Cable Nets Boost Scripps Q3 Profit

Oct 14, 2004  •  Post A Comment

Continued strength of its cable networks, along with robust political advertising spending at its television stations, helped E. W. Scripps Co. post profit and revenue gains Thursday.

The Cincinnati-based company, which owns cable nets Food Network and HGTV, along with 10 TV stations, reported a 7 percent increase in third-quarter profit to $55.6 million, or 34 cents a share, compared with a year-earlier profit of $51.9 million, or 32 cents a share. The per-share figures reflect a 2-for-1 stock split conducted in September.

Overall revenue rose 14 percent to $500 million.

The company’s Scripps Networks unit was the main driver of the company’s growth during the period, as gains in advertising and affiliate-fee revenue helped offset the impact of the hurricanes in Florida on the company’s newspaper and television properties there.

The impact of the hurricanes on Scripps’ four newspapers in Florida and on TV stations WPTV-TV in West Palm Beach, Fla., and WFTS-TV in Tampa, Fla., hurt profit by $3.7 million, or 2 cents a share.

Scripps Networks’ advertising revenue rose 33 percent to $128 million, while affiliate-fee revenue advanced 58 percent to $37.1 million. Segment profit at the unit rose 58 percent to $63.6 million.

Those gains came as each of the four channels in Scripps Networks posted higher subscriber numbers. HGTV is now in 87 million homes versus 83 million a year ago, while Food Network reached 85 million households versus 82 million in 2003. Among the newer channels, Fine Living reaches 24 million homes versus 19 million a year ago, and DIY-Do It Yourself reaches 30 million households, up from 22 million in 2003.

Meanwhile, Scripps’ television stations booked around $10.2 million in political advertising during the quarter-about flat compared with the 2000 election, but up sharply from a year ago, when political advertising spending was $1 million. The campaign spending helped the station group generate a 12 percent increase in revenue to $80.7 million and a 23 percent rise in segment profit to $23 million.

The earnings release comes two days after Scripps announced it was buying Great American Country, a 24-hour country-music cable network, from Jones Media Networks for $140 million. The deal, which is expected to close in late November, isn’t expected to impact fourth-quarter results, but will lower 2005 profit by $5 million to $10 million.