Biz Briefs

Jul 28, 2003  •  Post A Comment

Viacom last week reported a 21 percent jump in second-quarter profit to a record $660 million, or 37 cents a share, while revenue climbed 10 percent to $6.4 billion, thanks to robust growth at the media giant’s cable and television operations. The company also announced it would issue a cash dividend to shareholders starting in October, reflecting the company’s strength and a desire to reward shareholders.
The company said its cable unit recorded a 22 percent increase in revenue to $1.35 billion, fueled by advertising growth of 33 percent and 15 percent at MTV and BET, respectively. Strong advertising revenue helped Viacom’s TV operations post a 10 percent gain in revenue to $1.9 billion. TV station and syndication revenues were also up for the quarter.
Microsoft Settlement Boosts AOL TW
AOL Time Warner last week said its second-quarter profit nearly tripled to $1.1 billion, or 23 cents a share, thanks in part to one-time gains owing to its settlement with Microsoft and the sale of its 50 percent interest in Comedy Central. Revenue rose 6 percent to $10.8 billion, lifted by its television and cable units, which delivered jumps in revenue of 9 percent to $1.9 billion and 10 percent to nearly $2.2 billion, respectively.
The company noted that the Securities and Exchange Commission discovered more accounting problems that might result in more earnings restatements, even though AOL’s auditors maintain that their accounting was correct. The uncertainty will further delay plans to spin off its cable division an initial public offering, the company said.
Sony Posts Broad-Based Declines
Japanese conglomerate Sony has reported a 98 percent drop in its fiscal first-quarter profit to 1.1 billion yen ($9 million) on a 7 percent decline in revenue to 1.6 trillion yen ($13.4 billion), as nearly every unit-including Sony Pictures Entertainment-posted declines.
SPE posted a loss of 2.4 billion yen ($20 million) on a 13 percent drop in revenue to 173.6 billion yen ($1.5 billion), thanks to fewer theatrical releases and weakness in the films that debuted during the quarter. Offsetting those losses was a jump in TV revenues associated with a distribution deal for the “Seinfeld” television series.
MGM Chief Plays Down Vivendi’s Value
Metro-Goldwyn-Mayer Chairman and CEO Alex Yeminidjian said last week that MGM will not overpay for the U.S. entertainment assets of Vivendi Universal. He added that if the studio fails it will explore “sharing [MGM’s] wealth” with shareholders.
Those comments came as MGM reported a widened second-quarter loss of $133.6 million, or 55 cents a share, on a 45 percent revenue increase to $487.5 million. The company blamed the red ink on a loss related to the sale of its 20 percent stake in Rainbow Media Holdings earlier this year.