iWorld

CBS revenues up 9%, gains from retransmission, skinny bundles & OTT

http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/smartcrop_800x800/public/images/tv-images/2017/08/08/leslie%20moonves%20cbs%20corporation.jpg?itok=fpgT5dQd

MUMBAI: CBS Corporation has reported record second quarter revenues, operating income, and diluted earnings per share ("EPS") from continuing operations.

"CBS delivered outstanding second quarter results while continuing to take a number of steps to achieve our long-term financial goals," said Leslie Moonves, Chairman and Chief Executive Officer, CBS Corporation. "First, we had a terrific upfront with gains in pricing and volume, including more and more deals that better reflect how people are watching our programming on a delayed basis. In addition, we took significant steps during the quarter to grow our affiliate fees from both traditional and 'skinny' bundles. Retransmission consent and reverse compensation increased 25% in the second quarter. And we are now seeing the benefit of our recent skinny bundle deals with Google's YouTube TV, Hulu, fuboTV, and just today we announced that we will be a part of DIRECTV NOW as well. At the same time, our in-house over-the-top subscription services, CBS All Access and Showtime OTT, continue to grow beyond our expectations and are on track to surpass a combined four million subscribers by the end of 2017. We are now gearing up to take the next strategic step with All Access by expanding it into the international marketplace, starting with Canada in the first half of 2018. Showtime also had a terrific quarter, led by the successful return of Twin Peaks, which boosted OTT subscriptions dramatically, and we continue to expand the Showtime brand overseas with new deals to license our entire portfolio in France, India, Taiwan, Hong Kong, and others. So, 2017 is turning out to be a great year for the CBS Corporation even without the Super Bowl and political spending that we had in the prior year. And as we look ahead, we are positioned to have an even better year in 2018."

Second Quarter 2017 Results

Revenues for the second quarter of 2017 increased 9% to $3.26 billion from $2.98 billion for the same prior-year period, with growth across all of the Company's significant revenue streams. Affiliate and subscription fee revenues were up 16%, driven by a 25% increase in retransmission revenues and fees from CBS Television Network affiliated stations, as well as growth from new initiatives, including the Company's digital subscription services. Advertising revenues were up 4%, led by the broadcast of the semifinals and finals of the NCAA Division I Men's Basketball Championship ("NCAA Tournament") on the CBS Television Network. Content licensing and distribution revenues benefited from a higher volume of television licensing sales and grew 12%, despite a difficult comparison to the second quarter of 2016, which included the international sales of five Star Trek series.

Operating income for the second quarter of 2017 increased 3% to $669 million from $651 million for the same prior-year period, despite higher-margin licensing sales in the second quarter of 2016. Net earnings from continuing operations increased 6% to $397 million for the second quarter of 2017 from $373 million for the same quarter last year, mainly a result of the higher operating income. Adjusted net earnings for the second quarter of 2017 were $427 million compared with net earnings of $423 million for the same prior-year period.

Net earnings for the second quarter of 2017 were $58 million, which included a noncash charge of $365 million in discontinued operations to reduce the carrying value of CBS Radio to the value indicated by the stock valuation of Entercom Communications Corp. CBS Radio is classified as held for sale and therefore, in accordance with accounting guidance, the carrying value will continue to be adjusted based on the trading price of Entercom's stock, which could result in future gains or losses.

Diluted EPS from continuing operations for the second quarter of 2017 increased 18% to $.97 from $.82 for the same quarter in 2016, driven by higher earnings and lower shares outstanding in the second quarter of 2017 from the Company's ongoing share repurchase program. Diluted EPS for the second quarter of 2017 was $.14 as a result of the above-mentioned noncash charge at CBS Radio, compared with $.93 for the prior-year period. Adjusted diluted EPS increased 12% to $1.04. During the quarter, the Company repurchased 4.7 million of its shares for $300 million.

Details of the discrete items excluded from financial results, along with reconciliations of adjusted results to their most directly comparable GAAP financial measures, are included at the end of this earnings release.

