Film revenues increase 64 percent but profit margins fall
Box office hits like "Star Trek Into Darkness" and stronger ratings at Nickelodeon helped Viacom beat Wall Street projections on Friday, when the company posted stronger than expected third quarter results.
The media conglomerate saw revenues increase 14 percent during the three-month period ending in June to $3.69 billion. Analysts had anticipated revenues to increase to $3.6 billion.
Earnings at the company were also in keeping with predictions, with Viacom posting a 20.4 percent increase in profits of $643 million or $1.29 a share.
In addition, the company announced that its board of directors has approved a plan to double its share repurchasing program to $20 billion.
Viacom, which also owns cable channels like VH1 and Comedy Central, has been bruised by declines in viewers at its kids network Nickelodeon. However, it has worked aggressively to revitalize programing at the channel and ratings have begun to climb back up. That was reflected in a 6 percent increase in domestic advertising revenue and a 5 percent jump in worldwide advertising revenue for the quarter.
The company's filmed entertainment division released more films during the quarter than they had the previous year, with such titles as "World War Z" and "Pain & Gain" hitting multiplexes. That higher volume contributed to a 64 percent increase in theatrical revenues to $464 million.
The film division did see profit margins shrink by 63 percent to $17 million, with the company citing higher operating expenses as the culprit.
In addition, worldwide home entertainment revenues declined 10 percent for the quarter.