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Scripps Networks (SNI) Misses on Q4 Earnings, Beats Revenues
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Scripps Networks Interactive Inc. reported mixed results in the fourth quarter of 2016. The company’s earnings (excluding special items) of $1.02 per share fell short of the Zacks Consensus Estimate of $1.05. Also, the bottom line declined 24.4% on a year-over-year basis, due to higher costs.
The company’s fourth-quarter operating revenues of $888.7 million beat the Zacks Consensus Estimate of $881.2 million. Revenues were up 4.3% on a year over year basis. Strong TV advertising revenues in the U.S. boosted the top line.
Fourth-quarter consolidated segment profits (on an adjusted basis) totaled $340.5 million, up 3% year over year. Quarterly operating income (on a reported basis) declined 17.2% year over year to $227.75 million.
At the end of 2016, Scripps Networks had $122.93 million in cash & cash equivalents and $2,952 million of outstanding debt (less current portion) on its balance sheet compared with $223.4 million and $3,511.1 million, respectively, at the end of 2015. Moreover, the debt-to-capitalization ratio was approximately 57%.
Although concerned about the company’s high debt levels, we remain positive about its expansion efforts. Scripps Networks’ accord with AT&T (T - Free Report) in the third quarter of 2016 deserves mention. In fact, the deal with Tribune Media Company in the fourth quarter also seems to be encouraging. In addition, free cash flow at the end of 2016 was almost $716.7 million compared with $571 million at the end of 2015.
Segmental Performance
U.S. Networks
Quarterly revenues came in at $730.6 million, up 4.1% year over year. Advertisement revenues climbed 9.4% year over year to $523.3 million. The impressive growth in segmental advertising revenues reflected the growing demand for the company’s lifestyle offerings in the advertising market as well as overall ratings improvement in the quarter. However, distribution revenues dipped 3.1% year over year to $193.4 million, due to erosion in subscriber base among other factors.
Other revenues declined significantly year over year to $13.9 million. Segmental (adjusted) profits came in at $328.6 million, up 4.8% year over year due to higher revenues.
Segmental operating revenues from brands like, HGTV, Food Network, Travel Channel, Cooking Channel and Digital Business improved 7.6%, 5.6%, 0.9%, 4% and 3.6% year over year, respectively. Nonetheless, DIY Network, other revenues and Great American Country revenues dropped 1.4% , 36.4% and 8.5% respectively year over year.
International Networks
Quarterly total revenue of $165.4 million was up 1.5% owing to the inclusion of TVN results. Segmental adjusted profits totaled $40.9 million, up 2.3%. The improvement came on the back of higher revenues.
Conversely, loss (adjusted) from the Corporate and Other segment widened to $29 million from $24 million a year ago.
Scripps Networks Interactive, Inc Price, Consensus and EPS Surprise
Cinemark Holdings Inc. (CNK - Free Report) , in the broader Consumer Discretionary space, is scheduled to release its fourth-quarter 2016 results on Feb 23. The company has an impressive track record having delivered positive earnings surprises in three of the last four quarters, with an average beat of 4.3%.
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Scripps Networks (SNI) Misses on Q4 Earnings, Beats Revenues
Scripps Networks Interactive Inc. reported mixed results in the fourth quarter of 2016. The company’s earnings (excluding special items) of $1.02 per share fell short of the Zacks Consensus Estimate of $1.05. Also, the bottom line declined 24.4% on a year-over-year basis, due to higher costs.
The company’s fourth-quarter operating revenues of $888.7 million beat the Zacks Consensus Estimate of $881.2 million. Revenues were up 4.3% on a year over year basis. Strong TV advertising revenues in the U.S. boosted the top line.
Fourth-quarter consolidated segment profits (on an adjusted basis) totaled $340.5 million, up 3% year over year. Quarterly operating income (on a reported basis) declined 17.2% year over year to $227.75 million.
At the end of 2016, Scripps Networks had $122.93 million in cash & cash equivalents and $2,952 million of outstanding debt (less current portion) on its balance sheet compared with $223.4 million and $3,511.1 million, respectively, at the end of 2015. Moreover, the debt-to-capitalization ratio was approximately 57%.
Although concerned about the company’s high debt levels, we remain positive about its expansion efforts. Scripps Networks’ accord with AT&T (T - Free Report) in the third quarter of 2016 deserves mention. In fact, the deal with Tribune Media Company in the fourth quarter also seems to be encouraging. In addition, free cash flow at the end of 2016 was almost $716.7 million compared with $571 million at the end of 2015.
Segmental Performance
U.S. Networks
Quarterly revenues came in at $730.6 million, up 4.1% year over year. Advertisement revenues climbed 9.4% year over year to $523.3 million. The impressive growth in segmental advertising revenues reflected the growing demand for the company’s lifestyle offerings in the advertising market as well as overall ratings improvement in the quarter. However, distribution revenues dipped 3.1% year over year to $193.4 million, due to erosion in subscriber base among other factors.
Other revenues declined significantly year over year to $13.9 million. Segmental (adjusted) profits came in at $328.6 million, up 4.8% year over year due to higher revenues.
Segmental operating revenues from brands like, HGTV, Food Network, Travel Channel, Cooking Channel and Digital Business improved 7.6%, 5.6%, 0.9%, 4% and 3.6% year over year, respectively. Nonetheless, DIY Network, other revenues and Great American Country revenues dropped 1.4% , 36.4% and 8.5% respectively year over year.
International Networks
Quarterly total revenue of $165.4 million was up 1.5% owing to the inclusion of TVN results. Segmental adjusted profits totaled $40.9 million, up 2.3%. The improvement came on the back of higher revenues.
Conversely, loss (adjusted) from the Corporate and Other segment widened to $29 million from $24 million a year ago.
Scripps Networks Interactive, Inc Price, Consensus and EPS Surprise
Scripps Networks Interactive, Inc Price, Consensus and EPS Surprise | Scripps Networks Interactive, Inc Quote
Important Earnings Release Coming Up
Cinemark Holdings Inc. (CNK - Free Report) , in the broader Consumer Discretionary space, is scheduled to release its fourth-quarter 2016 results on Feb 23. The company has an impressive track record having delivered positive earnings surprises in three of the last four quarters, with an average beat of 4.3%.
Zacks Rank
Currently, Scripps Networks holds a Zacks Rank # 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>