Earnings analysis: Media companies report mixed 2nd-quarter results

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Media companies continued to post mixed earnings last week, as they struggle to emerge from the ad recession.

Walt Disney Co.-parent of the ABC and ESPN networks-posted net income of $364 million, down 7% from $392 million a year ago, on revenue of $5.8 billion, down 2.8% from $6 billion last year. On a pro-forma basis-factoring out accounting changes, the acquisition of ABC Family and the shutdown of its Go.com Internet unit-Disney's revenue was down 6% and net income down 62%. Management blamed theme parks, which continue to be affected by fears of terrorism and by the weak economy, as well as low ratings at its ABC network and low box office for recent film releases. Media network revenue was down slightly at $2.1 billion, from $2.2 billion in 2001, with broadcast network revenue down 16% and cable revenue up 1%.

Meredith Corp., parent of Better Homes & Gardens and Ladies Home Journal, had net income of $56.1 million, up from $11.9 million, but after factoring out accounting changes and gains on the swap of several Florida TV stations, net income was up 11.4%. Revenue for the quarter was up 1% at $267.2 million, with publishing revenue down 1% to $196.8 million and broadcasting revenue up 4% to $70.4 million.

Primedia net loss

Primedia reported a net loss of $34.4 million on revenue of $422.5 million in the quarter, a narrower loss than the $139.7 million it posted a year ago. Management cited continuing strength in its endemic advertising at its enthusiast titles and more stable consumer brand advertising, but business-to-business remained a soft spot.

Interep National Radio Sales posted a net income drop of almost 75% in the second quarter to $311,000 from $1.2 million a year earlier. But revenue from radio commissions increased 4.6% to $23.7 million. The company forecast full-year radio commission revenue of $82 million to $83 million, a 3% to 4% increase for the year.

The agency company reporting, Havas, showed improving results in the second quarter, but management warned that the ad market remains weak and is expected to be down for the year.

Havas posted $519.5 million in revenue for the quarter, a 5.2% drop, after factoring out the impact of currency and acquisitions, but that was better than a drop of 5.5% in the first quarter. Results got a boost from $1.05 billion in net new business during the first half, level with the year-ago period, and from improvement in marketing services and media revenue, which was down 1.6% for the second quarter, while traditional advertising dropped 11%. Advertising revenue in North America dropped 11.3% in the second quarter, while Europe, Havas' largest region, was down 0.2%.

"The recovery of the North American economy remains fragile in our view," said Chairman-CEO Alain de Pouzilhac.

contributing: cara b. dipasquale, jon fine

Fast Facts

Reporting this week:

Aug. 5: Procter & Gamble Co.

Aug. 6: Interpublic Group of Cos., Omnicom Group, Playboy Enterprises

Aug 7: Clorox Co.

Aug. 8: Univision Communications

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