Televisa earnings nearly double in Q1

B'caster beats analysts' expectations

MEXICO CITY — Grupo Televisa, Mexico’s largest broadcaster, reported an 81% increase in earnings boosted by strong net sales in the first quarter of this year.

Thursday’s results came just a day after rival TV Azteca released strong earnings, also thanks to a large jump in advertising sales, and built on a strong bottom-line turnaround in the fourth quarter of last year.

The results, during the traditionally slow period of the year, were refreshing for both nets.

Televisa said it would consider consolidating results for Innova, the company that controls satellite operator Sky Mexico, into its corporate earnings. Televisa owns two-thirds of Innova, which has shown strong subscriber increases over the past two years.

For the most recent quarter, Televisa reported net profits of 472 million pesos ($42.5 million), as compared to $23.4 million a year earlier. The earnings were built on a 4.3% uptick in sales to $471 million, led by the broadcast television division, which brought in $287 million.

The top-line figures exceeded analysts’ expectations for the net, but the net came up slightly short of market predictions for earnings, buffering movement for Televisa on the exchange. Trading on the Big Board, Televisa shares fell 4¢, to $43.68 per share. Most encouraging for Televisa was a big turnaround for its cable TV unit, Cablevision Mexico, which, after nine consecutive quarters of subscriber decreases, reported a gain of 1,500 subs. While that number is small, it seems to spell a long-awaited breath of fresh air for the troubled cabler, and was accompanied by a nearly 8% increase in sales and a 25% jump in operating profit.

Another happy surprise for investors was strong growth in Televisa’s film distribution unit, which the net plans to expand into the U.S. starting next month.

Canal 4 flow

Net’s open TV ad sales growth was chiefly attributed to Canal 4, which broadcasts in Mexico City and surrounding areas.

While most other Televisa units upped revenue for the period, net’s licensing operation, important for the largest Spanish-language programming producer in the world, showed a 2.3% decline in sales, which the net attributed to unfavorable Peso conversion rates.

Sales at Internet site esmas.com declined, although Televisa did not publish the figure. This contrasts with TV Azteca’s todito.com, which enjoyed its best quarter ever.

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