Discovery Q4 Profit, US Advertising Revenue Drop

Net Income decreased 13.5 percent from last year’s comparable three-month period

Last Updated: February 19, 2015 @ 7:04 AM

Discovery Communications, Inc. released fourth-quarter financials on Thursday morning before the U.S. stock markets opened, reporting diluted earnings per share of $0.38 on net income of $250 million. Revenue was $1.676 billion.

That profit number dropped 13.5 percent from 2013’s Q4, when net income was $289 million. The company attributed that primarily to higher restructuring costs and lower equity earnings.

Wall Street had forecasted Q4 2014 EPS of $0.41 on $1.7 billion in revenue, therefore, the media conglomerate missed analyst marks for the measured three-month period.

Despite falling below expectations, revenue rose from 2013’s comparable quarter, when Discovery reported $1.537 billion. Diluted EPS a year ago was $0.41.

U.S. advertising revenues declined three percent due to lowered ratings, though distribution sales rose enough to offset that.

On Wednesday, Discovery stock (DISCA) closed down at $30.80, from $31.25 per share.

“The healthy performance of our core business coupled with increasing contributions from our recent strategic acquisitions led to another year of solid operational and financial results and increasing capital returns in 2014,” said David Zaslav (pictured above), president and chief executive officer of Discovery Communications.

“Despite a more challenging U.S market and significant foreign currency headwinds, our content portfolio once again drove audience gains and boosted our market share around the world,” he continued. “As we move into 2015, we are confident that our long-term content investment strategy, strong global IP and brands, and local approach to markets will continue to drive our results and enable us to deliver additional value to shareholders.”

Discovery Communications houses Discovery Channel, TLC, Animal Planet, Science and Investigation Discovery, as well as U.S. joint venture networks OWN: Oprah Winfrey Network, The Hub and 3net, the first 24-hour 3D network.

Discovery hosted its Q4 and year-end investor call at 8:30 a.m. ET on Thursday.