local news apps on the #1 streaming plaorm in the nation. STIRR, our free ad-suppoed streaming plaorm, offers over 120 channels, including its most-watched channel, the unique and local news-focused, STIRR City, in addition to thousands of hours of on-demand content. The STIRR City channel offers live local news in 73 U.S. markets. The trends for STIRR are favorable; and with its increasing downloads, impressions and session growth, STIRR is an example of how broadcast television can continue to connect with changing audience behaviors. NewsON is also a free ad-suppoed app that provides instant access to live and on-demand newscasts from over 275 trusted local TV station paners in over 165 U.S. markets, allowing viewers to personalize their experience by seing favorite stations and watch breaking news coverage from multiple locations and devices. Our Bet on Spos Sinclair’s new position as a diversified media company still honors our legacy – one that has always championed connecting people with content everywhere and taking on challenges with zeal and forward-thinking creativity. We believe we are well-prepared for any curveballs the future may throw at us. We are recruiting the brightest minds, adopting technology for the future, providing unique value propositions across all our segments, and seing new industry benchmarks. Collectively, all signs point to another winning season for our Company. We thank you, our employees and shareholders, for your continued suppo and look forward to our future success. On the RSN front, we managed through the months-long suspension of live spos, the bedrock of programming for these valuable assets. Overnight, we were able to pivot and fill the void with shared content from our other spos propeies such as Tennis Channel, Stadium and Ring of Honor, demonstrating the value of having a broad content poolio. And while the RSNs have been impacted by subscriber declines and dropped carriage, the RSN business model did reflect its resiliency and built-in hedges throughout the shoened spos seasons.


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    SINCLAIR BROADCAST GROUP Our goal of taking spos viewing to new heights was bolstered by our enterprise-wide transformational panership with Bally’s Corporation, one of the most innovative being operators. As pa of the agreement, 19 of our majority owned RSNs have been rebranded as Bally Spos and our broadcast assets will be integrated with Bally’s. In addition to the RSNs receiving revenue for the naming rights and commied adveising spend from Bally’s, Sinclair received equity interests in their company. We believe this is a game-changing panership, both for Sinclair and Bally’s, as our poolio of TV stations, RSNs, Tennis Channel, Stadium and STIRR are expected to drive Bally’s brand and first-time being customers, which in return should drive audience engagement, and therefore future value, to the RSN plaorm. Under the new Bally Spos brand, viewers can expect a more engaging and satisfying experience. The Bally’s panership goes beyond legalized spos being and enables our effos in the gamification of spos. Central to this effo will be developing community-based fandom and engagement, contests, and fantasy spos, that can be accessed in conjunction with watching live spoing events. We believe there is an incredible oppounity to change the way in which people consume and interact with spos content - to transform a one-dimensional viewing experience into a highly-interactive and personalized activity. Just as our digital plaorms on the broadcast side have for many years introduced a ‘lean in’ experience, we will be pursuing the same strategy on the spos side. To ensure we capitalize on these trends, we have developed and are launching a new and enhanced digital plaorm for the RSNs that will feature more than just live spos, with added elements such as spos news, gaming oppounities, and super-fan content. The rise of U.S. online spos being and iGaming tells us this type of content can be paicularly aractive to younger households, which the industry is eager to beer engage. By panering in Bally’s, our goal is to paicipate in and benefit from the estimated $50 billion future market oppounity in the U.S. online spos being and iGaming addressable market. Meanwhile, Tennis Channel completed an industry-changing, long-term media panership with the ATP Men’s professional tour which, coupled with similar existing WTA Women’s tour rights, makes the network the exclusive paner for all professional tour tennis events in the U.S., across all media distribution plaorms. In 2020, Tennis Channel also debuted its global streaming subscription service, Tennis Channel International, in Europe with expanded distribution expected. Future Forward Our team has displayed a resiliency, ambition, and optimism that will carry well past today’s challenges, and we are prepared to see through the transition to a post-COVID world and its new paradigms. For local news, this means being at the ready to deliver crucial information to communities. For spos, this means more holistically engaging audiences by providing a more enjoyable and captivating experience through interactive elements, including gamification, with the goal of elevating the spos watching experience. For broadcast television, this means the deployment of new technologies and monetization oppounities like datacasting and mobile-first business models. For Sinclair, this means presenting our customers, viewers and paners with a unified poolio of brands, plaorms, reach and experience. The Sinclair culture was built upon leading, innovating and evolving and, as we look forward to the future, we are ‘playing to win.’ We thank you, our employees and shareholders, for your continued suppo and look forward to our future success. David D. Smith Chairman of the Board


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    TABLE OF CONTENTS Business 2 Forward-looking Statements 8 Selected Financial Data 9 Management's Discussion and Analysis of Financial Condition and Results of Operations 11 Quantitative and Qualitative Disclosure About Market Risk 32 Market For Registrant's Common Equity, Related Stockholder Matters and Issuers Purchases of Equity Securities 32 Controls and Procedures 34 Consolidated Balance Sheet 36 Consolidated Statement of Operations 37 Consolidated Statement of Comprehensive Income 38 Consolidated Statements of Equity 39 Consolidated Statement of Cash Flow 42 Notes to the Consolidated Financial Statements 43 Report of Independent Registered Public Accounting Firm 96


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    BUSINESS We are a diversified television media company with national reach and a strong focus on providing high-quality content on our local television stations, regional and national sports networks, and digital platforms. The content, distributed through our broadcast platform and third-party platforms, consists of programming provided by third-party networks and syndicators, local news, college and professional sports, and other original programming produced by us. Additionally, we own digital media products that are complementary to our extensive portfolio of television station and regional sports network related digital properties. Outside of our media related businesses, we operate technical services companies focused on supply and maintenance of broadcast transmission systems as well as research and development for the advancement of broadcast technology, and we manage other non-media related investments. We are a Maryland corporation founded in 1986. Our principal executive offices are located at 10706 Beaver Dam Road, Hunt Valley, Maryland 21030. Our telephone number is (410) 568-1500 and our website address is www.sbgi.net. The information contained on, or accessible through, our website is not part of this annual report and is not incorporated herein by reference. Segments As of December 31, 2020, we have two reportable segments: broadcast and local sports. Our broadcast segment is comprised of all of our television stations, which are owned and/or operated by our wholly-owned subsidiary, Sinclair Television Group, Inc. (STG) and its direct and indirect subsidiaries. Our local sports segment is comprised of our regional sports networks, which are owned and operated by our subsidiary, Diamond Sports Group, LLC (DSG) and its direct and indirect subsidiaries. We also earn revenues from our owned networks, original content, digital and internet services, technical services, and non-media investments. These businesses are included within the other segment. Other is not a reportable segment but is included for reconciliation purposes. Broadcast As of December 31, 2020, our broadcast segment consists primarily of our broadcast television stations. We own, provide programming and operating services pursuant to local marketing agreements (LMAs), or provide sales services and other non- programming operating services pursuant to other outsourcing agreements (such as joint sales agreements (JSAs) and shared services agreements (SSAs)) to 188 stations in 88 markets. These stations broadcast 628 channels, including 240 channels affiliated with primary networks or program service providers comprised of: FOX (57), ABC (40), CBS (31), NBC (25), CW (48), and MyNetworkTV (MNT) (39). The other 388 channels broadcast programming from programming services including Antenna TV, Azteca, Bounce Network, CHARGE!, Comet, Dabl, Decades, Estrella TV, Get TV, Grit, Me TV, Stadium, TBD, Telemundo, This TV, UniMas, Univision, Weather, and two channels broadcasting independent programming. Solely for the purpose of this report, these 188 stations and 628 channels are referred to as “our” stations and channels, and the use of such term shall not be construed as an admission that we control such stations or channels. Refer to our Television Markets and Stations table later for more information. Our broadcast segment provides free over-the-air programming to television viewing audiences in the communities we serve through our local television stations. The programming that we provide on our primary channels consists of network provided programs, locally-produced news, local sporting events, programming from program service arrangements, syndicated entertainment programs, and internally originated programming. We provide live, local sporting events on many of our stations by acquiring the local television broadcast rights for these events or through our relationship with national networks. We are one of the nation's largest producers of local news. We produce more than 2,500 hours of news per week at 130 stations in 82 markets. During 2020, our stations were awarded with 356 journalism awards, including one National Edward R. Murrow award. Our broadcast segment derives revenue primarily from the sale of advertising inventory on our television stations and fees received from traditional multi-channel video programming distributors (MVPDs), such as cable and satellite providers; virtual MVPDs (vMVPDs, and together with MVPDs, "Distributors"), which distribute multiple television channels through the internet without supplying their own data transport infrastructure; and other over-the-top (OTT) distributors that deliver live and on- demand programming over the internet, for the right to distribute our channels on their distribution platforms without a subscription with a Distributor. We also earn revenues by selling digital advertisements on third-party platforms and providing digital content to non-linear devices via websites, mobile, and social media advertisements. Our objective is to meet the needs of our advertising customers by delivering significant audiences in key demographics. Our strategy is to achieve this objective by providing quality local news programming, popular network, syndicated and live sports programs, and other original content to our viewing audience. We attract most of our national television advertisers through national marketing representation firms which have offices in New York City, Los Angeles, Chicago, Atlanta, and Dallas. Our local television advertisers are primarily attracted through the use of a local sales force at each of our television stations, which is comprised of approximately 600 marketing consultants and 90 local sales managers company-wide. 2 l Sinclair Broadcast Group


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    Our operating results are subject to cyclical fluctuations from political advertising. Political spending has been significantly higher in the even-number years due to the cyclicality of political elections. In addition, every four years, political spending is typically elevated further due to the advertising related to the presidential election. Because of the political election cyclicality, there has been a significant difference in our operating results when comparing even-numbered years’ performance to the odd numbered years’ performance. Additionally, our operating results are impacted by the number and importance of individual political races and issues discussed on a national level as well as those within the local communities we serve. We believe political advertising will continue to be an important advertising category in our industry. Political advertising levels may increase further as political-activism, around social, political, economic and environmental causes, continues to draw attention and Political Action Committees (PACs), including so-called Super PACs, continue to increase spending. Television Markets and Stations. As of December 31, 2020, our broadcast segment owns and operates or provides programming and/or sales and other shared services to television stations in the following 88 markets: Market Number of Network Market Rank (a) Channels Stations Affiliation (b) Washington, D.C. 9 6 WJLA, WDCO-CD, WIAV-CD ABC Seattle / Tacoma, WA 12 6 KOMO, KUNS ABC Minneapolis / St. Paul, MN 14 4 WUCW CW Portland, OR 21 7 KATU, KUNP ABC St. Louis, MO 23 4 KDNL ABC Raleigh / Durham, NC 24 7 WLFL, WRDC CW, MNT Pittsburgh, PA 26 7 WPGH, WPNT FOX, MNT Baltimore, MD 28 8 WBFF, WNUV(c), WUTB(d) FOX, CW, MNT Nashville, TN 29 10 WZTV, WNAB(d), WUXP FOX, CW, MNT Salt Lake City, UT 30 10 KUTV, KMYU, KJZZ, KENV(d) CBS, MNT, IND San Antonio, TX 31 9 KABB, WOAI, KMYS(d) FOX, NBC, CW Columbus, OH 33 11 WSYX, WTTE(c), WWHO(d) ABC, CW, MNT, FOX Asheville, NC / Greenville, SC 35 9 WLOS, WMYA(c) ABC, MNT Cincinnati, OH 36 8 WKRC, WSTR(d) CBS, CW, MNT Milwaukee, WI 37 3 WVTV CW, MNT Austin, TX 38 2 KEYE CBS WPEC, WTVX, WTCN-CD, WWHB- West Palm Beach / Ft Pierce, FL 39 13 CBS, CW, MNT CD Las Vegas, NV 40 9 KSNV, KVCW NBC, CW, MNT Grand Rapids / Kalamazoo / Battle Creek, 41 3 WWMT CBS, CW MI Harrisburg / Lancaster / Lebanon / York, 42 4 WHP CBS, CW, MNT PA Oklahoma City, OK 44 7 KOKH, KOCB FOX, CW WBMA-LD, WDBB(c), WTTO, Birmingham / Tuscaloosa, AL 45 15 ABC, CW, MNT WABM Norfolk, VA 46 4 WTVZ MNT Greensboro / High Point / Winston-Salem, 47 7 WXLV, WMYV ABC, MNT NC Providence, RI / New Bedford, MA 52 4 WJAR NBC Buffalo, NY 53 7 WUTV, WNYO FOX, MNT Fresno / Visalia, CA 55 12 KMPH, KMPH-CD, KFRE FOX, CW Richmond, VA 56 5 WRLH FOX, MNT Mobile, AL / Pensacola, FL 57 12 WEAR, WPMI(d), WJTC(d), WFGX ABC, NBC, IND, MNT Wilkes Barre / Scranton, PA 58 10 WOLF(c), WSWB(d), WQMY(c) FOX, CW, MNT Little Rock / Pine Bluff, AR 59 4 KATV ABC Albany, NY 60 7 WRGB, WCWN CBS, CW Tulsa, OK 61 4 KTUL ABC Dayton, OH 65 8 WKEF, WRGT(d) ABC, FOX, MNT Spokane, WA 66 3 KLEW CBS Des Moines, IA 68 4 KDSM FOX Green Bay / Appleton, WI 69 8 WLUK, WCWF FOX, CW KSAS, KOCW, KAAS, KAAS-LP, Wichita, KS 70 19 FOX, MNT KSAS-LP, KMTW(c) Roanoke / Lynchburg, VA 71 4 WSET ABC Omaha, NE 72 7 KPTM, KXVO(c) FOX, CW, MNT Flint / Saginaw / Bay City, MI 73 11 WSMH, WEYI(d), WBSF(d) FOX, NBC, CW 2020 Annual Report l 3


