Discovery Reports Lower Fourth Quarter Earnings
Discovery Communications reported lower fourth quarter earnings because of higher restructuring costs and a drop in U.S. ad revenue.
Net income fell 13% to $250 million, or 38 cents a share, in the quarter from $298 million, or 41 cents a share a year ago.
Revenues rose 9% to $1.676 million. The company attributed the decline to higher restructuring costs and lower equity earnings partly because of the consolidation of Discovery Family, formerly The Hub.
"The healthy performance of our core business coupled with increasing contributions from our recent strategic acquisitions led to another year of solid operational and financial results and increasing capital returns in 2014," said David Zaslav, president and CEO of Discovery Communications. "Despite a more challenging U.S market and significant foreign currency headwinds, our content portfolio once again drove audience gains and boosted our market share around the world. As we move into 2015, we are confident that our long-term content investment strategy, strong global IP and brands, and local approach to markets will continue to drive our results and enable us to deliver additional value to shareholders."
Operating income for Discovery's U.S. networks was down 7% to $405 million.
Revenue was up 1% to $745 million at the U.S. networks. Distribution revenue was up 8% to $333 million, but ad revenue dropped 3% to $398 million. The company said ad revenue was down because of lower ratings and lower demand.
Operating income was up 11% to $329 million for Discovery's International Networks. Revenue was up 17% to $884 million.
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Jon has been business editor of Broadcasting+Cable since 2010. He focuses on revenue-generating activities, including advertising and distribution, as well as executive intrigue and merger and acquisition activity. Just about any story is fair game, if a dollar sign can make its way into the article. Before B+C, Jon covered the industry for TVWeek, Cable World, Electronic Media, Advertising Age and The New York Post. A native New Yorker, Jon is hiding in plain sight in the suburbs of Chicago.