Profit Rises 38 Percent at Viacom

NEW YORK: Following cost-cutting initiatives and a rise in advertising revenues, Viacom reported a 38-percent increase in profit for the quarter ended March 31, 2010, rising from $177 million to $245 million.

The company reported overall revenues of $2.8 billion, down 4 percent on the year-ago period, with an operating income of $534 million, reflecting a 27-percent increase. "Viacom is off to an excellent start this year, delivering a strong performance, including outstanding bottom-line results," said executive chairman Sumner Redstone. "As the economy continues to strengthen, Viacom’s operational and financial discipline and fervent focus on content should continue to produce increasingly significant benefits across all of our businesses."

Philippe Dauman, president and CEO, added: "Over the past quarter, we have seen momentum building in our television and film businesses as our efforts to stoke the creative fires across Viacom and an improving economy continue to take hold. With a boost in ratings at our core networks and the advertising market showing signs of strength, our ad revenues moved into positive territory and are continuing that upward trend."

At the media networks, revenues increased 4 percent to $1.94 billion, with U.S. ad revenues up 1 percent and worldwide ad revenues up 3 percent. Worldwide affiliate revenues were up by 9 percent, but ancillary revenues fell 7 percent. The segment’s operating income was $684 million, a 9-percent gain.

Filmed entertainment, however, took an 18-percent hit in revenues to $886 million, largely from a 34-percent fall in home entertainment revenues. Theatrical revenues were also down, by 6 percent, while television license fees fell 16 percent. Filmed entertainment reported an operating loss of $86 million.