Viacom Business Down a Third
April 30, 2009 at 10:44 AM (PT)
VIACOM INC. reported a 34% drop in first-quarter net income, which it blamed on a still-poor advertising climate and weakness in its filmed-entertainment division, partially due to a stronger U.S. dollar that cut into international movie sales.
Q109 revenue decreased 7% to $2.9 billion, while net income decreased 34% to $177 million and earnings per share decreased 31% to $0.29, which basically lived up (or down) to WALL STREET expectations. Cited as reasons for the diminished results were lower ratings at some of its cable channels, higher startup losses at its pay-TV venture and lower sales of "ROCK BAND" video-game hardware after last year's boffo business.
"The global economy continues to present significant challenges for all businesses, including those in the entertainment industry," VIACOM Chairman SUMNER M. REDSTONE said. "VIACOM is successfully navigating these uncertain waters by taking full advantage of our financial strength to invest in great content and to build on our enduring global brands."
"During the first quarter, we further reduced our debt, generated seasonally strong cash flow and aggressively managed our costs while continuing to invest in our future with new programming and strategic partnerships," VIACOM Pres./CEO PHILIPPE DAUMAN said. "The overall advertising market remained soft as marketers continue to adjust their spending to the recessionary conditions. Nevertheless, our cable programming and motion picture businesses are well positioned to prosper. Our demographically targeted television programming continues to command top value in the marketplace."