Photo: Nick Nolte in HBO's "Luck." Credit: HBO.
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Some bad luck. Time Warner released its first-quarter results early Wednesday morning. Advertising gains and high subscription fees for its cable networks resulted in better-than-anticipated numbers. However, write-downs for the canceled HBO series "Luck" and the closing of a network in India hurt the bottom line. A quick take on the numbers from Reuters.
The cancellation of HBO's "Luck" and the closing of a TV channel in India put a damper on an otherwise solid first quarter for media giant Time Warner Inc.
Time Warner reported a profit of $583 million for the quarter ending March 31, compared with $653 million for the same period in 2011, an 11% drop. Revenue was up 4% to $7 billion.
“We’re off to a great start to the year, and we’re benefiting from strong momentum for our content across our businesses," said Time Warner Chief Executive Jeff Bewkes.
Much of the revenue gain can be attributed to stronger subscription fees and ad revenue at the Turner networks, including TNT and TBS. The company said revenue at its cable networks was $3.6 billion, a 3% jump. Ad revenue was up 6% thanks to commercial dollars from the NCAA basketball tournament which was carried on TNT, TBS and TruTV.
However, programming costs for Time Warner's networks unit rose 6% in part because of the rights fees for the NCAA tournament. The company also took at $35 million write-down for "Luck," the low-rated HBO series about horse racing that was cancelled in the midst of its first season after several horses died during production.
Operating income in the networks unit dropped 2% to $1.1 billion. Time Warner said those results included a charge of $58 million related to Turner's decision to close its entertainment channel in India.
Revenue at Warner Bros. jumped 7% to $2.8 billion thanks to the strong performance of "Sherlock Holmes: A Game of Shadows" and higher fees for selling TV shows.
The Skinny: I felt like an extra in "The Walking Dead" trying to get out of the Hollywood Bowl after the Coldplay concert. Good show, but at a $170 a ticket, they could have played a little longer. Wednesday's headlines include Time Warner's results, analysis of News Corp.'s problems in Britain and a fire at Tyler Perry's Atlanta production facility.
Daily Dose: If you are a New Yorker and are wondering why the Empire State Building is lighted up blue Wednesday night, it's not for the Mets. It is a tip of the hat to the Weather Channel, which is celebrating its 30th anniversary. Just don't tell me it's raining anymore.
Photo: Comcast Cable company trucks in Southern California / Credit: Bob Chamberlin / Los Angeles Times.
NBC/Universal may be disappointing but Comcast revenue up due to core cable market. Comcast Corp.'s earnings jumped nearly 30% in its first quarter as more customers signed up for high-speed Internet service. But the cable Goliath also showed strength in some an unexpected quarters: the long-lagging NBC broadcast unit and Universal Pictures, which released two hit movies, including "The Lorax."
For the quarter ended March 31, the Philadelphia-based company said its net income grew to $1.22 billion, or 45 cents per share, from $943 million, or 34 cents per share, from the year-earlier period.
Comcast generated consolidated revenue of $14.88 billion -- an increase of 23%.
"I'm really pleased with our start in 2012," Comcast Chief Executive Brian Roberts said in a Wednesday morning conference call with analysts. "Cable had another outstanding quarter.... We are starting to make some progress in broadcast."
NBCUniversal revenue was up 18% to $5.5 billion, in large part because the NBC broadcast network raked in $259 million in Super Bowl advertising revenue. (Excluding the Super Bowl, revenue at NBCUniversal was up 12.4%).
Roberts reminded analysts that NBCUniversal results would be volatile because of the hit-and-miss nature of movie box office and higher television programming costs. Comcast has been spending more on programming to try to lift the peacock network to profitability.
Operating cash flow at NBCUniversal was up 34.3% to $813 million compared to the first quarter of 2011. In terms of revenue, NBCUniversal cable networks generated $2.1 billion in revenue versus $2 billion in the year-earlier period. The NBC broadcast unit pulled in $1.85 billion in revenue (including the Super Bowl) compared to $1.35 billion in the year-earlier period. Film entertainment revenue swelled to $1.19 billion from $975 million in 2011. Theme parks generated $412 million, up from $390 million.
