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Comcast Profits Up Despite NBC Losses


For Comcast's Roberts, X1 Marks the Spot

Comcast Corp. reported higher fourth-quarter earnings as its cable profits outweighed losses at the struggling NBC broadcast network.

One year after buying control of NBCUniversal, Comcast's fourth-quarter net income was $1.3 billion, or 47 cents a share, up 26% from $1 billion, or 36 cents a share, a year ago.

Revenues rose 54.7% to $15 billion.

"Cable had another terrific quarter of improving customer metrics, demonstrating that our new Xfinity brand and our intensified focus on service and innovation are making a real difference," Comcast CEO Brian Roberts said in a statement.  "Our results at NBCUniversal underscore the strong performance of the cable networks and theme parks, and we continue to make progress enhancing the franchise values of its businesses."

Roberts said 2011 was an important year for Comcast. "Cable continued to drive innovation, increase new product introductions and transform the customer experience, and we successfully integrated NBCUniversal. We also reported strong financial and operating results in both the fourth quarter and for the full year," he said. "As we begin 2012, the strength of our businesses and free cash flow generation will allow us to continue to build value and consistently return capital to shareholders."

Comcast announced that it was increasing its dividend by 44% and would start a new $6.5 billion share repurchase plan that calls for the company to buy $3 billion in stock this year.

Revenue for NBCUniversal rose 0.8% to $5.7 billion in the fourth quarter. Operating cash flow decreased 6.8% to $1.1 billion, including $33 million in acquisition-related costs.

NBC's broadcast operations had negative cash flow, losing $80 million in the fourth quarter, compared to a gain of $55 million a year ago. Excluding the 2010 Olympics and acquisition related costs, the negative cash flow for the fourth quarter of 2011 was $52 million. Revenues were down 3.7% to $1.8 billion.

The company said broadcasting's problems reflected ratings weakness at NBC and lower political advertising at its owned stations. Higher marketing costs impacted cash flow.

For the year, NBCU had revenue of $21.1 billion, up 3.7% from 2010. Operating cash flow increased 2.3% to $3.8 billion.

Cash flow rose 15% to $923 million at NBCU's cable networks in the fourth quarter as revenue rose 5.3% Advertising revenue was up 2% reflecting four fewer selling days this quarter and fewer NBA games at its regional sports channel.

For the year, operating cash flow increased 5.4% to $3.3 billion, reflecting higher revenue, partially offset by an increased investment in original programming and acquisition-related accounting revisions totaling $137 million. Cable networks revenue increased 10.6% to $8.5 billion, with a 10.9% increase in distribution revenue, an 8.7% increase in advertising revenue and an 18.7% increase in other revenue primarily due to increases in the licensing of owned content from the cable production studio.

At Comcast's cable business, revenues rose 4.7% to $9.5 billion, driven by a 10% increase in high-speed internet revenue and a 37% jump in business services revenue. Revenue from Comcast Cable's video business grew just 1.3% as the number of video customers shrank by 135,000 to 22.3 million. Advertising revenue was down 9.3% to $546 million.