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    Market Number of Network Market Rank (a) Channels Stations Affiliation (b) Charleston / Huntington, WV 75 8 WCHS, WVAH(d) ABC, FOX Columbia, SC 76 4 WACH FOX Rochester, NY 77 7 WHAM(d), WUHF ABC, FOX, CW Portland, ME 78 7 WPFO(d), WGME FOX, CBS Toledo, OH 80 4 WNWO NBC Madison, WI 81 4 WMSN FOX Paducah, KY / Cape Girardeau, MO 84 8 KBSI, WDKA FOX, MNT Harlingen / Weslaco / Brownsville / 85 2 KGBT TBD McAllen, TX Syracuse, NY 87 6 WTVH(d), WSTM CBS, NBC, CW Chattanooga, TN 88 7 WTVC, WFLI(d) ABC, FOX, CW, MNT Charleston, SC 89 3 WCIV ABC, MNT WICS, WICD, WRSP(d), WCCU(d), Champaign / Springfield / Decatur, IL 90 17 ABC, FOX, CW WBUI(d) Savannah, GA 91 4 WTGS FOX Cedar Rapids, IA 92 8 KGAN, KFXA(d) CBS, FOX El Paso, TX 93 8 KFOX, KDBC FOX, CBS, MNT South Bend-Elkhart, IN 98 2 WSBT CBS, FOX Myrtle Beach / Florence, SC 99 9 WPDE, WWMB(c) ABC, CW Tri-Cities, TN-VA 100 7 WEMT(d), WCYB FOX, NBC, CW Boise, ID 101 8 KBOI, KYUU-LD CBS, CW Plus Greenville / New Bern / Washington, NC 102 8 WCTI-TV, WYDO(d) ABC, FOX Reno, NV 104 9 KRXI, KRNV(d), KNSN(c) FOX, NBC, MNT KHGI, KWNB, KWNB-LD, KHGI-CD, Lincoln and Hastings-Kearney, NE 105 9 ABC, FOX KFXL Johnstown / Altoona, PA 107 4 WJAC NBC, CW Plus Tallahassee, FL 108 8 WTWC, WTLF(d) NBC, FOX, CW Plus KVAL, KCBY, KPIC(e), KMTR(d), Eugene, OR 113 18 CBS, NBC, CW Plus KMCB(d), KTCW(d) Yakima / Pasco / Richland / Kennewick, KIMA, KEPR, KUNW-CD, KVVK-CD, 117 18 CBS, CW Plus WA KORX-CD Traverse City / Cadillac, MI 118 11 WGTU(d), WGTQ(d), WPBN, WTOM ABC, NBC Macon, GA 120 3 WGXA FOX, ABC Peoria / Bloomington, IL 123 1 WHOI TBD Bakersfield, CA 125 8 KBFX-CD, KBAK FOX, CBS Corpus Christi, TX 130 3 KSCC FOX, MNT Amarillo, TX 131 8 KVII, KVIH ABC, CW Plus KRCR-TV, KCVU(d), KRVU-LD, Chico-Redding, CA 132 15 ABC, FOX, MNT KKTF-LD, KUCO-LD Medford / Klamath Falls, OR 134 4 KTVL CBS, CW Plus Columbia / Jefferson City, MO 135 4 KRCG CBS Beaumont / Port Arthur / Orange, TX 144 8 KFDM, KBTV(d) CBS, CW Plus, FOX KPTH, KPTP-LD, KBVK-LP, Sioux City, IA 148 14 FOX, MNT, CBS KMEG(d) Albany, GA 154 4 WFXL FOX Gainesville, FL 160 8 WGFL(c), WNBW(c), WYME-CD(c) CBS, NBC, MNT Missoula, MT 161 6 KECI-TV, KCFW NBC Wheeling, WV / Steubenville, OH 163 3 WTOV NBC, FOX Abilene / Sweetwater, TX 165 4 KTXS-TV, KTES-LD ABC, CW Plus Quincy, IL / Hannibal, MO / Keokuk, IA 174 3 KHQA CBS, ABC Butte / Bozeman, MT 185 6 KTVM-TV, KDBZ-CD NBC KAEF-TV, KBVU(d), KECA-LD, Eureka, CA 193 10 ABC, FOX, CW Plus, MNT KEUV-LP San Angelo, TX 197 3 KTXE-LD ABC, CW Plus Ottumwa, IA / Kirksville, MO 200 3 KTVO ABC, CBS Total Television Channels 628 4 l Sinclair Broadcast Group


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    (a) Rankings are based on the relative size of a station’s Designated Market Area (DMA) among the 210 generally recognized DMAs in the United States as estimated by Nielsen Media Research (Nielsen) as of September 2020. (b) We broadcast programming from the following providers on our channels and the channels of our JSA/LMA partners: Number of Number of Affiliation Channels Markets Expiration Dates (1) ABC 40 30 August 31, 2022 FOX 57 42 December 31, 2023 CBS 31 24 October 31, 2023 through December 31, 2024 NBC 25 17 December 31, 2021 CW 48 37 August 31, 2021 through August 31, 2024 MNT 39 32 August 31, 2021 Total Major Network Affiliates 240 Number of Number of Affiliation Channels Markets Expiration Dates (1) Antenna TV 23 21 December 31, 2019 through January 1, 2024 Azteca 2 1 August 31, 2020 Bounce 1 1 August 31, 2019 Charge 67 59 (2) Comet 90 74 (2) DABL 30 29 October 31, 2022 Decades 1 1 January 31, 2022 Estrella 1 1 September 30, 2022 GetTV 5 5 June 30, 2017 Grit 1 1 December 31, 2019 IND 2 2 N/A MeTV 19 15 August 31, 2022 through August 1, 2024 Stadium 52 48 (2) TBD 77 65 (2) Telemundo 1 1 December 31, 2022 This TV 1 1 November 1, 2014 UniMas 1 1 December 31, 2021 Univision 8 5 December 31, 2021 through November 30, 2022 Weather 6 4 December 31, 2017 Total Other Affiliates 388 Total Television Channels 628 (1) When we negotiate the terms of our network affiliations or program service arrangements, we generally negotiate on behalf of our owned stations affiliated with that entity simultaneously, except in certain circumstances. This results in substantially similar terms for our stations, including the expiration date of the network affiliations or program service arrangements. If the affiliation agreement expires, we may continue to operate under the existing affiliation agreement on the same terms and conditions until a new affiliation agreement is entered into. (2) An owned and operated network, which is carried on our multicast distribution platform or the platform of our JSA/LMA partners. Thus, there is no expiration date. (c) The license assets for these stations are currently owned by third parties. We provide programming, sales, operational, and administrative services to these stations pursuant to certain service agreements, such as LMAs. (d) The license and programming assets for these stations are currently owned by third parties. We provide certain non-programming related sales, operational, and administrative services to these stations pursuant to service agreements, such as JSAs and SSAs. (e) We provide programming, sales, operational, and administrative services to this station, of which 50% is owned by a third party. 2020 Annual Report l 5


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    Local sports On August 23, 2019, we completed the acquisition of the controlling interests in certain regional sports network brands and Fox College Sports (collectively, the Acquired RSNs) from The Walt Disney Company (Disney). See Note 2. Acquisitions and Dispositions of Assets within the Consolidated Financial Statements for further discussion. In February 2019, we announced a joint venture with the Chicago Cubs (Cubs) that owns and operates Marquee Sports Network (Marquee, and, collectively with the Acquired RSNs, the RSNs), a regional sports network based in Chicago, Illinois. Marquee debuted February 22, 2020 with the airing of the Cubs’ first Spring Training game and is the Chicago-region’s exclusive network for fans to view live Cubs games, exclusive Cubs content, and other local sports programming. On August 29, 2019 we acquired a minority equity interest in the Yankee Entertainment and Sports Network (the YES Network), a regional sports network based in New York, New York. Through our RSNs and the YES Network, we own equity interests in the largest collection of regional sports networks in the United States, broadcasting approximately 4,800 professional sports games and producing approximately 24,800 hours of new content each year. As a result of the modified sports seasons due to the COVID-19 pandemic, during the year ended December 31, 2020, our RSNs and the YES Network broadcast approximately 2,270 professional sports games and produced approximately 12,200 hours of new content. Our RSNs and the YES Network are located in attractive, highly-populated geographic areas of the United States with significant local viewership and 45 of the most exciting professional sports teams. Our RSNs are a premier destination for local sports viewership, with premium live sports content reaching approximately 52 million subscribers nationally, excluding YES Network subscribers. Our RSNs and the YES Network have an extensive footprint that includes exclusive long-term agreements with 16 Major League Baseball (MLB) teams, 17 National Basketball Association (NBA) teams and 12 National Hockey League (NHL) teams. Within our sports network portfolio are 21 regional sports network brands (to be rebranded as 19 Bally Sports network brands), Marquee, and a minority equity interest in the YES Network. We generate revenues by distributing our networks to Distributors, and from the sale of advertising inventory. In connection with our agreement with Bally's Corporation (Bally's), our RSNs will be rebranded with the Bally Sports name. See Note 1. Nature of Operations and Summary of Significant Accounting Policies and Note 6. Other Assets within the Consolidated Financial Statements for further discussion. As of December 31, 2020, our RSNs have relationships with the following professional teams. MLB Teams NBA Teams NHL Teams Arizona Diamondbacks Atlanta Hawks Anaheim Ducks Atlanta Braves Charlotte Hornets Arizona Coyotes Chicago Cubs Cleveland Cavaliers Carolina Hurricanes Cincinnati Reds Dallas Mavericks Columbus Blue Jackets Cleveland Indians Detroit Pistons Dallas Stars Detroit Tigers Indiana Pacers Detroit Red Wings Kansas City Royals Los Angeles Clippers Florida Panthers Los Angeles Angels Memphis Grizzlies Los Angeles Kings Miami Marlins Miami Heat Minnesota Wild Milwaukee Brewers Milwaukee Bucks Nashville Predators Minnesota Twins Minnesota Timberwolves St. Louis Blues San Diego Padres New Orleans Pelicans Tampa Bay Lightning St. Louis Cardinals Oklahoma City Thunder Tampa Bay Rays Orlando Magic Texas Rangers Phoenix Suns San Antonio Spurs As of December 31, 2020, we also hold a minority interest in the YES Network, which has long term agreements with the New York Yankees and Brooklyn Nets. We also own Fox College Sports which offers collegiate programming throughout the country. 6 l Sinclair Broadcast Group


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    Other Owned Networks and Content We own and operate Tennis Channel, a cable network which includes coverage of many of tennis' top tournaments and original professional sport and tennis lifestyle shows; Tennis Magazine, the sport’s largest print publication; and Tennis.com (collectively, Tennis), the most visited online tennis platform in the world. We also own and operate various networks carried on distribution platforms owned by us or others, including: Comet, our science fiction network; CHARGE!, our adventure and action-based network; TBD, the first multiscreen TV network in the U.S. market to bring premium internet-first content to TV homes across America; and Stadium, a network that brings together professional sports highlights and college games. Our internally developed content, in addition to our local news, includes Ring of Honor (ROH), our professional wrestling promotion; The National Desk hosted by Jan Jeffcoat (The National Desk); and Full Measure with Sharyl Attkisson (Full Measure), our national Sunday morning investigative and political analysis program. Digital and Internet In January 2019, we launched STIRR, a national free, ad-supported direct-to-consumer (DTC) streaming app, which offers live and on-demand content spanning entertainment, sports, and news. With more than 6 million app downloads to date, STIRR had a break-out year and exceeded expectations with viewership up significantly, doubling the number of average monthly users and minutes viewed for the full year compared to a year ago. Driving this growth is STIRR’s local news channel, STIRR City, the addition of exclusive local on-demand rights, over 120 free TV channels, and two commercial free channels that cover both local and national elections and Covid-19 live press conferences from across the country. STIRR’s growth throughout the year enabled it to reach critical mass for national and local advertisers. We earn revenues from Compulse Integrated Marketing (Compulse), a full-service digital agency which uses our digital expertise, including our OTT advertising platform, CompulseOTT, to help businesses run social media, search, advertising, email marketing, web design, mobile marketing and creative services, audience extension, and navigate and compete in a world of constant innovation and changes in consumer behavior. DataSphere Technologies, provides marketing services to small businesses across the country and works in partnership with multiple media companies, including Sinclair. NewsON is a free, ad-supported app that provides instant access to live or on- demand local news broadcasts, including non-Sinclair affiliate partners. Sinclair Digital Ventures focuses on investment in emerging digital technologies, ad tech, and digital content companies that support, complement, or expand the Company's businesses. In November 2020, we entered into agreements for a long-term, enterprise-wide strategic partnership with Bally's Corporation (Bally's) to combine Bally's vertically integrated, proprietary sports betting technology and expansive market access footprint with our premier portfolio of local broadcast stations, RSNs, Tennis Channel, STIRR and digital and over-the-air television network Stadium. This partnership is expected to enhance the gamification of live sports to provide audiences a first-of-its-kind interactive viewing experience and drive legalized sports betting monetization. In connection with the agreement, we also received various equity interests in Bally's. See Note 1. Nature of Operations and Summary of Significant Accounting Policies and Note 6. Other Assets within the Consolidated Financial Statements for further information. Technical Services We own subsidiaries which are dedicated to providing technical services to the broadcast industry, including: Acrodyne Technical Services, a provider of service and support for broadcast transmitters throughout the world; Dielectric, a designer and manufacturer of broadcast systems including all components from transmitter output to antenna; and ONE Media 3.0, whose purpose is to develop business opportunities, products, and services associated with the NEXTGEN TV broadcast transmission standard and TV platform. We have also partnered with several other companies in the design and deployment of NEXTGEN TV services including: Saankhya Labs to develop NEXTGEN TV technologies to be used in consumer devices; Cast.era, a joint venture with South Korea’s leading mobile operator, SK Telecom, to develop wireless, cloud infrastructure and artificial intelligence technologies; and BitPath, a joint venture with Nexstar Media Group, to deploy and exploit datacasting models using NEXTGEN capabilities. Non-media Investments We own various non-media related investments across multiple asset classes including private equity, mezzanine financing, and real estate investments. Some of the largest investments include: Triangle Sign and Service (Triangle), a sign designer and fabricator; Jefferson Park, a mixed-use land development project in Frederick, MD; investments in sustainability initiatives; and a portfolio of apartment complexes. 2020 Annual Report l 7


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    AVAILABLE INFORMATION We regularly use our website as a source of company information and it can be accessed at www.sbgi.net. We make available, free of charge through our website, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8- K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after such documents are electronically submitted to the SEC, who also makes these reports available at http://www.sec.gov. We intend to comply with the requirements of Item 5.05 of Form 8-K regarding amendments to and waivers under the code of business conduct and ethics applicable to our Chief Executive Officer, Principal Financial Officer and Principal Accounting Officer by providing such information on our website within four days after effecting any amendment to, or granting any waiver under, that code, and we will maintain such information on our website for at least twelve months. In addition, a replay of each of our quarterly earnings conference calls is available on our website until the subsequent quarter’s earnings call. The information contained on, or otherwise accessible through, our website is not a part of this Annual Report and is not incorporated herein by reference. FORWARD-LOOKING STATEMENTS This report includes or incorporates 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 (the Exchange Act), and the U.S. Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements related to our expectations regarding the performance of our business, our financial results, our liquidity and capital resources, contingencies, our dividend policy, and other non-historical statements. When we use words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or similar expressions, we are making forward-looking statements. Such forward-looking statements are subject to various risks, uncertainties and assumptions. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements including, but not limited to, those listed below in summary form and as more fully described under Management’s Discussion and Analysis of Financial Conditions and Results of Operations and Quantitative and Qualitative Disclosures about Market Risk, as such factors may be updated from time to time in our periodic filings with the United States Securities and Exchange Commission (SEC), which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this report and in our other periodic filings with the SEC. Further, forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law. 8 l Sinclair Broadcast Group


