Looking Up: Discovery 4Q Ad Revs Rise

money arrow upBucking a media industry trend, Discovery Communications had an increase in net income due to improving advertising sales during its fourth-quarter 2008 period.

Net income rose to $106 million against a $170 million net loss in the same period in 2007. Overall revenues grew to $904 million from $903 million in the period before.

Advertising revenue from its U.S. network group climbed 6% to $282 million, while distribution fees from cable operators rose 13% to $236 million. Overall, Discovery's U.S. networks climbed 8% to $536 million.

A big part of this was the result of double-digit program ratings performances in the fourth quarter of Discovery Channel and TLC, two of Discovery's main network revenue performers. U.S. Networks' revenue for the full year 2008 increased 10% to $2,062 million, mainly driven by distribution and advertising revenue growth.



But Discovery's international networks did not fare as well, as revenue dropped 4% to $294 million because of foreign currency fluctuations. There was a 2% decline in distribution revenue and a 12% decline in advertising revenue.

One of its smaller divisions--Discovery's "commerce, education and other" businesses--witnessed a 23% drop in revenues to $70 million, attributed to unfavorable revenue comparisons to fourth-quarter 2007, which included strong DVD sales of "Planet Earth."

David Zaslav, president and CEO of Discovery Communications, said in a release: "As we execute our 2009 operating plan in a difficult economic climate, our stable foundation of contracted and growing subscription revenues, diversified international expansion and stringent focus on costs give us confidence that we will outperform the marketplace and continue to grow moving forward."

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