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Viacom Sinks on Poor Ratings, Strong Dollar

Sluggish ratings and a strong dollar helped drag down Viacom's fiscal fourth-quarter results, with domestic ad sales dipping 7% in the period.

The ad performance was better than the 9% domestic decline in fiscal Q3.

Overall, revenue was down 5% in the quarter to $3.8 billion, but excluding the impact of the strong U.S. dollar, the decline would have been 2%. At Viacom Media Networks, total revenue increased 5% to $2.8 billion, driven by gains in affiliate fees and a boost in international ad revenue. Operating income at the unit was down 6% in the quarter to about $1 billion. Viacom said domestic affiliate fees rose 15% in the period and international affiliate revenue was up 10%. International ad sales rose 45% in the period.

“Viacom's fourth-quarter and year-end results are indicative of our progress in key areas, including recent ratings improvement and renewals of important distribution agreements," CEO Philippe Dauman said in a statement. "Our strategy of increasing and accelerating investment in original content and expanding our profitable international footprint are among the major factors driving this success, which we believe will continue in 2016 and beyond. We are making great progress in tackling industry-wide inefficiencies in audience measurement, while expanding our audience reach with landmark distribution agreements.

"Viacom's family of Media Networks are the most watched by highly coveted younger audiences, and we are building engagement on all platforms, leading to first-of-their-kind marketing opportunities with our advertising partners," Dauman added. "Our investment in content continues to grow, supporting an unprecedented amount of quality original programming and a more robust slate of films. In addition, in fiscal 2015 we launched 21 channels overseas - including six in India - fueling the fastest international growth in our history.”