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    SELECTED FINANCIAL DATA The selected consolidated financial data for the years ended December 31, 2020, 2019, 2018, 2017, and 2016 have been derived from our audited consolidated financial statements. The information below should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Consolidated Financial Statements and related notes included elsewhere in this Annual Report. STATEMENTS OF OPERATIONS DATA (In millions, except per share data) For the Years Ended December 31, 2020 2019 2018 2017 2016 Statements of Operations Data: Media revenues (a) $ 5,843 $ 4,046 $ 2,919 $ 2,567 $ 2,521 Non-media revenues 100 194 136 69 102 Total revenues 5,943 4,240 3,055 2,636 2,623 Media programming and production expenses 2,735 2,073 1,191 1,064 956 Media selling, general and administrative expenses 832 732 630 534 502 Amortization of program contract costs 86 90 101 116 128 Non-media expenses 91 156 122 75 85 Depreciation of property and equipment 102 97 105 97 98 Corporate general and administrative expenses 148 387 111 113 74 Amortization of definite-lived intangible and other assets 572 327 175 179 184 Impairment of goodwill and definite-lived intangible assets 4,264 — — — — Gain on asset dispositions and other, net of impairment (115) (92) (40) (279) (6) Operating (loss) income (2,772) 470 660 737 602 Interest expense including amortization of debt discount and deferred financing costs (656) (422) (292) (212) (211) Loss on extinguishment of debt (10) (10) — (1) (24) (Loss) gain from equity method investments (36) (35) (61) (14) 1 Other income, net 325 6 3 9 4 (Loss) income before income taxes (3,149) 9 310 519 372 Income tax benefit (provision) 720 96 36 75 (122) Net (loss) income (2,429) 105 346 594 250 Net income attributable to redeemable noncontrolling interests (56) (48) — — — Net loss (income) attributable to noncontrolling interests 71 (10) (5) (18) (5) Net (loss) income attributable to Sinclair Broadcast Group $ (2,414) $ 47 $ 341 $ 576 $ 245 Earnings Per Common Share Attributable to Sinclair Broadcast Group: Basic earnings per share $ (30.20) $ 0.52 $ 3.38 $ 5.77 $ 2.62 Diluted earnings per share $ (30.20) $ 0.51 $ 3.35 $ 5.72 $ 2.60 Dividends declared per share $ 0.80 $ 0.80 $ 0.74 $ 0.72 $ 0.71 As of December 31, 2020 2019 2018 2017 2016 Balance Sheet Data: Cash and cash equivalents $ 1,259 $ 1,333 $ 1,060 $ 681 $ 260 Total assets $ 13,382 $ 17,370 $ 6,572 $ 6,784 $ 5,963 Total debt (c) $ 12,551 $ 12,438 $ 3,893 $ 4,049 $ 4,204 Redeemable noncontrolling interests $ 190 $ 1,078 $ — $ — $ — Total (deficit) equity $ (1,185) $ 1,694 $ 1,600 $ 1,534 $ 558 (a) Media revenues include distribution revenue, advertising revenue, and other media related revenues. (b) Depreciation and amortization includes depreciation and amortization of property and equipment and amortization of definite-lived intangible assets and other assets. (c) Total debt is defined as current and long-term notes payable, finance leases, and commercial bank financing, including finance leases of affiliates. 2020 Annual Report l 9


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    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Forward Looking Statements We make statements in this section that are forward-looking statements within the meaning of the federal securities laws. For a complete discussion of forward-looking statements, see the section in this report entitled “Forward-Looking Statements.” Certain risks may cause our actual results, performance or achievements to differ materially from those expressed or implied by the following discussion. Overview The following Management’s Discussion and Analysis provides qualitative and quantitative information about our financial performance and condition and should be read in conjunction with the other sections in this annual report, including Business, Selected Financial Data, and the Consolidated Financial Statements including the accompanying notes to those statements. This discussion consists of the following sections: Executive Overview — a description of our business, summary of significant events and financial highlights from 2020 and so far in 2021, and information about industry trends; Critical Accounting Policies and Estimates — a discussion of the accounting policies that are most important in understanding the assumptions and judgments incorporated in the consolidated financial statements and a summary of recent accounting pronouncements; Results of Operations — a summary of the components of our revenues by category and by network affiliation or program service arrangement, a summary of other operating data and an analysis of our revenues and expenses for 2020, 2019, and 2018, including comparisons between years and certain expectations for 2021; and Liquidity and Capital Resources — a discussion of our primary sources of liquidity, an analysis of our cash flows from or used in operating activities, investing activities and financing activities, a discussion of our dividend policy, and a summary of our contractual cash obligations and off-balance sheet arrangements. EXECUTIVE OVERVIEW We are a diversified television media company with national reach and a strong focus on providing high-quality content on our local television stations, RSNs, and digital platforms. This content consists of programming provided by third-party networks and syndicators, local news, college and professional sports, and other original programming produced by us. Additionally, we own digital and internet media products that are complementary to our extensive portfolio of television station related digital properties. Outside of our media related businesses, we operate technical services companies focused on supply and maintenance of broadcast transmission systems as well as research and development for the advancement of broadcast technology, and we manage other non-media related investments. We have two reportable segments: broadcast and local sports. Our broadcast segment is comprised of our television stations. Our local sports segment is comprised of our RSNs. We also earn revenues from our owned networks, original content, digital and internet services, technical services, and non-media investments. These businesses are included within other. Corporate and unallocated expenses primarily include our costs to operate as a public company and to operate our corporate headquarters location. Other and corporate are not reportable segments. STG, for which certain assets and results of operations are included in the broadcast segment and which is one of our wholly owned subsidiaries, is the primary obligor under the STG Bank Credit Agreement, the STG 5.125% unsecured notes due 2027, the STG 5.875% unsecured notes due 2026, the STG 5.500% unsecured notes due 2030, and the STG 4.125% secured notes due 2030 (the STG notes are collectively referred to as the STG Notes). We and substantially all of STG’s subsidiaries (and not DSG nor any of its subsidiaries) are guarantors under the STG debt instruments. DSG, for which certain assets and results of operations are included in the local sports segment and which is one of our subsidiaries, is the primary obligor under the DSG Bank Credit Agreement, the DSG 5.375% secured notes due 2026, the DSG 6.625% unsecured notes due 2027, and the DSG 12.750% secured notes due 2026 (the DSG notes are collectively referred to as the DSG Notes). DSG’s wholly-owned subsidiaries (and not us, STG, or any of STG's subsidiaries) are guarantors under the DSG debt instruments. Our Class A Common Stock and Class B Common Stock remain securities of SBG and not obligations or securities of STG or DSG. For more information about our business, reportable segments, and our operating strategy, see Business in this Annual Report. 2020 Annual Report l 11


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    Summary of Significant Events and Financial Highlights Transactions • In January 2020, a minority partner in one of our RSNs exercised its right to sell us the entirety of its non-controlling interest for $376 million. • In November 2020, we entered into an agreement with Bally's for a long-term strategic partnership that combines Bally’s vertically integrated, proprietary sports betting technology and expansive market access footprint with our premier enterprise-wide portfolio of local broadcast stations, RSNs, Tennis Channel, Stadium, and STIRR. • In February 2021, we sold our stations WDKA and KBSI, in Paducah, KY for $28 million. • In February 2021, we acquired the remaining 73% interest we did not already own in Zyp Media, a leading demand-side platform specializing in executing local media campaigns for media companies and agencies in the United States. Television and Digital Content • In January 2020, STIRR, our fast-growing, free ad-supported streaming service, launched an original channel, "2020 LIVE", to offer a continuous stream of live election coverage, giving viewers live access to daily campaign event feeds from across the country, including town hall meetings and stump speeches. • In March 2020, STIRR launched a new channel dedicated to COVID-19 coverage, including live feeds of press conferences as well as other local and national news. • In April 2020, we made significant changes to the content across three company-owned networks; Comet, Charge!, and TBD, including adding some of the most popular classic television series, as well as TBD's first-ever original series, The Link. • In April 2020, our Nashville affiliate, WZTV FOX17, was named AP Outstanding News Operation in the state of Tennessee. The station was awarded the honor for its remarkable agility in chasing breaking news and demonstrating a sustained commitment to public service. • In April 2020, we won four National Headliner Awards and for the second consecutive year, our Project Baltimore investigative reporting team received Investigative Reporters and Editors Inc. (IRE) recognition for exposing local education issues that reflected governmental neglect and lack of oversight. • In September 2020, we invested in Playfly Sports, a leading company in the management of exclusive college and high school sports and esport multi-media rights across the U.S. • In 2020, our newsrooms won a total of 356 journalism awards, including a National RTDNA Edward R. Murrow award, 28 Regional RTDNA Edward R. Murrow awards, and 87 regional Emmy awards. • In January 2021, we launched our headline news service The National Desk across our CW and MNT affiliates and several FOX affiliates, as well as on all station websites and STIRR. The service highlights the latest and most pressing news of the day in real time for viewers across the country. Distribution, Network and Teams • In January 2020, we reached an agreement in principle to renew ten affiliation agreements with FOX Broadcasting Company. • In February 2020, Marquee announced a carriage agreement with Hulu. Including Hulu and previously announced agreements with OTT platform AT&T TV and traditional MVPDs Charter, AT&T U-Verse, DirecTV, and Mediacom, Marquee has signed distribution agreements with 43 Distributors and other OTT distributors. • In March 2020, we reached an agreement with YouTube TV for continued carriage of 19 regional sports networks across the country. • In June 2020, we signed a multi-year agreement with ViacomCBS to renew eight CBS network affiliations for our stations. ViacomCBS also reached agreements to renew the affiliations of two stations to which we provide services, WTVH in Syracuse, NY and WGFL in Gainesville, FL. • In July 2020, we entered into multi-year content carriage agreements with Comcast for all of our television stations and RSNs in Comcast's cable television footprint, including Marquee and the YES Network, as well as continued distribution of the Tennis Channel. • In August 2020, we entered into a multi-year media rights agreement with the Kansas City Royals beginning with the 2020 baseball season for Fox Sports Kansas City (to be rebranded as Bally Sports Kansas City) to continue as the television home of the Royals. In conjunction with this agreement, the Royals received a minority interest ownership percentage in Fox Sports Kansas City. • As of September 1, 2020, Frontier Communications no longer carries the Acquired RSNs and the YES Network. 12 l Sinclair Broadcast Group


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    • In September 2020, we reported that YouTube TV would no longer carry our RSNs. • In October 2020, we reported that Hulu would no longer carry our RSNs and the YES Network. • In December 2020, we entered into a multi-year agreement with FOX Broadcasting Company that renewed FOX network affiliations for stations in 25 markets that reach approximately 11% of U.S. television households. • In January 2021, we entered into a multi-year agreement with ViacomCBS across 13 CBS network affiliations reaching about 5% of the U.S. television households. • In January 2021, we entered into a multi-year agreement with Verizon Communications, Inc., for the continued carriage on Verizon’s FiOS platform of our broadcast television stations and Tennis Channel. • In February 2021, we entered into a multi-year media rights agreement with the Milwaukee Brewers, beginning with the 2021 baseball season, for FOX Sports Wisconsin (to be rebranded as Bally Sports Wisconsin) to continue as the television home of the Brewers. NEXTGEN TV • In January 2020, we announced, with SK Telecom, the Cast.era joint venture focused on cloud infrastructure for broadcasting, ultra-low latency OTT broadcasting, and targeted advertising. • In January 2020, with significant support from our ONE Media 3.0 team, the International Telecommunications Union announced the approval of NEXTGEN TV for use internationally. • In February 2020, we became a member of Pearl TV, a business organization of U.S. broadcast companies with a shared interest in exploring forward-looking broadcasting opportunities, including innovative ways of promoting local broadcast TV content and developing digital media and wireless platforms for the broadcast industry. • In September 2020, we received the honor of being the winner of Achievement in Local Broadcasting awarded by TV of Tomorrow, which was specifically focused and awarded because of Sinclair and ONE Media’s continued efforts with NEXTGEN TV. • In December 2020, ONE Media 3.0 launched NEXTGEN radio services, branded as “STIRR XT,” for delivery in Seattle using the NEXTGEN TV standard. • As of the end of January 2021, we, in coordination with other broadcasters, and led by our joint venture, BitPath, have deployed NEXTGEN TV, powered by ATSC 3.0, in 12 of our markets: Number of Month Market Stations SBG Stations May 2020 Las Vegas, NV 4 KSNV (NBC), KVCW (CW) June 2020 Pittsburgh, PA 3 WPGH (FOX), WPNT (MNT) June 2020 Nashville, TN 5 WZTV (FOX), WUXP (MNT) June 2020 Salt Lake City, UT 4 KUTV (CBS), KJZZ (IND) July 2020 Portland, OR 7 KATU (ABC) October 2020 Austin, TX 4 KEYE (CBS) October 2020 Oklahoma City, OK 5 KOKH (FOX), KOCB (CW) October 2020 Mobile, AL / Pensacola, FL 6 WEAR (ABC), WFGX (MNT) November 2020 Norfolk, VA 4 WTVZ (MNT) November 2020 Raleigh / Durham, NC 5 WLFL (CW), WRDC (MNT) December 2020 Seattle / Tacoma, WA 7 KOMO (ABC), KUNS (Univision) January 2021 Columbus, OH 4 WSYX (ABC/FOX) Financing, Capital Allocation, and Shareholder Returns • In January 2020, we redeemed 200,000 units of the Redeemable Subsidiary Preferred Equity for an aggregate redemption price equal to $200 million, plus accrued and unpaid dividends. • In May 2020, we purchased $2.5 million aggregate principal amount of the STG 5.875% unsecured notes in open market transactions for consideration of $2.3 million. The STG 5.875% unsecured notes acquired in May 2020 were canceled immediately following their acquisition. • In June 2020, we exchanged $66.5 million aggregate principal amount of the DSG 6.625% unsecured notes due 2027 for $31 million aggregate principal amount of the DSG 12.750% secured notes due 2026 and cash payments totaling $10 million, including accrued but unpaid interest. 2020 Annual Report l 13


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    • In March 2020 and June 2020, we purchased a total of $15 million aggregate principal amount of DSG's 6.625% unsecured notes in open market transactions for consideration of $10 million. The DSG 6.625% unsecured notes acquired in March 2020 and June 2020 were canceled immediately following their acquisition. • In August 2020, the Board of Directors authorized an additional $500 million share repurchase authorization. • In August 2020, we redeemed 350,000 units of the Redeemable Subsidiary Preferred Equity for an aggregate redemption price equal to $350 million, plus accrued and unpaid dividends. • In September 2020, the Company's and DSG's indirect, wholly-owned subsidiary, Diamond Sports Finance SPV, LLC (DSPV), entered into the $250 million A/R Facility which matures on September 23, 2023. • In December 2020, we issued $750 million aggregate principal amount of senior secured notes, which bear interest at a rate of 4.125% per annum and mature on December 1, 2030 (the STG 4.125% Secured Notes). The net proceeds of the STG 4.125% Secured Notes were used, plus cash on hand, to redeem $550 million aggregate principal amount of STG's 5.625% senior unsecured notes due 2024 (the STG 5.625% Notes) and to prepay $200 million outstanding under STG's term loan B under the STG Bank Credit Agreement. • For the year ended December 31, 2020, we repurchased approximately 19 million shares of Class A Common Stock for $343 million. • For the year ended December 31, 2020, we paid dividends of $0.80 per share. In February 2021, we declared a quarterly cash dividend of $0.20 per share. Other Legal and Regulatory • In January 2020, we and Nexstar agreed to settle the outstanding lawsuit between us and Tribune Media Company, which Nexstar acquired in September 2019. See Litigation under Note 13. Commitments and Contingencies within the Consolidated Financial Statements for further discussion. • In November 2020, we and the plaintiffs settled the outstanding Derivative actions lawsuit. See Litigation under Note 13. Commitments and Contingencies within the Consolidated Financial Statements for further discussion. Other Events • In February 2020, we promoted Lucy Rutishauser to Executive Vice President & Chief Financial Officer, Del Parks to Executive Vice President & Chief Technology Officer, Don Thompson to Executive Vice President & Chief Human Resources Officer, Scott Shapiro to Senior Vice President/Chief Development Officer, Brian Bark to Senior Vice President/Chief Information Officer, and Don Roberts to VP/Sports Engineering and Production Systems. • In March 2020, in direct response to the COVID-19 pandemic, we made available incremental payments to offer financial support to nearly 1,300 eligible freelancers who work across the RSNs, as the onset of the COVID-19 pandemic halted the production of live sports, depriving these freelancers of work. • In April 2020, we entered into a new public service initiative, in partnership with the University of Maryland School of Medicine, to provide consumers with important and timely news and information about COVID-19. • In June 2020, at our Annual Shareholders' Meeting, our shareholders re-elected all nine Directors, ratified the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2020, and approved the proposed non-binding advisory vote on executive compensation. • In June 2020, we selected ten winning applicants for our Broadcast Diversity Scholarship, awarding tuition assistance to students demonstrating a promising future in the broadcast industry. • In June 2020, Jeff Krolik, President, RSNs, announced his retirement effective August 30, 2020. We announced in July 2020 that Steve Rosenberg, a broadcasting industry executive with over 30 years of experience, joined the Company and would take on the role of President of Local Sports, effective September 1, 2020. • In July 2020, we announced that Scott Shapiro assumed the newly-created role of Chief Strategy Officer/Sports in addition to his current role as Chief Development Officer. • In August 2020, we announced that we were named one of the Baltimore Business Journal's 2020 Best Places to Work award finalists. • In September 2020, we announced the hiring of J.R. McCabe in the newly-created role of Chief Business Officer of D2C/ Gamification. • In October 2020, Lucy Rutishauser, our Executive Vice President and Chief Financial Officer, was named one of The Baltimore Sun's 2020 Women to Watch. • In November 2020, we announced the hiring of John Zeigler in the newly-created role of Chief Marketing Officer. • In December 2020, we produced the 'Rock the Red Kettle' special in partnership with Sony Music Nashville and The Salvation Army. 14 l Sinclair Broadcast Group


