NBCUniversal Posts Higher First-Quarter Operating Cash Flow
Comcast on Wednesday reported higher first-quarter operating cash flow for entertainment arm NBCUniversal, even though the company's broadcast business posted weaker results in part due to the year-ago broadcast of the Super Bowl on NBC.
The entertainment giant, led by CEO Steve Burke, had operating cash flow of $953 million in the opening quarter of 2013. That was up 17 percent from the $813 million in the year-ago period. Its quarterly revenue came in at $5.34 billion, down 2.4 percent. But adjusting for last year's Super Bowl revenue of $259 million, revenue would have been up 2.4 percent.
Comcast, led by chairman and CEO Brian Roberts, recently acquired full control of NBCUniversal by buying out a 49 percent stake held by General Electric.
Comcast said its cable systems lost 60,000 video subscribers, more than the 37,000 losses recorded last year, to end March with 21.94 million video subscribers. Roberts said the company still plans to further narrow video sub losses as it had done in recent quarters. He also highlighted that the cable business brought in its highest video revenue growth in more than four years.
Comcast on Wednesday reported a first-quarter revenue gain of 2.9 percent, or 4.7 percent when excluding the year-ago Super Bowl benefit, to $15.3 billion. Earnings increased nearly 14 percent to $1.65 billion.
Roberts on Wednesday once again lauded the performance of NBCUniversal. "We completed the acquisition of NBCUniversal during the quarter and look forward to continuing to drive innovation and operational excellence to deliver superior entertainment and communications choices for consumers," he said in a release.
On an earnings call later, he said "we feel really good about the entire transaction" two years after Comcast first bought a majority stake in the entertainment firm. "We have a fantastic platform with a lot of different growth opportunities for many years to come."
Roberts lauded ratings gains at USA and Bravo and said that with Bonnie Hammer now overseeing all of the company's cable channels, NBCUniversal is "very enthusiastic" about their outlook.
Roberts also highlighted the success of Syfy series Defiance as the latest example for how Comcast and NBCUniversal reach cross-promotion benefits. Ratings in Comcast homes outperformed other TV distributors by 77 percent, he said.
NBCUniversal's first-quarter broadcast loss widened to $35 million from $14 million in the year-ago period on an 18.5 percent revenue drop to $1.5 billion. Excluding last year's Super Bowl, the decline would have amounted to 5.3 percent. The company cited “lower primetime ratings at the NBC broadcast network and lower content licensing revenue."
Cable networks unit revenue increased 4.6 percent, with operating cash flow up 6.2 percent. "Advertising revenue increased 2.5 percent, primarily reflecting price increases, offset by lower ratings, and content licensing and other revenue decreased 11.9 percent," the company said. On the cost side, continued investment in original programming was partially offset by lower sports programming costs compared to last year's first quarter.
Film unit revenue rose two percent driven by higher theatrical revenue due to the strong box-office performance of Les Miserables and the releases of Identity Thief and Mama, as well as higher content licensing revenue. Operating cash flow multiplied to $69 million compared to $6 million in the first quarter of 2012, thanks to the higher revenue and lower marketing expense due to fewer theatrical releases.