Crown Media Holdings reported higher revenue in the third quarter, but its profits dropped because of costs associated with getting rid of high-interest debt.
Net income was $8.7 million, or 2 cents per share, compared to $14.9 million, or 4 cents per share, a year ago.
In August, Crown redeemed $8.5 million in notes for $9.5 million and retired a portion of the debt issuance costs of $200,000, which resulted in an aggregate, pre-tax loss of extinguishment of debt of approximately $1.2 million.
Income from operations before interest and income tax expense rose to $36.9 million from $34.8 million.
Revenue rose 14% to $106.2 million.
Advertising revenue increased 17% to $83.6 million. The company attributed the gain to improved ratings on the Hallmark Movies & Mysteries channel.
Subscriber fee revenue was up 65% to $21.9 million.
Programming costs were up 18% because of higher cost for primetime original series and daytime programming. Marketing expenses declined.
“We are pleased with the accomplishments achieved during Third Quarter, including the successful re-launch of our channels on AT&T, the culmination of our debt refinancing and the continued double-digit ratings growth for Hallmark Movies & Mysteries” said Bill Abbott, president and CEO of Crown Media Family Networks. “In a continuously changing marketplace, we are achieving historical audience levels and revenue milestones, underlining our ability to engage viewers. This momentum, along with our robust holiday slate, should pave the way to a strong fourth quarter.”
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