Going out in style

Peacock profits soar in fiscal swan song

NEW YORK — In what could be NBC’s last fiscal quarter as a solo media act, parent company General Electric on Thursday announced Peacock revenues of $1.58 billion for the first three months of 2004, up 8% over the same period last year. Operating profit posted a hefty 15% gain to $394 million.

NBC was among nine of GE’s 11 major divisions to honor the company’s time-honored tradition of double-digit quarterly earnings gains.

For the second quarter, NBC expects to post operating profits up 5%-10% over the same period in 2003, partly thanks to big ad sales from the primetime finales of “Friends” and “Frasier.” Peacock estimates it will see upfront ad sales up around 5% over last year.

Overall, the vast industrial conglom finished the first quarter of 2004 with total profits up 1% on last year’s first quarter to $3.2 billion off of revenues up 10% to a whopping $33.4 billion. Excluding an accounting change, corporate earnings grew a healthier 8%, allowing investors to breathe a sigh of relief about the prospects for the market’s single biggest economic bellwether.

GE chief exec Jeff Immelt expressed confidence in the company’s “broad-based momentum” — and by extension the wider economy — for 2004 and 2005. “This is really the broadest growth we’ve seen since the first half of 2000,” he said. “The company is in great shape, and we have very good momentum going forward.” GE topper said company was working to reorient itself as a “faster growth industrial company.”

Mindful that it will take more than sluggish turbine engine sales to power future growth, Immelt’s acquisition strategy is expected to provide much of the fuel. He said company is on track to complete NBC’s merger with Vivendi Universal Entertainment next month, having just closed its $9.5 billion acquisition of medial diagnostic group Amersham.

Buoyed by the recent financial success at Universal film and cable TV businesses, company forecasts that the new NBC-Universal will see total sales rise 25% and operating profits gain 30% over the next two years. Combined group is forecast to earn $2.4 billion in 2004 off of total revenues of $12 billion. Group has identified around $100 million in synergies (cost savings and new revenue ops) in 2004, with another $300 million expected for 2005.

“The Universal businesses are in very strong shape,” Immelt told analysts and investors on a Thursday conference call. “Universal movies have been well received, and both USA and Sci Fi (channels) are showing improved ratings this year.”

Company pointed to six primary growth drivers for the future, including cost-cutting in TV production, better film library utilization, more cross-selling across film and TV and improved cable branding. “There’s a great opportunity to accelerate DVD sales and work harder with the library,” Immelt said.

Among the notable first quarter milestones at the Peacock, GE brass noted the reupping of “Tonight Show” host Jay Leno, big ratings gains at Telemundo and Bravo and NBC’s strong showing in primetime during February sweeps. Net also boasted five of the top eight dramas, with “ER,” “Las Vegas,” “Law & Order,” “Law & Order: Special Victims Unit” and “Crossing Jordan.”

Contributing to first-quarter double-digit operating profit growth, NBC said cable net Bravo more than doubled its primetime viewers among adults 18-49 and adults 25-54 over the year-earlier period. Spanish-lingo web Telemundo, though still a distant second behind Univision, boosted its weekday prime-time ratings 59% over first quarter 2003 among adults 18-49 and recorded gains in that demographic across all dayparts.

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