Mexican pay-TV and broadcasting behemoth
Grupo Televisa S.A.B.
) reported mixed financial results for the second quarter of 2014.
Net income came in at around $203.5 million, up 19.5% year over
year. However, earnings per Global Depository Shares (GDS) stood at
35 cents, missing the Zacks Consensus Estimate by a penny.
Quarterly consolidated net revenue of around $1,489.5 million,
reflects an improvement of 7.1% over the prior-year quarter and
also surpassed the Zacks Consensus Estimate of $1,400 million.
Televisa currently carries a Zacks Rank #3 (Hold).
Gross margin came in at 47.5% compared with 47.8% in the
year-ago quarter. Consolidated operating income was $374.8 million,
down 1.8% from the prior-year quarter. Operating margin was 25.2%
compared with 27.4% in the year-ago quarter. Capital expenditure,
during the reported quarter, was approximately $245.6 million.
At the end of second-quarter 2014, Televisa had approximately
$2,851.7 million in cash and marketable securities and $5,695.3
million of outstanding debt compared with $1,572 million of cash
and marketable securities and $4,624.3 million of outstanding debt
at the end of 2013. At the end of the reported quarter, the
debt-to-capitalization ratio was around 0.47 against 0.43 at the
end of 2013.
Quarterly total revenue came in at $662.6 million, up 4.4% year
over year. Operating profit was $304.7 million, down 2.7% year over
year, while operating margin was 46% compared with 49.3% in the
year-ago quarter. Quarterly royalty from Univision was a
record-high $84 million, up 19.1% year over year.
Within this segment, Advertising revenues totaled $482.4
million, up 6% year over year. Network Subscription revenues were
$51.7 million, indicating a decrease of 23.8% from the year-ago
quarter. Licensing and Syndication revenues were $128.5 million, up
15.2% year over year.
Quarterly revenues came in at $333.7 million, up 8.3% year over
year. Operating profit was $160.3 million, up 10.7% year over year.
Quarterly operating margin was 48% compared with 47% in the
Quarterly revenues were $369.9 million, up 14.7% year over year.
Operating profit totaled $136.9 million, up 12.4% year over year.
Operating margin came in at 37% compared with 37.7% in the year-ago
Other Businesses Segment
Quarterly revenues were $149.9 million, down 1% year over year.
Operating income stood at $15.3 million, down 4.4% year over year.
Operating margin was 10.2% as against 10.5% in the year-ago
As of Jun 30, 2014, Televisa had 2,570,599 Video subscribers;
1,840,348 Broadband Internet subscribers; and 990,785 Telephony
subscribers, which together constitute 5,401,732 revenue generating
units (RGU) in the Telecommunications segment. The company also had
6,357,552 net active Satellite TV subscribers, up 12.6% year over
year. In the reported quarter, the Sky segment added 203,262 net
Televisa is likely to gain significantly from its ownership
stake in the U.S. broadcaster Univision Communications Inc. In
2007, Univision was acquired by a consortium led by billionaire
Haim Saban. Other investors in the group were Madison Dearborn
Partners, Providence Equity Partners, TPG and THL Partners.
At present, the owners of Univision are exploring strategic
options to sell the company and may also consider an initial public
offering (IPO) in 2015. Univision's owners have held talks with
Time Warner Inc.
) regarding this, however, nothing concrete has emerged so far.
According to industry rumors management is expecting more than $20
billion from the Univision sale.
In 2012, Televisa started investing in Univision and currently
effectively holds a 38% (after converting debt into equity) stake
in the company. Moreover, Televisa has the scope to buy another 2%
stake of Univision within the next three years. Consequently, the
Mexican broadcaster is positioned to gain significantly from the
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
GRUPO TELEVISA (TV): Free Stock Analysis Report
TIME WARNER INC (TWX): Free Stock Analysis
CBS CORP (CBS): Free Stock Analysis Report
VIACOM INC-B (VIAB): Free Stock Analysis Report
To read this article on Zacks.com click here.