A Noisy Quarter at Cablevision

Cablevision's (NYSE:CVC) earnings report, which was released on Tuesday, had more moving parts than a bag full of centipedes. Having said that, I think the most important things for Fools to know about the company's results are that the cable business continues to expand nicely, interest costs increased in the quarter as a result of borrowing to pay a special dividend, and Larry Brown, a former New York Knicks basketball coach, had a one-year stint with the team that made him more money than most Fools see in a lifetime.

Now let's see if we can't bring some order out of this chaos: The company's net revenue grew 13.4% in the quarter to $1.69 billion, up from $1.49 billion a year earlier. Operating income was $208.3 million, down 9.4% from the prior year. The net loss for the quarter was $23.9 million, with the loss from discontinued operations weighing in at $30.4 million, and income from continuing operations amounted to $6.5 million. Included in the negative non-operating items was a $30 million after-tax expense relating to the settlement of a contractual dispute with Loral Space & Communications, a satellite manufacturer. Other costs included $29.4 million of "higher team-related expenses," including $18.5 million that went to former Knicks coach Brown.

Cablevision serves about 3 million cable subscribers in the New York metropolitan area. Those activities, which account for about two-thirds of the company's revenues, involve the Cablevision "triple play" offerings of video, high-speed data, and telephone service. Revenues from that telecommunications unit increased 17.9% in the quarter to $1,119.5 million. The company's Rainbow programming operation contributed another $236.7 million, and Madison Square Garden and its related entities added $339.6 million to revenues.

In disclosing the company's results for the year, management also provided guidance regarding its expectations for 2007. That guidance, should it prove accurate, would suggest some slowing growth for the year, including a revenue-generating unit (one subscriber taking one service) increase of 850,000 to 950,000, versus 1.4 million in 2006, and basic video subscriber growth of 1% to 2%.

Like other cable operators, including Comcast (NASDAQ:CMCSA), Time Warner Cable, and Mediacom (NASDAQ:MCCC), Cablevision's core business continues to score impressive results. And despite the noise in its earnings release, I continue to believe that Fools should keep the company -- and, indeed, the entire group -- firmly in their sights.

For related Foolishness:

• Dolan Redux at Cablevision
• Can Cable Keep Rolling?
• Comcast: A Rediscovered Highflier

Time Warner is a Stock Advisor pick. Check out our flagship newsletter free for 30 days.

Fool contributor David Lee Smith thinks a hiatus from writing about Comcast would benefit his portfolio by giving him an opportunity to buy the stock, which he doesn't currently own. Nor does he own shares in any of the other companies mentioned. He welcomes your comments or questions. The Fool's disclosure policy is a hit in syndication.