Viacom 4Q earnings up 13 pct despite revenue drop

NEW YORK (AP) ? Viacom Inc., owner of the Paramount movie studio and cable TV channels such as Nickelodeon and Comedy Central, said Thursday that its net income grew 13 percent in its fourth fiscal quarter even as revenue fell more than Wall Street expected with the lack of a strong theatrical release.

Net income for the July-September quarter was $650 million, or $1.26 a share, compared with $576 million, or $1 a share, a year earlier. After adjusting for one-time items, earnings came to $1.21 per share.

Analysts surveyed by Fact Set were expecting adjusted earnings of $1.17 per share.

Revenue fell 17 percent to $3.36 billion from $4.05 billion and below the $3.41 billion analysts expected. Viacom reduced expenses by 26 percent to $2.31 billion, from $3.12 billion.

The company's Paramount Pictures movie studio division saw revenue fall 39 percent to $1.09 billion in the fiscal fourth quarter because it had no blockbuster release. Its lone release in the quarter, the documentary "Katy Perry: Part of Me," sold $32 million in tickets worldwide. A year ago, it released "Transformers: Dark of the Moon," which has sold $1.1 billion in tickets.

Viacom said it had eight movies on its release schedule for the holiday quarter, including "Rise of the Guardians," a cartoon produced by DreamWorks Animation SKG Inc., and "Flight," a Denzel Washington drama released Nov. 2 in North America. Viacom has been the distributor of DreamWorks Animation movies, though News Corp.'s 20th Century Fox is replacing Viacom next year.

Despite the large revenue drop, operating income for the business grew 5 percent to $195 million.

Revenue at Viacom's cable TV network business was largely unchanged at $2.29 billion, while operating income fell 3 percent to $933 million.

The advertising environment has slowed for most major media conglomerates, compounded in the quarter by the London Olympics, which saw advertising and audiences shift to NBC and its sister cable networks. Viacom faces additional challenges of ongoing audience weakness at its major TV networks.

Viacom said increases in fees from cable and satellite companies to carry its channels were countered by declines in advertising revenue. Ad revenue fell 6 percent in the U.S. and 7 percent worldwide.

For the full fiscal year, earnings fell 7 percent to $1.98 billion, or $3.69 per share, compared with $2.14 billion, or $3.59 per share, a year ago. Revenue fell 7 percent to $13.9 billion.

Source: http://news.yahoo.com/viacom-4q-earnings-13-pct-despite-revenue-drop-123416581--finance.html

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