| MUMBAI:
US media conglomerate Viacom has announced its results for the first quarter.
Operating income
was down 29 per cent to $443 million, compared to a year-ago period. The $20 million
decline in operating income at the Media Networks segment was principally the
result of a 19 per cent growth in expenses, including restructuring charges of
$56 million, higher programming amortization, selling and marketing expenses and
stock based compensation expense partially offset by revenue growth of 10 per
cent. The
decline in operating income at the film segment of $157 million was principally
due to incremental domestic print and advertising costs of $170 million, or $236
million worldwide. The increase in corporate expenses was driven by incremental
stock based compensation expense of $11 million, partially offset by other cost
reductions. Revenues
increased by 16 per cent to $2.75 billion in the first quarter of 2007. Viacom
executive chairman Sumner M. Redstone says, “Viacom continues to successfully
execute on its strategic plan and is making substantial progress on its path for
long-term growth. With our robust portfolio of entertainment brands, we are well
positioned to further expand our presence on all platforms around the world.”
Viacom CEO Philippe P. Dauman adds, “Our first quarter results reflect
our focused agenda to fully leverage creative and operating excellence across
all of our businesses. We moved quickly to increase the efficiency of our domestic
and international operations to invest in content and our digital initiatives.
This will allow us to drive future growth while maintaining our overall margins. "
Also significant is the meaningful growth we experienced in worldwide advertising
revenues, with solid increases across MTV Networks and BET Networks. These results
reflect the continued strength of our brands and the early benefits of our new,
more integrated, multi-platform sales organization. “Furthering
our rapid digital expansion, we announced a number of new partnerships with key
industry players, such as Joost, Yahoo! and Sprint, which broadened our revenue
opportunities on wireless and online platforms. Additionally, Paramount’s
2007 slate is off to a solid start. Both in our digital activities and overall,
we see our results building through the year.” Media
networks revenues rose 10 per cent to $1.73 billion from $1.57 billion in 2006,
led by a 14 per cent growth in affiliate revenues to $558 million. Worldwide advertising
revenues were up 10 per cent to $974 million from $886 million in 2006. Ancillary
revenues increased two per cent in the quarter to $201 million. Acquisitions contributed
$40 million in net incremental revenues to the Media Networks segment in the quarter.
The film segment revenues were up 27 per cent to $1.05 billion in the first quarter
2007. The acquisition of DreamWorks closed and the distribution activities for
DreamWorks Animation commenced on 31 January 2006. For comparative purposes, these
activities, and distribution of the DreamWorks live-action library contributed
revenues of $101 million for the month of January 2007. | 
