Viacom reported a loss in the second quarter as the media company took a huge restructuring charge.
The charge was $784 million dollars. The company said it expects to save $350 million annually because of the restructuring.
The loss, in the quarter ended March 31, was $53 million, compared to net income of $502 million a year ago. Adjusting for the charge, net income was down 3% to $467 million. Adjusted earnings per share were up 7% to $1.16 from $1.08 because of stock buybacks over the year.
Revenues fell 3% to $3.1 billion. Domestic ad revenues at Viacom’s cable networks, a problem spot recently, were down 5% because of lower ratings
“We are deeply committed to investing in more and more original content, expanding in international growth markets, where we are launching networks at a rapid pace, and adapting to changes in technology and consumer behavior,” CEO Philippe Dauman said in a statement. “With our strategic realignment largely complete, Viacom is in excellent position to take full advantage of the many opportunities in the rapidly evolving media environment.”
Viacom’s Media Networks Group, which includes MTV and Nickelodeon, reported a 6% drop to $822 million in adjusted operating income because of increased programming and promotional expenses. Revenues were up 4% to $2.4 billion.
Domestic ad revenues were down 5%. The company blamed the decline on lower ratings. Yesterday the company announced a data-based ad sales product called Viacom Vantage designed to provide advertisers with new metrics to use when buying media. Those metrics should include viewers not present in the ratings currently used in advertising transactions.
Worldwide advertising revenues were up 4%.
Domestic affiliate revenues rose 5% and worldwide affiliate revenues were up 3%.