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Category: Paramount

Viacom profit up 56%, boosted by higher cable fees

 EddieMurphyAThousandWords
Viacom Inc.'s second-quarter profit soared 56%, thanks to higher fees from pay-television operators and lower expenses at the company's Paramount Pictures movie studio.

For the quarter ended March 31, Viacom earned $585 million, or $1.07 per share, up from $376 million, or 63 cents a share, in the same period in 2011. Revenue grew 2% to $3.33 billion.

"Across our divisions we sharpened our focus on execution and efficiency while continuing to invest in programming that connects with audiences worldwide," Viacom Chief Executive Philippe Dauman told analysts in a Thursday morning conference call.  "Distribution continues to be a strong and steady driver for Viacom."

The New York-based media company's earnings exceeded analysts' estimates while revenue was largely within expectations. The company, controlled by billionaire Sumner Redstone, also spent about $700 million during the quarter to repurchase 14.7 million shares.

The bulk of the company's earnings came from its Media Networks unit, which includes cable channels MTV, Nickelodeon, Comedy Central, BET, VH1 and TV Land.  Revenue generated by cable channels grew 5% to $2.2 billion, driven by an increase in affiliate fees paid by cable and satellite television operators.  Affiliate fee revenue was up 17%. 

Media networks' operating income climbed 11% to $893 million. Domestic advertising revenue inched up 1%, while foreign advertising revenue remained flat. 

"We are seeing encouraging signs of a strengthening ad market," Dauman noted.

At the Los Angeles-based Paramount Pictures, which is celebrating its 100th anniversary this year, revenue dropped 5% to $1.17 billion.  The company attributed the lower revenue to a "less widely distributed mix of releases during the quarter," which included the highly profitable "The Devil Inside" and DreamWorks Pictures'  Eddie Murphy vehicle, "A Thousand Words," which flopped.

Theatrical revenue was down 19% to $326 million for the quarter.  The division was helped during the quarter by carry-over receipts from "Mission Impossible: Ghost Protocol," with Tom Cruise, which was released in the previous quarter.

Operating income at the film studio nearly tripled to $115 million, up from $39 million in the year-earlier period. The company said the studio's higher margin came from lower distribution costs.

"We are being disciplined in managing our expenses," Chief Operating Officer Thomas Dooley told the analysts.  

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Photo:  Eddie Murphy plays a cad named Jack in the DreamWorks comedy "A Thousand Words," released during the first quarter by Paramount Pictures.   Credit: Bruce McBroom / DreamWorks Pictures

 

Star sightings and Leslie Moonves at Sumner Redstone ceremony

  SumnerRedstoneStarPhilippeDaumanBradGreyLeslieMoonves

Two sides of Hollywood were on display Friday as billionaire Sumner Redstone, executive chairman of Viacom Inc. and CBS Corp., received his star on the Hollywood Walk of Fame.

Clustered outside the historic Hollywood Roosevelt Hotel were the industry's power brokers, all in suits: Redstone; CBS Corp. Chief Executive Leslie Moonves; Viacom CEO Philippe Dauman; Paramount Pictures Chairman Brad Grey and Vice Chairman Rob Moore; producer Brian Grazer; Viacom Chief Operating Officer Thomas Dooley and Entertainment Group President Doug Herzog, who oversees Comedy Central; and Cyma Zarghami, the head of children's channel Nickelodeon.

JulieChenAnother Hollywood contingent was there too: about 200 stargazers, many of whom began gathering more than an hour before the ceremony. They milled about in the street, separated from the power crowd by metal barriers.

"There's Julie Chen!" shouted one of the fans when the star of CBS' daytime talk show, "The Talk," strode into view.

"It is Julie Chen!" chimed in another fan, 20-year-old Jeremiah Miller, who lives in Hollywood and frequents the star-unveiling ceremonies. 

"Who's the guy in the gray suit next to Julie Chen?" Miller asked.

A reporter said the gray-suited man was Leslie Moonves, one of television's biggest titans -- as well as Chen's husband.

"Oh," Miller said, then turning to the other spectators:  "He runs CBS."

