Entertainment Industry

Category: Brian Roberts

Comcast profit jumps 30%, with mixed results at NBCUniversal

Comcast Corp.'s earnings jumped nearly 30% in its first quarter as more customers signed up for high-speed Internet service.  But the cable Goliath also showed strength in some an unexpected quarters: the long-lagging NBC broadcast unit and Universal Pictures, which released two hit movies, including "The Lorax."

For the quarter ended March 31, the Philadelphia-based company said its net income grew to $1.22 billion, or 45 cents per share, from $943 million, or 34 cents per share, from the year-earlier period.

Comcast generated consolidated revenue of $14.88 billion -- an increase of 23%.

"I'm really pleased with our start in 2012," Comcast Chief Executive Brian Roberts said in a Wednesday  morning conference call with analysts.  "Cable had another outstanding quarter.... We are starting to make some progress in broadcast."

NBCUniversal revenue was up 18% to $5.5 billion, in large part because the NBC broadcast network raked in $259 million in Super Bowl advertising revenue. (Excluding the Super Bowl, revenue at NBCUniversal was up 12.4%).

Roberts reminded analysts that NBCUniversal results would be volatile because of the hit-and-miss nature of movie box office and higher television programming costs. Comcast has been spending more on programming to try to lift the peacock network to profitability.

Operating cash flow at NBCUniversal was up 34.3% to $813 million compared to the first quarter of 2011.  In terms of revenue, NBCUniversal cable networks generated $2.1 billion in revenue versus $2 billion in the year-earlier period.  The NBC broadcast unit pulled in $1.85 billion in revenue (including the Super Bowl) compared to $1.35 billion in the year-earlier period. Film entertainment revenue swelled to $1.19 billion from $975 million in 2011. Theme parks generated $412 million, up from $390 million.

However, the company's operating cash flow margins were lower at cable networks due to higher programming and production costs, including those for NBA basketball. The broadcast unit posted an operating cash flow loss of $10 million, reflecting higher programming costs and higher marketing expenses to support the launch of mid-season shows, including "Smash."

"We're starting to make some progress but there is a long way to go," NBCUniversal Chief Executive Steve Burke told analysts. "And in film, we have a much stronger slate this year." Among Universal's upcoming film titles are the big budget action film "Battleship," the dark fairy tale "Snow White and the Huntsman," and a new iteration of the successful "Bourne" series.

Comcast is the nation's largest cable television and high-speed Internet provider. It holds a 51% controlling interest in NBCUniversal. 


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-- Meg James

Photo: Comcast Cable company trucks in Southern California / Credit:  Bob Chamberlin / Los Angeles Times.

Top Comcast executives take a pay cut in 2011


Comcast Corp.’s highest-paid executives — Chief Executive Brian Roberts and NBCUniversal Chief Executive Steve Burke — experienced compensation deflation last year.

Roberts’ pay package shrank 13.3% in 2011 to $26.9 million. That included a performance-based cash bonus of $5.5 million for the 52-year-old executive.

Meanwhile, Burke’s compensation dropped a whopping 32% to $23.7 million, which included a performance bonus of $6.7 million. The 53-year-old executive’s amount fell dramatically in 2011 as it was the first time in three years that he did not collect a signing bonus.

Burke, who took over management of NBCUniversal last year when Comcast acquired controlling interest in the company, received bonuses of about $10 million in both 2009 and 2010 for extending his contract.

The compensation, disclosed Friday in a proxy filed with the Securities and Exchange Commission, put the managers of the Philadelphia-based cable and entertainment giant in the middle rungs of corporate pay across big media conglomerates.

By comparison, CBS Corp. Chief Executive Leslie Moonves received a package valued at $69.9 million last year, Discovery Communications Chief Executive David Zaslav received $52.4 million; Viacom Chief Executive Philippe Dauman captured $43 million, Walt Disney Co. Chief Executive Robert Iger collected $31.4 million, and Time Warner Inc. Chief Executive Jeffrey Bewkes got $25.9 million. SteveBurkeNBCUniversalChief

Three years ago, Comcast’s top executives agreed to a four-year freeze in their base salary. Roberts’ base salary was $2.8 million; Burke’s was $2.24 million.

The top Comcast executives could have received fatter packages last year. The company achieved substantial growth in revenue and free cash flow, but its top executives elected to bring their performance base bonus calculations more in line with how their underlings are paid — and the Comcast board's compensation committee agreed.

