Grupo Televisa S.A.B. (TV) reported better-than-expected financial results for the third quarter of 2013. Net income was approximately $204 million, down 18.4% year over year. However, earnings per Global Depository Shares (GDS) were 36 cents, well above the Zacks Consensus Estimate of 34 cents. Quarterly consolidated net revenue of around $1,454 million improved 8.1% over the prior-year quarter and easily outpaced the Zacks Consensus Estimate of $1,420 million.
Gross margin was 48.3% compared with 48.2% in the year-ago quarter. Consolidated operating income was $393.5 million, up 4.3% from the prior-year quarter. Operating margin was 27% compared with 28% in the year-ago quarter. Capital expenditure, during the reported quarter, was approximately $22.6 million.
At the end of third-quarter 2013, Televisa had approximately $1,422.8 million in cash and marketable securities and $4,669.2 million of outstanding debt compared with $1,892 million of cash and marketable securities and $4,112.1 million of outstanding debt at the end of 2012. At the end of the reported quarter, the debt-to-capitalization ratio was around 0.45 compared with 0.43 at the end of 2012.
Content Segment
Quarterly total revenue was $681.5 million, up 5.3% year over year. Operating profit was $342.2 million, up 4.4% year over year, and operating margin was 50.2% compared with 50.6% in the year-ago quarter. Quarterly royalty from Univision was a record-high $71.4 million, up 15.2% year over year.
Within this segment, Advertising revenues were $498.1 million, up 5% year over year. Network Subscription revenues were $67.6 million, reflecting a rise of 6.2% from the year-ago quarter. Licensing and Syndication revenues were $115.9 million, up 6.1% year over year.
Publishing Segment
Quarterly revenues were $60.9 million, down 5.2% year over year. Operating profit was $5 million, down 47.4% year over year and operating margin was 8.3% compared with 14.9% in the year-ago quarter.
Sky Segment
Quarterly revenues came in at $317 million, up 9.9% year over year. Operating profit was $147.5 million, up 11.1% year over year. Quarterly operating margin was 46.5% compared with 46% in the year-ago quarter.
Cable and Telecom Segment
Quarterly revenues were $339 million, up 12.4% year over year. Operating profit was $114.6 million, up 3.4% year over year. Operating margin came in at 33.8% compared with 36.8% in the year-ago quarter.
Other Businesses Segment
Quarterly revenues were $84.1 million, up 18% year over year. Operating income was $7.6 million, up a whopping 724.4% year over year. Operating margin was 9% as against 1.3% in the year-ago quarter.
Subscriber Statistics
As of Sep 30, 2013, Televisa had 2,464,116 Video subscribers; 1,566,660 Internet Broadband subscribers; and 871,665 Telephony subscribers, which together constitutes 4,902,441 revenue generating units (RGU) in the Cable and Telecom segment. The company also had 5,878,925 net active Satellite TV subscribers, up 20.4% year over year. In the reported quarter, the Sky segment added 232,671 net active subscribers.
Other Stocks to Consider
Televisa currently has a Zacks Rank #3 (Hold). However, there are other stocks which are performing well in this industry. Some of them include Nexstar Broadcasting Group Inc. (NXST), Phoenix New Media Ltd. (FENG) and LIN Media LLC. (LIN). All three stocks currently carry a Zacks Rank #2 (Buy).
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