USA boosts earnings despite ad slump
By BroadCasting & Cable Staff -- Broadcasting & Cable, 10/25/2001 5:00:00 AM
Saying that advertising sales have now dropped to 1999 levels, USA Networks Inc. nevertheless posted a 15% increase in cash flow for the third quarter.
The company attributed the gain in large part to a license fee hike to cable operators carrying USA Network.
The basic cable services saw revenue grow 7% to $214 million but cash flow jump 31% to $113.7 million.
Sci-Fi's revenues dropped 2% to $63.1 million but cash flow increased 6% to $23.9 million.
Home Shopping Network's sales dropped dramatically in the days following the Sept. 11 terrorist attacks, but have "fully recovered", Chairman Barry Diller said.
HSN's domestic rose 8 %to $396.4 million but cash flow fell 9% to $48.9 million.
Companywide, advertising accounts for 14% of USA Networks' revenues.
In an unusal move, Diller said that USA Networks would no longer offer "guidance" to Wall Street on expected earnings, but simply publish the division's budgets.
The common method of providing guidance is "dopey" Diller said. - John M. Higgins
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