Discovery Second-Quarter Profit Declines

August 5, 2015 World Screen
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SILVER SPRING: In Q2, Discovery Communications generated net income of $286 million, down about 25 percent, on revenues of $1.65 billion, up 3 percent.

As for the profit decline, Discovery said it was primarily due to higher foreign currency losses, a lower gain on disposition, a gain on the consolidation of Eurosport in the prior year, and higher restructuring and other charges due to content impairments.

At its U.S. networks, revenues in the second quarter increased 5 percent to $814 million, driven by 12 percent distribution growth. Ad revenues were essentially flat. Revenues from Discovery's international networks increased 1 percent to $801 million. Distribution revenue was up 7 percent, with a strong performance in Latin America. Advertising revenues were also up 7 percent, again thanks to LatAm.

For the full year ending December 31, 2015, Discovery expects total revenue (excluding currency) to grow in the high single- to low double-digit range, adjusted OIBDA (excluding currency) to grow in the low to mid single-digit range and adjusted EPS (excluding currency) to grow low double digits.
 
“Driven by our unmatched portfolio and steady growth around the world, Discovery’s strong start to the year continued in the second quarter,” said Discovery Communications' president and CEO, David Zaslav. “We have carried that momentum into the third quarter and signed three landmark deals—the historic agreement for the Olympic Games in Europe, our agreement to acquire full ownership of Eurosport and our comprehensive long-term renewal with Comcast—that will bolster Discovery’s position and market share for years to come. I am pleased with the progress we made in the first half of the year and look forward to building our stable of content, IP and world-class platforms to drive viewer engagement and meaningful value to distributors, advertisers and shareholders now and into the future.”