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    • In January 2021, we announced the hiring of Jeffrey Lewis as our Chief Compliance Officer, a newly-created position to supervise corporate compliance functions, including regulatory, code of conduct, competition, and privacy. • In January 2021, we jointly revealed, with Bally's, the new Bally Sports logo and Bally Sports regional monikers for our owned and operated RSNs. • In February 2021, we began taking applications for our 2021 Diversity Scholarship, which has awarded $160,000 in scholarships over the last five years. Industry Trends • The traditional MVPD industry continues to experience a decline in subscribers, which has been even higher with the onset of COVID-19, which is partially offset by growth in subscribers of virtual MVPDs. • The Distributor industry has continued to undergo significant consolidation, which gives top Distributors purchase power. • The vMVPDs have continued to gain increasing importance and have quickly become a critical segment of the market. These vMVPDs offer a limited number of networks at a significantly lower price point as compared to the traditional cable offering. • Political spending is significantly higher in the even-numbered years due to the cyclicality of political elections. In addition, every four years, political spending is typically elevated further due to the advertising related to the presidential election. 2020 proved to be a record year in political advertising. • The FCC has permitted broadcast television stations to use their digital spectrum for a wide variety of services including multi-channel broadcasts. The FCC “must-carry” rules only apply to a station’s primary digital stream. • Seasonal advertising increases within our broadcast segment occur in the second and fourth quarters due to the anticipation of certain seasonal and holiday spending by consumers. • Seasonal advertising increases within our local sports segment occur in the second and third quarters due to a higher volume of sports games being played during this time, particularly the MLB season. • Broadcasters have found ways to increase returns on their news programming initiatives while continuing to maintain locally produced content through the use of news sharing arrangements. • Advertising revenue related to the Olympics occurs in even numbered years, with the exception of this year which was postponed due to COVID-19, and the Super Bowl is aired on a different network each year. Both of these popularly viewed events can have an impact on our advertising revenues. 2020 Annual Report l 15


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    CRITICAL ACCOUNTING POLICIES AND ESTIMATES This discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amount of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates including those related to revenue recognition, goodwill and intangible assets, program contract costs, sports programming rights, income taxes and variable interest entities. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. These estimates have been consistently applied for all years presented in this report and in the past we have not experienced material differences between these estimates and actual results. However, because future events and their effects cannot be determined with certainty, actual results could differ from our estimates and such differences could be material. We consider the following accounting policies to be the most critical as they are important to our financial condition and results of operations, and require significant judgment and estimates on the part of management in their application. For a detailed discussion of the application of these and other accounting policies, see Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements. The COVID-19 pandemic continues to create significant uncertainty and disruption in the global economy and financial markets. It is reasonably possible that these uncertainties continue to impact our estimates related to, but not limited to, revenue recognition, goodwill and intangible assets, sports programming rights, and income taxes. As a result, many of our estimates and assumptions require increased judgment and carry a higher degree of variability and volatility. See Distribution Revenue in Revenue Recognition, Sports Programming Rights, and Impairment of Goodwill, Intangibles, and Other Assets under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements for further discussion on how COVID-19 has impacted distribution revenue, sports rights expense, and the value of goodwill and definite- lived intangible assets, respectively. Our estimates may further change in the future as the COVID-19 pandemic continues, new events occur, and additional information emerges, and such changes are recognized or disclosed in the consolidated financial statements. Revenue Recognition. As discussed in Revenue Recognition under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements, we generate advertising revenue primarily from the sale of advertising spots/impressions on our broadcast television, RSN, and digital platforms. Advertising revenue is recognized in the period in which the advertising spots/impressions are delivered. In arrangements where we provide audience ratings guarantees; to the extent that there is a ratings shortfall, we will defer a proportionate amount of revenue until the ratings shortfall is settled through the delivery of additional advertising. The term of our advertising arrangements is generally less than one year and the timing between when an advertisement is aired and when payment is realized is not significant. In certain circumstances, we require customers to pay in advance; payments received in advance of satisfying our performance obligations are reflected as deferred revenue. We generate distribution revenue through fees received from Distributors and other OTT providers for the right to distribute our broadcast channels and cable networks on their distribution platforms. Distribution arrangements are generally governed by multi-year contracts and the underlying fees are based upon a contractual monthly rate per subscriber. These arrangements represent licenses of intellectual property; revenue is recognized as the signal is provided to our customers (as usage occurs) which corresponds with the satisfaction of our performance obligation. Revenue is calculated based upon the contractual rate multiplied by an estimated number of subscribers. Our customers will remit payments based upon actual subscribers a short time after the conclusion of a month, which generally does not exceed 120 days. Historical adjustments to subscriber estimates have not been material. Certain of our distribution arrangements contain provisions that require the Company to deliver a minimum number of live professional sports games or tournaments during a defined period which usually corresponds with a calendar year. If the minimum threshold is not met, we may be obligated to refund a portion of the distribution fees received if shortfalls are not cured within a specified period of time. If we are unable to meet these minimum requirements, we reduce revenue based upon estimated rebates due to our distribution customers over the measurement period of the rebate. See Revenue Recognition within Note 1. Nature of Operations and Summary of Significant Accounting Policies. Impairment of Goodwill, Indefinite-Lived Intangible Assets, and Other Long-Lived Assets. We evaluate our goodwill and indefinite-lived intangible assets for impairment annually, or more frequently, if events or changes in circumstances indicate an impairment may exist. As of December 31, 2020, our consolidated balance sheet includes $2,092 million and $171 million of goodwill and indefinite-lived intangible assets, respectively. We evaluate long-lived assets, including definite-lived intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying value of our asset groups may not be recoverable. 16 l Sinclair Broadcast Group


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    In the performance of our annual goodwill and indefinite-lived intangible asset impairment assessments we have the option to qualitatively assess whether it is more likely-than-not that the respective asset has been impaired. If we conclude that it is more- likely-than-not that a reporting unit or an indefinite-lived intangible asset is impaired, we apply the quantitative assessment, which involves comparing the estimated fair value of the reporting unit or indefinite-lived intangible asset to its respective carrying value. See Impairment of Goodwill, Intangibles and Other Assets under Note 1. Nature of Operations and Summary of Significant Accounting Policies and Note 5. Goodwill, Indefinite-Lived Intangible Assets, and Other Intangible Assets within the Consolidated Financial Statements for further discussion of the significant judgments and estimates inherent in both qualitatively assessing whether impairment may exist and estimating the fair values of the reporting units and indefinite-lived intangible assets if a quantitative assessment is deemed necessary. Our RSNs included in the local sports segment have been negatively impacted by the recent loss of three Distributors. In addition, our existing Distributors are experiencing elevated levels of subscriber erosion which we believe is influenced, in part, by shifting consumer behaviors resulting from media fragmentation, the current economic environment, the COVID 19 pandemic and related uncertainties. Most of these factors are also expected to have a negative impact on future projected revenue and margins of our RSNs. As a result of these factors, we performed an impairment test of the RSN reporting units' goodwill and long-lived asset groups during the third quarter of 2020 which resulted in a non-cash impairment charge on goodwill of $2,615 million, customer relationships of $1,218 million, and other definite-lived intangible assets of $431 million, included within impairment of goodwill and definite-lived intangible assets in our consolidated statements of operations. See Note 5. Goodwill, Indefinite-Lived Intangible Assets, and Other Intangible Assets for more information. For our annual goodwill and indefinite-lived intangibles impairment tests related to our broadcast and other reporting units in 2020, 2019, and 2018, we concluded that it was more-likely-than-not that goodwill was not impaired based on our qualitative assessments. For one reporting unit in 2019, we elected to perform a quantitative assessment and concluded that its fair value significantly exceeded the carrying value. We believe we have made reasonable estimates and utilized appropriate assumptions in the performance of our impairment assessments. If future results are not consistent with our assumptions and estimates, including future events such as a deterioration of market conditions, loss of significant customers, significant increases in discount rates, among other factors, we could be exposed to impairment charges in the future. Any resulting impairment loss could have a material adverse impact on our consolidated balance sheets, consolidated statements of operations and consolidated statements of cash flows. Program Contract Costs. As discussed in Broadcast Television Programming under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements, we record an asset and corresponding liability for programming rights when the program is available for its first showing or telecast. These costs are expensed over the period in which an economic benefit is expected to be derived. To ensure the related assets for the programming rights are reflected in our consolidated balance sheets at the lower of unamortized cost or fair value, management estimates future advertising revenue to be generated by the remaining program material available under the contract terms. Management’s judgment is required in determining the timing of expense for these costs, which is dependent on the economic benefit expected to be generated from the program and may significantly differ from the timing of related payments under the contractual obligation. If our estimates of future advertising revenues decline, amortization expense could be accelerated or fair value adjustments may be required. Sports Programming Rights. As discussed in Sports Programming Rights under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements, we have multi-year program rights agreements that provide us with the right to produce and telecast professional sports games within a specified territory in exchange for an annual rights fee. A prepaid asset is recorded for rights acquired related to future games upon payment of the contracted fee. The assets recorded for the acquired rights are classified as current or non-current based on the period when the games are expected to be aired. Liabilities are recorded for any program rights obligations that have been incurred but not yet paid at period end. We amortize these programming rights as an expense over each season based upon contractually stated rates. Amortization is accelerated in the event that the stated contractual rates over the term of the rights agreement results in an expense recognition pattern that is inconsistent with the projected growth of revenue over the contractual term. 2020 Annual Report l 17


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    Income Tax. As discussed in Income Taxes under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements, we recognize deferred tax assets and liabilities based on the differences between the financial statement carrying amounts and the tax bases of assets and liabilities. We provide a valuation allowance for deferred tax assets if we determine that it is more likely than not that some or all of the deferred tax assets will not be realized. In evaluating our ability to realize net deferred tax assets, we consider all available evidence, both positive and negative, including our past operating results, tax planning strategies, current and cumulative losses, and forecasts of future taxable income. In considering these sources of taxable income, we must make certain judgments that are based on the plans and estimates used to manage our underlying businesses on a long-term basis. As of December 31, 2020, a valuation allowance has been provided for deferred tax assets related to certain temporary basis differences, interest expense carryforwards under the Internal Revenue Code (IRC) Section 163(j) and a substantial amount of our available state net operating loss carryforwards based on past operating results, expected timing of the reversals of existing temporary basis differences, alternative tax strategies and projected future taxable income. As of December 31, 2019, a valuation allowance was provided for deferred tax assets related to a substantial amount of our available state net operating loss carryforwards based on past operating results, including the RSN impairment, expected timing of the reversals of existing temporary basis differences, alternative tax strategies and projected future taxable income. Future changes in operating and/or taxable income or other changes in facts and circumstances could significantly impact the ability to realize our deferred tax assets which could have a material effect on the consolidated financial statements. Management periodically performs a comprehensive review of our tax positions, and we record a liability for unrecognized tax benefits if such tax positions are more likely than not to be sustained upon examination based on their technical merits, including the resolution of any appeals or litigation processes. Significant judgment is required in determining whether positions taken are more likely than not to be sustained, and it is based on a variety of facts and circumstances, including interpretation of the relevant federal and state income tax codes, regulations, case law and other authoritative pronouncements. Based on this analysis, the status of ongoing audits and the expiration of applicable statute of limitations, liabilities are adjusted as necessary. The resolution of audits is unpredictable and could result in tax liabilities that are significantly higher or lower than for what we have provided. See Note 12. Income Taxes within the Consolidated Financial Statements, for further discussion of accrued unrecognized tax benefits. Variable Interest Entities (VIEs). As discussed in Note 14. Variable Interest Entities within the Consolidated Financial Statements, we have determined that certain third-party licensees of stations for which we perform services pursuant to arrangements, including LMAs, JSAs, and SSAs, are VIEs and we are the primary beneficiary of those variable interests because, subject to the ultimate control of the licensees, we have the power to direct the activities which significantly impact the economic performance of the VIE through the services we provide and because we absorb losses and returns that would be considered significant to the VIEs. We have determined that certain RSN joint ventures are VIEs. We are the primary beneficiary of those RSN joint ventures because we have the power to direct the activities which significantly impact the economic performance of certain regional sports networks, including sales and certain operational services and because we absorb losses and returns that would be considered significant to the VIEs. Transactions with Related Parties. We have determined that we conduct certain business-related transactions with related persons or entities. See Note 15. Related Person Transactions within the Consolidated Financial Statements for discussion of these transactions. Recent Accounting Pronouncements See Recent Accounting Pronouncements under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements for a discussion of recent accounting policies and their impact on our financial statements. 18 l Sinclair Broadcast Group


