Canada's Corus Entertainment Doubles Third Quarter Earnings
Despite a slight revenue fall, the Canadian broadcaster fed its bottom line with a one-time gain from the sale of a non-controlling stake in Food Network Canada.
TORONTO -- Corus Entertainment doubled its third-quarter earnings after selling a non-controlling stake in Food Network Canada on Thursday.
But the Canadian broadcaster also gave a warning on its full-year profit guidance, as overall revenue was down on soft radio advertising and sharply lower kids' merchandising and distribution business.
“The third quarter was challenging on a number of fronts -- most notably, advertising softness in radio continued and our merchandising, production and distribution businesses faced tough year‐over‐year comparatives,” Corus president and CEO John Cassaday said in a statement that accompanied his latest financial results.
Those included earnings for the three months to May 31 coming in at $91.5 million, against a year-earlier profit of $45 million, on Q3 revenue coming in at $200.06 million, compared to $204 million in the same period of 2012.
The earnings jump during the latest quarter was down to a one-time gain of $55.4 million from the sale of a minority stake in Food Network Canada to parent Shaw Communications, as part of an overall deal where Corus assumed full ownership of ABC Spark Canada.
Cassaday warned that despite higher earnings in Q3, expectations “for a stronger back half have not materialized."
As a result, Corus said it will miss the lower end of its segment profit guidance.
The revision was down in part to the weaker radio business and international sales of Nelvana product being shifted into the first half of the next fiscal year.
In addition, sales of the Beyblade toy line are tapering off.
Elsewhere Thursday, Montreal-based cable and media giant Cogeco posted static third-quarter earnings, even as overall revenue soared.
The profit for the three months to May 31 was virtually unchanged at $53.3 million, compared to $53.2 million in 2012, on total revenue up 45 percent to $464.4 million.
Cogeco’s cable division entered the U.S. market last summer by acquiring Atlantic Broadband for $1.36 billion.