Viacom Quarterly Results: August 2015

(press release) Viacom Inc. (NASDAQ:VIAB,VIA) today reported financial results for the quarter ended June 30, 2015, including a 4% increase in adjusted diluted earnings per share to $1.47, a record high for the June quarter.

Sumner M. Redstone, Executive Chairman of Viacom, said, “Viacom is meeting the challenges of a rapidly-changing media landscape by creating exciting, unique content that connects with audiences on all platforms. Our management team is positioning Viacom for success, and I am confident that we have the strategies in place to thrive.”

Philippe Dauman, President and Chief Executive Officer of Viacom, said, “Viacom continues to drive change in our business, creating unprecedented levels of original content, forging innovative marketing and distribution partnerships, and prioritizing international growth through organic expansion and strategic investments. Our Media Networks are quickly bringing innovative data-based advertising products to market, broadening our sales capabilities and developing new solutions for marketing partners that capture the full scope and depth of our powerful multiplatform brands. We introduced several popular new series in the third quarter, including Lip Sync Battle and Scream and expanded agreements with important distribution partners. Paramount also set the stage for the return of one of the studio's most successful franchises, Mission: Impossible, and is anticipating the broadcast premiere of the first Paramount Television production, Minority Report, next month.

"Underpinning this, we are operating more efficiently than ever, accelerating content development and delivering programming more quickly to audiences on all screens. We maintain a strong balance sheet, giving us significant financial flexibility and we remain committed to resuming Viacom's share repurchase program in October."



Quarterly revenues declined 11% to $3.06 billion due to lower theatrical revenues in Filmed Entertainment, which scheduled no wide theatrical releases in the quarter. Media Networks revenues increased $6 million to $2.60 billion, primarily due to higher affiliate fees. Absent an unfavorable 2% impact of foreign exchange, Media Networks revenues increased 2%. Worldwide and domestic affiliate revenues rose 2%, driven by rate increases. Excluding the impact from the timing of product available under certain distribution agreements, domestic affiliate revenues grew in the mid-single digits. Domestic advertising revenues decreased 9%, due to a decline in traditional ratings. Worldwide advertising revenues decreased 2%, which reflects a 58% gain in international advertising revenues driven principally by Channel 5.

Filmed Entertainment revenues decreased by 44% to $479 million, largely due to a decline in theatrical revenues of 92% related to the timing of the summer season theatrical slate. In the prior year, Transformers: Age of Extinction was released in the third quarter, while this year's summer tentpoles, Terminator: Genisys and Mission: Impossible - Rogue Nation, were widely released in the fourth quarter. Worldwide home entertainment revenues decreased 30%, to $199 million in the quarter, and ancillary revenues declined 43%, primarily driven by the benefit in the prior year of the sale of certain distribution rights.

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