Discovery Posts Loss Due To Impairment Charges - Broadcasting & Cable

Discovery Posts Loss Due To Impairment Charges

Justice Dept. closes investigation of Scripps deal
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Discovery Communications posted a fourth quarter loss as special charges and costs related to its pending acquisition of Scripps Networks Interactive more than offset gains at its cable networks business.

Discovery also said that the U.S. Justice Department has closed its investigation into the Scripps deal and expects to transaction to close by the end of the first quarter.

Discovery’s net loss was $1.144 billlon, or $1.99 a share, in the quarter, compared to income of $309 million, or 51 cents per share, a year ago.

“We are pleased to have passed this significant regulatory milestone on our path to acquire Scripps Networks Interactive,” said Discovery CEO David Zaslav. “The conclusion of the Department of Justice’s investigation is an integral step toward closing our transaction. We look forward to combining these two great companies to the benefit of our enthusiast audiences around the world.

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The loss included a $1.321 billion non-cash after tax good will impairment charge and $59 million in transaction related costs.

Revenue was up 11% to $1.864 billion.

Related: Scripps Networks Reported Earnings Monday

Discovery’s U.S. network’s generated a 7% increase in adjusted operating income on a 10% gain in revenue. Advertising growth was 8%. Excluding the impact of transactions involving OWN, Group Nine and TEN, ad revenue would have been up 3%.

Revenue was up 13% at Discovery’s international  networks. 

“2017 was an historic year for Discovery. We took significant steps to position ourselves for success in a changing industry, while driving growth from our traditional linear business and accelerating our investments in new growth areas like digital and mobile in an effort to reach superfans on every screen,” said Zaslav. “Solid global advertising and distribution revenue growth helped us achieve our 2017 strategic and financial objectives. Additionally, we remain excited by the prospects for a combined Discovery and Scripps Networks.”

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