[opendtv] News: CBS Q4 Profits Fall 52%; Cuts Dividend To 5 Cents

Burried in the 4th paragraph of this story:
CBS reported full year losses of $11.6 billion, after taking a write-down of $14 billion on the declining value of its assets. 

And a bright spot...

Check out the last paragraph.

Regards
Craig



http://www.broadcastingcable.com/article/174459-CBS_Q4_Profits_Fall_52_Cuts_Dividend_To_5_Cents.php?nid=2228&source=title&rid=5250536

CBS Q4 Profits Fall 52%; Cuts Dividend To 5 Cents
Exposure to ad market hurts CBS businesses
By Claire Atkinson -- Broadcasting & Cable, 2/18/2009 3:57:39 PM MT
CBS Corporation showed some of the worst scars of the faltering economy, reporting a loss of $11.6 billion for the year and a 52% drop in net income. Two thirds of the company's revenue is derived from advertising.
Hurt by local advertiser pull backs in radio and outdoor and a challenged national TV ad market, CBS Corp. said operating income at the television segment was down 40% in the fourth quarter, at $272.2 million down from $450.5 million in the year previous and for the full year down 14% to $1.5 billion in 2008. CBS had broadcast the Super Bowl in the year previous. TV segment revenue was down 8% for the fourth quarter at $2.2 billion and down one percent for the full year at $8.99 billion.
According to an earnings statement, the company saw a 13% decline in TV advertising revenue for the full year. But the TV segment wasn't the worst performer in the CBS stable, the company's outdoor unit saw operating income down 75% and radio down 56% in the fourth quarter.
CBS Corp. which encompasses businesses including publisher Simon & Schuster, said it would cut its dividend by 80% to pay shareholders 5 cents per share beginning April down from 27 cents. Revenue dropped 6% to $3.53 billion for the quarter over the year ago period and stood at $13.9 billion for the full year. CBS reported full year losses of $11.6 billion, after taking a write-down of $14 billion on the declining value of its assets. Net earnings were $136 million for the fourth quarter.
Speaking on an earnings call this afternoon, CEO Leslie Moonves, emphasized the non-advertising supported businesses which include Showtime and the company's syndication slate. "It is a very difficult time to forecast the impact of the economy. We have five series hitting in the second half of 2009 and we expect it will be stronger than the first half even if the economy doesn't improve."
Moonves declined be specific about the extent of the second quarter option taking at CBS, saying: "Options in the second quarter are fairly normal. Certain categories are lower. We're feeling fairly good." CBS programming is performing well across the board leading Moonves to say, "We're looking forward to the upfront because we have quiet a story to tell."
Ironically, CBS ratings success may be something of a burden. CBS doesn't have make-goods and its high ratings give its sales team many more ratings points to sell than its competitors. In some instances scarcity of ad inventory creates higher pricing. Analysts have noted that the network may have difficulty selling all those additional eyeballs in a down ad market. Also, CBS traditionally holds back more inventory for the year round scatter market, rather than selling it upfront, banking on its strong programming slate to bring in usually higher scatter pricing.
Separately, CBS's TV.com lost programming from its partner Hulu.com which pulled its TV programming from CBS Website, TV.com. The issue did not come up on the earnings call, but Moonves praised TV.com and said it had added thousands of videos and was delivering five times the number of a streams as last year. "TV.com is clearly going to be a very, very big play in what is clearly a fast growing market." The CBS Interactive unit saw a jump in revenue for the fourth quarter to $186 million reflecting the acquisition of CNET along with higher mobile revenue and higher ad sales. 


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