‘xXx’ Overseas Ticket Sales Boost Viacom Revenue Despite Weak Domestic Box Office

Television studio production licensing also helps parent company top second-quarter projections

Last Updated: May 4, 2017 @ 7:38 AM

Thank goodness for foreign countries — and giant accounting adjustments.

Viacom bested Wall Street’s benchmarks for the second-quarter of 2017, with the revenue win due in large part to the international performance of “xXx: Return of Xander Cage.” Paramount’s theatrical sales rose 10 percent over the quarter, but it truly was a tale of two territories. Domestically, they dropped 45 percent; overseas, they soared 98 percent.

As it turns out, licensing chipped in even more than Vin Diesel. That particular stream of revenue jumped 45 percent, mostly thanks to Paramount Television production. Home entertainment also had a nice three months, growing 29 percent from the comparable quarter’s sales last year.

The company’s media networkks didn’t really help or hurt. Overall revenue there was up 1 percent, with a slight uptick in affiliate revenue offsetting a small downturn in ad sales. Domestic advertising revenue was down 4 percent, but international commercial sales rose 11 percent. Perhaps Viacom should just move offshore.

Ultimately, Viacom reported adjusted earnings per share of 79 cents on $3.256 billion in revenue. Wall Street had forecast earnings per share (EPS) of 59 cents on $3.03 billion in revenue, per a Yahoo Finance compilation. Sans any adjustment, however, Viacom’s profit sunk 61 percent, due to a $280 million restructuring charge.

All told, the company’s adjusted EPS was 3 cents higher than it was in Q2 2016, and revenues leapt 8 percent. Overall, new(ish) boss Bob Bakish seems pretty pleased with the money coming in.

“In the second quarter, Viacom delivered continued top-line improvement, with growth in affiliate revenues, international media networks and across every business segment of Paramount Pictures,” the chairman and CEO said in prepared remarks. “Additionally, we executed quickly on our strategic plan, making significant organizational changes to better focus and align Viacom’s brand portfolio and ensure strong leadership, including the appointment of Jim Gianopulos to chart a new course at Paramount.”

“We are working diligently to cement Viacom as a partner of choice in the industry, presenting new and reinvigorated brand strategies for our advertisers, producing creative and flexible new opportunities with our distributors and recommitting ourselves to be the home for the world’s best talent,” he continued.

“Viacom also took significant steps forward on our plan to strengthen our balance sheet, improve our leverage profile and enhance liquidity. Since the end of our first fiscal quarter, we completed a successful hybrid debt offering, redeemed outstanding debt and executed on the sale of non-core assets, including the pending sale of our stake in EPIX,” Bakish concluded. “There is a lot of work still to do, but we are making important changes at Viacom, taking substantial strides towards revitalizing our portfolio of brands and returning the company to consistent top-line growth.”

Bakish and other top company executives will host a conference call at 8:30 a.m. ET to discuss the quarter in greater detail.

They’ll also probably have to address a tough Wednesday of Viacom stock trading: shares of VIAB closed down $3.20 per share yesterday — or minus 7.54 percent — hitting $39.36.

Last quarter, Viacom also did better than most media analysts had predicted — though the company’s profit dropped then. On the same day, new boss Bob Bakish laid out his five-point strategic plan for the Paramount Pictures parent company.