Quarterly revs up 23% as core holdings prosper

NEW YORK — Quarterly revenue at John Malone’s Liberty Media Corp. jumped 23% to $778 million with increases in all its major businesses, including Encore Media Group, Discovery Communications and QVC.

Liberty, which also holds stakes in a wide range of other media and telecom businesses, said cash flow for the second quarter ended in June rose 43% to $74 million. The Englewood, Colo., group hopes to authorize a stock buyback “prior to the end of the year and possibly sooner than that,” execs said during a conference call.

$4 bil in cash on hand

Liberty ended the quarter with a hefty $4.8 billion of cash on its books and $3.8 billion in debt. Factoring in the purchase of some News Corp. shares and other investments, cash on hand is about $4 billion. Execs indicated that a “multibillion-dollar cash investment” in any one project is unlikely and that no deals are imminent. The company recently agreed to buy post-production house Todd-AO and said it’s seeking investments that will help it build some kind of infrastructure for interactive advertising and programming.

Liberty also owns a piece of U.K. cabler Telewest and said it might look for other cable systems or network investments overseas. Execs acknowledged clear advantages for Telewest to team up with its newly merged rivals, NTL and Cable & Wireless. That three-way combination is widely expected.

Liberty’s 100%-owned Encore Media Group, which houses Encore, Starz! and thematic multiplex premium movie services, saw revenue rise 25% to $159 million and cash flow more than double to $39 million. The strong numbers were due in part to lower marketing expenses — down 12% from last year’s big Starz! branding campaign.

Encore chief John Sie said the company is working to roll out a service similar to video on demand in which a consumer is charged a flat monthly fee instead of paying per movie.

Discovery rev up 35%

At 49%-owned Discovery, total revenue rose 35% to $349 million on cash flow up 39% to $32 million. The unit includes the flagship Discovery Channel and the Learning Channel as well as Animal Planet and the Travel Channel.

Cash flow for the Discovery and Learning channels was $80 million for the second quarter and should hit $425 million for the year. The two less-carried networks should post a combined operating loss of about $350 million for the year.

Discovery Latin America, in 10 million homes, had operating cash flow of about $6 million this year through July. Discovery Europe, in about 6 million homes, had cash flow of $5.3 million.

And Liberty execs said they’re talking actively with most big U.S. cable operators to find analog carriage for Discovery Health, a channel that’s only on AT&T’s digital service. They hope to have 10 million to 15 million subscribers by year end.

At 43%-owned home shopping channel QVC, revenue rose 19% to $632 million and cash flow was up 31% to $122 million.

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