Discovery Communications witnessed big advertising revenue growth in its fourth-quarter period, recognized primarily from newly acquired international businesses.
Advertising revenue grew
40% to $817 million, with overall company revenue -- including distribution and other revenue -- up nearly 30% to $1.5 billion. Net income grew 30% to $290 million from $224 million.
network revenue grew 5% to $740 million, coming from 4% advertising growth to $411 million and 7% distribution growth to $309 million.
International business gained from acquiring Nordic
SBS and consolidating Discovery Japan operations. Core advertising was up 26% with affiliate fee revenues adding on 16%. Still, MoffettNathanson Research says cash flow -- earnings before interest,
taxes, depreciation and amortization -- was well below estimates.
Looking to build out its international networks, last month, Discovery agreed to buy a controlling interest in Eurosport
International from TF1 Group for approximately $340 million.
MoffettNathanson Research says
the combined joint ventures of networks OWN and The Hub still lost $11 million during the period.
During midday trading, Discovery’s stock was down 2.7% to $80.69. Analysts say
Discovery’s earnings came in a bit under estimates.