CBS Profit Tops Estimates on Buybacks; Dividend BoostedChristopher Palmeri
CBS Corp., owner of the most-watched U.S. television network, reported second-quarter profit that topped analysts’ estimates, boosted by share repurchases. The company doubled its buyback and raised the dividend.
Profit before some items rose to 78 cents a share from 75 cents a year earlier, the New York-based company, controlled by billionaire Sumner Redstone, said yesterday in a statement. That beat the 72-cent average of 27 analysts’ estimates.
The buybacks and dividend increase countered a decline in revenue and operating income, as advertising sales fell. CBS had the largest audience decline of the four big broadcast networks among viewers in the 18-to-49 age group last season. The network enters the new season with a package of National Football League games on Thursday nights beginning Sept. 11.
“We feel very good about the quarters ahead and about our long-term growth prospects as a content company going forward,” Chief Executive Officer Les Moonves said yesterday on a conference call.
CBS increased its stock-buyback program to $6 billion from $3 billion, while raising the quarterly dividend 25 percent to 15 cents a share.
Net profit from continuing operations fell 3.9 percent to $418 million, or 72 cents a share. Sales dropped 5.4 percent, CBS said, citing the absence of college basketball semifinals and softness in the ad market during the quarter,
Second-quarter revenue fell to $3.19 billion from $3.37 billion a year earlier. Analysts had projected $3.2 billion.
Network TV advertising “is accelerating nicely in the back half of the year,” buoyed by football and new programs, Moonves said.
CBS considered bidding for CNN after Rupert Murdoch said he would sell the 24-hour news channel if he acquired Time Warner Inc., the current owner. Moonves said he’s no longer interested in the cable news network now that it’s unlikely to be put up for sale.
CBS, based in New York, was little changed at $57 in extended trading yesterday after the announcement. The stock fell 1.3 percent to $56.90 at the close in New York and has dropped 11 percent this year.