MEXICO CITY — Televisa’s third-quarter earnings went south as the Mexican media conglom ramped up cable and gaming ventures, paid higher taxes and faced tough comparisons with record profits from the same period last year.
Televisa said Thursday that net income fell 8.4% to 2.36 billion pesos ($219 million) compared with $239 million a year earlier. Profits were hit by higher taxes compared to last year when web took a large write-off.
Quarterly revenue beat analyst estimates, posting 8.9% growth to $954 million. Broadcast, pay TV, publishing, film and new off-track betting and bingo salons all posted solid growth. Still, the company said it expects revenue for all of 2007 to be down 3% compared to 2006.
Despite the tough comparison to the same quarter last year, when the web saw record profits on ad sales during the final games of the soccer World Cup, quarterly revenue from broadcasting unit still rose 3.4% to $490 million.
Sales at satcaster Sky, web’s second-biggest revenue stream, rose 5.5% to $188.4 million, and subs now number more than 1.5 million.
Sky recently launched ops in Costa Rica and the Dominican Republic. It will soon launch in Nicaragua and early next year in Panama and Guatemala.
Televisa is building up a national network to offer triple-play services, having taken stakes this year in two major cable companies and purchasing a stake with them in telcom Bestel in late August for $325 million. Televisa already controls the majority share of Mexico City cabler Cablevision, which saw sales grow 17% during the quarter to $55 million.
During the quarter, Televisa also expanded its U.S. beachhead, signing a film and TV deal co-production deal with Lionsgate.
Profits next year will be trimmed by recent regulatory changes. Under a new tax code, Televisa is likely to have to pay higher income tax, slap a 20% tax on revenue from its gambling business, and have to carry political ads free, cutting off a significant source of revenue.