Discovery Communications Reports Q1 Profit Increase
Programmer Hurt Overseas by U.K. Recession
by Claire Atkinson (Broadcasting & Cable) -- Multichannel News, 5/4/2009 12:31:03 PM
Discovery Communications turned in another strong first quarter, reporting a rise in profit of $119 million, an $85 million increase on the year ago period. Domestic ad revenue also rose 2%, a seemingly impossible feat in today's troubled economic environment.
The growth came in part from an uptick in ratings at the company's cable channels which include TLC and Animal Planet. Ad revenue for the quarter was $244 million at the U.S. Networks, while distribution revenue rose 11% to $248 million. The company said last week it would relaunch Discovery Kids as part of a joint venture with toy company Hasbro.
At about 12:25 p.m., Discovery's stock price was up about 9% to $20.25 (up $1.64).
The Maryland based factual programming giant, did not have such a positive story internationally, with revenue down 4% to $255 million. Ad revenue was down 12% to $57 million and distribution revenue down fell 1% to $177 million. Discovery felt the full impact foreign currency fluctuations and the global recession. It is particularly exposed in the U.K. where it operates more than 10 channels.
Without the impact of currency changes, revenue would have been up 9% and ad revenue would have risen by some 7% on strong growth in the Europe, the Middle East region and Latin America.
First quarter revenue rose by $8 million to $817 million over the prior year's quarter with 5% growth at US networks and 23% growth at the company's commerce and education unit. International revenue was down 4%.
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