NBC Universal, the General Electric Co. media unit in which Comcast Corp. is buying a majority stake, reported a 15 percent decline in profit after it didn’t repeat a year-ago gain from a cable-channel merger.
Third-quarter profit fell to $625 million from $732 million a year ago, GE said today in a statement. Revenue at the New York-based unit slid to $4.07 billion from $4.08 billion. Excluding year-earlier impairment charges and a $283 million gain from merging its A&E cable-TV network with Lifetime, profit was up 5 percent.
The improvement in operating results was led by a 22 percent climb in profit from cable channels including USA, Bravo, Oxygen and CNBC, GE Chief Financial Officer Keith Sherin said today on a conference call. Revenue at the NBC broadcast network was down 2 percent to $1.4 billion and profit was down $80 million because of higher spending on prime-time TV shows.
NBC Universal Chief Executive Officer Jeffrey Zucker is stepping down, he announced last month, when Comcast completes its takeover. Zucker will be replaced by Comcast Chief Operating Officer Stephen Burke as the cable operator looks to reshape the TV company after ratings at its NBC network have fallen. The companies are working on getting regulatory approval and still hope to close the deal by yearend, Sherin said.
Local advertising increased 18 percent in the quarter, and the so-called scatter market where TV commercial time is bought closer to air was up 20 percent, Sherin said. The theme-park business had a record quarter with the opening of the Harry Potter attraction, he said.
“Given that the economy, although improving, is still far from robust, these are excellent results driven by superior execution throughout our operations,” Zucker said in a letter to NBC Universal’s employees today.
Fairfield, Connecticut-based GE, which reported overall revenue that trailed analysts’ estimates, fell 86 cents, or 5 percent, to $16.30 at 4:15 p.m. in New York Stock Exchange composite trading. Comcast, based in Philadelphia, rose 57 cents, or 3.1 percent, to $18.95 on the Nasdaq Stock Market.
Last year, NBC agreed with Walt Disney Co. and Hearst Corp. to combine the A&E and Lifetime channels into a new company, resulting in the gain for GE. Also, the company reduced the value of its stake in an Indian entertainment company, its share of the Weather Channel and some programming.