Comcast Corp. ( CMCSA
) maintains its strong momentum in the third quarter of 2012,
supported by healthy businesses generated during the London
Olympics. While the company's Cable businesses continue to beat
market expectations, NBC Universal division makes a turnaround.
Importantly, the company's struggling basic video operation
continues its positive momentum.
GAAP net income for the third quarter of 2012 was $2,113 million
or 78 cents per share against a net income of $908 million or 33
cents per share in the prior-year quarter. Quarterly adjusted
earnings per share of 46 cents were exactly in line with the Zacks
Consensus Estimate. Total revenue came in at $16,544 million in the
reported quarter, beating the Zacks Consensus Estimate of $16,035
million, up 15.4% year over year.
Quarterly operating costs and expenses were $11,536 million, up
18.1% year over year. However, quarterly operating income was
$3,048 million, representing an annualized growth of 15.4%.
Operating margin, in the third quarter of 2012, was 18.4%,
remaining same year over year. During the reported quarter, Comcast
repurchased 22.9 million of its common shares for a consideration
$750 million and paid dividends totaling $435 million.
During the third quarter of 2012, Comcast generated $5,008
million of cash from operations compared with $4,574 million in the
year-ago quarter. Consolidated free cash flow in the reported
quarter was $1,514 million compared with $1,392 million in the
prior-year quarter. Cash and cash equivalents, at the end of the
reported quarter, were $8,899 million compared with $1,620 million
at the end of 2011.
Total debt at the end of the previous quarter was approximately
$38,590 million compared with $39,309 million at the end of 2011.
At the end of the third quarter, debt-to-capitalization ratio was
0.42 compared with 0.44 at the end of 2011.
Cable Communications Segment
Quarterly total revenue was $9,976 million, up 6.9% year over
year. Operating cash flow was $3,998 million, up 7.7% year over
year. Within this segment, Video revenue was $5,021 million, up
2.7% year over year. High-Speed Internet revenue was $2,403
million, up 8.8% year over year. Voice revenue was $895 million, up
1.5% year over year. Advertising revenue was $607 million, up 23.5%
year over year. Business Services revenue was $621 million, up
33.6% year over year. Other revenue was $429 million, up 9.4% year
As of September 30, 2012, Comcast had 19.025 million (up 6.8%
year over year) High-Speed Internet customers; 9.787 million (up
6.4% year over year) Voice customers; and 22.002 million (down 1.6%
year over year) Video customers. In the reported quarter, Comcast
lost a net total of 117,000 video customers compared with a net
loss of 165,000 customers in the prior-year quarter. The company
added a net 287,000 High-Speed Internet customers compared with
261,000 in the year-ago quarter. Similarly, Comcast added a net
total of 123,000 voice customers compared with 138,000 in the
prior-year quarter. In the previous quarter, monthly ARPU
from video customers increased 8.7% to $150.73.
NBC Universal Segment
Quarterly total revenue was $6,822 million, up 31.2% year over
year. The segment's pro forma operating cash flow was $1,140
million, showing a 19.9% year-over-year growth. Within this
segment, Cable Networks revenue was $2,165 million, up 3.2% year
over year. Broadcast TV revenue was $2,777 million, up 83.8% year
over year. Alongside, Filmed Entertainment revenue was $1,355
million, up 23.6% year over year. Theme Parks revenue was $614
million, up 5.8% year over year.
Comcast becamethe largest integrated content development and
distribution company in the U.S.after completing the acquisition of
the majority stake of NBC Universal from General Electric
Co. ( GE ). We also remain quite optimistic regarding
the company's diversification, network upgrade and innovative
product offering strategies. Comcast continues to post strong
growth in revenue and free cash flow. We maintain our long-term
Neutral recommendation on Comcast. Currently, it holds a Zacks#2
Rank (Buy) on the stock.COMCAST CORP A (CMCSA): Free Stock Analysis
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