"I always hate the ceremonies where I never know people's names," Miller said. "You know who I would really like to see?  George Lopez."

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Top photo: Viacom and CBS Chairman Sumner Redstone, seated, received his star on the Hollywood Walk of Fame. Behind him from left: Viacom Chief Executive Philippe Dauman, Paramount Pictures Chairman Brad Grey and CBS Chief Executive Leslie Moonves.  Credit: Alberto E. Rodriguez / Getty Images 

Bottom photo:  Julie Chen. Credit: John P. Filo / CBS

Sumner Redstone attends Viacom shareholders' meeting

Sumner Redstone Arrives Oscars

Who is the man behind the curtain at Viacom? Sumner Redstone, of course.

After much speculation about the health of the company's 88-year-old chairman, Viacom Inc. opened its annual shareholders meeting Thursday morning in New York by dramatically parting a curtain for the big reveal: the ginger-haired Redstone on stage, sitting at a table along with two other senior Viacom executives — Chief Executive Philippe Dauman and General Counsel Michael Fricklas.

Last week, Redstone — who lives in Los Angeles — made headlines after deciding not to fly across the country to attend the annual session with shareholders in New York. A company spokesman initially said that Redstone — who controls nearly 80% of Viacom's voting shares — had an "unavoidable conflict" that would prevent his attendance. Media reports about Redstone's decision to skip the meeting prompted inquiries from shareholders, leading Redstone to make the trip after all.

"To paraphrase my very good friend Mark Twain, who couldn't be here with us today ... reports of my absence from this meeting have been greatly exaggerated," Redstone said to open the meeting, after the curtain parted, according to a Viacom executive in attendance.

Redstone in recent years has been cutting back on public appearances as his mobility has become an issue. The mogul, who will turn 89 this spring, attended last month's 84th Academy Awards ceremony in Hollywood, and plans to participate in the festivities on Hollywood Boulevard when he receives a star on the Hollywood Walk of Fame later this month.

He also kicks off every Viacom and CBS Corp. (which Redstone also controls) quarterly earnings call with Wall Street analysts, via speaker phone, by boasting about Viacom and CBS' sunny futures and how much he adores his two handpicked lieutenants, Viacom's Dauman and CBS Chief Executive Leslie Moonves.

About 30 investors attended Viacom's meeting Thursday, along with about 90 Viacom employees. Two investors asked questions. One shareholder wanted to know whether Viacom's Hollywood movie studio, Paramount Pictures, was still in business with Steven Spielberg. Viacom's Dauman said "yes," noting that the celebrated director was an executive producer of the "Transformers" movies.

Another shareholder, an older woman, said that she thought the actor Timothy Olyphant ("Justified") was "very hot" and that he should appear in Paramount's movies.  

Instead, Katy Perry will star this summer in a 3-D concert movie called "Katy Perry: Part of Me," Dauman announced at the meeting.

"Across our divisions, we strengthened our operational efficiency while continuing to invest in programming and films that resonate with audiences around the world," Dauman said. "On the eve of its 100th birthday, Paramount Pictures finished the 2011 calendar year as the No. 1 studio at the domestic box office. The studio captured the top spot thanks to an unprecedented run of highly successful films, including an industry-leading six consecutive films that earned $100 million or more in U.S. theaters."

At the end of the 45-minute meeting, the curtain closed, preventing spectators from witnessing Redstone's departure.

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Photo: Sumner Redstone, center, arrives at the 84th Academy Awards ceremony in Hollywood on Feb. 26. Credit:  Paul Buck / European Pressphoto Agency

Video of Brad Grey's wife Cassandra goes viral in Hollywood

The hottest new film in Hollywood isn't "The Lorax" or "John Carter."

It's a promotional video made by the Italian version of Vogue magazine featuring Paramount Pictures Chairman Brad Grey's wife, Cassandra. The two wed last year in a lavish ceremony, attended by stars including Brad Pitt, Tom Cruise and Jennifer Lopez.

Titled "The Princess of Bel Air," the video features Cassandra Grey at her home, walking her dogs, and in a car on the way to her Melrose Avenue fashion studio, discussing life and her thoughts on style.

