During a conference call on Viacom Inc.'s third-quarter results, president
Mel Karmazin was bullish on the recovering advertising market, as the giant
company's overall ad revenue was up 14 percent.
He was also upbeat about the one weak link in the company's cable stable,
VH1, which is in the midst of a turnaround effort.
'VH1's ratings are up 20 percent from last year and getting better,' Karmazin
told analysts. 'And what's really interesting is that in spite of the rating
problem the network had, which is over, our margin in the third quarter was 40
In the third quarter, revenue for Viacom's cable networks increased 13
percent, to $1.24 billion from $1.1 billion a year ago.
Operating income for cable was up 41 percent, to $510.8 million from $363.1
Third-quarter EBITDA (earnings before interest, taxes, depreciation and
amortization) for Viacom's cable stable increased to $556.8 million from $470.2
million, up 18 percent.
Those third-quarter revenue and operating-income gains were driven by
double-digit ad-sales growth at MTV: Music Television, Nickelodeon, TV Land,
TNN: The National Network and Black Entertainment Television, as well as
double-digit increases in affiliate fees, according to Viacom officials.
Also in the third quarter, subscriptions for Viacom's premium service,
Showtime, were up 9 percent, or by 2.7 million homes, bringing its distribution
to 32.3 million.
As a whole, in the third quarter, Viacom's revenue was up 10 percent, to $6.3
billion from $5.7 billion.
For the first nine months of this year, revenue for Viacom's cable properties
hit $3.38 billion, up 8 percent from $3.14 billion in the prior-year