CBS Reports 31 Percent Rise in Profit to $370 Million
Chief executive Les Moonves predicts big ad bucks over the next 12 months due to a "not very pleasant" political campaign and Super Bowl commercials that could sell for $4 million a spot in 2013.
CBS reported a 31 percent fourth-quarter rise in net income to $370 million compared with $283 million a year ago, though revenue dropped 3 percent to $3.8 billion.
The company said the revenue fall was due to tough comparisons, given that last year's fourth quarter included a significant second-cycle syndication sale of CSI: Crime Scene Investigation and much more political advertising.
Net income from continuing operations rose 26 percent to $356 million, or 53 cents per share, up from 41 cents a share a year ago.
For the year, CBS recorded net earnings of $1.3 billion, up from $724 million in 2010. Revenue for the year was $14.25 billion, up from $14.06 billion.
"2011 was a record year for CBS, and we're confident 2012 will be even better," said CEO Leslie Moonves.
During a conference call with analysts, Moonves -- called a "genius" by Sumner Redstone on multiple occasions -- predicted that, while the upcoming presidential election won't be very pleasant for the candidates, the commercials they buy will be great for CBS.
"We're looking forward to a lot of nastiness on both sides," Moonves said.
Moonves said about $2 billion will be spent on political advertising between now and the general election in November and CBS, between its TV and radio assets, should capture up to 10 percent of that, or $200 million.
Moonves also predicted that next year's Super Bowl that will air on CBS could command $4 million per ad spot.
Moonves also said CBS is talking to Netflix about producing an original show to stream for its subscribers. Until 20 percent of what Netflix streams is original content, CBS will not treat it as a competitor, just another customer, he said.
He also noted that The Big Bang Theory often beats American Idol in the ratings, though he referred to Fox's hit show as a "talent show" that airs on "another network."
CBS boasts 14 of the Top 20 shows and six of the Top 7 comedies, Moonves said.
Nevertheless, investors weren't pleased with the dip in revenue and the stock was falling 3 percent in after-hours trading after dropping 1 percent during the regular session to $29.57.