Starz reported lower earnings as its Netflix deal ended and
new affiliation agreements call for smaller subscriber fees.
First quarter net income fell to $57.9 million, or 47 cents
per share, from $77.8 million, or 65 cents per share a year ago.
Revenue fell 1% to $399 million primarily because the
company's affiliation agreement with Netflix was not renewed. Affiliation
agreement with two other distributors renewed in the fourth quarter called for
less favorable financial terms.
"Starz delivered solid operational performance in the
first quarter with record subscriber totals at Starz and Encore. We continue to execute our strategy to
grow the Starz Original series programming portfolio with quality dramatic
series," Chris Albrect, CEO of Starz, said in a statement. "We are confident
that over time our approach to original programming will deliver strong
shareholder value."
The company said subscriptions to its Starz service
increased by 7% to 21.6 million and Encore subscribers were up 4% to 35.1 million.