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    RESULTS OF OPERATIONS Any references to the first, second, third or fourth quarters are to the three months ended March 31, June 30, September 30, or December 31, respectively, for the year being discussed. We have two reportable segments, broadcast and local sports, that are disclosed separately from our other and corporate activities. Seasonality / Cyclicality The operating results of our broadcast segment are usually subject to cyclical fluctuations from political advertising. In even numbered years, political spending is usually significantly higher than in odd numbered years due to advertising expenditures preceding local and national elections. Additionally, every four years, political spending is usually elevated further due to advertising expenditures preceding the presidential election (as was the case in 2020). Also, the second and fourth quarter operating results are usually higher than the first and third quarter operating results because advertising expenditures are increased in anticipation of certain seasonal and holiday spending by consumers. The operating results of our local sports segment are usually subject to cyclical fluctuations based on the timing and overlap of the MLB, NBA, and NHL seasons. Usually, the second and third quarter operating results are higher than the first and fourth quarter operating results. However, with the exception of political advertising, our usual seasonality and cyclicality, as described above, did not occur in 2020, and may not occur in 2021, for either segment due to the COVID-19 pandemic. Consolidated Operating Data The following table sets forth certain of our consolidated operating data for the years ended December 31, 2020, 2019, and 2018 (in millions). For definitions of terms, see the footnotes to the table in Selected Financial Data. Years Ended December 31, 2020 2019 2018 Media revenues $ 5,843 $ 4,046 $ 2,919 Non-media revenues 100 194 136 Total revenues 5,943 4,240 3,055 Media programming and production expenses 2,735 2,073 1,191 Media selling, general and administrative expenses 832 732 630 Depreciation and amortization expenses 674 424 280 Amortization of program contract costs 86 90 101 Non-media expenses 91 156 122 Corporate general and administrative expenses 148 387 111 Impairment of goodwill and definite-lived intangible assets 4,264 — — Gain on asset dispositions and other, net of impairment (115) (92) (40) Operating (loss) income $ (2,772) $ 470 $ 660 Net (loss) income attributable to Sinclair Broadcast Group $ (2,414) $ 47 $ 341 2020 Annual Report l 19


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    The Impact of COVID-19 on our Results of Operations Overview On March 11, 2020, the World Health Organization declared COVID-19 a pandemic, and by the end of the following day, each of the MLB, NBA, and NHL had suspended their seasons. On March 13, 2020, the United States declared a national state of emergency. Since that time, efforts to contain the spread of COVID-19 have intensified. Several countries, including the United States, have taken steps to restrict travel, temporarily close businesses and issue quarantine orders, and it remains unclear how long such measures will remain in place regionally. Broadcast segment Advertising revenue was negatively impacted due to COVID-19 starting in the late first quarter and throughout the year due to lower local and national net times sales. During the year ended December 31, 2020, as compared to the prior year, we saw decreases in several advertising categories, primarily as a result of the impact of the COVID-19 pandemic. These decreases were partially offset by an increase in political advertising revenue, primarily due to strong demand in the third and fourth quarters. Distribution revenue was negatively impacted by subscriber erosion experienced by certain Distributors resulting from the effects of COVID-19, among other factors. See Revenues under the Broadcast Segment section below for further discussion. Local sports segment In March 2020, the NBA and NHL each postponed their ongoing 2019-2020 seasons and the MLB postponed the start of its 2020 season. During various points in the third quarter, the NBA, NHL, and MLB all returned to operation under reduced game counts and were able to complete these modified seasons during the early part of the fourth quarter of 2020. During the fourth quarter of 2020, the NBA and NHL announced their plans for their 2020-2021 seasons, which included season start dates in December 2020 and January 2021, respectively, however both with reduced game counts. Due to these interruptions and modified seasons, advertising revenue was down in the second quarter of 2020 as compared to the first quarter of 2020. However, with the resumption of some events during the third quarter of 2020, advertising revenue increased to $124 million during the period as compared to $3 million in the second quarter of 2020. Distribution revenue was negatively impacted by subscriber erosion experienced by certain Distributors resulting from the effect of COVID-19, three Distributors dropping carriage of the RSNs and lower professional sports game counts due to COVID-19, which resulted in rebates to the Distributors, among other factors. The MLB has announced that they expect their 2021 season to begin on time in April 2021 and contain a full game schedule. The NBA and NHL have not announced their 2021-2022 season schedules yet. There can be no assurance that the MLB, NBA, or NHL will complete full or abbreviated seasons in the future. Any reduction in the actual number of games played by the leagues may have an adverse impact on our operations and the cash flows of our local sports segment. See Distribution Revenue in Revenue Recognition and Sports Programming Rights under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements for further discussion on how COVID-19 has impacted distribution revenue and sports rights expense, respectively, including the need for us to provide rebates to our Distributors as well as seek rebate from or reduce future payments to certain of the sports teams. Business continuity Within the United States, our business has been designated an essential business, which allows us to continue to serve our customers, however, the COVID-19 pandemic has disrupted our operations. Certain of our facilities have experienced temporary disruptions as a result of the COVID-19 pandemic, and we cannot predict whether our facilities will experience more significant disruptions in the future and how long these disruptions will last. The COVID-19 pandemic has heightened the risk that a significant portion of our workforce will suffer illness or otherwise be unable to work. Furthermore, reductions in our workforce may become necessary as a result of declines in our business caused by the COVID-19 pandemic. If we take such actions, we cannot assure that we will be able to rehire our workforce once our business has recovered. 20 l Sinclair Broadcast Group


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    BROADCAST SEGMENT The following table sets forth our revenue and expenses for our broadcast segment, previously referred to as our local news and marketing services segment, for the years ended December 31, 2020, 2019, and 2018 (in millions): Percent Change Increase / (Decrease) 2020 2019 2018 ‘20 vs.‘19 ‘19 vs.‘18 Revenue: Distribution revenue $ 1,414 $ 1,341 $ 1,186 5% 13% Advertising revenue 1,364 1,268 1,484 8% (15)% Other media revenue (a) 144 81 45 78% 80% Media revenues $ 2,922 $ 2,690 $ 2,715 9% (1)% Operating Expenses: Media programming and production expenses $ 1,257 $ 1,173 $ 1,081 7% 9% Media selling, general and administrative expenses 553 553 530 —% 4% Amortization of program contract costs 83 90 101 (8)% (11)% Corporate general and administrative expenses 119 144 100 (17)% 44% Depreciation and amortization expenses 239 246 252 (3)% (2)% Gain on asset dispositions and other, net of impairment (118) (62) (100) 90% (38)% Operating income $ 789 $ 546 $ 751 45% (27)% (a) Includes $100 million and $35 million for the years ended December 31, 2020 and 2019, respectively, of intercompany revenue related to certain services provided to the local sports segment and other under management services agreements, which is eliminated in consolidation. Revenues Distribution revenue. Distribution revenue, which includes payments from Distributors for our broadcast signals, increased $73 million in 2020 and $155 million in 2019 when compared to the same periods in 2019 and 2018, respectively. The increase is primarily due to an increase in rates, partially offset by a decrease in subscribers. Advertising revenue. Advertising revenue increased $96 million in 2020 compared to 2019, primarily due to an increase in political advertising revenue of $334 million, as 2020 was a political and presidential election year. The increase is partially offset by decreases in certain categories, most notably a $92 million decrease in automotive, a $24 million decrease in entertainment, a $21 million decrease in furniture, a $16 million decrease in retail, a $14 million decrease in medical, an $11 million decrease in media, and a $10 million decrease in services, primarily as a result of the impact of the COVID-19 pandemic. Advertising revenue decreased $216 million in 2019 compared to 2018. The decrease is primarily related to a decrease in political advertising revenue of $221 million, as 2018 was a political year. These decreases were partially offset by increases in certain categories, notably home products and services. For the year ended December 31, 2021 we expect a significant decrease in advertising revenue, when compared to 2020, primarily related to a decrease in political revenue, as 2020 was a political and presidential election year. 2020 Annual Report l 21


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    The following table sets forth our primary types of programming and their approximate percentages of advertising revenue, excluding digital revenue, for the periods presented: Percent of Advertising Revenue (Excluding Digital) for the Twelve Months Ended December 31, 2020 2019 2018 Local news 34% 33% 34% Syndicated/Other programming 27% 29% 28% Network programming 24% 24% 25% Sports programming 12% 11% 10% Paid programming 3% 3% 3% The following table sets forth our affiliate percentages of advertising revenue for the years ended December 31, 2020, 2019, and 2018: Percent of Advertising Revenue for the # of Twelve Months Ended December 31, Channels (a) 2020 2019 2018 ABC 40 28% 30% 29% FOX 57 25% 25% 24% CBS 31 22% 20% 20% NBC 25 15% 13% 16% CW 48 5% 6% 6% MNT 39 4% 4% 4% Other 388 1% 2% 1% Total 628 (a) We broadcast other programming from the following providers on our channels including: Antenna TV, Azteca, Bounce Network, CHARGE!, Comet, Dabl, Decades, Estrella TV, Get TV, Grit, Me TV, Stadium, TBD, Telemundo, This TV, UniMas, Univision, and Weather. Other Media Revenue. For the years ended December 31, 2020 and 2019, other media revenue increased $63 million and $36 million, respectively, when compared to the same periods in 2019 and 2018. The increase is primarily due to $100 million and $35 million, respectively, in intercompany revenue from the local sports and other segments related to providing certain services under a management services agreement, which are eliminated in our consolidated results. 22 l Sinclair Broadcast Group


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    Expenses Media programming and production expenses. Media programming and production expenses increased $84 million during 2020 compared to 2019, primarily related to an increase in fees pursuant to network affiliation agreements of $105 million. This increase was partially offset by a $16 million decrease in advertising costs, $3 million decrease in employee compensation costs and travel expenses, and a $2 million decrease in network and programming expenses due to COVID-19 broadcasting cancellations. Media programming and production expenses increased $92 million during 2019 compared to 2018, which is primarily related to increases in fess pursuant to network affiliation agreements. Media selling, general and administrative expenses. Media selling, general and administrative expenses remained flat during 2020 compared to 2019, primarily due to a $12 million increase in national sales commissions, partially offset by a $6 million decrease in regulatory costs, a $4 million decrease in travel and entertainment expenses due to the COVID-19 pandemic, and a $2 million decrease in employee compensation costs and travel expenses. Media selling, general and administrative expenses increased $23 million during 2019 compared to 2018. The increase is primarily due to a $13 million increase in third-party fulfillment costs from our digital business due to higher revenues and product mix, a $6 million increase related to a regulatory cost, and a $10 million increase related to employee compensation costs. These increases were partially offset by an $11 million decrease in national sales commissions. Amortization of program contract costs. The amortization of program contract costs decreased $7 million during 2020 compared to 2019, and is primarily related to the timing of amortization on long-term contracts and reduced renewal costs, partially offset by amortization related to new programming. The amortization of program contract costs decreased $11 million during 2019 compared to 2018. The decrease is primarily due to $11 million related to the timing of amortization on long term contracts and reduced renewal costs. Corporate general and administrative expenses. See explanation under Corporate and Unallocated Expenses. Depreciation and amortization expenses. Depreciation of property and equipment and amortization of definite-lived intangibles and other assets decreased $7 million during 2020 compared to 2019, primarily related to depreciation and amortization related to assets retired during 2020. Depreciation of property and equipment and amortization of definite-lived intangibles and other assets decreased $6 million during 2019 compared to 2018, primarily related to $3 million of depreciation and amortization related to assets retired during 2019. Gain on asset dispositions and other, net of impairments. During 2020 and 2019, we recorded a gain of $90 million and $62 million, respectively, related to reimbursements from the FCC's National Broadband Plan spectrum repack process. For the year ended 2020, we recorded a gain of $29 million related to the sale of KGBT-TV and WDKY-TV. For the year ended 2018, we recorded a gain of $83 million associated with the sale of broadcast spectrum in the FCC broadcast incentive auction. See Dispositions within Note 2. Acquisitions and Dispositions of Assets within the Consolidated Financial Statements for further discussion. 2020 Annual Report l 23


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    LOCAL SPORTS SEGMENT Our local sports segment, previously referred to as our sports segment, reflects the results of our RSNs and a minority equity interest in the YES Network. The RSNs and YES Network own the exclusive rights to air, among other sporting events, the games of professional sports teams. The following table sets forth our revenue and expenses for our local sports segment for the years ended December 31, 2020 and 2019 (in millions): 2020 2019 (b) Revenue: Distribution revenue $ 2,472 $ 1,029 Advertising revenue 196 103 Other media revenue 18 7 Media revenue $ 2,686 $ 1,139 Operating Expenses: Media programming and production expenses $ 1,361 $ 769 Media selling, general and administrative expenses (a) 243 90 Depreciation and amortization expenses 410 157 Corporate general and administrative 10 93 Impairment of goodwill and definite-lived intangible assets 4,264 — Operating (loss) income (a) $ (3,602) $ 30 Income from equity method investments $ 6 $ 18 Other income, net $ 160 $ 10 (a) Includes $98 million and $35 million for the years ended December 31, 2020 and 2019, respectively, of intercompany expense related to certain services provided by the broadcast segment under a management services agreement, which is eliminated in consolidation. (b) Represents the activity from the closing date of the acquisition of the Acquired RSNs of August 23, 2019 through December 31, 2019. Media revenue. Media revenue was $2,686 million and $1,139 million for the years ended December 31, 2020 and 2019, respectively, and is primarily derived from distribution and advertising revenue. The increase was primarily due to the results of the Acquired RSNs being included for the whole period of the current year, versus a partial period in the prior year, as the acquisition of the Acquired RSNs closed on August 23, 2019. Distribution revenue is generated through fees received from Distributors for the right to distribute our RSNs. As discussed under Distribution Revenue in Revenue Recognition under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements, decisions made by the leagues during 2020 regarding the timing and format of their seasons have resulted, in some cases, in our inability to meet minimum requirements for delivery of live games and the need to reduce revenue based upon estimated rebates due to our Distributors. As a result, for the year ended December 31, 2020, we reduced revenue and accrued corresponding rebates to Distributors of $420 million. See Subsequent Events under Note 1. Nature of Operations and Summary of Significant Accounting Policies within the Consolidated Financial Statements. We expect distribution revenue to increase during 2021 as compared to 2020, primarily due to $420 million in rebate accruals in 2020 and increases in contractual rates, offset in part by dropped carriage by three Distributors and continued elevated subscriber churn. Advertising revenue is primarily generated from sales of advertising spots/impressions within the RSNs' programming. Due to the interruptions and modified seasons, advertising revenue decreased in the second quarter of 2020 as compared to the first quarter of 2020. However, with the resumption of some events during the third quarter of 2020, advertising revenue increased to $124 million for the third quarter of 2020, as compared to $3 million in the second quarter of 2020. Advertising revenue decreased in the fourth quarter of 2020 as compared to the third quarter of 2020 due to the postponement of the start of the NBA and NHL seasons. We expect advertising revenue to increase during 2021 compared to 2020, primarily due to a higher number of games scheduled to be played in each of the seasons of the MLB, NBA, and NHL. The extent of this increase will depend on the actual number of games played and other macro-economic factors associated with the COVID-19 pandemic. See discussion under The Impact of COVID-19 on our Results of Operations for further discussion. 24 l Sinclair Broadcast Group