Free Cash Flow, Balance Sheet and Liquidity

For the second quarter of 2017, operating cash flow from continuing operations was $231 million, compared with $216 million for the second quarter of 2016, and for the first six months of 2017, operating cash flow from continuing operations was $909 million, which included discretionary contributions of $100 million to prefund the Company's qualified pension plans, compared with $1.14 billion for the first six months of 2016, which included CBS's broadcast of Super Bowl 50. Operating cash flow from continuing operations for 2017 benefited from higher affiliate and subscription fee revenues. Free cash flow was $190 million for the second quarter of 2017 compared with $181 million for the same prior-year period, and for the first six months of the year, free cash flow was $841 million in 2017, which included the aforementioned pension contributions, compared with $1.07 billion in 2016.

In July 2017, the Company issued $400 million of 2.50% senior notes due 2023 and $500 million of 3.375% senior notes due 2028. The Company used the net proceeds from these issuances to repay its $400 million outstanding 1.95% senior notes which matured on July 1, 2017, and to redeem all of its $300 million outstanding 4.625% senior notes due May 2018. The remaining net proceeds were used for general corporate purposes, including the repayment of short-term borrowings, such as commercial paper.

Consolidated and Segment Results (dollars in millions)

The tables below present the Company's revenues by segment and type; operating income (loss) excluding other operating items, net, by segment ("Segment Operating Income"); and depreciation and amortization by segment for the three and six months ended June 30, 2017, and 2016.

Entertainment (CBS Television Network, CBS Television Studios, CBS Studios International, CBS Television Distribution, CBS Interactive, and CBS Films)

Entertainment revenues of $2.18 billion for the second quarter of 2017 were up 12% from $1.95 billion for the same prior-year period. This increase was led by 38% growth in affiliate and subscription fees, driven by higher station affiliation fees and subscriber growth at CBS All Access. Advertising revenues increased 6%, as a result of the broadcast of the semifinals and finals of the NCAA Tournament on the CBS Television Network. Content licensing and distribution revenues benefited from more television licensing activity in the second quarter of 2017 and grew 12%, despite the difficult comparison with the prior-year period, which included the international licensing sales of five Star Trek series.

Entertainment operating income of $346 million for the second quarter of 2017 decreased 1% from $351 million for the same prior-year period, primarily reflecting higher-margin revenues in the second quarter of 2016.

Cable Networks (Showtime Networks, CBS Sports Network, and Smithsonian Networks)

Cable Networks revenues of $571 million for the second quarter of 2017 increased 7% from $536 million for the same prior-year period. The increase was driven by higher affiliate and subscription fees, led by growth of the Showtime digital streaming subscription offering and higher international television licensing sales of Showtime original series.

Cable Networks operating income of $253 million for the second quarter of 2017 increased 11% from $227 million for the same prior-year period, primarily reflecting the revenue growth.

Publishing (Simon & Schuster)

Publishing revenues of $206 million for the second quarter of 2017 grew 10% from $187 million for the same prior-year period. The increase was led by growth in print book sales and digital audio sales. Bestselling titles for the second quarter of 2017 included Lord of Shadows by Cassandra Clare and I Can't Make This Up by Kevin Hart.

Publishing operating income of $28 million for the second quarter of 2017 increased 8% from $26 million for the same prior-year period, mainly reflecting the revenue growth.

Local Media (CBS Television Stations and CBS Local Digital Media)

Local Media revenues of $412 million for the second quarter of 2017 increased 4% from $396 million for the same prior-year period, driven by higher retransmission revenues. Advertising revenues for the second quarter of 2017 decreased 2%, driven by lower political advertising sales, which were offset by CBS's broadcast of the semifinals and finals of the NCAA Tournament.

Local Media operating income of $127 million for the second quarter of 2017 decreased 2% from $130 million for the same prior-year period due to the mix of revenues. Retransmission revenues have associated network affiliation costs paid to the CBS Television Network, whereas political advertising sales carry a high operating income margin.

Corporate

Corporate expenses for the second quarter of 2017 were $85 million compared with $83 million for the same prior-year period.

