Discovery's Ad Biz Steady: U.S. Up 8%, Global Rises 23%
The major impact of a year-ago licensing deal in the first quarter affected Discovery Communications' first-quarter 2013 earnings comparisons.
Discovery posted a 7% revenue gain to $1.2
billion and a 2% decline in operating income before depreciation and amortization (OIBDA) of $498 million. Net income was up $10 million to $231 million, from $221 million for the year-ago time
These results were below analysts' expectations, where estimated revenues were projected to be around $1.5 billion. Midday trading of Discovery was down 3.2% to $76.52.
The company says that excluding the $45 million result of a year ago from digital licensing revenues, distribution revenues grew 6% and total revenues were up 8%.
Discovery's U.S. networks’ revenues in the first quarter only inched up 1% to $686 million -- with distribution revenue sinking 9% to 308 million. U.S. Networks also witnessed their OIBDA sinking 9% to $377 million.
Discovery's advertising business continued to be steady and strong -- up 8% to $356 million, while its international advertising business group was 23% higher to $152 million. Overall, international business grew 17% to $444 million. The company says there has been a 16% viewership growth for its international channels.
U.S. viewing trends were also positive. Brian Wieser, senior research analyst of Pivotal Research Group, has noted that "our analysis of Rentrak data indicates gains in viewing share of national TV properties versus 1Q12, especially at Discovery, ID and TLC networks."