Viacom Earnings: Upfront Almost CompleteCable ad revenue down 6%, less than expected 7/28/2009 10:37:28 AM Eastern
Viacom's MTV Networks unit is almost complete with its upfront, according to Viacom President and CEO Philippe Dauman, speaking on a conference call with analysts Tuesday to report second-quarter earnings.
"I am very happy to report we are just about done with our advertising upfront," Dauman said. "Given current conditions, we are very pleased with the results from both a volume and pricing standpoint. I want to thank our advertisers and the advertising agencies for their continuing support of our iconic brands." He declined to give details on the volume sold or the CPM pricing levels obtained.
The second quarter was another tough one for the company overall, though one bright spot was an improving advertising picture in cable. The company is still seeing declines, however.
Ad revenue at the Viacom's domestic cable unit, which includes Comedy Central, MTV and BET, was down 6% on the year ago period; it fell by 9% in the first quarter. Even a 6% decline was better than analysts' expectations. Credit-Suisse had penciled an 8.5% drop. Globally, the company continued to feel the worldwide recession with ad revenue down 8% in the second quarter; it was 10% in the first quarter.
Media networks revenue dropped 8%, to $1.97 billion, largely on lower sales of music video game Rock Band. Operating income was down 12%, to $671 million. Worldwide affiliate revenue was up 9%, though ancillary revenue was down 41%, worse than expected.
Viacom net earnings fell 32%, to $277 million, operating income was down 26%, to $586 million, while total revenue fell 14%, to $3.3 billion.
On the call, Viacom also noted a deal with Verizon FiOS for carriage of the new premium channel Epix, a joint venture between Viacom-owned Paramount, Lionsgate and MGM.
In a statement, Dauman said: "While the global economy continued to be a challenge in the second quarter, the diversity of our revenue streams, sequential improvement in our domestic advertising sales, our generation of cash and our operational discipline all helped to temper the short term impact."