With a decline of 16% in ita Operating income, Viacom has provided an update on the company’s strategic priorities, with a five-point plan that includes putting its “full power” behind six flagship brands: BET, Comedy Central, MTV, Nickelodeon, Nick Jr. and Paramount.
Spike will be rebranded in early 2018 as The Paramount Network and will serve as Viacom’s premier general-entertainment brand. The network will showcase the very best in Viacom original scripted and non-scripted programming and incorporate more original and third-party programming. Also, the company announced a commitment between Nickelodeon and Paramount to move forward on a slate of four films. The first of these movies, Amusement Park, will premiere in theaters in summer 2018 and will launch a TV series on Nickelodeon the following year.
The company plans to invest in new content experiences and will establish its first-ever dedicated short-form content unit. The company will also look to further extend the reach of Viacom’s brands through live experiences and consumer products.
In order to drive its scale, market strength and financial flexibility, the company is refocusing its approach to partnerships and is committing to “deeper, more client-centric relationships” with distribution and advertising partners. These partnerships may include working with distributors to create new and improved pay-TV experiences or broadening advertising offerings to include cross-portfolio access.
Bob Bakish, the president and CEO of Viacom, said, “Today we share a strategy that will enable Viacom to realize the full potential of its premier global portfolio of entertainment brands. Building on our leading domestic and growing international footprint, this strategy will expand the depth and reach of our flagship brands across multiple platforms and around the world, while also providing for more competitive differentiation and increased adaptability for our business overall. There is much work to be done, but we are confident we have the plan and people to take our brands to greater heights and build a bright future for our company.”
Revenues in the first fiscal quarter at Viacom were $3.32 billion, an increase of 5 percent year-on-year. There were improved theatrical revenues, a return to growth in domestic affiliate revenues, continued strength internationally and ancillary revenue growth. Operating income declined 16 percent to $706 million, and adjusted operating income was down 11 percent to $748 million. Net earnings attributable to Viacom declined to $396 million, and adjusted net earnings attributable to Viacom declined to $413 million.
“Viacom’s first quarter results reflect improvement in our core businesses, with increases in revenues and operating cash flow, continued strong international performance, including initial contributions from the acquisition of Telefe, and a return to positive growth in affiliate revenues,” Bakish said. “We are already benefiting from changes made early in the second quarter and seeing green shoots in our strongest businesses, as well as those that are poised for a turnaround. As we implement our strategy across the company, we believe we can drive significant value for shareholders.”