Some of those thoughts are surprising. "Other than Steve Jobs and Mark Zuckerberg and Natalie Massenet [founder of the online luxury fashion shop net-a-porter.com], fashion designers are my heroes," Grey tells the camera. "Because they dress us in their dreams and enrich our moments with decorations."

Though it was originally posted in December, the video appears to have recently been discovered on the Chinese video sites tudou.com and youku.com. The tudou.com version was popping up in email in-boxes throughout Hollywood on Monday.

"I’m taking my role as a wife and a lover and a stepmother very seriously, meaning I want to be really, really good at it," she says early in the video, while wearing a flapper-esque head wrap and holding a cigarette.

At another point, she holds up an old copy of "Vogue's Book of Etiquette" and says she has been studying the text. "A lot of it is sort of outdated but a lot of it's relevant today," she says. "And I think they should teach this book in school."

Asked to comment on the video, the good-humored Grey said in an email that she wasn't altogether pleased with the results. "I was trying for a caricature of myself, thinking it may read funny and make for a more entertaining interview," she wrote. "But it seems the joke's on me. I do love fashion, and I am proud of the work that I do behind the scenes, which is where I belong. It's safe to say I won't be starring in 'The Fresh Princess of Bel Air.'"

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Redstone to skip Viacom meeting; but will get a Walk of Fame star

SumnerRedstoneArrivesOscars
Viacom Executive Chairman Sumner Redstone won't be attending his company's annual shareholders' meeting in New York next week. However, later this month, he will be staking out a spot on Hollywood Boulevard.

Redstone will be at the center of attention on March 30 when he receives his own star on Hollywood's Walk of Fame. He will join the ranks of other past and present media moguls with their names forever emblazoned on the legendary Hollywood stretch including Ted Turner, Michael Eisner, Louis B. Mayer and Darryl Zanuck.

Redstone, the 88-year-old controlling shareholder of both Viacom Inc. and CBS Corp., has been making fewer public appearances in recent years. However, he did attend the 84th Academy Awards last Sunday, an event also staged on Hollywood Boulevard, about 8 miles from his home in the gated enclave of Beverly Park.

But he is not planning to make the cross-country trip to New York to attend next week's shareholders meeting, marking the first time in memory that Redstone will miss Viacom's annual gathering. Redstone's absence will be due to an "unavoidable conflict," Viacom spokesman Carl Folta said Thursday, declining to elaborate on the reason.

Instead, the man who once roared that "Viacom is me" will address shareholders in a videotaped message. Redstone's conflict, according to Folta, was "not health related." 

Even though Redstone won't be there in person, he still will control the show. Redstone holds nearly 80% of Viacom's voting shares, so it is a safe bet that he will cast the votes necessary to retain his seat as executive chairman. In Viacom's most recent fiscal year, Redstone raked in $21 million in executive compensation — about $6 million more than he received in 2010.

Viacom includes such assets as MTV, VH-1, Comedy Central, BET, TV Land and the Hollywood-based movie studio Paramount Pictures.

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Photo: Sumner Redstone, center, arrives at the 84th Academy Awards ceremony in Hollywood on Feb. 26. Credit:  Paul Buck / European Pressphoto Agency

Sacha Baron Cohen follows Oscars stunt with new Paramount deal

Leaders
Fresh off a publicity stunt at the Academy Awards promoting his upcoming film "The Dictator," Sacha Baron Cohen has signed a new deal to produce and star in more movies for Paramount Pictures -- even after he slipped away without actually attending the Oscarcast.

After ginning up huge press coverage about whether he would be allowed to attend the Oscars -- including a phone-in appearance on the "Today" show -- Cohen walked the red carpet in costume as his "Dictator" character Gen. Aladeen. After promising Academy of Motion Picture Arts and Sciences officials not to disrupt the Oscars broadcast, Cohen was given sixth row tickets to watch the ceremony on the condition that he change out of his "Dictator" get-up and into formal attire, a person familiar with the matter but not authorized to speak publicly said.

