CBS TV Stations’ 1Q Revenue Up 5%

CBS Corp. on Wednesday reported its strongest-ever quarterly results, including 1Q revenue that exceeded $4 billion for the first time since CBS became a stand-alone company in 2006.

Its Local Broadcasting revenues (which includes CBS Radio) increased 3% to $638 million from $622 million for the same prior-year period. CBS Television Stations revenues increased 5%, primarily driven by the benefit of the 2013 telecast of Super Bowl XLVII to the CBS-affiliated stations owned by the company as well as higher retransmission revenues.

These revenue increases were partially offset by lower revenues from the nonrenewal of an unprofitable sports programming contract, the timing of the semifinals of the NCAA Tournament, and one less week of NFL games during the first quarter of 2013.

CBS Radio revenues remained flat compared with the same prior-year period, as the benefit of the new CBS Sports Radio network was offset by the impact of radio station dispositions in 2012.

Local Broadcasting operating income before depreciation and amortization (OIBDA) for the first quarter of 2013 increased 16% to $199 million from $171 million for the same prior-year period, primarily driven by the segment’s revenue growth, lower programming costs, and the benefit from the nonrenewal of the unprofitable sports contract.

Entertainment division (CBS Television Network, CBS Television Studios, CBS Studios International, CBS Television Distribution, CBS Films, and CBS Interactive) revenues of $2.54 billion for the first quarter of 2013 increased 10% from the same prior-year period, driven by higher advertising revenues from the broadcast of Super Bowl XLVII on the CBS Television Network as well as growth in network affiliation fees. These revenue increases were partially offset by one less week of NFL games during the first quarter of 2013 as well as the timing of the semifinals of the NCAA Division I Men’s Basketball Championship, which aired during the second quarter in 2013 versus the first quarter in 2012.

Entertainment OIBDA for the first quarter of 2013 increased 17% to $480 million from $411 million for the same prior-year period, principally reflecting the segment’s revenue growth.

Cable Networks revenues for the first quarter of 2013 increased 6% to $478 million from $452 million for the same prior-year period. The growth was driven by higher affiliate revenues from increases in rates and subscriptions at Showtime Networks (which includes Showtime, The Movie Channel, and Flix), CBS Sports Network, and Smithsonian Networks.

Cable Networks OIBDA for the first quarter of 2013 increased 11% to $231 million from $209 million for the same prior-year period, primarily reflecting the growth in Cable Networks revenues, which were partially offset by higher programming costs.

The company as a whole posted its highest quarterly results in the following key metrics:

• Revenue of $4.04 billion
• Operating income before depreciation and amortization (OIBDA) of $916 million
• Operating income of $800 million
• Diluted earnings per share from continuing operations of $.73

Revenues of $4.04 billion for the first quarter of 2013 increased 6% from $3.80 billion in the same prior-year period. This growth was led by an 8% increase in advertising revenues, which was driven by the broadcast of Super Bowl XLVII on the CBS Television Network.

The timing of the semifinals of the NCAA Division I Men’s Basketball Championship, which aired during the second quarter in 2013 versus the first quarter in 2012, as well as one less week of NFL games broadcast during the quarter, partially offset the advertising growth.

Affiliate and subscription fee revenues rose 14%, driven by 62% higher retransmission revenues and fees from CBS Television Network affiliated television stations as well as growth at its cable networks. Content licensing and distribution revenues were down 1% primarily because of the timing of theatrical releases and a significant syndication sale in 2012. At the same time, content licensing and distribution revenues benefited from a 19% increase in streaming revenues.  

“CBS has started the year with a terrific first quarter,” said Sumner Redstone, executive chairman, CBS Corp. “Our premium content and multiplatform distribution strategy are leading to results that are better than ever. I am confident that this approach, under the guidance of Leslie [Moonves] and his team, will continue to propel CBS ahead in the years to come.”

“Across key financial measures—including revenue, OIBDA, operating income, and EPS—this was the most successful quarter in our Company’s history,” said Leslie Moonves, CBS president-CEO. “The value of our world-class content clearly continues to rise. In terms of big-event television, we had tremendous success during the quarter with the Super Bowl, the Grammys, the NCAA men’s basketball tournament, and more recently, the Academy of Country Music Awards.

“And our primetime lineup continues to dominate as well. The CBS Television Network is poised to win the season across all demographics, putting us in a very strong position as we prepare to unveil our new primetime lineup at the Upfront later this month. In the weeks that follow, we’ll be selling our schedule into an advertising marketplace that continues to improve, and we expect to once again lead the competition in pricing and volume.”