Silver Spring, MD-based Discovery Communications, Inc. reported strong results for the second quarter of 2016. The company’s second-quarter 2016 earnings (on an adjusted basis) of 71 cents per share were ahead of the Zacks Consensus Estimate of 61 cents. Earnings also improved over the year-ago figure by 44.9%.
Discovery reported revenues of $1,708 million, up 3% on a year-over-year basis. Revenues narrowly missed the Zacks Consensus estimate of $1,716 million. Foreign currency movements impacted results, excluding which the top line expanded 6% in the second quarter of 2016.
Quarterly Performance
Total Distribution revenue was $813 million, up 4.9% year over year. Total Advertising revenue stood at $813 million, down 0.1% year over year. Other revenues increased 26.2% to $82 million. Quarterly expenses (on a reported basis) increased 2.3% to $1,122 million in the reported quarter. Quarterly adjusted operating income before depreciation and amortization (OIBDA) increased 4% year over year to $706 million.
The company exited the quarter with cash and cash equivalents of $185 million and $7,809 million of debt outstanding (non-current portion) compared with $390 million and $7,616 million, respectively, at the end of 2015.
The company bought back shares worth $377 million in the reported quarter, including $91 million of repurchase being part of Advance/Newhouse Programming Partnership ("ANPP").The company’s outlook for 2016 is expected to be discussed in the second quarter earnings conference call.
Segmental Details
U.S. Networks
Total revenue came in at $873 million, up 7% year over year. Within this, Distribution revenues were up 8% year over year while Advertising revenues climbed 5% from the year-ago quarter. Meanwhile, other revenues rose 60% to $16 million. Adjusted OIBDA was up 10% year over year. Adjusted OIBDA margin stood at 62% in the reported quarter versus 61% a year ago.
International Networks
Total revenue came in at $790 million, down 1% year over year. Within this, Distribution revenues climbed 2% year over year while Advertising revenues fell 7%. Other revenues improved 31% year over year. Furthermore, adjusted OIBDA decreased 6% on a year-over-year basis. Adjusted OIBDA margin stood at 32%, compared with 33% in the prior-year quarter.
Education & Other
Total revenue at the segment was $46 million, up 15% year over year.
Zacks Rank & Key Picks
Discovery currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the same space include CBS Corp (CBS), Liberty LiLAC Group (LBRDA) and MSG Networks Inc. (MSGN). Each of the companies carries a Zack Rank #2 (Buy).
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Silver Spring, MD-based Discovery Communications, Inc. reported strong results for the second quarter of 2016. The company’s second-quarter 2016 earnings (on an adjusted basis) of 71 cents per share were ahead of the Zacks Consensus Estimate of 61 cents. Earnings also improved over the year-ago figure by 44.9%.
Discovery reported revenues of $1,708 million, up 3% on a year-over-year basis. Revenues narrowly missed the Zacks Consensus estimate of $1,716 million. Foreign currency movements impacted results, excluding which the top line expanded 6% in the second quarter of 2016.
Quarterly Performance
Total Distribution revenue was $813 million, up 4.9% year over year. Total Advertising revenue stood at $813 million, down 0.1% year over year. Other revenues increased 26.2% to $82 million. Quarterly expenses (on a reported basis) increased 2.3% to $1,122 million in the reported quarter. Quarterly adjusted operating income before depreciation and amortization (OIBDA) increased 4% year over year to $706 million.
The company exited the quarter with cash and cash equivalents of $185 million and $7,809 million of debt outstanding (non-current portion) compared with $390 million and $7,616 million, respectively, at the end of 2015.
The company bought back shares worth $377 million in the reported quarter, including $91 million of repurchase being part of Advance/Newhouse Programming Partnership ("ANPP").The company’s outlook for 2016 is expected to be discussed in the second quarter earnings conference call.
Segmental Details
U.S. Networks
Total revenue came in at $873 million, up 7% year over year. Within this, Distribution revenues were up 8% year over year while Advertising revenues climbed 5% from the year-ago quarter. Meanwhile, other revenues rose 60% to $16 million. Adjusted OIBDA was up 10% year over year. Adjusted OIBDA margin stood at 62% in the reported quarter versus 61% a year ago.
International Networks
Total revenue came in at $790 million, down 1% year over year. Within this, Distribution revenues climbed 2% year over year while Advertising revenues fell 7%. Other revenues improved 31% year over year. Furthermore, adjusted OIBDA decreased 6% on a year-over-year basis. Adjusted OIBDA margin stood at 32%, compared with 33% in the prior-year quarter.
Education & Other
Total revenue at the segment was $46 million, up 15% year over year.
Zacks Rank & Key Picks
Discovery currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the same space include CBS Corp (CBS), Liberty LiLAC Group (LBRDA) and MSG Networks Inc. (MSGN). Each of the companies carries a Zack Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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