ALSO READ :

Hotstar & CBS agree to bring Showtime content & brand to India

Competing with Google & FB on free side and with Netflix and Amazon on subscription -- Hotstar CEO Ajit Mohan

US$ 232-bn TV ads market expanding at 7% CAGR, online TV fastest growing: Report

Telly awards: Mediaboss, Discovery, Disney, Fox & Viacom among winners

Latest Reads

http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/02/24/Netflix_0.jpg?itok=ELorJ1C5
Netflix announces 3 new India originals

MUMBAI: Netflix announced three new India original series, across genres and themes. The three new originals are Leila, Ghoul and Crocodile. From drama to horror to mystery, these broad and diverse stories, upon completion, will debut exclusively to over 117 million Netflix members in 190...

iWorld Over The Top Services
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/02/23/viu.jpg?itok=JDSzgOi-
Viu and Star Suvarna launches McDowell's no1 Soda No.1 Yaari with Shivanna

Friendship and brotherhood is the support system that sees millennials through moments of self-doubt and obstacles and is truly responsible for shaping them. McDowell’s No1 Soda by Diageo India and the global Video-on-Demand OTT service by Vuclip and PCCW

iWorld Over The Top Services
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/02/23/karix_0.jpg?itok=w7btUzt2
Karix Mobile Gearing to Send a 'Message' on World Stage

Karix Mobile Pvt. Ltd. (formerly known as mGage India), world’s largest messaging solution and mobile engagement company, has announced its participation in the Mobile World Congress (MWC) 2018 being organised by the GSMA (Groupe Spécial Mobile Association). The 2018 edition of MWC is being...

iWorld Telecom
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/02/22/paytm.jpg?itok=Ca6mzCQg
Paytm ranked among Top 50 global companies

India’s largest mobile payments platform Paytm’s instrumental role towards pioneering the cashless economy has been honored in American business magazine Fast Company’s annual ranking of the world’s ‘50 Most Innovative Companies’ for 2018. The company is among the only two Indian companies that...

iWorld e-commerce
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/02/22/netflix_0.jpg?itok=XFBAQz_D
Netflix and YG Entertainment to launch YG future strategy office Bigbang's Seungri

Netflix Inc., the world’s leading internet entertainment service, announced today that it is launching YG Future Strategy Office(FSO, working title), a new Netflix Original Series with YG Entertainment, home to some of Korea’s top talent. YG FSO will launch this year exclusively through Netflix.

iWorld Over The Top Services
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/02/22/hotstar.jpg?itok=mXrsiSoQ
Video Lighting up Data and Smartphones, Says Hotstar

Releasing the first India Watch Report 2018, Hotstar, India’s leading premium streaming platform, today shared insights on the dramatic transformation sweeping the Internet landscape in India. In a first of its kind report for any streaming platform in the world, the service has disclosed usage...

iWorld Over The Top Services
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/02/22/remix.jpg?itok=QDzr0v1g
Amazon Prime blends East, West in 'The Remix'

MUMBAI: Amazon Prime Video wants to hit the right chords with the music lovers of India. Its latest and third Indian original prime show The Remix wants to grab the eye of the music-loving spirit of the nation.  It is a spin-off challenge between DJs and singers to blend Indian and western music...

iWorld Over The Top Services
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/02/21/google.jpg?itok=Urt0YMO6
Google launches support for tamil languages ads

Google India announced the launch of Tamil language support for its advertising products - Google AdWords and Google AdSense to support the Tamil language web publishers and also help advertisers to reach out to the large base of Internet users in Tamil. With this launch, Google has now scaled...

iWorld Over The Top Services
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/02/21/arre_0.jpg?itok=XhWj_2tl
Arré Launches a music & comedy festival headlined by only women, called Arré Siren

This Women’s Day weekend in March, all roads will lead to Arré SIREN - Arré Earworm’s first big step into the live music and entertainment space, in partnership with celebrated world music songstress Zila Khan

iWorld Over The Top Services

Latest News

Load More

Sign up for our Newsletter

subscribe for latest stories