ViacomCBS has updated its fiscal outlook for the year in a filing to the US Securities and Exchange Commission on March 26, stating it expects the impacts of COVID-19 — from the postponement of theatrical releases to production delays — to be “material” to the newly merged company’s financial standing. It's currently unknown whether the theatrical release of the new SpongeBob SquarePants film The SpongeBob Movie: Sponge on the Run will be delayed.
The “magnitude” of the impacts will depend on the duration and extent of the pandemic, ViacomCBS reported in its filing, in addition to the “impact of federal, state, local and foreign governmental actions and consumer behavior.”
“Due to the evolving and uncertain nature of this situation, we are not able to estimate the full extent of the negative impact on ViacomCBS’ operating results, cash flow and financial position — including advertising and filmed entertainment revenues– particularly over the near to medium term,” the company stated.
As of March 26, it has not drawn from its US$3.5 billion revolving credit facility.
ViacomCBS reports increased viewership across its broadcast and cable properties, and is “utilizing its deep library of content to mitigate in part the impact of those delays.”
The media conglomerate is also working proactively to offset a portion of anticipated revenue losses through “cost-saving initiatives,” though it did not elaborate on what form those measures may take.
It still expects to achieve US$750 million of “full run-rate merger related cost synergies” over the next three years, in addition to garnering around 16 million domestic streaming subscribers in pay and approximately 30 million monthly active users on Pluto TV in 2020.
This statement comes as Nickelodeon tries to capture on an increased linear viewership audience. The kidcaster launched its preschool Noggin SVOD service on Apple TV in more than 25 territories with a free seven-day trial.
It also launched the new “#KidsTogether” campaign to help children stay healthy and active while they are out of school. As part of the campaign, Nickelodeon is rolling out shot-form digital and linear content featuring the network’s brands teaching kids about social distancing and hand washing.
Taking that initiative even further, today Nickelodeon announced it’s premiering a new hour-long special on March 30 dubbed #KidsTogether: The Nickelodeon Town Hall. Hosted by Kristen Bell (The Good Place, Frozen 2), the TV event will include a performance by Alicia Keys and appearances by Charli D’Amelio, Josh Gad, Kel Mitchell, Kenan Thompson and Ciara Wilson. The special will address kids’ questions and concerns with tips from medical experts including Dr. Nadine Burke Harris (California Surgeon General) and Dr. Vivek H. Murthy (former US Surgeon General).
It will be simulcast across Nickelodeon, TeenNick and Nicktoons, as well as be made available on Nick On Demand, Nickelodeon YouTube, the Nick App and the Nick Pluto TV channel following the on-air premiere. It will also premiere on Nick’s international channels.
Below is ViacomCBS's statement in full:
ViacomCBS Statement on COVID-19
On March 26, 2020, ViacomCBS filed a Form 8-K with the following statement that updates the company’s 2020 outlook in light of global concerns about the coronavirus disease 2019 (COVID-19).
2020 Outlook
Global concerns about the coronavirus disease 2019 (“COVID-19”) have impacted the macroeconomic environment, as well as ViacomCBS Inc.’s (“ViacomCBS” or the “Company”) business. As a result of COVID-19 and measures to prevent its spread, ViacomCBS is withdrawing its previous guidance as to its 2020 financial results. While ViacomCBS has experienced production delays, the Company has seen increased viewership across its broadcast and cable properties, and is utilizing its deep library of content to mitigate in part the impact of those delays. The Company is also working proactively to offset a portion of anticipated revenue losses through costsavings initiatives.
ViacomCBS is reaffirming its expectation to achieve $750 million of full run-rate merger-related cost synergies over the next three years. The Company is also reaffirming its expectation to have approximately 16 million domestic streaming subscribers in pay and approximately 30 million monthly active users on Pluto TV as it exits 2020. The Company this week has also announced multi-year agreements to renew CBS affiliations with local stations across the country.
Still, the impact of COVID-19 on ViacomCBS’ businesses – including the postponement of theatrical releases domestically and internationally, cancellation or rescheduling of sports events for which the Company had broadcast rights, and production delays in television and filmed entertainment programming – could be material to the Company’s operating results, cash flows and financial position. The magnitude of the impacts will depend on the duration and extent of the COVID-19 pandemic and the impact of federal, state, local and foreign governmental actions and consumer behavior in response to the pandemic and such governmental actions. Due to the evolving and uncertain nature of this situation, we are not able to estimate the full extent of the negative impact on ViacomCBS’ operating results, cash flows and financial position – including advertising and filmed entertainment revenues – particularly over the near to medium term.