However, the company's operating cash flow margins were lower at cable networks due to higher programming and production costs, including those for NBA basketball. The broadcast unit posted an operating cash flow loss of $10 million, reflecting higher programming costs and higher marketing expenses to support the launch of mid-season shows, including "Smash."
"We're starting to make some progress but there is a long way to go," NBCUniversal Chief Executive Steve Burke told analysts. "And in film, we have a much stronger slate this year." Among Universal's upcoming film titles are the big budget action film "Battleship," the dark fairy tale "Snow White and the Huntsman," and a new iteration of the successful "Bourne" series.
Comcast is the nation's largest cable television and high-speed Internet provider. It holds a 51% controlling interest in NBCUniversal.
Good start. Comcast Corp., the nation's largest cable operator and parent of NBCUniversal, released its first-quarter results and said profits were up 30%. NBC's coverage of the Super Bowl meant big advertising gains for the network. Next up: The Summer Olympics from London. Early analysis from the Philadelphia Inquirer.
Photo: Firefighters at Tyler Perry's studio. Credit: Curtis Compton / Associated Press
Burning questions. Investigators are trying to figure out what caused a major fire at film and TV mogul Tyler Perry's Atlanta production facility. The fire, which damaged one building on the vast complex, started late Tuesday night. More from the Atlanta Journal-Constitution.
London's calling. The Parliament report on the ethics scandal at News Corp.-owned British newspapers dealt a devastating blow to the media giant and its leader Rupert Murdoch. Not only did the report accuse News Corp. executives of misleading investigators and lawmakers, it said Murdoch was unfit to lead the company. While News Corp. acknowledged and apologized for the ethical lapses, the company also took issue with some of the political overtones of the report. Meanwhile, analysts tried to figure out if the report was the beginning of the end of News Corp. or just a blip at a small unit of the giant company. Coverage from the Los Angeles Times, New York Times, News Corp.'s Wall Street Journal and the Guardian.
Photo: Media magnate Rupert Murdoch and son James attend a horse race in Britain in March 2010. Credit: Adrian Dennis / AFP/Getty Images
Battle for Newscorp to keep BSkyB liscence begins. British Sky Broadcasting insisted Wednesday that it remains a "fit and proper" holder of a broadcasting license in Britain, despite a damning parliamentary report on media baron Rupert Murdoch, whose News Corp. owns a controlling stake in the company.
In an earnings report, the lucrative satellite television service said it was cooperating with British regulator Ofcom as part of the agency's evaluation of whether BSkyB remains a suitable holder of a broadcasting license.
The company said its "positive contribution to U.K. audiences, employment and the broader economy, as well as its strong record of regulatory compliance and high standards of governance" qualified it to maintain its license.
The statement came a day after an excoriating report by a parliamentary committee branded Murdoch as "not fit" to run a major international company. The report accused three senior News Corp. executives of lying to the panel during its investigation into phone hacking by the News of the World.
Murdoch shut down the tabloid last summer at the height of public outrage over phone hacking, which now appears to have been common practice at the paper. The furor also forced Murdoch to abandon his bid to buy the 61% of BSkyB that News Corp. does not already own.
The head of BSkyB sought to put some distance between his company and Murdoch's on Wednesday.
"It's important to remember that Sky and News Corp. are separate companies," Chief Executive Jeremy Darroch told reporters. "We believe that Sky's track record as a broadcaster is the most important factor in determining our fitness to hold a license. And the evidence shows that Sky serves U.K. audiences and customers well."
BSkyB reported a 5% rise in revenue over the last nine months, compared with same period a year earlier. Its adjusted operating profit during that period exceeded $1.4 billion, a 15% increase.
"Get the Gringo," will be released directly to satellite broadcaster DirecTV at a price of $9.99. After a pay-per-view run on DirecTV, the movie will head to the DVD shelf. Details from Bloomberg.
TV Guide notes, a lot has to go right for Netflix in talks with CBS, the cast and producers in order to get new episodes of such an old series made. Hey, I still watch my DVDs of the great ABC series "The Job" starring Denis Leary. How about bringing that back next?
Inside the Los Angeles Times: The Academy Awards are staying in Hollywood. TV critic Mary McNamara looks at the growing popularity of the rhymes-with-witch word on television.
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