QUARTERLY REPORT

CBS Stations 2Q Revenue Moves Up 4%

The increase is helped by a higher retransmission consent and reverse comp revenue.

 

CBS Corp. on Thursday afternoon reported results for the second quarter of 2017 that included a 4% in Local Media revenue to $412 million, up from $396 million in the same period of 2016.

The Local Media operating income of $127 million was down 2.4% from $130 million in last year’s 2Q.

Leslie Moonves, CBS chairman-CEO, said: “CBS delivered outstanding second quarter results while continuing to take a number of steps to achieve our long-term financial goals. First, we had a terrific upfront with gains in pricing and volume, including more and more deals that better reflect how people are watching our programming on a delayed basis. In addition, we took significant steps during the quarter to grow our affiliate fees from both traditional and ‘skinny’ bundles.

“Retransmission consent and reverse compensation increased 25% in the second quarter. And we are now seeing the benefit of our recent skinny bundle deals with Google’s YouTube TV, Hulu, and fuboTV, and just today we announced that we will be part of DirecTV Now as well. At the same time, our in-house over-the-top subscription services, CBS All Access and Showtime OTT, continue to grow beyond our expectations and are on track to surpass a combined four million subscribers by the end of 2017.

“We are now gearing up to take the next strategic step with All Access by expanding it into the international marketplace, starting with Canada in the first half of 2018. Showtime also had a terrific quarter, led by the successful return of Twin Peaks, which boosted OTT subscriptions dramatically, and we continue to expand the Showtime brand overseas with new deals to license our entire portfolio in France, India, Taiwan, Hong Kong, and others.

“So, 2017 is turning out to be a great year for the CBS Corp. even without the Super Bowl and political spending that we had in the prior year. And as we look ahead, we are positioned to have an even better year in 2018.”

BRAND CONNECTIONS

Entertainment segment revenues (which include CBS Television Network, CBS Television Studios, CBS Global Distribution Group, CBS Interactive and CBS Films) were up 12% to $2.2 billion. Entertainment segment operating income dipped 1.5%, from $351 million in 2Q 2016 to $346 million.

Cable Networks segment revenues of $571 million were up 6.5% from $536 million a year ago. Cable Networks operating income of $253 million grew 11.4%.

For the company overall, 2Q revenues increased 9% to $3.26 billion from $2.98 billion for the same prior-year period, with growth across all of the Company’s significant revenue streams.

Affiliate and subscription fee revenues were up 16%, driven by a 25% increase in retransmission revenues and fees from CBS Television Network affiliated stations, as well as growth from new initiatives, including the company’s digital subscription services. Advertising revenues were up 4%, led by the broadcast of the semifinals and finals of the NCAA Division I Men’s Basketball Championship on the CBS Television Network.

Operating income for the second quarter was increased 3% to $669 million from $651 million for the same prior-year period, despite higher-margin licensing sales in the second quarter of 2016. Net earnings from continuing operations increased 6% to $397 million for the second quarter of 2017 from $373 million for the same quarter last year, mainly a result of the higher operating income.

Read the company’s report here.


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