Discovery Communications reported lower fourth-quarter profits as foreign currency changes hurt its international operations.
Net income fell 16% to $219 million, or 34 cents a share in the quarter from $260 million, or 38 cents a share, a year ago. The company said that excluding currency and the impact of the acquisition of Eurosport and the sale of SBS Radio, revenues and adjusted operating income before depreciation and amortization would have been up.
Revenues fell 2% to $1.646 billion.
The numbers were lower than Wall Street expectations.
“In 2015, Discovery Communications continued to build momentum with our unmatched worldwide brands and leading multiplatform distribution network. We surpassed 3 billion cumulative viewers, launched more new networks and increased audience and market share, all of which helped to drive steady global growth and strong financial results,” CEO David Zaslav said. “Propelled by our category leadership, broad rights ownership and content and brand expansion across platforms, Discovery is well positioned to thrive in the rapidly evolving media landscape and to drive continued shareholder value in the years ahead.”
Discovery’s U.S. networks registered a 1% increase in adjusted operating income to $410 million for the quarter. Operating expenses were up because of higher content amortization and impairments and marketing costs.
Revenues rose 6% to $787 million. Distribution revenues were up 7% and advertising revenue grew 5%, with higher prices offsetting lower delivery.
Discovery’s International networks had 20% lower operating income at $262 million. Distribution revenues were down 2% and advertising revenues were 11% lower.
Excluding the impact of adding Eurosport, selling SBS Radio and currency changes, adjusted operating income was up 1%, with revenue up 11%. Expenses were up 18% because of higher content expenses and personnel costs.