somewhat weak U.S. advertising growth in its second fiscal quarter -- but soaring international advertising revenue gains.
U.S. advertising revenues inched up 2%, while the international ad
business grew 14%.
Building on that growth, Viacom announced a somewhat surprising deal to buy Channel 5 in the U.K. for $757 million. The channel’s advertising sales had been
operated by BSkyB. Michael Nathanson, media analyst at MoffettNathanson Research, wondered how advertising sales would now be incorporated into the company.
Overall, cable network revenues
grew 6.4% to $2.38 billion -- with domestic affiliate fees rising 11% and worldwide affiliate fees climbing 10%.
Revenue from its film entertainment businesses was down 11.7% to $831
million -- most of which came from lower international theatrical revenue and a steep drop in home video revenues (down 30%), given fewer releases. Films in the period included “Anchorman 2: The
Legend Continues” and “The Wolf of Wall Street.”
Overall revenues moved up 1% to $3.2 billion, with net income from continuing operations 4% higher at $502 million. Media
networks carried the bulk of Viacom’s profitability -- operating income up 9% to $949 million with film entertainment business sinking 83% to $11 million.
Midday trading of
Viacom’s stock was down 0.7% to $84.34.