"In '02, we are rocking big-time," President Mel Karmazin said.
$640 million net income
The parent of the CBS and UPN broadcast networks, cable properties MTV and Nickelodeon, and the Infinity radio chain posted $640.3 million in net income for the quarter, compared to a net loss of $190.4 million a year ago. Revenues increased 10% to $6.3 billion, thanks to a 14% increase in advertising revenue.
The third quarter results
Double-digit ad revenues
TV revenues increased 14%, thanks to an 18% increase in advertising revenue for the CBS and UPN, while cable revenues grew 13%, driven by a 16% increase in advertising at ad-supported networks. Infinity's revenue grew 6%, with radio revenue up 10% and outdoor revenue up 2%.
He disputed claims that the strong numbers were due to political advertising or easier comparisons with last year's third quarter and the after-effects of the Sept. 11 attacks. Mr. Karmazin said radio and TV revenue were up in July and August, and TV station advertising sales are pacing up 19% in November and December, absent political ads. Additionally, outdoor sales are pacing up in the low- to mid-single-digit percentages into the end of the year, he said.
Revenue growth affirmed
Management affirmed its projection of revenue growth in the mid-single-digit percentages and earnings per share growth in the mid-teens.
Momentum is building for 2003, with signs of advertising recovery, Mr. Redstone said. Mr. Karmazin noted Viacom has sold 75% to 80% of its cable and network ad inventory for the first nine months of the season and no material options are being exercised. Additionally, Mr. Karmazin said, the local TV stations will benefit in the next year from easier comparisons to the first quarter of 2002, when they lost audience due to the Olympic Games broadcast on General Electric Co.'s NBC.