Viacom Inc. (NASDAQ: VIAB, VIA), the parent company of the Nickelodeon brand, has today, Thursday 13th November 2014, reported record results for the fiscal year ended Tuesday 30th September 2014, driven by gains in its Media Networks segment! Results for the fourth quarter of 2014 reflected a 9% increase in revenues to $3.99 billion, adjusted net earnings from continuing operations attributable to Viacom of $729 million and adjusted diluted earnings per share of $1.71, an increase of 10%.
Revenues for the full fiscal year were $13.78 billion, substantially unchanged from the previous year, as higher Media Networks revenues were offset by lower Filmed Entertainment revenues. Full-year adjusted operating income grew 5% to a record $4.13 billion and adjusted net earnings from continuing operations attributable to Viacom rose 3% to $2.38 billion. Full-year adjusted diluted earnings per share from continuing operations increased 15% to an all-time high of $5.40.
Sumner M. Redstone, Executive Chairman of Viacom, said, "As we conclude another fiscal year, Viacom remains well-positioned as a creative leader with many of the world's most innovative media properties and best entertainment brands."
Philippe Dauman, President and Chief Executive Officer of Viacom, said, "Viacom's record financial results in 2014 demonstrate the strength of our brands and continuing momentum for our strategy of investing in creativity, with a relentless focus on growing demographic and geographic markets and embracing new distribution platforms. Our Media Networks achieved continued growth in the fourth quarter and the fiscal year. Viacom's affiliate distribution business remains a reliable engine for high-margin revenue expansion and provides significant opportunities to build new consumer experiences with long term distributors and emerging technology partners alike. Despite ratings challenges and uncertainty in the scatter advertising market at the close of the year, Viacom's advertising revenues grew in fiscal 2014, as our creative and marketing teams rolled out innovative new offerings. We also continue to take the lead in defining the next generation of measurement tools that will more fully capture the growing multiplatform engagement of our audiences. Our September acquisition of Channel 5 has already made a positive impact on our business, and points the way to further significant long-term growth of our international business. Paramount delivered the top movie of 2014 and the largest-ever theatrical release in China -
Transformers: Age of Extinction - and the studio successfully launched another long-term franchise with the
Teenage Mutant Ninja Turtles.
"This performance allowed us to continue the strong delivery of value directly to investors. Over the past five years, Viacom has returned $16.1 billion to shareholders."
Quarterly revenues increased 9% to $3.99 billion. Media Networks revenues grew 8% to $2.66 billion, principally due to growth in affiliate fees. Domestic and worldwide affiliate revenues increased 21% and 22%, respectively, primarily due to rate increases and higher revenues related to the timing of available programming from certain distribution agreements. Excluding the impact of these arrangements, the domestic affiliate revenue growth rate was in the high single digits. Domestic advertising revenues declined 5%, reflecting ratings challenges. Worldwide advertising revenues decreased 2%, reflecting the domestic decline partially offset by a 33% increase in international advertising revenues. International advertising revenues benefited from the acquisition of Channel 5 on September 10, 2014.
Filmed Entertainment revenues grew 12% to $1.36 billion, due to growth in theatrical revenues. Strong results from current quarter releases and the carryover performance of
Transformers: Age of Extinction drove Theatrical revenues up 226% to $557 million. Home entertainment revenues declined 38%, reflecting two fewer releases in the current quarter.
Full-year revenues were $13.78 billion, substantially flat compared to the prior fiscal year. Media Networks revenues rose 5% to $10.17 billion, reflecting a 10% increase in affiliate fees and a 2% gain in advertising revenues driven by higher international advertising revenues. Filmed Entertainment revenues decreased 13%, principally due to lower revenues across the distribution windows reflecting the number and mix of films.
Quarterly adjusted operating income was $1.21 billion, flat compared to the prior year. Media Networks adjusted operating income rose 5% due to higher affiliate revenues, partially offset by increased expenses. Filmed Entertainment adjusted operating income declined 27%, reflecting the contribution of Marvel distribution rights sales in the fourth quarter of 2013. Corporate expenses declined by 21%, due to lower deferred compensation costs.
Full-year adjusted operating income increased 5%, to $4.13 billion, a record for the company. Media Networks adjusted operating income increased $175 million, or 4%, driven by higher revenues partially offset by an increase in expenses. Filmed Entertainment adjusted operating income decreased $29 million, reflecting the contribution of Marvel distribution rights sales in the prior year. Corporate expenses decreased 10% in the period, primarily due to lower deferred compensation costs.
Quarterly adjusted net earnings from continuing operations attributable to Viacom were down slightly to $729 million, driven by an increase in interest expense. Adjusted diluted earnings per share from continuing operations for the quarter were $1.71, a 10% increase from the prior year's comparable quarter.
Full-year adjusted net earnings from continuing operations attributable to Viacom increased 3%, to $2.38 billion. The increase resulted from higher adjusted operating income, higher equity in net earnings of investee companies and a lower effective income tax rate, partially offset by an increase in interest expense and higher net earnings attributable to noncontrolling interests. Adjusted diluted earnings per share from continuing operations increased 15% to $5.40.
For the quarter ended September 30, 2014, Viacom repurchased 10.4 million shares under its stock repurchase program, for an aggregate purchase price of $850 million. As of November 12, 2014, Viacom had $6.24 billion remaining in its $20 billion stock repurchase program. As of September 30, 2014, Viacom had 414 million shares of common stock outstanding.
At September 30, 2014, total debt outstanding, including capital lease obligations, was $12.77 billion, compared with $11.89 billion at September 30, 2013. The Company's cash balances were $1 billion at September 30, 2014, a decrease from $2.4 billion at September 30, 2013.
You can read Viacom's press release announcing the company's earnings and growth during 4Q14 in full, including tables of Viacom's statements and balance sheets,
here on BusinessWire.com.
Also, below is Viacom's Q4 2014 Results Earnings Call Transcript, in which Viacom Management discusses the company's Q4 2014 Results and future plans for Nickelodeon, from
Seeking Alpha:
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