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    Media programming and production expenses. Media programming and production expenses were $1,361 million and $769 million for the years ended December 31, 2020 and 2019, respectively, and are primarily related to $1,078 million and $637 million, respectively, of amortization of our sports programming rights with MLB, NBA, and NHL teams and the costs of producing and distributing content for our brands including live games, pre-game and post-game shows, and backdrop programming. The increase was primarily due to the results of the Acquired RSNs being included for the whole period of the current year, versus a partial period in the prior year, as the acquisition of the Acquired RSNs closed on August 23, 2019. We expect media programming and production expenses to increase during 2021 compared to 2020, primarily due to the expectation of a higher number of games scheduled to be played in each of the seasons of the MLB, NBA, and NHL. The extent of this increase will depend on the number of actual games played and other macro-economic factors associated with the COVID-19 pandemic. See discussion under The Impact of COVID-19 on our Results of Operations for further discussion. Media selling, general, and administrative expenses. Media selling, general, and administrative expenses were $243 million and $90 million for the years ended December 31, 2020 and 2019, respectively, and are primarily related to $98 million and $35 million, respectively, of management services agreement fees paid to the broadcast segment and eliminated in consolidation, employee compensation cost, advertising expenses, and consulting fees. Depreciation and amortization. Depreciation and amortization expense was $410 million and $157 million for the years ended December 31, 2020 and 2019, respectively, and is primarily related to the amortization of definite-lived intangible assets and other assets. Impairment of goodwill and definite-lived intangible assets. For the year ended December 31, 2020, we recorded a total impairment loss of $4,264 million relating to goodwill and definite-lived intangible assets of $2,615 million and $1,649 million, respectively. See further discussion in Note 5. Goodwill, Indefinite-Lived Intangible Assets, and Other Intangible Assets within the Consolidated Financial Statements. Corporate general and administrative expenses. See explanation under Corporate and Unallocated Expenses. Other income, net. See explanation under Corporate and Unallocated Expenses. Income from equity method investments. For the years ended December 31, 2020 and 2019, respectively, we recognized income from equity method investments of $6 million and $18 million, respectively. The income is primarily related to our minority ownership interest in the YES Network. 2020 Annual Report l 25


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    OTHER The following table sets forth our revenues and expenses for our owned networks and content, non-broadcast digital and internet solutions, technical services, and non-media investments (collectively, other) for the years ended December 31, 2020, 2019, and 2018 (in millions): Percent Change Increase / (Decrease) 2020 2019 2018 ‘20 vs.‘19 ‘19 vs.‘18 Revenue: Distribution revenue $ 199 $ 130 $ 113 53% 15% Advertising revenue 131 110 75 19% 47% Other media revenues 7 13 16 (46)% (19)% Media revenues $ 337 $ 253 $ 204 33% 24% Non-media revenues (a) $ 114 $ 217 $ 146 (47)% 49% Operating Expenses: Media expenses (c) $ 254 $ 257 $ 210 (1)% 22% Non-media expenses (b) $ 98 $ 168 $ 128 (42)% 31% Amortization of program contract costs $ 3 $ — $ — n/m n/m Corporate general and administrative expenses $ 1 $ 1 $ 1 —% —% Loss (gain) on asset dispositions and other, net of impairments $ 3 $ (4) $ 60 n/m n/m Operating income (loss) $ 65 $ 26 $ (78) (150)% (133)% Loss from equity method investments $ (42) $ (53) $ (61) (21)% (13.1) n/m — not meaningful (a) Non-media revenues for the years ended December 31, 2020, 2019, and 2018 include $14 million, $23 million, and $10 million, respectively, of intercompany revenues related to certain services and sale provided to the broadcast segment, which are eliminated in consolidation. (b) Non-media expenses for the years ended December 31, 2020, 2019, and 2018 include $7 million, $12 million, and $6 million, respectively, of intercompany expenses related to certain services and sales provided by the broadcast segment, which are eliminated in consolidation. (c) Media expenses for the year ended December 31, 2020 includes $2 million of intercompany expense primarily related to certain services provided by the broadcast segment under a management services agreement, which is eliminated in consolidation. Revenue. Media revenue increased $84 million and $49 million for the years ended December 31, 2020 and 2019, respectively, when compared to the same period in the prior year. The increase for both periods is primarily related to an increase in distribution and advertising revenue related to our owned networks. Non-media revenue decreased $103 million during 2020 compared to 2019, and is primarily related to a decrease in broadcast equipment sales due to the winding down of the FCC's National Broadband Plan spectrum repack process. Non-media revenue increased $71 million during 2019 compared to 2018 and is primarily related to an increase in broadcast equipment sales and services related to the FCC's National Broadband Plan repack process, partially offset by decreased sales from our real estate development projects. Expenses. Media expenses decreased $3 million during 2020 compared to 2019. The decrease is primarily related to our owned networks. Non-media expenses decreased $70 million during 2020 compared to 2019, and is primarily related to a decrease in the cost of goods related to broadcast equipment sales. Media expenses increased $47 million during 2019 compared to 2018 primarily due to our owned networks and our non-broadcast digital initiatives. Non-media expenses increased $40 million during 2019 compared to 2018. The increase is primarily related to broadcast equipment business and services, primarily due to higher sales related to the FCC's National Broadband Plan repack process. Corporate general and administrative expenses. See explanation under Corporate and Unallocated Expenses. Loss (gain) on asset dispositions and other, net of impairments. During the year ended 2018, we recorded a non-cash impairment of $60 million related to a real estate development project. 26 l Sinclair Broadcast Group


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    CORPORATE AND UNALLOCATED EXPENSES The following table presents our corporate and unallocated expenses for the years ended December 31, 2020, 2019, and 2018 (in millions): Percent Change Increase/ (Decrease) 2020 2019 2018 ‘20 vs.‘19 ‘19 vs.‘18 Corporate general and administrative expenses $ 148 $ 387 $ 111 (62)% 249% Interest expense including amortization of debt discount and deferred financing costs $ 656 $ 422 $ 292 55% 45% Loss on extinguishment of debt $ (10) $ (10) $ — —% n/m Other income, net $ 325 $ 6 $ 3 n/m 100% Income tax benefit $ 720 $ 96 $ 36 650% 167% Net income attributable to redeemable noncontrolling interests $ (56) $ (48) $ — 17% n/m Net loss (income) attributable to noncontrolling interests $ 71 $ (10) $ (5) (810)% 100% n/m — not meaningful Corporate general and administrative expenses. The table above and the explanation that follows cover total consolidated corporate general and administrative expenses. Corporate general and administrative expenses decreased in total by $239 million during 2020 compared to 2019. The decrease is primarily due to a $258 million decrease in legal, consulting, and regulatory costs, primarily related to the litigation discussed under Note 13. Commitments and Contingencies within the Consolidated Financial Statements and the acquisition of the Acquired RSNs, partially offset by a $20 million increase in employee compensation cost. Corporate general and administrative expenses increased in total by $276 million during 2019 compared to 2018. The increase is primarily due to a $187 million increase in legal, litigation, and regulatory costs, primarily related to the acquisition of the Acquired RSNs, $73 million in consulting fees and transaction costs, primarily related to the financing of the acquisition of the Acquired RSNs, and a $14 million increase in employee compensation cost. We expect corporate general and administrative expenses to remain flat in 2021 compared to 2020. Interest expense. The table above and explanations that follows cover total consolidated interest expense. Interest expense increased by $234 million during 2020 compared to 2019. The increase is primarily due to an increase of $257 million of interest expense associated with acquisition related financing related to the Acquired RSNs which was outstanding for a partial period in 2019 versus the full year in 2020. The increase is partially offset by net decreases in STG interest expense due to refinancing of existing debt and decreases in LIBOR. Interest expense increased by $130 million during 2019 compared to 2018. The increase is primarily related to $211 million of acquisition related financing related to the acquisition of the Acquired RSNs, of which $189 million related to the DSG Notes and DSG Bank Credit Agreement, and $22 million related to a new term loan facility at STG. See Note 7. Notes Payable and Commercial Bank Financing within the Consolidated Financial Statements for further discussion. The increase was partially offset by $79 million in financing ticking fees for the year ended December 31, 2018, associated with the proposed Tribune acquisition, which was subsequently abandoned in August 2018. Prior to any refinancing activities that may occur in 2021, we expect interest expense in 2021 to decrease when compared to 2020 primarily as a result of refinancing activities discussed in Note 7. Notes Payable and Commercial Bank Financing within the Consolidated Financial Statements. Other income, net. Other income, net increased by $319 million during 2020 when compared to 2019. The increase is primarily due to a $158 million increase in the value of investments recorded at fair value and a measurement adjustment gain of $159 million related to certain variable payment obligations assumed in connection with the RSN acquisition. See Note 6. Other Assets and Note 13. Commitments and Contingencies within the Consolidated Financial Statements for further information Income tax benefit. The 2020 income tax benefit for our pre-tax loss of $3,149 million resulted in an effective tax rate of 22.9%. The 2019 income tax benefit for our pre-tax income of $9 million resulted in an effective tax rate of (1,103.4)%. The decrease in the effective tax rate from 2019 to 2020 is primarily due to substantially magnified impact of 2019 discrete items as a result of negligible 2019 pre-tax income. The 2018 income tax benefit for our pre-tax income (including the effects of noncontrolling interest) of $306 million resulted in an effective tax rate of (11.7)%. The increase in the effective tax rate from 2018 to 2019 is primarily due to substantially magnified impact of 2019 discrete items as a result of negligible 2019 pre-tax income. 2020 Annual Report l 27


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    As of December 31, 2020, we had a net deferred tax asset of $197 million as compared to a net deferred tax liability of $407 million as of December 31, 2019. The change from a net deferred tax liability to a net deferred tax asset primarily relates to the 2020 impairment charge related to goodwill and certain definite-lived intangible assets of our RSNs. See Note 5. Goodwill, Indefinite-Lived Intangible Assets, and Other Intangible Assets within the Consolidated Financial Statements for further information. As of December 31, 2020, we had $11 million of gross unrecognized tax benefits. Of this total, $11 million (net of federal effect on state tax issues) represents the amount of unrecognized tax benefits that, if recognized, would favorably affect our effective tax rate. As of December 31, 2019, we had $11 million of gross unrecognized tax benefits. Of this total, $10 million (net of federal effect on state tax issues) represents the amount of unrecognized tax benefits that, if recognized, would favorably affect our effective tax rate. We recognized $0.3 million and $1 million of income tax expense for interest related to uncertain tax positions for the years ended December 31, 2020 and 2019, respectively. See Note 12. Income Taxes within the Consolidated Financial Statements for further information. See Note 12. Income Taxes within the Consolidated Financial Statements for further information. Net income attributable to redeemable noncontrolling interests. For the years ended December 31, 2020 and 2019, net income attributable to redeemable noncontrolling interests was $56 million and $48 million, respectively, and is primarily related to dividends accrued and distributed related to the Redeemable Subsidiary Preferred Equity Net loss (income) attributable to noncontrolling interests. For the years ended December 31, 2020 and 2019, net loss and net income attributable to the noncontrolling interests was $71 million and $10 million, respectively. The net loss is primarily related to the portion of the non-cash impairment charge on customer relationships, other definite-lived intangible assets and goodwill that is attributable to the noncontrolling interests, partially offset by income attributable to the noncontrolling interest. LIQUIDITY AND CAPITAL RESOURCES As of December 31, 2020, we had net working capital of approximately $2,183 million, including $1,259 million in cash and cash equivalent balances. Cash on hand, cash generated by our operations, and borrowing capacity under the Bank Credit Agreements are used as our primary sources of liquidity. On September 23, 2020, DSPV entered into the A/R Facility, which matures on September 23, 2023, in order to enable DSG to raise incremental funding for the ongoing business needs of the local sports segment. The maximum funding availability under the A/R Facility is the lesser of $250 million and the sum of the lowest aggregate loan balance since November 1, 2020 plus $50 million. The amount of actual availability under the A/R Facility is subject to change based on the level of eligible receivables sold by certain indirect wholly owned subsidiaries of DSG identified therein (Originators) to DSPV and certain reserves. Eligibility of the receivables is determined by a variety of factors, including, but not limited to, credit ratings of the Originators’ customers, customer concentration levels, and certain characteristics of the accounts receivable being transferred. As of December 31, 2020, the total commitment was $227 million and the balance of the loans under the A/R Facility was $177 million. On March 17, 2020, we drew $648 million and $225 million under the revolving credit facility portion of the STG Bank Credit Agreement (the STG Revolving Credit Facility) and the revolving credit facility portion of the DSG Bank Credit Agreement (the DSG Revolving Credit Facility, and together with the STG Revolving Credit Facility, the Revolving Credit Facilities), respectively, as a precautionary measure given the COVID-19 pandemic. During the quarter ended June 30, 2020, we fully repaid the amounts outstanding under each of the Revolving Credit Facilities. The Bank Credit Agreements each include a financial maintenance covenant, the first lien leverage ratio (as defined in the respective Bank Credit Agreements), which requires such applicable ratio not to exceed 4.5x and 6.25x, measured as of the end of each fiscal quarter, for STG and DSG, respectively. The respective financial maintenance covenant is only applicable if 35% or more of the capacity (as a percentage of total commitments) under the respective Revolving Credit Facility, measured as of the last day of each quarter, is utilized under such Revolving Credit Facility as of such date. Since there was no utilization under either of the Revolving Credit Facilities as of December 31, 2020, neither STG nor DSG was subject to the respective financial maintenance covenant under their applicable Bank Credit Agreement. As of December 31, 2020, the STG first lien leverage ratio was below 4.5x and the DSG first lien leverage ratio exceeded 6.25x. We expect that DSG's first lien leverage ratio will remain above 6.25x for at least the next 12 months, which will restrict our ability to fully utilize the DSG Revolving Credit Facility. We do not currently expect to have more than the 35% of the capacity of the DSG Revolving Credit Facility outstanding as of any quarterly measurement date during the next 12 months, therefore we do not expect DSG will be subject to the financial maintenance covenant. The Bank Credit Agreements contain other restrictions and covenants which the respective entities were in compliance with as of December 31, 2020 and expect to be over the next 12 months. 28 l Sinclair Broadcast Group


