Cable Net Results Help Propel Scripps to Q1 Profit

Apr 25, 2006  •  Post A Comment

Strong results from cable networks including HGTV and Food Network helped E.W. Scripps Co. post a 7 percent increase in the first quarter to $75.1 million, or 45 cents a share, compared with a year-earlier profit of $70 million, or 42 cents per share.

The results, announced Tuesday by Scripps, beat Wall Street projections of 40 cents per share, and sent the company’s stock climbing more than 2 percent to $45.60 per share Tuesday morning. The results include $5.3 million in stock-option compensation expense in the quarter.

Revenue during the quarter surged more than 22 percent to $589.7 million, as strength at Scripps Networks, the cable channel operation, the broadcast division and the company’s online business offset declines at the company’s newspaper publishing group.

Scripps reported a 32 percent increase in segment profit to $107 million at its television businesses. Total revenue rose 17 percent to $238 million, fueled in part by a 17 percent increase to $187 million in advertising revenue. The company said all five networks-HGTV, Food Network, DIY, Fine Living and Great American Country-produced positive results, with Fine Living and GAC swinging to profits in the quarter following year-earlier losses.

The company’s broadcast division, which includes 10 network-affiliated TV stations, reported a 16 percent increase in revenue, driven by gains in local and national advertising, which rose 19 percent and 13 percent, respectively. In addition, the broadcast division got a lift from $1 million in political advertising revenue, compared with none a year earlier. Segment profit surged 38 percent to $22.5 million.

Meanwhile, Shop at Home, the struggling home-shopping channel that earlier this year Scripps said it would explore selling, fell deeper into the red, posting a loss of $10 million, compared with a year-earlier loss of $5.4 million. Revenue at the channel tumbled more than 17 percent to $84.4 million.