Viacom Thriving Despite Paramount Losses30 Jan, 2014 By: Chris Tribbey
Paramount parent Viacom posted a profit of $547 million for its fiscal first quarter, up from $470 million a year ago, despite a drop in revenue ($3.2 billion, down 4% from $3.3 billion).
The profit gain came despite a $74 million loss from the Paramount unit, which saw a 37% decrease in home entertainment revenue — driven by the absence of major releases during the quarter — and a 52% drop in theatrical revenue, with the studio releasing only five titles in the last quarter, compared with eight a year ago. The Paramount loss was an improvement from the previous year’s quarter, when the studio lost $139 million.
“Paramount Pictures launched a number of successful releases in the December quarter including Anchorman 2, Wolf of Wall Street and yes, ladies and gentlemen, the Oscar-nominated Jackass Presents: Bad Grandpa,” Viacom CEO Philippe Dauman said in a call with investors. “In fact, the studio garnered 13 Oscar nominations in total, not only for Bad Grandpa, but also for Wolf of Wall Street and Nebraska.”
The company’s media segment delivered strong results, with operating income of $1.1 billion, up from $1 billion, with Nickelodeon, Comedy Central, Spike, VH1 and Country Music Channel all delivering strong ratings growth. Domestic affiliate revenues were up 10%.
“In the current quarter, while it is still early, we expect to see sequential improvement in our domestic ad sales growth despite the headwind of the shift of Easter to the June quarter this year,” Dauman said.
He also made note of the company’s renewal agreement with Time Warner Cable, which covers both Viacom’s linear TV networks as well as streaming for TV Everywhere apps. The deal also includes distribution of EPIX, starting in May, with Dauman saying Epix has “perhaps the best lineup of any pay service in the marketplace.” Viacom is also partnering with Verizon’s FiOS to bring a new standalone linear channel — My Nick Jr. — to it customers.
“We continue to expand our lineup of TV Everywhere apps with Nickelodeon and MTV apps rolling out on Android, and apps from Comedy Central, Nick Jr. and Logo due this year,” Dauman said.
Regarding digital distribution of Viacom-owned content, Dauman said he expects a new “virtual” multichannel video programming distributor to enter the market this year, which would present the company “good incremental opportunities.”
“Whether it's Netflix or Amazon, or local players, OTT players in different countries around the world, there is clearly an expansion of this new distribution marketplace,” he said.