In its proxy, Comcast said its operating management’s “cash bonuses are based primarily on business unit operating metrics rather than consolidated financial performance.”

Chief Financial Officer Michael J. Angelakis last year received a total package of $21.9 million, which was a 4% decline from his 2010 compensation. In contrast, Executive Vice President David L. Cohen accepted more stock and other bonuses which boosted his take 19% to $15.1 million.

Comcast Cable Communications Chief Executive Neil Smit collected $18.5 million in 2011, including a $3-million cash performance bonus. This was the first time that Comcast was required to disclose Smit’s earnings. Smit joined Comcast two years ago but he did not become a top corporate officer until last year when he was named chief executive officer of Comcast Cable.

And Ralph J. Roberts, the 92-year-old co-founder of the cable company, collected his customary $1-a-year salary.


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— Meg James

Top photo: Comcast Chief Executive Brian Roberts in 2007. Credit: George Widman / Associated Press.  Bottom right: NBCUniversal Chief Executive Steve Burke in 2010. Credit: Nati Harnik / Associated Press.

Comcast elevates cable systems chief Neil Smit

Comcast Corp. elevated Neil Smit to chief executive of the company's revenue engine: Comcast Cable Communications. The move recognizes the veteran executive's contributions during his short tenure with the Philadelphia cable giant.

Smit, a rising star who joined Comcast from Charter Communications Inc. in March 2010, is responsible for all aspects of the company's cable TV and high-speed Internet delivery systems. He previously had served as president of Comcast Cable. He continues to report to Comcast Corp. chief executive Brian L. Roberts. 

Smit's elevation to the newly created position puts him on equal footing with Steve Burke, Comcast's chief executive of NBCUniversal. 

Roberts hired Smit to replace Burke as head of cable systems when Comcast was preparing to merge its entertainment properties with NBCUniversal. Burke was put in charge of all of the entertainment channels.

“Neil has done a phenomenal job," Roberts said Wednesday in a prepared statement. "He has driven innovation, improved the customer experience, increased the speed of the introduction of new products, and has expanded our company into new opportunities for profitable growth."

Since Smit took over the cable division, Comcast has notched a 13% increase in new customers as measured during the most recent quarter. 

Comcast also has witnessed a dramatic increase in customers signing up for all three services -- television, high-speed Internet and telephone.  Now more than a third of all Comcast customers pay for "triple play" service, a particularly high-margin area for cable companies.

Comcast's high-speed Internet subscribers are up 5% year over year. The company's business services division revenue has increased nearly 40%. Those gains have helped offset losses in video subscribers.

Roberts has made the integration of new technologies a priority. To that end, Smit has overseen 16 new product launches in 2011 -- more than the last two years combined.

Smit served as Charter Communications CEO from 2005 to 2010. Before that, he was in charge of Time Warner’s America Online, CompuServe and Netscape Internet service. Before his civilian career, he served for 5 1/2 years on active duty with the Navy SEALs. He retired from the service in the 1980s as a lieutenant commander.


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Photo: Comcast Cable Chief Executive Neil Smit. Credit: Paul Sirochman / Comcast Corp.

Comcast delivers strong quarter; NBCUniversal revenue up 17%

 As with life, when it comes to the purchase of media companies, timing is key.

Comcast Corp. on Wednesday delivered strong-second quarter earnings, led by the company's core businesses of providing cable television and high-speed Internet service to its more than 20 million customers.

But its newly acquired media company, NBCUniversal, also shined as each of its entertainment divisions Fi-nbc4-span turned in double-digit revenue growth. NBCUniversal revenue jumped 17% to $5.2 billion -- a much stronger performance than what the company had been mustering in recent quarters when General Electric Co. was in control.

Comcast completed its acquisition of a 51% interest in NBCUniversal in late January, more than 14 months after it structured its joint-venture deal with GE. At that time, some of NBCUniversal's businesses, primarily its broadcast network, appeared on the ropes.

"Our timing was just right," Comcast Chief Executive Brian Roberts told analysts in a morning conference call. 

NBCUniversal primarily benefited from a much healthier advertising market as well as the continued success of its cable television channels. GE continues to hold a 49% stake, but it plans to exit the media company completely in the coming years. 

