CBS Corp. on Thursday afternoon reported results for the first quarter of 2017 that included a 9% drop in Local Media revenue to $409 million due, in part, to the absence of Super Bowl coverage this year and an additional NFL playoff game in 2016. CBS said the impact of those items was partially offset by growth in retransmission revenues.
The Local Media operating income of $123 million for the first quarter decreased 18% from $150 million for the same prior-year period, primarily reflecting the decline in revenues.
Leslie Moonves, CBS chairman-CEO, said: “Our first-quarter results once again demonstrate the strength of our strategy, which is to diversify our revenue mix as we achieve our long-term financial goals. Retransmission consent and reverse compensation led the way in Q1, growing 28%. This contributed to a 17% increase in our company’s affiliate and subscription fee revenue, which also benefited from our over-the-top subscription services, CBS All Access and Showtime OTT.
“In addition, we a had very solid quarter for content licensing and distribution, which was up 16% and is poised for continued strength when several of our hit series enter the syndication cycle later this year. And we continue to add to our content pipeline all the time.
“In two weeks we will unveil our new primetime schedule on the CBS Television Network, which will include 19 returning series further strengthened by several new shows, the majority of which we will own. We look forward to the upfront marketplace where we’re confident advertisers will once again place great value on the No. 1 television network in an increasingly fragmented media landscape. And longer term, that content becomes even more valuable when we license it across distribution services, both here in the U.S. and internationally as well.
“As we continue to sharpen our core content focus in the quarters to come, including the impending split-off of our radio business, we will be even better positioned to take advantage of all of the opportunities before us. So there is so much yet to come, and our road map for success is clear.”
Entertainment segment revenues (which include CBS Television Network, CBS Television Studios, CBS Global Distribution Group, CBS Interactive and CBS Films) were $2.35 billion, down 9% from $2.59 billion for 1Q 2016.
Cable Networks segment revenues of $543 million for the first quarter of 2017 increased 3% from $525 million for the same prior-year period. The increase was driven by higher affiliate and subscription fees, led by growth of the Showtime digital streaming subscription offering, which was partially offset by the timing of international television licensing sales of Showtime original series.
Cable Networks operating income of $248 million for the first quarter of 2017 increased 9% from $228 million for the same prior-year period, primarily reflecting growth in higher-margin revenues.
For the company overall, revenues were $3.34 billion, down from $3.59 billion for the first quarter of 2016, again due in part from the absence of the two NFL games. CBS said that excluding these two games, first quarter revenues would have been up in the high single digits.
Affiliate and subscription fee revenues increased increased 17%, driven by 28% growth in retransmission revenues and fees from CBS Television Network affiliated stations, as well as the Company’s digital subscription services.
Operating income for the first quarter was $704 million compared with $765 million for the same prioryear period, as a result of the above-mentioned noncomparable NFL games.
Net earnings from continuing operations were $454 million for the first quarter of 2017 compared with $442 million for the same quarter last year
Read the company’s report here.
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