Mel Karmazin may have left the building, but his legacy of performance appears to live on at CBS parent Viacom
Second-quarter revenues were up 7% to $6.8 billion from $6.4 billion in the same period a year ago. Earnings jumped 14% to $754 million, or $0.43 per diluted share, up from $660 million, or $0.37 per stub, a year ago. Free cash flow for the quarter was up 14%, to roughly $1 billion. Cash flow is up more than 20% year-to-date.
Executives once again pointed to ad revenues as the key driver of Viacom's growth. Ads have so far this year accounted for 49% of the firm's $13.6 billion in revenue. That's up from 46% at this same point during 2003.
The ad resurgence is probably at least partially linked with the popularity of CBS' spate of reality shows and Viacom cable properties, including MTV and Nickelodeon. Cable TV revenues were up 18% for the quarter and are up more than 19% year-to-date. Revenues from broadcast television are up 11% for the quarter, and 15% thus far during 2004.
If nothing else, the good results could grab the attention of investors who have all but ignored the sector after turmoil at competitor Disney
It's too early to tell if Viacom shares really are a bargain, but cash flow could continue to improve after Blockbuster
For more Fool coverage of the entertainment biz:
- Fox continues to get real.
- Disney management may have gotten the clue about boosting its dividend.
- Viacom's Amazing Race is underway.
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Fool contributor Tim Beyers isn't much of a reality TV fan, but he has yet to watch The Amazing Race. He wonders what all the fuss is about. Tim owns no stake in any of the companies mentioned, and you can view his Fool profile here.