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    In December 2020, STG issued $750 million aggregate principal amount of 4.125% secured notes which mature on December 1, 2030. The net proceeds of the STG 4.125% secured notes were used, plus cash on hand, to redeem all of STG's $550 million aggregate principal amount of 5.625% unsecured notes due 2024 for a redemption price including accrued and unpaid interest, and a call premium, of $571 million and to prepay $200 million outstanding under STG's term loan B with a January 2024 stated maturity date. In June 2020, DSG exchanged $66.5 million aggregate principal amount of its 6.625% unsecured notes due 2027 for $31 million aggregate principal amount of its 12.750% secured notes due 2026 and cash payments totaling $10 million, including accrued but unpaid interest. In May 2020, we purchased $2.5 million aggregate principal amount of the STG 5.875% unsecured notes in open market transactions for consideration of $2.3 million. In March 2020 and June 2020, we purchased a total of $15 million aggregate principal amount of the DSG 6.625% unsecured notes in open market transactions for consideration of $10 million. During the year ended December 31, 2020, we redeemed 550,000 units of the Redeemable Subsidiary Preferred Equity for an aggregate redemption price equal to $550 million plus accrued and unpaid dividends, representing 100% of the unreturned capital contribution with respect to the units redeemed, plus accrued and unpaid dividends with respect to the units redeemed up to, but not including, the redemption date, and after giving effect to any applicable rebates. The balance of the Redeemable Subsidiary Preferred Equity as of December 31, 2020 was $170 million, net of issuance costs. In January 2020, a minority partner in one of our RSNs exercised its right to sell us the entirety of its non-controlling interest, which we purchased for $376 million. We anticipate that existing cash and cash equivalents, cash flow from our operations, and borrowing capacity under the Bank Credit Agreements and A/R Facility will be sufficient to satisfy our debt service obligations, capital expenditure requirements, and working capital needs for the next 12 months. However, certain factors, including but not limited to, the severity and duration of the COVID-19 pandemic and resulting effect on the economy, our advertisers, Distributors, and their subscribers, could affect our liquidity and our first lien leverage ratio which could affect our ability to access the full borrowing capacity under the Bank Credit Agreements. For our long-term liquidity needs, in addition to the sources described above, we may rely upon various sources, such as but not limited to, the issuance of long-term debt, the issuance of equity or other instruments convertible into or exchangeable for equity, or the sale of interests in the RSNs or non-core assets. However, there can be no assurance that additional financing or capital or buyers of our non-core assets will be available, or that the terms of any transactions will be acceptable or advantageous to us. Sources and Uses of Cash The following table sets forth our cash flows for the years ended December 31, 2020, 2019, and 2018 (in millions): 2020 2019 2018 Net cash flows from operating activities $ 1,548 $ 916 $ 647 Cash flows used in investing activities: Acquisition of property and equipment $ (157) $ (156) $ (105) Acquisition of businesses, net of cash acquired (16) (8,999) — Spectrum repack reimbursements 90 62 6 Proceeds from the sale of assets 36 8 2 Purchases of investments (139) (452) (48) Other, net 27 7 27 Net cash flows used in investing activities $ (159) $ (9,530) $ (118) Cash flows (used in) from financing activities: Proceeds from notes payable and commercial bank financing $ 1,819 $ 9,956 $ 4 Repayments of notes payable, commercial bank financing, and finance leases (1,739) (1,236) (167) Proceeds from the issuance of redeemable subsidiary preferred equity, net — 985 — Repurchase of outstanding Class A Common Stock (343) (145) (221) Dividends paid on Class A and Class B Common Stock (63) (73) (74) Dividends paid on redeemable subsidiary preferred equity (36) (33) — Redemption of redeemable subsidiary preferred equity (547) (297) — Debt issuance costs (19) (199) (1) Distributions to redeemable noncontrolling interests (383) (5) — Other, net (149) (66) (6) Net cash flows (used in) from financing activities $ (1,460) $ 8,887 $ (465) 2020 Annual Report l 29


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    Operating Activities Net cash flows from operating activities increased during the year ended December 31, 2020 compared to the same period in 2019. The increase is primarily related to the results of the Acquired RSNs being included for the entire period in 2020 versus a partial period in the prior year, as the acquisition closed on August 23, 2019, partially offset by a corresponding increase in interest expense on debt incurred in connection with the acquisition of the Acquired RSNs. Net cash flows from operating activities increased during the year ended December 31, 2019 compared to the same period in 2018. The increase is primarily due to the acquisition of the Acquired RSNs in August 2019 and higher distribution revenues. Investing Activities Net cash flows used in investing activities decreased during the year ended December 31, 2020 compared to the same period in 2019. The decrease is primarily related to the acquisition of the Acquired RSNs and equity interest in the YES Network during the third quarter of 2019, partially offset by the sale of WDKY-TV during the third quarter of 2020 and KGBT-TV during the first quarter of 2020 as well as higher spectrum repack reimbursements. Net cash flows used in investing activities increased during the year ended December 31, 2019 compared to the same period in 2018. The increase is primarily related to the acquisition of the Acquired RSNs in August 2019, and an increase in net cash invested in debt and equity investments, primarily related to our investment in the YES Network. Financing Activities Net cash flows from financing activities decreased during the year ended December 31, 2020 compared to the same period in 2019. The decrease is primarily related to financing inflows during the prior year associated with the issuance of debt and Redeemable Subsidiary Preferred Equity for the acquisition of the Acquired RSNs. During the year ended December 31, 2020, net cash flows used in financing activities primarily related to the redemption of Redeemable Subsidiary Preferred Equity, payments on our term loans, the redemption of the STG 5.625% unsecured notes, and repurchases of Class A Common Stock, partially offset by the proceeds from loans under the A/R Facility and the issuance of the STG 4.125% senior secured notes. See Note 7. Notes Payable and Commercial Bank Financing and Note 10. Redeemable Noncontrolling Interests within the Consolidated Financial Statements for further discussion. Net cash flows from financing activities increased during the year ended December 31, 2019 compared to the same period in 2018. The increase is primarily related to the issuance of debt and the Redeemable Subsidiary Preferred Equity for the acquisition of the Acquired RSNs, offset by the redemption of the STG 5.375% unsecured notes in August 2019, the STG 6.625% unsecured notes in November 2019, and the Redeemable Subsidiary Preferred Equity in December 2019. See Note 7. Notes Payable and Commercial Bank Financing and Note 10. Redeemable Noncontrolling Interests within the Consolidated Financial Statements for further discussion. 30 l Sinclair Broadcast Group


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    Contractual Obligations We have various contractual obligations which are recorded as liabilities in our consolidated financial statements. Other items, such as certain purchase commitments and other executory contracts are not recognized as liabilities in our consolidated financial statements but are required to be disclosed. For example, we are contractually committed to acquire future programming. The following table reflects a summary of our contractual cash obligations as of December 31, 2020 and the future periods in which such obligations are expected to be settled in cash (in millions): CONTRACTUAL OBLIGATIONS 2026 and Total 2021 2022-2023 2024-2025 thereafter Notes payable, finance leases and commercial bank financing (a) $ 16,157 $ 622 $ 1,410 $ 2,275 $ 11,850 Operating leases 306 46 68 50 142 Programming rights and content (b) 17,168 2,832 4,391 3,033 6,912 Programming services (c) 103 50 49 3 1 Other (d) 459 183 133 61 82 Total contractual cash obligations $ 34,193 $ 3,733 $ 6,051 $ 5,422 $ 18,987 (a) Includes interest on debt and finance leases, including finance leases payable to related parties. Estimated interest on our variable rate debt has been calculated at an effective weighted interest rate of 3.11% as of December 31, 2020. Variable rate debt represents $6 billion of our $13 billion total face value of debt as of December 31, 2020. See Note 7. Notes Payable and Commercial Bank Financing within the Consolidated Financial Statements for further discussion of the changes to notes payable, finance leases, and commercial bank financing during 2020 and Note 15. Related Person Transactions within the Consolidated Financial Statements for further discussion of related parties. (b) Our programming rights and content includes contractual amounts owed through the expiration date of the underlying agreement for the local sports segment's sports programming rights of $14.7 billion, active and future television program contracts, network programming, and additional advertising inventory in various dayparts. Active television program contracts are included in the balance sheet as an asset and liability while future television program contracts are excluded until the cost is known, the program is available for its first showing or telecast, and the licensee has accepted the program. Industry protocol typically enables us to make payments for television program contracts on a three-month lag, which differs from the contractual timing within the table. Network programming agreements may include variable fee components such as subscriber levels, which in certain circumstances have been estimated and reflected in the table above based on current subscriber amounts. (c) Includes obligations related to rating service fees, music license fees, market research, weather, and news services. (d) Other includes obligations related to post-retirement benefits, guaranteed payments under a deferred purchase price liability, maintenance and support, other corporate contracts, other long-term liabilities, commitments to contribute capital to various non-media private equity investments, and LMA and outsourcing agreements. Excluded from the table are estimated amounts due pursuant to LMAs and outsourcing agreements where we consolidate the counter-party. The fees that we are required to pay under these agreements total $3 million and $0.4 million for the periods 2021 and 2022-2023, respectively. Certain station related operating expenses are paid by the licensee and reimbursed by us under the LMA agreements. Certain of these expenses that are in connection with contracts are included in the table above. Off Balance Sheet Arrangements Off balance sheet arrangements as defined by the SEC means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with the registrant is a party, under which the registrant has: obligations under certain guarantees or contracts; retained or contingent interest in assets transferred to an unconsolidated entity or similar arrangements; obligations under certain derivative arrangements; and obligations arising out of a material variable interest in an unconsolidated entity. As of December 31, 2020, we do not have any material off balance sheet arrangements. 2020 Annual Report l 31


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    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed to market risk from changes in interest rates and consider entering into derivative instruments primarily for the purpose of reducing the impact of changing interest rates on our floating rate debt and to reduce the impact of changing fair market values on our fixed rate debt. See Note 7. Notes Payable and Commercial Bank Financing within the Consolidated Financial Statements for further discussion. We did not have any outstanding derivative instruments during the three years ended December 31, 2020, 2019, and 2018. During the year ended December 31, 2019, we entered into an amended and restated STG Bank Credit Agreement and the DSG Bank Credit Agreement. We are exposed to risk from the changing interest rates of our variable rate debt issued under the Bank Credit Agreements. As of December 31, 2020, our total variable rate debt under the Bank Credit Agreements was $6 billion. We estimate that adding 1% to respective interest rates would result in an increase in our interest expense of $57 million. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our Class A Common Stock is listed for trading on the NASDAQ stock market under the symbol "SBGI". Our Class B Common Stock is not traded on a public trading market or quotation system. As of February 25, 2021, there are approximately 40 shareholders of record of our Class A Common Stock. Many of our shares of Class A Common Stock are held by brokers and institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders. We intend to pay regular quarterly dividends to our stockholders, although all future dividends on our Common Stock, if any, will be at the discretion of our Board of Directors and will depend on several factors including our results of operations, cash requirements and surplus, financial condition, covenant restrictions, and other factors that the Board of Directors may deem relevant. In February 2021, we declared a quarterly cash dividend of $0.20 per share. See Note 3. Stock-Based Compensation Plans within the Consolidated Financial Statements for discussion of our stock-based compensation plans. 32 l Sinclair Broadcast Group


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    Comparative Stock Performance The following line graph compares the yearly percentage change in the cumulative total shareholder return on our Class A Common Stock with the cumulative total return of the NASDAQ Composite Index and the cumulative total return of the NASDAQ Telecommunications Index (an index containing performance data of radio and television broadcast companies and communication equipment and accessories manufacturers) from December 31, 2015 through December 31, 2020. The performance graph assumes that an investment of $100 was made in the Class A Common Stock and in each Index on December 31, 2015 and that all dividends were reinvested. Total shareholder return is measured by dividing total dividends (assuming dividend reinvestment) plus share price change for a period by the share price at the beginning of the measurement period. Company/Index/Market 12/31/2015 12/31/2016 12/31/2017 12/31/2018 12/31/2019 12/31/2020 Sinclair Broadcast Group, Inc. 100.00 104.84 121.50 86.67 111.83 110.82 NASDAQ Composite Index 100.00 108.87 141.13 137.12 187.44 271.64 NASDAQ Telecommunications Index 100.00 112.56 135.96 125.10 158.73 192.30 Stock Repurchases For the quarter ended December 31, 2020: None 2020 Annual Report l 33


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    CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures and Internal Control over Financial Reporting Our management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the design and effectiveness of our disclosure controls and procedures and our internal control over financial reporting as of December 31, 2020. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to provide reasonable assurance that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost- benefit relationship of possible controls and procedures. The term “internal control over financial reporting,” as defined in Rules 13a-15d-15(f) under the Exchange Act, means a process designed by, or under the supervision of our Chief Executive and Chief Financial Officers and effected by our Board of Directors, management and other personnel, 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 (GAAP) and includes those policies and procedures that: • pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; • provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP and that our receipts and expenditures are being made in accordance with authorizations of management or our Board of Directors; and • provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material adverse effect on our financial statements. Assessment of Effectiveness of Disclosure Controls and Procedures Based on the evaluation of our disclosure controls and procedures as of December 31, 2020, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level. Report of Management on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we assessed the effectiveness of our internal control over financial reporting as of December 31, 2020 based on the criteria set forth in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (COSO). Based on our assessment, management has concluded that, as of December 31, 2020, our internal control over financial reporting was effective based on those criteria. The effectiveness of our internal control over financial reporting as of December 31, 2020 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included herein. Changes in Internal Control over Financial Reporting There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended December 31, 2020, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. 34 l Sinclair Broadcast Group


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    Limitations on the Effectiveness of Controls Management, including our Chief Executive Officer and Chief Financial Officer, do not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management’s override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. 2020 Annual Report l 35


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    CONSOLIDATED BALANCE SHEETS (In millions, except share and per share data) As of December 31, 2020 2019 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 1,259 $ 1,333 Accounts receivable, net of allowance for doubtful accounts of $5 and $8, respectively 1,060 1,132 Income taxes receivable 230 103 Prepaid sports rights 498 113 Prepaid expenses and other current assets 170 232 Total current assets 3,217 2,913 Property and equipment, net 823 765 Operating lease assets 197 223 Deferred tax assets 197 — Restricted cash 3 — Goodwill 2,092 4,716 Indefinite-lived intangible assets 171 158 Customer relationships, net 4,286 5,979 Other definite-lived intangible assets, net 1,338 1,998 Other assets 1,058 618 Total assets (a) $ 13,382 $ 17,370 LIABILITIES , REDEEMABLE NON-CONTROLLING INTERESTS, AND EQUITY Current liabilities: Accounts payable and accrued liabilities $ 533 $ 782 Current portion of notes payable, finance leases, and commercial bank financing 58 71 Current portion of operating lease liabilities 34 38 Current portion of program contracts payable 92 88 Other current liabilities 317 155 Total current liabilities 1,034 1,134 Notes payable, finance leases, and commercial bank financing, less current portion 12,493 12,367 Operating lease liabilities, less current portion 198 217 Program contracts payable, less current portion 30 39 Deferred tax liabilities — 407 Other long-term liabilities 622 434 Total liabilities (a) 14,377 14,598 Commitments and contingencies (See Note 13) Redeemable noncontrolling interests 190 1,078 Shareholders' Equity: Class A Common Stock, $0.01 par value, 500,000,000 shares authorized, 49,252,671 and 66,830,110 shares issued and outstanding, respectively 1 1 Class B Common Stock, $0.01 par value, 140,000,000 shares authorized, 24,727,682 and 24,727,682 shares issued and outstanding, respectively, convertible into Class A Common Stock — — Additional paid-in capital 721 1,011 (Accumulated deficit) retained earnings (1,986) 492 Accumulated other comprehensive loss (10) (2) Total Sinclair Broadcast Group shareholders’ (deficit) equity (1,274) 1,502 Noncontrolling interests 89 192 Total (deficit) equity (1,185) 1,694 Total liabilities, redeemable noncontrolling interests, and equity $ 13,382 $ 17,370 The accompanying notes are an integral part of these consolidated financial (a) Our consolidated total assets as of December 31, 2020 and 2019 include total assets of variable interest entities (VIEs) of $233 million and $228 million, respectively, which can only be used to settle the obligations of the VIEs. Our consolidated total liabilities as of December 31, 2020 and 2019 include total liabilities of the VIEs of $60 million and $27 million, respectively, for which the creditors of the VIEs have no recourse to us. See Note 14. Variable Interest Entities. 36 l Sinclair Broadcast Group