For the quarter ended June 30, NBCUniversal's revenue of $5.2 billion compared with $4.4 billion in the second quarter of 2010. The company's operating cash flow of $1 billion was up 5.2% from the previous-year period. 

NBCUniversal's cable channels, including USA Network, Syfy, E! and Bravo, led the way with $2.2 billion in revenue -- up 12.6% from the previous-year period. The broadcast television division, including the fourth-place NBC network, collected $1.7 billion in revenue, an 18.5% climb from 2010.

The company's Los Angeles-based film studio, Universal Pictures, generated $1.3 billion -- an increase of 21% from the year-earlier period. The Universal theme parks, buoyed by the success of the Harry Potter attraction in its Orlando, Fla., park, took in $147 million -- 22.5% more revenue than in the previous-year period. 

"The bottom line is we are off to a very strong start," said NBCUniversal Chief Executive Steve Burke. "We are making investments, and they are starting to work."

Analysts, however, expressed concern that the advertising market might take another hit as the economy appears to be flat-lining -- again. Burke said the company saw ad revenue increases in the second quarter, but "we are obviously concerned about the economy, as you would expect us to be."

Comcast, as a whole, posted revenue of $14.3 billion, an increase of 50% over the year-earlier period. The higher revenue was attributed to the consolidation of NBCUniversal as well as strong operating results.  

Comcast's operating income was up 41% to $2.9 billion or 37 cents a share. That compared with $2.1 billion, or 31 cents a share, for the second quarter of 2010.


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Photo: Associated Press

Comcast extends employment contract for CEO Brian Roberts

Brianroberts2011 Cable television giant Comcast Corp. has extended by one year the employment agreement of Chief Executive Brian Roberts.

Roberts' contract was due to expire Thursday.  Instead, Roberts postponed the end date of his contract until June 30, 2012. Last year, Roberts also amended his contract for just one year, a company spokesman said.

It's not like Roberts needs job security. 

He is chairman and CEO of the Philadelphia company and he also controls 33% of the company's voting shares. The 51-year-old executive collected a compensation package of $31 million last year (significantly less than Viacom Chief Philippe Dauman's $84.5-million compensation, but still enough to keep Roberts one of the 10 highest-paid media chiefs). 

Comcast made note of the change in a brief filing Friday with the Securities and Exchange Commission. 


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Photo: Comcast CEO Brian Roberts. Credit:  Matt Rourke / Associated Press



Comcast chief Brian Roberts unveils next generation Xfinity TV system

Comcast Chief Executive Brian Roberts is linking TVs to the cloud.

On Thursday, at the National Cable & Telecommunications Assn. conference in Chicago, Roberts unveiled the latest generation of the Philadelphia cable giant's Xfinity TV system. The upgrade boasts a less complicated remote control and a souped-up "Xcaliber" program guide, which is currently being tested in a few homes in Augusta, Ga.  

ROBERTS The system includes applications to connect viewers via the cloud to their Facebook page, traffic and weather reports and Pandora Internet radio. The term "cloud" refers to computer storage via any Internet-connected device. Think of it as a file cabinet in the sky. For example, consumers can store their iTunes library or photo connections on a "cloud" and not use up valuable space on their computers. 

Roberts differentiated the Comcast cloud from traditional clouds.

"This is cloud computing, not necessarily cloud storage," Roberts said. "The cloud allows you to have faster innovation to be able to take all the brains of the [program] guide -- the search, personalization and recommendations -- and pull it out of the cable box."

Cable companies have invested billions of dollars into the manufacture and distribution of cable boxes -- that soon become outdated as technology advances. "That doesn't happen in the cloud," Roberts said.

The system is faster than those that the company currently deploys in its approximately 23 million homes that have Comcast cable service. Roberts played a video that showed a cable modem downloading TV shows at speeds exceeding 1 gigabyte per second.

The service allows viewers to customize their offerings, including the ability to post on Facebook what they like or if they are watching a TV show or movie. Viewers also can use a search function that quickly identifies programs available on TV that feature a favorite actor like Tom Hanks, a particular program like "CSI" or a baseball team.

"So I'm interested in the Cubs," Roberts said as he demonstrated the feature for a large audience in Chicago. Then one of Philadelphia's favorite sons paused and said, "By the way, not really."

-- Meg James

Photo: Comcast Chief Executive Brian Roberts. Credit: George Widman / Associated Press.


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