But after walking the carpet and throwing what he claimed were the ashes of deceased North Korean dictator Kim Jong Il on Ryan Seacrest, Cohen never took his seat in the Hollywood & Highland theater. Rather, he was shown into a dressing room inside the theater, where he changed into a tuxedo and then went out a back door to a party off-site, the person confirmed. A spokesman for Cohen did not immediately respond to a request for comment.

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The Oscars stunt provided a marketing boost to "The Dictator," which will be released by Paramount on May 11.

Under the new deal, Paramount will make Cohen's next film in which he stars as well. The agreement also gives the British star, who made his name on television with "Da Ali G Show," funds to develop new movie projects with his production company Four By Two Films. For the next three years, Paramount will have a first right of refusal on every movie developed by Four By Two.

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Photo: Sacha Baron Cohen on the Academy Awards red carpet Sunday. Credit: Jay L. Clendenin / Los Angeles Times

Paramount animation chief David Stainton resigns

David Stainton Paramount Pictures
Four months after he was hired, David Stainton has abruptly resigned as head of Paramount Pictures' fledgling animation unit, the studio announced Wednesday.

The Viacom Inc.-owned studio said Stainton had left his job for "personal reasons," and declined to elaborate on the reasons for his departure.

“We are grateful for the time David spent at the studio and we wish him well in his future endeavors,” Adam Goodman, president of Paramount Motion Picture Group, said in a statement.  

Goodman will directly oversee the animation development team moving forward, the studio said.

Paramount has been distributing movies from DreamWorks Animation for several years, but that relationship is expected to end when the studios' seven-year deal expires at the end of this year. The two sides have differed over how much DreamWorks should pay Paramount to distribute its movies.

Separately, DreamWorks last fall tapped former Disney distribution executive Chuck Viane as a consultant to advise it on its various options, including distributing its own movies.

Beginning in 2014, Paramount aims to release one animated feature a year with budgets up to $100 million, developing projects including those from Viacom's children's cable TV network Nickelodeon. The studio has released several movies based on Nickelodeon shows such as "SpongeBob SquarePants."

Before joining Paramount last October, Stainton spent 17 years at Walt Disney studios, where he rose to president of feature animation and remained in that top role until early 2006 when Disney acquired Pixar Animation Studios. At that time, Pixar's co-founder, Ed Catmull, and his creative partner, John Lasseter, were put in charge of the Burbank studio's storied but struggling feature animation division.

Stainton took over Paramount's animation unit after it launched last year following the release of "Rango," the critically acclaimed but moderately successful animated movie voiced by Johnny Depp that is nominated for an Oscar for best animated film.

Paramount also helped finance and distribute "The Adventures of Tintin," a 3-D animated film from director Steven Spielberg and producer Peter Jackson, which has grossed $372 million worldwide.

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Photo: David Stainton at Walt Disney Studios, where he served as president of feature animation. Credit:  Los Angeles Times

Viacom first-quarter profit drops 65% on weak advertising

LeadEven Tom Cruise wasn't enough for media company Viacom Inc. to pull off a nearly impossible mission: turning a crowd-pleasing first-quarter earnings.

The New York-based media company's profit plummeted 65% on lower advertising sales at its important cable television networks for the quarter ended Dec. 31. Advertising woes were particularly nettlesome at children's channel Nickelodeon, which has experienced a precipitous drop in ratings. 

Viacom's earnings were also dragged down by a $383-million charge for payments to former shareholders of the Rock Band video game franchise, part of the company's long-running legal dispute over Harmonix Music Systems. The payout was the latest sour note in Viacom's failed attempt to get into the video game business.

Net income dropped to $212 million, or 38 cents a share, compared to $610 million, or $1, during the same period the previous year. The earnings, reported Thursday, slightly beat analysts' forecasts.  Viacom's revenue increased 3% to $3.95 billion. Analysts, however, had expected slightly higher revenue.  

Hollywood-based movie studio Paramount Pictures delivered an admirable box office performance, boosted by the late-December release of "Mission: Impossible -- Ghost Protocol," starring Cruise and directed by Brad Bird. (The film has taken in $575 million worldwide.) The century-old Melrose Avenue film studio also thanked "Paranormal Activity 3" and "Puss In Boots" for its box office results. "The Adventures of TinTin" underperformed.

