Double-digit growth in advertising and affiliate fees boosted Scripps Networks Interactive’s financials in the fourth quarter, executives said Thursday, helped by “power brands” Food Network and HGTV.
Revenues were up 33% to $573 million, and net profits rose 38% to $131 million. For the full year, revenues grew 34% to $2.1 billion, and profits rose 37% to $411 million.
CEO Ken Lowe acknowledged some softness in ratings in the quarter, but said new programming being introduced across all its channels will lead to a rebound in the coming quarters. Execs said Scripps would spend 6% to 9% more on programming this year.
John Lansing, president of Scripps Networks, said the channels are seeing increased competition for viewers from the NFL, particularly at Food on Sundays. “We will continue to track that,” he said.
Travel Channel, which Scripps purchased in December 2009, continues to be a winner for the company. Without Travel, revenues would have grown 20% in the quarter to $504 million.
For the period ending Dec. 31, revenues from ads were up 23% and from affiliate fees by 61%, largely because of better terms negotiated for new carriage deals, Lowe said. The impact of sluggish ratings on advertising was “measurable,” said CFO Joseph NeCastro, due to make-goods to advertisers. Without those, ad revenues would have been above 30%, execs said.
The growth in Shopzilla’s shopping sites in Europe helped drive Scripps’ interactive unit growth in the quarter with revenues rising 38% to $68 million.