Televisa fourth-quarter earnings down

Dip due to higher taxes, losses at La Sexta

MEXICO CITY — Mexican media conglom Grupo Televisa on Wednesday reported fourth-quarter earnings were down 10.6% to $216.6 million due to higher taxes and losses at new Spanish web, La Sexta.

Earnings were well below analyst estimates. The company had taken a hit due to higher taxes related to the consolidation of satcaster Sky Mexico and losses by La Sexta, of which Televisa owns a 40% stake.

Revenue for the three months ending in December was up 6.9% to $993.6 million as the conglom reported solid growth in all its major divisions — broadcast, pay TV, radio, print and film.

Sales at bedrock broadcasting unit were up 1.4% to $570 million during the fourth quarter. Televisa draws around 70% of broadcasting auds to its three national channels.

Quarterly revenue from Sky Mexico, the nation’s only satcaster and Televisa’s second biggest revenue stream, was up 16.9% to $689.4 million. During the full year, subscribers grew 14.4% to more than 1.4 million.

For the full year, Televisa’s earnings grew 34.7% to $794.3 million while revenue increased 12.2% to $3.5 billion. Full-year revenue was boosted by windfall revenue from political ads ahead of the 2006 national elections and soccer World Cup-related advertising.

Without such events ahead this year, growth is expected to sharply recede during 2007, but income from a new gaming and lottery business will help offset duller results from broadcast and pay TV.

Televisa said upfront sales for 2007 had increased 8.3% to $1.47 billion

Company should also get a financial boost in the coming months once the sale of top U.S. broadcaster Univision is completed. Televisa is planning to sell its 11% stake in Univision after it lost out last year in it attempt to buy the U.S. web to a competing bid from a group of investors led by media mogul Haim Saban.

Sale of Univision shares should net the Mexican web around $1.1 billion, pushing up its cash reserves to more than $3 billion.

Back home, speculation continues on whether Televisa could face competition from another national network in the coming years. NBC Universal-owned Telemundo, with local partners the wealthy Saba family, is seeking a broadcast license in Mexico as are other groups of domestic investors.