Liquidity
As previously disclosed in Note 8 “Debt” to the consolidated financial statements in ViacomCBS’ Annual Report on Form 10-K for the year ended December 31, 2019, ViacomCBS has access to a committed $3.5 billion revolving credit facility with a maturity in January 2025 which is available for general corporate purposes and to support commercial paper outstanding, if any. As of December 31, 2019, the Company had no outstanding borrowings under the revolving credit facility, $699 million of commercial paper outstanding, and $632 million of cash on its balance sheet. As of March 26, 2020, the Company has not drawn on its revolving credit facility and has approximately $932 million of short-term indebtedness, including $732 million of commercial paper outstanding and $200 million of short-term bank borrowings. The Company has upcoming corporate debt maturities in the next 12 months of $300 million in February 2021 and $500 million in March 2021.
Cautionary Statement Concerning Forward-Looking Statements
This communication contains both historical and forward-looking statements. All statements that are not statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements reflect the Company’s current expectations concerning future results, objectives, plans and goals, and involve known and unknown risks, uncertainties and other factors that are difficult to predict and which may cause future results, performance or achievements to differ. These risks, uncertainties and other factors are discussed in the risk factors disclosed in the Company’s Annual Report on Form 10-K filed with the SEC on February 20, 2020 and also include the impacts of the COVID-19 pandemic, as noted in this communication. Other risks may be described in the Company’s news releases and filings with the SEC, including but not limited to the Company’s reports on Form 10-Q and Form 8-K. The forward-looking statements included in this communication are made only as of the date of this communication, and the Company does not have any obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances.
About ViacomCBS
ViacomCBS (NASDAQ: VIAC; VIACA) is a leading global media and entertainment company that creates premium content and experiences for audiences worldwide. Driven by iconic consumer brands, its portfolio includes CBS, Showtime Networks, Paramount Pictures, Nickelodeon, MTV, Comedy Central, BET, CBS All Access, Pluto TV and Simon & Schuster, among others. The company delivers the largest share of the U.S. television audience and boasts one of the industry’s most important and extensive libraries of TV and film titles. In addition to offering innovative streaming services and digital video products, ViacomCBS provides powerful capabilities in production, distribution and advertising solutions for partners on five continents.
For more information about ViacomCBS, please visit www.viacbs.com and follow @ViacomCBS on social platforms.
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From The Hollywood Reporter:
ViacomCBS Raises $2.5 Billion in New Debt Amid Virus Crisis
The studio is picking up fresh cash after reporting the new coronavirus pandemic could have a "material" impact on its financial results.
ViacomCBS on Friday said it has raised $2.5 billion with an eye to reducing its debt obligations.
The Hollywood studio, led by CEO Bob Bakish, is the latest entertainment industry company to raise fresh cash amid the fallout from the coronavirus crisis. ViacomCBS said it agreed to sell $1.25 billion in 4.750 percent senior notes due 2025, and another $1.25 billion in 4.950 percent senior notes due 2031.
The studio added it aimed to use the net proceeds from the new debt offering "for general corporate purposes, which may include repayment of outstanding indebtedness."
ViacomCBS earlier on Friday said the new coronavirus pandemic could have a "material" impact on its results, withdrew its 2020 financial guidance and said it was planning "cost savings initiatives" to offset some of the expected revenue losses.
"Global concerns about the coronavirus disease 2019 have impacted the macroeconomic environment, as well as ViacomCBS Inc.’s business," ViacomCBS said its statement.
"While ViacomCBS has experienced production delays, the company has seen increased viewership across its broadcast and cable properties, and is utilizing its deep library of content to mitigate in part the impact of those delays," the studio added.
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More Nick: Nickelodeon Launches #KidsTogether--A Global Prosocial Initiative to Help Kids and Families Stay Informed and Engaged With Activities; Noggin to be Offered Free to Kids in Need in Partnership with National Head Start Association and First Book
Original source: Kidscreen.
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