) declared fourth-quarter 2013 financial results with both the
bottom and the top line beating the Zacks Consensus Estimate.
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Net income from continuing operations in the reported quarter was
$739 million or $1.55 per share compared with $626 million or
$1.21 per share in the prior-year quarter. The reported figure
was above the Zacks Consensus Estimate of $1.44.
Total revenue in the reported quarter was $3,652 million, up 9%
year over year and also above the Zacks Consensus Estimate of
$3,627 million. Better performances from both the Media Networks
and Filmed Entertainment segments have led to the improvement.
Quarterly operating income was $1,107 million, up 5% year over
During the reported quarter, Viacom bought 33.7 million common
shares for $2.7 billion. At the end of the fourth quarter of
fiscal 2013, Viacom had $2,403 million in cash & cash
equivalent and $11,867 million in outstanding debt on its balance
sheet compared with cash and cash equivalent of $848 million and
outstanding debt of $8,131 at the end of fiscal 2012.
Debt-to-capitalization ratio was 0.70 against 0.52 at the end of
Media Networks Segment
Quarterly revenues of $2,460 million inched up 7% year over year,
mainly triggered by better advertising, affiliate and ancillary
revenues. Quarterly operating profit was $1,035 million, up 11%
from the prior-year quarter. Both domestic and worldwide
affiliate revenues rose 6% year over year. Both domestic and
worldwide advertising revenues surged 10% year over year.
Filmed Entertainment Segment
Quarterly revenues rose 11% year over year to $1,208 million,
mainly driven by popular movie releases. Quarterly operating
profit was $291 million, up 49% year over year.
Global Theatrical revenues increased 31% year over year,
primarily due to more hit movie releases than the year-ago
quarter. Worldwide Home Entertainment rose 24% coupled with a 5%
decline in television license fees. However, Worldwide Filmed
Entertainment ancillary revenues rose 54%.
We believe that Viacom is well positioned for long-term growth as
it continues to benefit from its predominantly cable
networks-based business model, strong affiliate fee revenue
growth, increased number of share repurchase plans,
multi-platform content, and is one of the fastest growing
traditional ad media.
However, stiff competition from other media companies like
Time Warner Inc.
) along with mounting debt may act as headwinds for the stock,
Currently, Viacom has a Zacks Rank #3 (Hold).