Mexican media company Televisa said Friday it will spend $360 million this year on its satellite TV unit, pay-TV networks and cable services, as well on its core broadcasting business.
Grupo Televisa SA, Mexico's largest broadcaster and the world's biggest producer of Spanish-language television programming, also expects TV advertising sales to increase by 4.5 percent this year, Alfonso de Angoitia, Televisa's executive vice president, told analysts in a conference call.
Capital expenditures will be slightly higher than the $355 million the company spent in 2007, de Angoitia said.
About $120 million will be spent on satellite TV unit Sky Mexico, $105 million on TV broadcasting and other businesses, $85 million on pay TV networks and telecommunications services, and $50 million on its gambling business, he said.
Televisa has sought to diversify its business. Last year, company executives said they would like to put together a national cable system to capitalize on the country's burgeoning cable TV, data and voice transmission market.
Late Thursday, Televisa reported a 17 percent increase in fourth-quarter earnings on strong sales in its pay television and cable networks.
It earned 2.8 billion pesos ($262 million) in the last three months of 2007, up from 2.4 billion pesos in the year-earlier period.
Its sales rose 11.3 percent to 12.41 billion pesos ($1.1 billion) from 11.1 billion pesos a year earlier.
Despite the strong sales, the company said that as of Dec. 31, upfront deposits for television advertising dropped 3.2 percent to 16.23 billion pesos ($1.5 billion). TV companies generally sell commercial time in what is known as the upfront market well ahead of when the ads are to appear.
Net profit for the full year fell 9.3 percent to 8.1 billion pesos ($750 million) from 8.9 billion pesos in 2006, mostly due to higher taxes. Sales for 2007 increased 5.6 percent to 42 billion pesos ($3.9 billion).
Television broadcasting sales rose 5.6 percent to 6.8 billion pesos ($629 million) in the fourth quarter. Fourth-quarter sales for the company's cable and telecommunication segment climbed 43.2 percent from a year earlier.
Sales at the company's Sky satellite television service increased 10.9 percent to 2.2 billion pesos ($204 million). The company reported a 17 percent increase in fourth-quarter earnings late Thursday due to strong sales in its pay television and cable networks.
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