MUMBAI: US media conglomerate Viacom‘s revenues for the first quarter ended 31 December 2012 have fallen by 16 per cent to $3.3 billion from $3.9 billion in the same period last year. The reason was lower revenues from the film division as a result of the schedule of releases.
Operating income and adjusted net earnings from continuing operations attributable to Viacom declined by 22 per cent to $797 million and $461 million, respectively, reflecting lower film results and a decline in Media Networks ad revenues, partially offset by increased affiliate revenues. Adjusted diluted earnings per share from continuing operations decreased by 14 per cent to $0.91 per diluted share.
Media Networks revenues decreased by two per cent to $2.39 billion. Domestic and worldwide ad revenues each decreased by six per cent. The decline in domestic ad revenues was driven by lower ratings. Domestic affiliate revenues increased by four per cent. Excluding the impact of digital distribution arrangements, which are affected by the timing of available programming, the domestic affiliate revenue growth rate was in the low-double digits. Worldwide affiliate fees increased by three per cent.
Filmed Entertainment revenues were down by 37 per cent to $975 million. Worldwide theatrical revenues decreased by 42 per cent in the quarter to $328 million, principally reflecting the difficult comparison against the prior year release of ‘Mission: Impossible - Ghost Protocol‘, as well as the year over year comparison of revenue from third-party theatrical releases. Worldwide home entertainment revenues declined 43%, principally resulting from fewer releases in the quarter compared to the first quarter of 2012. The decline in home entertainment revenues also reflects lower carryover revenues from the prior period release of ‘Transformers: Dark of the Moon‘. Television license fees decreased by 24 per cent to $227 million in the quarter.
Viacom executive chairman Sumner M. Redstone said, "Viacom continues to build on its impressive global portfolio of movies, television programming and digital content. Philippe leads a talented executive and creative team at Viacom, and I am fully confident that by investing in new hits we will continue to build our outstanding brands and deliver strong value to shareholders."
Viacom president, CEO Philippe Dauman said, "Throughout the quarter, we kept our focus on creative excellence and strategic programming investment. Our ongoing investments in programming continue to produce results, with positive ratings trends and growing consumer engagement in new hit content, despite difficult short-term comparisons based on the mix of film releases and the lingering effect of ratings softness last year. Our television brands continue to be highly valued by distribution partners, highlighted by our double digit organic affiliate revenue growth. Paramount is well positioned for the future, with several upcoming tentpole releases, including G.I. Joe: Retaliation, Pain & Gain, Star Trek Into Darkness and World War Z. In addition, we are working closely with existing distribution partners and new digital distributors to continue to launch robust and consumer-friendly content experiences.
"Viacom‘s ability to generate significant cash flow permits us to continuously invest in our businesses and deliver value directly to shareholders through our share repurchase and dividend programs. Viacom‘s strong balance sheet has provided the flexibility to tap the financing markets and lower our average cost of debt."