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    CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2020, 2019 AND 2018 (In millions, except share and per share data) 2020 2019 2018 REVENUES: Media revenues $ 5,843 $ 4,046 $ 2,919 Non-media revenues 100 194 136 Total revenues 5,943 4,240 3,055 OPERATING EXPENSES: Media programming and production expenses 2,735 2,073 1,191 Media selling, general and administrative expenses 832 732 630 Amortization of program contract costs 86 90 101 Non-media expenses 91 156 122 Depreciation of property and equipment 102 97 105 Corporate general and administrative expenses 148 387 111 Amortization of definite-lived intangible and other assets 572 327 175 Impairment of goodwill and definite-lived intangible assets 4,264 — — Gain on asset dispositions and other, net of impairment (115) (92) (40) Total operating expenses 8,715 3,770 2,395 Operating (loss) income (2,772) 470 660 OTHER INCOME (EXPENSE): Interest expense including amortization of debt discount and deferred (656) (422) (292) financing costs Loss on extinguishment of debt (10) (10) — Loss from equity method investments (36) (35) (61) Other income, net 325 6 3 Total other expense, net (377) (461) (350) (Loss) income before income taxes (3,149) 9 310 INCOME TAX BENEFIT 720 96 36 NET (LOSS) INCOME (2,429) 105 346 Net income attributable to the redeemable noncontrolling interests (56) (48) — Net loss (income) attributable to the noncontrolling interests 71 (10) (5) NET (LOSS) INCOME ATTRIBUTABLE TO SINCLAIR BROADCAST GROUP $ (2,414) $ 47 $ 341 EARNINGS PER COMMON SHARE ATTRIBUTABLE TO SINCLAIR BROADCAST GROUP: Basic earnings per share $ (30.20) $ 0.52 $ 3.38 Diluted earnings per share $ (30.20) $ 0.51 $ 3.35 Basic weighted average common shares outstanding (in thousands) 79,924 92,015 100,913 Diluted weighted average common and common equivalent shares 79,924 93,185 101,718 outstanding (in thousands) The accompanying notes are an integral part of these consolidated financial statements. 2020 Annual Report l 37


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    CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2020, 2019 AND 2018 (In millions) 2020 2019 2018 Net (loss) income $ (2,429) $ 105 $ 346 Adjustments to post-retirement obligations, net of taxes (1) (1) 1 Share of other comprehensive loss of equity method investments (7) — — Comprehensive (loss) income (2,437) 104 347 Comprehensive income attributable to redeemable noncontrolling interests (56) (48) — Comprehensive loss (income) attributable to noncontrolling interests 71 (10) (5) Comprehensive (loss) income attributable to Sinclair Broadcast Group $ (2,422) $ 46 $ 342 The accompanying notes are an integral part of these consolidated financial statements 38 l Sinclair Broadcast Group


  • Page 45

    CONSOLIDATED STATEMENTS OF EQUITY FOR THE YEARS ENDED DECEMBER 31, 2018 (In millions, except share data) Sinclair Broadcast Group Shareholders Class A Class B Accumulated Common Stock Common Stock Additional Other Paid-In Retained Comprehensive Noncontrolling Shares Values Shares Values Capital Earnings Loss Interests Total Equity BALANCE, December 31, 2017 76,071,145 $ 1 25,670,684 $ — $ 1,321 $ 249 $ (2) $ (34) $ 1,535 Cumulative effect of adoption of new accounting standard — — — — — 2 $ — $ — 2 Dividends declared and paid on Class A and Class B Common Stock ($0.74 per share) — — — — — (74) — — (74) Repurchases of Class A Common Stock (7,761,529) — — — (221) — — — (221) Class A Common Stock issued pursuant to employee benefit plans 588,107 — — — 21 — — — 21 Distributions to noncontrolling interests, net — — — — — — — (10) (10) Other comprehensive income — — — — — — 1 — 1 Net income — — — — — 341 — 5 346 BALANCE, December 31, 2018 68,897,723 $ 1 25,670,684 $ — $ 1,121 $ 518 $ (1) $ (39) $ 1,600 The accompanying notes are an integral part of these consolidated financial statements. 2020 Annual Report l 39


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    CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS FOR THE YEARS ENDED DECEMBER 31, 2019 (In millions, except share data) Sinclair Broadcast Group Shareholders Class A Class B Accumulated Redeemable Common Stock Common Stock Additional Other Noncontrolling Paid-In Retained Comprehensive Noncontrolling Interest Shares Values Shares Values Capital Earnings Loss Interests Total Equity BALANCE, December 31, 2018 $ — 68,897,723 $ 1 25,670,684 $ — $ 1,121 $ 518 $ (1) $ (39) $ 1,600 Issuance of redeemable subsidiary preferred equity, net of issuance costs 985 — — — — — — — — — Dividends declared and paid on Class A and Class B Common Stock ($0.80 per share) — — — — — — (73) — — (73) Class B Common Stock converted into Class A Common Stock — 943,002 — (943,002) — — — — — — Repurchases of Class A Common Stock — (4,555,487) — — — (145) — — — (145) Class A Common Stock issued pursuant to employee benefit plans — 1,544,872 — — — 35 — — — 35 Noncontrolling interests acquired in a business combination 380 — — — — — — — 248 248 Distributions to noncontrolling interests, net (38) — — — — — — — (27) (27) Redemption of redeemable subsidiary preferred equity, net of fees (297) — — — — — — — — — Other comprehensive loss — — — — — — — (1) — (1) Net income 48 — — — — — 47 — 10 57 BALANCE, December 31, 2019 $ 1,078 66,830,110 $ 1 24,727,682 $ — $ 1,011 $ 492 $ (2) $ 192 $ 1,694 The accompanying notes are an integral part of these consolidated financial statements. 40 l Sinclair Broadcast Group


  • Page 47

    CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS FOR THE YEARS ENDED DECEMBER 31, 2020 (In millions, except share data) Sinclair Broadcast Group Shareholders Class A Class B (Accumulated Accumulated Redeemable Common Stock Common Stock Additional Deficit) Other Noncontrolling Paid-In Retained Comprehensive Noncontrolling Total Equity Interests Shares Values Shares Values Capital Earnings Loss Interests (Deficit) BALANCE, December 31, 2019 $ 1,078 66,830,110 $ 1 24,727,682 $ — $ 1,011 $ 492 $ (2) $ 192 $ 1,694 Dividends declared and paid on Class A and Class B Common Stock ($0.80 per share) — — — — — — (64) — — (64) Repurchases of Class A Common Stock — (19,418,934) — — — (343) — — — (343) Class A Common Stock issued pursuant to employee benefit plans — 1,841,495 — — — 53 — — — 53 Noncontrolling interests issued 22 — — — — — — — — — Distributions to noncontrolling interests, net — — — — — — — — (32) (32) Distributions to redeemable noncontrolling interests (419) — — — — — — — — — Redemption of redeemable subsidiary preferred equity, net of fees (547) — — — — — — — — — Other comprehensive loss — — — — — — — (8) — (8) Net income (loss) 56 — — — — — (2,414) — (71) (2,485) BALANCE, December 31, 2020 $ 190 49,252,671 $ 1 24,727,682 $ — $ 721 $ (1,986) $ (10) $ 89 $ (1,185) The accompanying notes are an integral part of these consolidated financial statements. 2020 Annual Report l 41


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    CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2020, 2019 AND 2018 (In millions) 2020 2019 2018 CASH FLOWS FROM OPERATING ACTIVITIES: Net (loss) income $ (2,429) $ 105 $ 346 Adjustments to reconcile net income to net cash flows from operating activities: Impairment of goodwill and definite-lived intangible assets 4,264 — — Amortization of sports programming rights 1,078 637 — Amortization of definite-lived intangible and other assets 572 327 175 Depreciation of property and equipment 102 97 105 Amortization of program contract costs 86 90 101 Stock-based compensation 52 33 26 Deferred tax benefit (604) (5) (103) Gain on asset disposition and other, net of impairment (119) (62) (19) Loss from equity method investments 36 35 61 Net (gain) loss from investments (152) 6 1 Distributions from investments 27 6 4 Sports programming rights payments (1,345) (578) — Loss on extinguishment of debt 10 10 — Measurement adjustment gain on variable payment obligations (159) — — Changes in assets and liabilities, net of acquisitions: Decrease (increase) in accounts receivable 70 70 (37) Decrease (increase) in prepaid expenses and other current assets 48 (27) (10) (Decrease) increase in accounts payable and accrued and other current liabilities (3) 334 24 Net change in net income taxes payable/receivable (127) (127) 49 Decrease in program contracts payable (96) (94) (108) Increase (decrease) in other long-term liabilities 198 (1) — Other, net 39 60 32 Net cash flows from operating activities 1,548 916 647 CASH FLOWS USED IN INVESTING ACTIVITIES: Acquisition of property and equipment (157) (156) (105) Acquisition of businesses, net of cash acquired (16) (8,999) — Spectrum repack reimbursements 90 62 6 Proceeds from the sale of assets 36 8 2 Purchases of investments (139) (452) (48) Other, net 27 7 27 Net cash flows used in investing activities (159) (9,530) (118) CASH FLOWS (USED IN) FROM FINANCING ACTIVITIES: Proceeds from notes payable and commercial bank financing 1,819 9,956 4 Repayments of notes payable, commercial bank financing, and finance leases (1,739) (1,236) (167) Proceeds from the issuance of redeemable subsidiary preferred equity, net — 985 — Repurchase of outstanding Class A Common Stock (343) (145) (221) Dividends paid on Class A and Class B Common Stock (63) (73) (74) Dividends paid on redeemable subsidiary preferred equity (36) (33) — Redemption of redeemable subsidiary preferred equity (547) (297) — Debt issuance costs (19) (199) (1) Distributions to noncontrolling interests, net (32) (27) (9) Distributions to redeemable noncontrolling interests (383) (5) — Other, net (117) (39) 3 Net cash flows (used in) from financing activities (1,460) 8,887 (465) NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH (71) 273 64 CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, beginning of year 1,333 1,060 996 CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, end of year $ 1,262 $ 1,333 $ 1,060 The accompanying notes are an integral part of these consolidated financial statements. 42 l Sinclair Broadcast Group


  • Page 49

    SINCLAIR BROADCAST GROUP, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Nature of Operations Sinclair Broadcast Group, Inc. (the Company) is a diversified television media company with national reach and a strong focus on providing high-quality content on our local television stations, regional sports networks, and digital platforms. The content, distributed through our broadcast platform and third-party platforms, consists of programming provided by third-party networks and syndicators, local news, college and professional sports, and other original programming produced by us. Additionally, we own digital media products that are complementary to our extensive portfolio of television station related digital properties. Outside of our media related businesses, we operate technical services companies focused on supply and maintenance of broadcast transmission systems as well as research and development for the advancement of broadcast technology, and we manage other non-media related investments. As of December 31, 2020, we had two reportable segments for accounting purposes, broadcast and local sports. The broadcast segment consists primarily of our 188 broadcast television stations in 88 markets, which we own, provide programming and operating services pursuant to agreements commonly referred to as local marketing agreements (LMAs), or provide sales services and other non-programming operating services pursuant to other outsourcing agreements (such as JSAs and SSAs). These stations broadcast 628 channels as of December 31, 2020. For the purpose of this report, these 188 stations and 628 channels are referred to as “our” stations and channels. The local sports segment consists primarily of our regional sports network brands, Marquee, and a minority equity interest in the YES Network. The RSNs and YES Network own the exclusive rights to air, among other sporting events, the games of professional sports teams. Principles of Consolidation The consolidated financial statements include our accounts and those of our wholly-owned and majority-owned subsidiaries, including the operating results of the Acquired RSNs acquired on August 23, 2019, as discussed in Note 2. Acquisitions and Dispositions of Assets, and VIEs for which we are the primary beneficiary. Noncontrolling interests represent a minority owner’s proportionate share of the equity in certain of our consolidated entities. Noncontrolling interests which may be redeemed by the holder, and the redemption is outside of our control, are presented as redeemable noncontrolling interests. All intercompany transactions and account balances have been eliminated in consolidation. We consolidate VIEs when we are the primary beneficiary. We are the primary beneficiary of a VIE when we have the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and have the obligation to absorb losses or the right to receive returns that would be significant to the VIE. See Note 14. Variable Interest Entities for more information on our VIEs. Investments in entities over which we have significant influence but not control are accounted for using the equity method of accounting. Income from equity method investments represents our proportionate share of net income or loss generated by equity method investees. Use of Estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses in the consolidated financial statements and in the disclosures of contingent assets and liabilities. Actual results could differ from those estimates. The impact of the outbreak of the novel coronavirus (COVID-19) continues to create significant uncertainty and disruption in the global economy and financial markets. It is reasonably possible that these uncertainties could further materially impact our estimates related to, but not limited to, revenue recognition, goodwill and intangible assets, program contract costs, sports programming rights, and income taxes. As a result, many of our estimates and assumptions require increased judgment and carry a higher degree of variability and volatility. Our estimates may change as new events occur and additional information emerges, and such changes are recognized or disclosed in our consolidated financial statements. 2020 Annual Report l 43


  • Page 50

    Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued new guidance related to accounting for leases, Accounting Standards Codification (ASC) Topic 842. We adopted the new guidance on January 1, 2019 using the modified retrospective approach and the optional transition method. Under this adoption method, comparative prior periods were not adjusted and continue to be reported in accordance with our historical accounting policy. We elected to apply the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allowed us to carryforward our historical assessments of whether contracts are, or contain, leases and lease classification. The primary impact of adopting this standard was the recognition of $215 million of operating lease liabilities and $196 million of operating lease assets. The adoption did not have a material impact on how we account for finance leases. See Note 8. Leases for more information regarding our leasing arrangements. In June 2016, the FASB issued amended guidance on the accounting for credit losses on financial instruments. Among other provisions, this guidance introduces a new impairment model for most financial assets and certain other instruments. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a forward- looking “expected loss” model that will replace the current “incurred loss” model that will generally result in the earlier recognition of allowances for losses. We adopted this guidance during the first quarter of 2020. The impact of the adoption did not have a material impact on our consolidated financial statements. In August 2018, the FASB issued guidance which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software, with the capitalized implementation costs of a hosting arrangement that is a service contract expensed over the term of the hosting arrangement. We adopted this guidance during the first quarter of 2020. The impact of the adoption did not have a material impact on our consolidated financial statements. In October 2018, the FASB issued guidance for determining whether a decision-making fee is a variable interest. The amendments require organizations to consider indirect interests held through related parties under common control on a proportional basis rather than as the equivalent of a direct interest in its entirety, as currently required in generally accepted accounting principles (GAAP). We adopted this guidance during the first quarter of 2020. The impact of the adoption did not have a material impact on our consolidated financial statements. In March 2019, the FASB issued guidance which requires that an entity test a film or license agreement within the scope of Subtopic 920-350 for impairment at the film group level, when the film or license agreement is predominantly monetized with other films and/or license agreements. We adopted this guidance during the first quarter of 2020. The impact of the adoption did not have a material impact on our consolidated financial statements. In December 2019, the FASB issued guidance which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 will be effective for interim and annual periods beginning after December 15, 2020. Early adoption is permitted. We early adopted this guidance during the third quarter of 2020. The impact of the adoption did not have a material impact on our consolidated financial statements. In March 2020, the FASB issued guidance providing optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (LIBOR) or by another reference rate expected to be discontinued. The guidance was effective for all entities immediately upon issuance of the update and may be applied prospectively to applicable transactions existing as of or entered into from the date of adoption through December 31, 2022. We are currently evaluating the impact of this guidance, if elected, but do not expect a material impact on our consolidated financial statements. Cash and Cash Equivalents We consider all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. 44 l Sinclair Broadcast Group

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