Grupo Televisa's Profit Plunges - Analyst Blog

Grupo Televisa S.A. (TV), the largest media company in Mexico, reported financial results for the fourth quarter 2009. Quarterly consolidated net income was $91 million, down 58% year-over-year. Fourth quarter EPGDS (Earnings per Global Depository Shares) was 16 cents, significantly below the Zacks Consensus Estimate of 33 cents. This was primarily due to higher cost of sales and foreign exchange losses. 

Quarterly consolidated net revenue of $1,161.5 million was an improvement of 4.8% over the prior-year quarter and was above the Zacks Consensus Estimate of $1,088 million. This was mainly attributable to vigorous growth in its cable and satellite services partially offset by lukewarm performance in Publishing and Television Broadcasting segments.
 
Quarterly gross margin was 54.9% compared to 56.2% in the prior-year quarter. Fourth quarter consolidated operating income was $329 million, down 9.7% over the prior-year quarter. Integral cost of financing, in the reported quarter, was $70.2 million, compared to a gain of $38.3 million in the year-ago quarter.
 
At the end of fiscal 2009, Grupo Televisa had approximately $3.46 billion cash and marketable securities and $3.33 billion outstanding debt on its balance sheet compared to $3.47 billion of cash and marketable securities and $2.98 billion outstanding debt at the end of fiscal 2008. Capital expenditure, during fiscal 2009 was $499.3 million. 

Television Broadcasting Segment 

Quarterly revenue of $516.78 million was up 0.5% year-over-year. Operating profit was $256.23 million, down 3.9% year-over-year. Quarterly operating margin was 49.6% compared to 51.9% in the year-ago quarter. 

Pay Television Networks Segment 

Quarterly revenue of $56.82 million was up 6.1% year-over-year. Operating profit was $30.87 million, down 6.2% year-over-year. Quarterly operating margin was 54.3% compared to 61.5% in the year-ago quarter. 

Programming Exports Segment 

Quarterly revenue of $58.63 million was up 4% year-over-year. Operating profit was $29.04 million, up 15.5% year-over-year. Quarterly operating margin was 49.5% compared to 44.6% in the year-ago quarter. 

Publishing Segment 

Quarterly revenue of $72.41 million was down 17.4% year-over-year. Operating profit was $0.08 million, down 99.6% year-over-year. Quarterly operating margin was just 0.1% compared to 23.2% in the year-ago quarter. 

Sky Segment 

Quarterly revenue of $202.03 million was up 9.3% year-over-year. Operating profit was $87.65 million, up 5.4% year-over-year. However, quarterly operating margin was 43.4% compared to 45% in the year-ago quarter. 

Cable and Telecom Segment 

Quarterly revenue of $203.37 million was up 21.7% year-over-year. Operating profit was $60.29 million, up 15.3% year-over-year. However, quarterly operating margin was 29.6% compared to 31.3% in the year-ago quarter. 

Other Businesses Segment 

Quarterly revenue of $73.49 million was up 11.9% year-over-year. Operating loss was $16.71 million, up 33.7% year-over-year. Quarterly operating margin was negative (22.7%) compared to negative (19%) in the year-ago quarter. 

Subscriber Statistics 

At the end of 2009, Grupo Televisa had 1,781,948 video subscribers, 651,661 broadband subscribers, 356,014 Telephony subscribers. Together these constitute 2,789,623 revenue generating units (RGU) in the Cable and Telecom segment. At the end of 2009, Grupo Televisa had 1,959,722 gross active satellite TV subscribers including 144,326 commercial subscribers.
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