Viacom reports strong quarterly earnings; Paramount Pictures shows dramatic improvement
The Melrose Avenue film studio raked in $1.2 billion in revenue, with "Rango" and "Justin Bieber: Never Say Never" helping propel worldwide box office of $401 million. Paramount posted an operating profit of $39 million for the second fiscal quarter, compared with an $83-million loss in the year-earlier period.
"Paramount Pictures delivered strong results across the board," Philippe Dauman, Viacom chief executive, told analysts Thursday during an early-morning conference call.
For example, Paramount's home-entertainment division, fueled by nine DVD releases including "Megamind" and "The Fighter," garnered a 38% increase in revenue to $410 million. In the year-earlier quarter, the studio released only one new DVD title. Worldwide box-office revenue was up 50%. The division also collected $336 million in TV license fees, which was up 30% compared with a year earlier.
Viacom executives told analysts that, although thrilled with the studio's performance, they would search for ways to improve efficiency because filmed entertainment continued to be the company's lowest-margin business. Paramount has thrived, in part, because of its partnerships with Marvel and DreamWorks Animation. It now wants to stock its pipeline with more pictures from Paramount.
"We are looking to benefit from our own franchises," Dauman said.
Overall, Viacom's net earnings from continuing operations climbed to $376 million, or 63 cents a share, compared with $255 million a year earlier. Revenue for the company soared 20% to $3.27 billion.
Cable television networks, including MTV, Nickelodeon and BET, continue to be the company's financial heart. Second-quarter television revenue of $2 billion was up 11%. Operating income of $795 million was up 13%.
Advertising at the cable networks jumped 12% for the quarter. The company has taken advantage of its broadcast-sized ratings for several of its shows, including MTV's "Jersey Shore," and Nickelodeon's "iCarly" special. And BET delivered its best ratings quarter ever.
"Every part of Viacom is in great shape," Dauman said.
-- Meg James
Photo: "Rango." Credit: Paramount Pictures / Viacom Inc.