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Viacom Beats Q3 Rev, Lags Earnings

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Viacom Inc. (VIAB - Free Report) declared third-quarter 2013 financial results with the bottom line missing the Zacks Consensus Estimate but the top line surpassing the same. Following the announcement, the company also raised its share buyback plan from $10 billion to $20 billion.

Net income from continuing operations in the reported quarter was $647 million or $1.32 per share compared with $523 million or 99 cents per share in the prior-year quarter. Adjusted earnings per share of $1.29 surpassed the Zacks Consensus Estimate of $1.31.

Total revenue in the reported quarter was $3,693 million, up 14% year over year and also above the Zacks Consensus Estimate of $3,592 million. Better performances from both the Media Networks and Filmed Entertainment segment have led to the revenue growth. Quarterly operating income was $1,085 million, up 20% year over year.

During the reported quarter, Viacom bought 10.5 million common shares for $700 million. At the end of the third quarter of fiscal 2013, Viacom had $1,144 million in cash & cash equivalent and $8,893 million in outstanding debt on its balance sheet compared with cash and cash equivalent of $848 million and outstanding debt of $8,131 at the end of fiscal 2012. Debt-to-capitalization ratio at the end of the reported quarter was 0.57 compared with 0.52 at the end of fiscal 2012.

Media Networks Segment

Quarterly revenues of $2,569 million inched up 13% year over year, mainly triggered by better advertising, affiliate and ancillary revenues. Quarterly operating profit was $1,158 million, up 24% year over year. Domestic affiliate revenues and worldwide affiliate revenues rose 28% and 26%, respectively, as compared with the prior-year quarter. Domestic and worldwide advertising revenues jumped 6% and 5%, respectively, year over year.  

Filmed Entertainment Segment

Quarterly revenues jumped 15% year over year to $1,158 million, mainly driven by popular movie releases. Quarterly operating profit was $17 million.

Global Theatrical revenues jumped 64% year over year, primarily due to more hit movie releases than the year-ago quarter. Worldwide Home Entertainment slumped 10% coupled with a 5% decline in television license fees. However, Worldwide Filmed Entertainment ancillary revenues rose 16%.

Currently, Viacom has a Zacks Rank #3 (Hold).

Other Stocks to Consider

Certain other companies belonging to the same media sector are CBS Corporation (CBS - Free Report) , The Walt Disney Company (DIS - Free Report) and Time Warner Inc. .

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