Paramount generated $1.6 billion in revenue, an increase of 4%.  Theatrical revenue was up 37% to $570 million.  Home entertainment sales dipped 6% to $598 million.  Overall, the expense-laden studio reported a $31-million deficit for the quarter.  

Viacom -- which is controlled by 88-year-old billionaire Sumner Redstone -- depends almost entirely on its collection of cable channels, including MTV, Nickelodeon, BET, VH-1 and Comedy Central, for income. Most alarming to analysts was Viacom's admission that advertising was off 3% to $1.35 billion for the quarter.  

The company's Media Networks unit took in $2.44 billion, which was a 3% increase over 2010.  Operating income for the media networks increased 7% to $1.1 billion.

"Despite some early headwinds, Viacom is off to a strong start in 2012," Viacom Chief Executive Philippe Dauman said during an early morning call with analysts. 

Dauman said the company would produce nearly 30% more hours of original TV programming this fiscal year to try to gain back lost ratings and boost advertising sales. The company expects to spend $3 billion on programming this year.

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Photo:  Tom Cruise in "Mission: Impossible -- Ghost Protocol." Credit: Paramount Pictures

'The Devil Inside' blowing past box-office estimates

Devil Inside"The Devil Inside" is scaring up way more business than most people in Hollywood expected.

Estimates based on box-office returns as of late Friday afternoon indicate the horror film will collect well over $20 million this weekend and could end up close to $30 million. That's double earlier predictions, based on pre-release surveys that indicated it would do between $12 million and $15 million.

The film is now set to collect almost that much money on Friday alone, including $2 million from after-midnight screenings Thursday.

Where "The Devil Inside" ends up will depend on word of mouth from opening day audiences. Reviews have been overwhelmingly negative, garnering the film a Rotten Tomatoes score of just 8%.

It's now certain, however, to be the No. 1 movie at the box office this weekend, ahead of "Mission: Impossible — Ghost Protocol," which will likely earn about $15 million.

For distributor Paramount Pictures, it's poised to be a huge winner. The studio spent only $1 million to acquire the picture, before marketing expenses.

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Photo: Suzan Crowley and Fernanda Andrade in "The Devil Inside." Credit: Paramount Pictures.

Movie Projector: 'Devil Inside' challenges 'Mission: Impossible'

DevilInside
Low-budget horror movie "The Devil Inside" will try to do what Sherlock Holmes, Alvin and the Chipmunks, and a girl with a dragon tattoo couldn't: Knock Tom Cruise out of the top box-office spot.

"The Devil Inside," about a woman investigating her mother's exorcisms, will likely open this weekend to between $12 million and $15 million, people who have seen pre-release audience surveys said. That should put it very close to Cruise's "Mission: Impossible — Ghost Protocol," which after two weekends in the No. 1 spot is expected to drop to about $15 million.

The "Mission" hit sequel, which has rejuvenated Cruise's sagging star status, has so far grossed $145 million in the U.S. and Canada, and another $254 million overseas.

Paramount Pictures, which is releasing both movies, is essentially competing against itself for the weekend box-office crown.

The likely results for "The Devil Inside" — the weekend's only new release to open nationwide — should please the Viacom Inc.-owned studio, which spent under $1 million to acquire the movie. It is the second film from the studio's low-budget and youth-oriented Insurge label, whose debut offering was last year's hit documentary "Justin Bieber: Never Say Never."

Moviegoers under 25 make up most of the audience interested in the R-rated "Devil Inside."

The first weekend of January is typically a slow one at the box office, but important for establishing which of the large number of movies released around Christmas have strong enough word of mouth to keep playing through the winter.

Among the pictures that did decent business over the holidays and will be looking for a modest drop this weekend are "War Horse," "We Bought a Zoo" and "The Girl with the Dragon Tattoo."

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Photo: Fernanda Andrade in "The Devil Inside." Credit: Paramount Insurge.

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