Univision Quarterly Revenue Rises 11.8%
The Spanish-language media company’s loss increased though amid a Televisa settlement and costs related to debt reduction.
NEW YORK - Spanish-language media giant Univision Communications on Thursday reported a bigger fourth-quarter loss amid debt extinguishment costs and a legal settlement with Mexican broadcaster Televisa, which recently struck a deal to become an investor in the company.
The company said its quarterly profit amounted to $631.9 million, compared with $174.6 million in the year-ago period. The latest result was dragged down by $452 million for a Televisa settlement and related charges, as well as $195.1 million in debt extinguishment losses. Revenue increased 11.8 percent to $576.7 million amid TV ratings and advertising momentum.
“The impact of Univision now having more exploitable content than ever before, both through our in-house efforts and from our expanded programming agreement with our most important partner, Televisa, cannot be underestimated - nor can the upcoming release of the 2010 U.S. Census results, which are sure to spell out the rapid growth and enormous influence of U.S. Hispanics,” said Univision president and CEO Joe Uva. “Both of these present tremendous growth opportunities for Univision, and with our enhanced financial flexibility, the Company is very well-positioned to more quickly realize its potential.”
He highlighted that the Univision network was the only major broadcast network to increase its audience in primetime among adults 18-34 and adults 18-49 during the fourth quarter compared with the year-ago period.
The company's full year 2010 revenue increased 13.8 percent to $2.25 billion. The 2010 FIFA World Cup contributed an estimated $109.5 million of incremental revenue with its incremental impact on operating income before depreciation and amortization being a positive $13.6 million.
On an earnings conference call, Uva predicted this year's upfront advertising market would be even stronger than last year's when Univision recorded 14 percent organic growth and the addition of 93 new brands. "We expect that this powerful momentum will only accelerate in 2011 as advertisers continue to recognize that reaching Hispanic consumers through Univision is the sure-fire conduit to meaningful growth in the current landscape," Uva said.
Meanwhile, radio continues to improve for the company. CFO Andrew Hobson said that the first quarter is trending flat to slightly down in radio, but he expects growth after that.
Discussing the expanded relationship with Televisa, Hobson said 2011 will see higher costs to start putting to use new Televisa content rights, but the relationship will make "very meaningful contributions" quickly, although not in its first year.
Uva mentioned sports and Televisa networks that aren't available in the U.S. so far as key opportunities for the expanded collaboration. "We have the opportunity through the Televisa relationship to look at some network...concepts where they had very successful pay networks that they distribute in Mexico and Latin America...that we will have the opportunity to look at and launch here," he said, mentioning a Televisa novela channel as one possibility.
Uva on Thursday also reiterated his company's goal to make Univision the top network in the U.S. within five years.