Viacom Group has reported a 37 per cent increase in profits for the quarter that ended in June. The company’s net earnings of $574 million, were up from $420 million, in the same quarter last year. The company reported revenues of $3.77 billion, up from $3.27 billion.
Viacom credited a robust television advertising market, solid revenues from subscriber fees and emerging revenues from digital distributors like Netflix.
“We have always thrived on competition in the distribution arena, and there’s now more competition than there has ever been, and it’s growing,” said Philippe Dauman, the chief executive of Viacom. Media companies like Viacom are increasingly accepting online distributors like Netflix, Amazon and Hulu as new bidders for their content — especially for the old content in their libraries that does not compete directly with what is currently on their television channels. Viacom already has licensing deals with Netflix and Hulu, and Dauman said that discussions were under way with other potential licensees.
“As a result of these new deals, we have set a new higher base for our affiliate revenues this year and we expect to continue to increase those revenues from this higher base at a high single- to low double-digit annual rate every year for the foreseeable future,” Dauman said.
In the quarter, Viacom’s cable networks had revenues of $2.39 billion, up 16 per cent versus the same quarter last year, in large part because of the strength in advertising.
Profit growth was up sharply in the cable division, but down in the Paramount filmed entertainment division, largely because of the “timing and mix of theatrical releases,” the company said in its earnings statement.