BENGALURU:  Viacom Inc. reported three per cent increase in its Media Network revenue to $2452 million in the quarter ended 31 March, 2015 (Q2-2015, current quarter) from the $2375 million reported for the corresponding year ago quarter. The $77 million increase was more than offset by a two per cent negative impact of foreign exchange (forex) and a 21 per cent decline in revenue to $659 million in Q2-2015 from  831 million in Q2-2014. Overall, the company’s revenue in Q2-2015 declined three per cent to $3078 million as compared to the $3174 million reported for Q2-2014.

The company reported a six per cent lower adjusted operating income (excluding restructuring and programming charges) of $822 million in the current quarter as compared to the $872 million in Q2-2014. Factoring in restructuring and programming charges of $784 million, the company’s adjusted operating income for Q2-2015 was just $38 million. 

The company reported a loss attributable to Viacom of $210 million in Q2-2015 as compared to a profit of $502 billion in Q2-2015.

Viacom executive chairman Sumner M. Redstone said, “Viacom's outstanding brands deliver great entertainment content on every screen, from film to television, mobile and beyond. We have the global footprint and the expert leadership to continue our success.”

Viacom president and chief executive office Philippe Dauman added, “We are deeply committed to investing in more and more original content, expanding in international growth markets, where we are launching networks at a rapid pace, and adapting to changes in technology and consumer behavior. In the quarter, Viacom's Media Networks delivered higher advertising and affiliate revenues, and new hits like Lip Sync Battle set the stage for even more exciting, original programming across our networks. Paramount Pictures also continues to be a proven hit maker. The SpongeBob Movie: Sponge Out of Water was the first title from our brand new Paramount Animation division and a box office success around the world, and we look forward to the releases of Terminator Genisys and Mission: Impossible - Rogue Nation this summer.

“With our strategic realignment largely complete, Viacom is in excellent position to take full advantage of the many opportunities in the rapidly evolving media environment. The $175 million in savings to be achieved in fiscal 2015 and substantial ongoing annual benefit will allow us to move efficiently through the second half of the year and beyond,” added Dauman.

During the six month period ended 31 March, 2015 (6M-2015), Viacom revenue improved slightly by 0.8 per cent to $6422 million from $6371 million in 6M-2014. Comprehensible Income attributable to Viacom for 6M-2015 was $169 million, which was less than a sixth (1/6.4 times) the $1082 reported for 6M-2014.

Media Networks

Media Networks revenues increased $77 million, or three per cent, due to higher advertising revenues in Q2-2015, driven by the acquisition of Channel 5 Broadcast Limited in September 2014, and affiliate fees, partially offset by the impact of foreign exchange. Excluding an unfavourable four per cent and two per cent impact of foreign exchange, Filmed Entertainment revenues declined 17 per cent and Media Networks revenues increased five per cent, informs Viacom.

Media Networks adjusted operating income declined $46 million, reflecting an increase in programming and promotional expenses, partially offset by higher revenues. 

Within Media Networks, advertisement revenues increased four per cent in Q2-2015 to $1172 million from $1124 million in Q2-2014, Affiliate fees improve three per cent to $1146 million in Q2-2015 from $1114 million in Q2-2014, while Ancillary revenue reduced three per cent to $134 million from $137 million in the corresponding year ago quarter.

Filmed Entertainment

The company says that lower Filmed Entertainment segment revenue was because of lower license fees and home entertainment revenues. Filmed Entertainment adjusted operating income declined $10 million due to the number and mix of available titles in the television licensing windows.

Within Filmed Entertainment, Theatrical revenues went down $24 million or 10 per cent to $205 million in Q2-2015, on the back of lower mix of prior period releases and 35 per cent lower international theatrical revenues. The Sponge Bob Movie: Sponge out of water and Selma helped spike revenues up by $41 million. Worldwide home entertainment revenues decreased $63 million, or 25 per cent, to $194 million in the quarter. Revenues from current quarter titles decreased $32 million driven by the mix of releases. Domestic home entertainment revenues decreased 16 per cent and international home entertainment revenues decreased 35 per cent. Foreign exchange had a seven percentage point unfavourable impact on international home entertainment revenues.