July 30 (Bloomberg) -- Oprah Winfrey’s OWN cable network posted its first quarterly profit, said Discovery Communications Inc., the TV host’s partner in the venture.
OWN became “cash flow positive” in the three months ended June 30, David Zaslav, chief executive officer of Discovery Communications, said on an analyst call today after the owner of cable channels Animal Planet and TLC reported earnings.
OWN, which debuted in 2008 and has received a $420 million investment from Discovery Communications, may have lost as much as $330 million since its inception through the end of last year. Now that it’s profitable, the company should start to recoup that money, Zaslav said.
“I want to congratulate Oprah and the entire team at OWN for this significant milestone,” he said. “We remain very bullish on its long-term trajectory and our ability to drive continued asset appreciation in the future.”
OWN signed 30 new advertising clients during the recent upfront market where marketers buy commercial time in advance of the coming season, Zaslav said. The network has also secured higher fees from pay-TV operators that carry the channel, about 20 cents per subscriber each month on average.
Second-quarter profit excluding some items at Discovery Communications was 82 cents a share, compared with 76 cents a year earlier, according to a statement. Analysts had estimated 91 cents, on average, according to data compiled by Bloomberg.
Revenue at the Silver Spring, Maryland-based company advanced 30 percent to $1.47 billion, while analysts estimated $1.48 billion.
Discovery Communications cut its annual profit and sales forecast. The company now expects annual net income of $1.1 billion to $1.15 billion, down from a prior forecast of $1.2 billion to $1.3 billion. Revenue will be $5.55 billion to $5.63 billion, compared with a prior view of $5.58 billion to $5.7 billion, according to the statement.
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