Net income falls 14% due to Web ventures, music, new station
MIAMI — Univision Communications reported net revenue of $237.5 million in the second quarter, up 4% over the previous year.
However, net income fell 14% to $28.6 million due to losses associated with the company’s online division, its music group and its planned second network, as well as equity losses on unconsolidated subsidiaries and charges for paying down debt.
Univision Online, Univision Music Group and the Telefutura Network, which will bow in January, will continue to generate losses this year, Univision said.
While most media have been affected by the economic slowdown, the impact has not been as pronounced for Spanish-lingo Univision, said executive VP Andrew Hobson during a conference call with analysts.
Second-quarter revenue at its core Spanish-lingo TV business increased 2% to $235.1 million. For the year, revenue from the TV group is estimated to rise 3%-5%, Hobson said, or to $892 million to $910 million.
Univision Online, which launched last October, could contribute another $8 million to $11 million in revenue this year. Hobson said execs are modifying the online business model in light of changes in the online ad market.
Telefutura will launch in January as a counterprogrammed alternative to both the flagship Univision network and Telemundo.
Expected to bow with 80%-plus coverage of U.S. homes that will only cannibalize about 25% of current Univision viewers, Univision execs expect to capture a bigger percentage of ad spending with two networks next year.
Univision is also acquiring stations in Puerto Rico, where it will launch both networks. The Puerto Rican ad market is worth about $200 million, Hobson said.
Network prexy Ray Rodriguez said the flagship network has been regaining market share against Telemundo. He noted that during the May sweeps, Univision was rated the No. 1 primetime station among adults 18-34 — counting Hispanic and non-Hispanic households — in Los Angeles, Miami and Houston.