Wednesday, November 7, 2012

Discovery Communications Reports Lower Third-Quarter Earnings ...

Discovery Communications on Tuesday reported lower third-quarter earnings and revenue despite continued advertising revenue growth and strong ratings momentum.

The cable networks company, led by CEO David Zaslav, posted third-quarter earnings of $206 million, compared with $237 million in the year-ago quarter. Earnings from continuing operations declined from $240 million to $215 million. "The strong operating performance in the current year was more than offset by the impact of foreign currency fluctuations, increased mark-to-market equity-based compensation, other and interest expense as well as higher taxes," the company said.

Analysts said that the year-ago earnings were boosted by a big licensing deal with Netflix. Excluding that, the company's latest quarterly profit would have looked stronger.

Discovery's third-quarter revenue dropped slightly to $1.076 billion from $1.080 billion as seven percent growth at the company's international networks was offset by a four percent decline at the U.S. networks "primarily due to additional revenues in the prior year from extending and expanding certain licensing agreements." The company had also said the early part of the third quarter would be weaker due to the Summer Olympics in London, which focused higher viewership on NBCUniversal's networks.

The company slightly lowered its full-year growth forecast to revenue of $4.475 billion-$4.525 billion and earnings of $975 million-$1.025 billion. Previously, it had targeted revenue of $4.55 billion-$4.65 billion and earnings of $1.0 billion-$1.1 billion.

Said Zaslav: "Discovery delivered another quarter of strong operating results as a sustained focus on developing compelling content and leveraging it globally provided additional growth opportunities and continued financial momentum. In the U.S. we expanded market share, built new hits and capitalized on the ongoing strength of the ad market, while, internationally, we further leveraged the universal appeal of our programming and increased penetration of global pay TV platforms to expand our unparalleled distribution footprint."

Added Zaslav: "Going forward we remain committed to thoughtfully investing in our brands and platforms while delivering sustained financial success and returning capital to our shareholders.?

Email: Georg.Szalai@thr.com
Twitter: @georgszalai

Source: http://www.hollywoodreporter.com/news/discovery-communications-third-quarter-earnings-399274

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