Viacom (NYSE: VIA) reported its Q309 earnings this morning, and its profits rose to $463 million from $401 million a year earlier, beating analysts expectations, while revenues declined to $3.32 billion from $3.41 billion. It rev decrease primarily reflects lower home entertainment and ad sales, which more than offset increases in affiliate sales and theatrical revenues, it said. ITher data points:
—Media Networks revenues were essentially flat at $2.12 billion, with solid growth in affiliate sales offset by lower advertising and ancillary revenues.
—Domestic ad revenues were down 4 percent, which is a 2-percentage point sequential improvement over Q209 results. Worldwide advertising revenues declined 5 percent.
—Strong sales of The Beatles: Rock Band video game were offset by lower home entertainment and consumer products revenues, resulting in a 3 percent decrease in worldwide ancillary revenues.
—Filmed Entertainment revenues were down 6 percent year-over-year to $1.22 billion as weakness in home entertainment sales more than offset growth in theatrical revenues. Transformers: Revenge of the Fallen and G.I. Joe: The Rise of Cobra fueled a 16% increase in worldwide theatrical revenues. More from the conference call as warranted.
From the call: Even as the execs are touting “emerging recovery”, it is all about costs, costs, and costs.
Phrases like “savings”, “low budget”, “taking costs out of the system”, are peppered throughout. On the launch of premium movie JV service Epix: it is close to additional distribution deals, and should be announced very soon, Viacom CEO Philippe Dauman said. He was very specific on licensing fee it gets from its networks from affiliates: “Our networks are clearly undervalued: we have 20 percent viewership, while we get 8 percent of the revenues. We remain very focused on closing this gap.” Meanwhile, he is very bullish on the newly acquired Teenage Mutant Ninja Turtles franchise for about $60 million. He described it as a “great investment for future at a relatively low cost. We have marketing ad creative assets to revitalize this franchise.”