Currency Rates Drag Discovery Q4

Foreign currency rates helped drag down Discovery Communications' Q4 results, as cash flow outside the US fell 12% erasing a 9% increase domestically.

Revenue in the fourth quarter was up 2% to $1.7 billion, fueled by a 3% gain at US Networks and slight growth internationally. Cash flow was essentially flat in the period at $581 million as a 12% decline internationally, mainly due to unfavorable foreign exchange rates. Excluding currency effects, fourth quarter total revenue and adjusted OIBDA grew 4% and 3%, respectively.

“Discovery’s diversified set of nonfiction, sports and kids’ entertainment brands, and strong strategic positioning continued to drive attractive distribution agreements, helping to deliver solid operating and financial results in 2016,” said Discovery CEO David Zaslav in a statement. “As we begin 2017, we will continue to invest in our premier global IP and brands to nourish fans across all screens, all platforms and all services to drive shareholder value and propel our business for years to come amid the rapidly changing media landscape.”

Full year revenue increased 2% to $6.5 billion, as 5% growth at U.S. Networks was partially offset by a 2% decline at International Networks, primarily due to the sale of SBS Radio and currency effects.  Full year cash flow was essentially flat (up 1%) at $2.4 billion as 8% growth at U.S. Networks was more than offset by a 12% decline at International Networks, partially due to the sale of SBS Radio and currency effects.  Excluding currency effects and the impact of the SBS Radio sale, total Company revenues and Adjusted OIBDA both grew 5%.