CBS Corp Posts 45.6 Percent Drop In Quarterly Profit
By Joyce C. Abaño
Mass media company, CBS Corporation, posted a 46.5 percent decrease in quarterly profit, hurt mainly by a one-time pension settlement charge in the fourth quarter of 2016.
CBS, owner of the most-watched US television network, reported a drop in net income to $271 million, or 63 cents per share, in the fourth quarter ending Dec. 31, compared to the $507 million from the prior corresponding period.
The company's revenues for the fourth quarter of 2016 fell to $3.52 billion compared to the $3.59 billion of the previous corresponding period. Affiliate and subscription fee revenues saw a 13-percent increase, led by growth in retransmission revenues, fees from CBS Television Network affiliated stations and digital distribution services.
Advertising revenues dropped three percent, which was affected by having three fewer "Thursday Night Football" games compared to the fourth quarter of 2015, and it was also hurt by the lower ratings from the broadcast of NFL games in the fourth quarter of 2016.
The company reported an operating income of $484 million for the fourth quarter of 2016, a decrease from the $770 million of the same period in 2015. Comparability was affected by the one-time pension settlement charge in the fourth quarter of 2016 and a gain from the sale of an internet business in China in the fourth quarter of 2015.
Leslie Moonves, chair and CEO of CBS Corp., stated in a media release 2016 was a phenomenal year for the company. "With all-time highs in revenue, operating income, and EPS that came in above $4 for the first time in our company's history, and as we begin 2017, I couldn't be more excited about our growth prospects in the years ahead."
Moonves said at the CBS Television Network, they are on track to be number one for the ninth year in a row and 14 out of the past 15 years.
CBS also recently announced a deal to split-off the company's radio business through a tax-free transaction with Entercon, which, when completed, Moonves said, will allow them to focus even more on their core content strength and enable their faster-growing revenue to drive results.
"Across the board, our strategy of creating the best content, and distributing it in all the ways consumers want it, continues to position CBS to succeed no matter how the world changes," Moonves added.