) carries on with its fabulous run as it enjoys yet another
record quarterly performance. The company ended its superb run
for 2013 on a high note as the fourth quarter's adjusted earnings
of 78 cents grew nearly 22% year over year and steered clear of
the Zacks Consensus Estimate of 76 cents. The stock price rose
4.4% on the index in the after-hours trading session.
Including earnings from discontinued operations, earnings were 76
cents per share, rising 22.6% from the year-ago quarter.
For the full year, earnings came in at $3.02 per share, a penny
ahead of the Zacks Consensus Estimate and up 18.4% year over
year. Including earnings from discontinued operations, earnings
rose 21% to $3.00 per share. This was the first time that
full-year earnings crossed the $3 mark.
Similarly, total revenue of $3,911.0 million cruised ahead of the
Zacks Consensus Estimate of $3,831 million and grew 5.8% from the
prior-year quarter. This growth in revenues was owing to 27.6%
rise in content licensing and distribution revenues to $898
million and 7.3% increase in affiliate and subscription fees to
Again, full-year revenues of $15,284 million were ahead of the
Zacks Consensus Estimate of $15,194 million and up 8.5% year over
Adjusted operating income before depreciation and amortization
(OIBDA) increased 7.0% to $927 million and operating income grew
9% to $793 million. The rise in both the key financial metrics
was driven by robust revenue growth partly offset by increased
investment in television content and higher stock based
CBS benefited from content monetization and rise in
non-advertising revenue. In fact, non-advertising contributed 42%
to total revenue in 2013, the highest ever. Moreover, recently
CBS has signed several deals with HULU and
) among others to put its programming (
Under The Dome
for HULU) on a diverse range of platforms and make this as one of
the steady sources of revenues.
, increased 10.4% to $2,916 million due to strong performances
across the segment.
revenues rose 11.0% to $2,214 million from the year-ago quarter,
driven by increase in domestic and international licensing as
well as higher advertising and network affiliation revenues. The
segment's OIBDA grew 27% to $418 million as strong revenue growth
was partly offset by the company's increased investment in
Continuous growth in licensing revenues and affiliate revenues
' revenues to mark an increase of 9% to $477 million. Moreover,
growth in cable networks revenues helped the segment's OIBDA to
increase 8% to $199 million, partly offset by a rise in
revenues rose 5% to $225 million due to increase in the sales of
print books. The segment's OIBDA increased 19% to $37 million on
the back of higher revenues.
, came in at $1,066 million, down 5.4% from the prior-year
revenues decreased 9% to $719 million as absence of political
advertising offset the higher retransmission fees. CBS Television
Stations revenues fell 12% and CBS Radio revenues fell 4%. The
segments' OIBDA decreased 19% to $263 million due to lower
political advertising revenues.
revenues rose nearly 2% to $347 million whereas OIBDA increased
28% to $120 million in the quarter. The company is looking
forward to launch the IPO in the first quarter of 2014 but is
currently awaiting IRS approval to convert this division into a
Real Estate Investment Trust (REIT).
Other Financial Details
CBS ended the quarter with cash and cash equivalents of $397
million, long-term debt of $5,940 million, and shareholders'
equity of $9,966 million. The company generated net cash flow
from operations of $1,873 million and incurred capital
expenditures of $270 million. Free cash flow of $382 million was
generated during the quarter and $ 1,774 billion for the year.
In the quarter, CBS Corporation repurchased 6.1 million shares
for $364 million, bringing the full year buybacks to 45.8 million
shares at a cost of $2.2 billion.
Feb 12, 2014
, CBS announced an accelerated share repurchases program of $1.5
billion. It will buyback $2 billion worth of shares in the first
quarter reflecting the company's priority to maximize shareholder
Needless to say, the company is firing on all cylinders and it is
expected that this growth momentum will continue in 2014 and
beyond. CBS which competes with
Twenty-First Century Fox, Inc.
The Walt Disney Company
), is focused on lowering its dependency on conventional
advertising, which is a commendable since it is highly
susceptible to economic headwinds.
Given the increasing reverse compensation from affiliates, strong
demand of its content, digital distribution, syndication sales
and retransmission consent, CBS is poised to benefit from
diversification of revenue streams.
CBS expects retransmission fees to hit the $2 billion mark in
2020. Currently, it expects retransmission fees to reach $1
billion by 2017.
Additionally, the company expects CBS Television Network to be a
major growth driver as the network owns most shows in the top 10
and top 20 countdowns. Notably, its shows such as
The Big Bang Theory
are worth mentioning in this respect.
Currently, CBS has a Zacks Rank #3 (Hold).
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