New Starz CEO Albrecht discusses plans

Future of Overture FIlms being evaluated

NEW YORK -- John Malone's Liberty Media on Thursday reported mixed fourth-quarter financials for key holdings Starz Entertainment and QVC and said it continues to evaluate the future of Overture Films.

"We recognize that Overture Films continues to face significant challenges, and we are currently evaluating strategic alternatives for Overture," said new Starz LLC president and CEO Chris Albrecht. "While no final decisions have been made, we do not expect it to incur annual operating losses in the future of the same magnitude that it has experienced in recent years."

The Liberty Capital Group that houses Overture parent Starz Media posted an adjusted operating loss before depreciation and amortization of $76 million for the fourth quarter and $175 million for the full year 2009. Revenue rose 18% and 6%, respectively.

On a conference call with analysts, Starz management confirmed that it has decided not to continue series "Crash" due to its weaker-than-hoped performance.

Albrecht told the call that his goal is to spend money on new original content, while at the same time improving bottom line results. One key strategy here will be the use of "innovative" financing approaches that allow the firm to retain certain non-Starz distribution rights, he said.

Asked to explain his approach to original content, he said it must provide value, attitude and differentiation to a pay network to make it stand out from competitors rather than simply ratings.

"We plan to have a year-long presence in original programming," Albrecht said, adding his team is currently working on coming up with "a cohesive brand" for the content strategy.

Starz management also said Thursday it is in active talks with Disney over a renewal of an exclusive film output deal at terms that are close to the current deal.

Liberty's Liberty Starz Group posted adjusted operating income before depreciation and amortization of $74 million, down 2% from the year-ago period due to higher marketing and production costs at Starz Entertainment for series "Spartacus: Blood and Sand" and "Crash." Quarterly revenue rose 6% to $304 million.

For the full year 2009, adjusted OIBDA at Liberty Starz rose 29%, and revenue grew 7%. Albrecht lauded the 2009 results as "strong."

Finally, Liberty Interactive posted an adjusted OIBDA gain of 29% to $556 million in the fourth quarter, leaving 2009 up 6%. Revenue rose 14% and 3%, respectively.

The business' crown jewel, home shopping network QVC, saw adjusted OIBDA grow 27% in the fourth quarter and 4% for the year. Revenue rose 14% and 1%, respectively.
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