Viacom Inc. (VIAB) posted stronger-than-expected earnings for its fiscal second quarter and said it was taking taking "substantial strides" to return to consistent top-line growth as global ad revenue continues to decline.
Viacom said adjusted earnings for the three months ended in March were 79 cents a share, well ahead of the FactSet consensus of 59 cents and up 4% from the same period last year. Group revenue also impressed, rising 8% to $3.26 billion and topping the FactSet estimate of $3.02 billion.
Net income attributable to the company, however, plunged 60% to $121 million, the company said, translating to a diluted EPS of 30 cents per share.
"In the second quarter, Viacom delivered continued top-line improvement, with growth in affiliate revenues, international media networks and across every business segment of Paramount Pictures," said CEO Bob Bakish. "Viacom also took significant steps forward on our plan to strengthen our balance sheet, improve our leverage profile and enhance liquidity."
"There is a lot of work still to do, but we are making important changes at Viacom, taking substantial strides towards revitalizing our portfolio of brands and returning the company to consistent top-line growth."
Media networks revenue grew 1% to $2.39 billion, the company said, while affiliate revenue was 2% higher from the same period last year at $1.16 billion. Advertising revenue, however, slipped 1% to $1.11 billion as domestic ads slowed by 4% "driven by higher pricing more than offset by lower impressions" and international ad revenue decreased by 11%.
Viacom shares closed at $39.26 in New York on Wednesday after slumping more than 7.5% on the session, the biggest one-day decline of the year, after rival Time Warner Inc. (TWX) cautioned that second-quarter advertising revenue would be lower than expected.
