NBCUniversal Second-Quarter Earnings Rise

NBCUniversal CEO Steve Burke

UPDATED: The entertainment arm of cable giant Comcast, led by CEO Steve Burke, benefited from better broadcast TV results as the film unit posted lower revenue but higher profitability.

Cable giant Comcast on Tuesday reported improved second-quarter financials for its entertainment arm NBCUniversal. 

The entertainment company, led by CEO Steve Burke, reported higher operating cash flow and revenue than in the same period last year amid improved profitability in all business units. 

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Among the company's operations, its broadcast TV unit reported better results thanks to stronger ratings, while the film unit posted higher operating cash flow despite lower revenue. 

Comcast, led by chairman and CEO Brian Roberts, earlier this year agreed to acquire Time Warner Cable in a $45 billion deal. Management said it remains "excited" about the deal and estimated that a shareholder vote would happen in the fall while regulators go through their review. 

NBCUniversal's operating cash flow jumped 20.4 percent to $1.43 billion despite a climb of only 0.3 percent in revenue to $6.02 billion.

Broadcast TV unit revenue increased 4.9 percent to $1.80 billion despite a 1.8 percent drop in advertising revenue. The company cited fewer hours of hit show The Voice on this year's schedule in the second quarter compared with the same period in 2013. But broadcast operating cash flow jumped 16.2 percent to $240 million.

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The cable networks division reported a 2.6 percent revenue gain to $2.48 billion as ad sales declined 2.2 percent, but content licensing and distribution revenue improved. Operating cash flow rose 6.3 percent to $914 million amid cost discipline.

Film unit revenue fell 15.3 percent, but operating cash flow rose by $162 million to $195 million. The company explained the results by pointing to "lower theatrical revenue from fewer releases in the second quarter compared to the same period last year, partially offset by higher content licensing revenue, as well as higher home entertainment revenue from the strong performances of Ride Along and Lone Survivor." Operating cash flow also benefited from a decrease in the amortization of film costs and reduced advertising, marketing and promotion expense due to the smaller film slate.

The year-ago period unit result was boosted by the theatrical run of Fast and Furious 6 and Despicable Me 2

Theme park revenue rose 12.8 percent to $615 million amid higher attendance and per-capita spending, with operating cash flow climbing 5.6 percent to $244 million.

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In the seasonally weak second quarter, cable customer relationships decreased by 25,000 to 26.8 million, a 62 percent improvement compared with a decline of 66,000 during the second quarter of 2013. The company lost 144,000 video subscribers to end June with 22.46 million, compared with a loss of 162,000 in the year-ago period.

"Video customer net losses improved year-over-year and were also the best result for a second quarter in six years," Comcast said. The company had added video subscribers in the previous two quarters. 

Said Roberts: "We continue to see strong momentum across our cable and content businesses." 

He added: "NBCUniversal had another excellent quarter with double-digit operating cash flow growth driven by solid results in each segment and a first-place finish for NBC for the 2013-2014 broadcast television season."

Email: Georg.Szalai@THR.com
Twitter: @georgszalai