DreamWorks unit helps Viacom triple its profit
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MTV owner Viacom Inc.’s profit more than tripled in the fourth quarter after the addition of the DreamWorks studio last year, which swung its movie business to a profit.
Viacom, which also owns BET, VH1 and several other cable television channels, said it earned $480.8 million, or 69 cents a share, compared with $129.5 million, or 17 cents, a year earlier.
On a comparable basis, Viacom’s operating income increased 28% to $855.6 million, or 65 cents a share. Analysts polled by Thomson Financial were expecting 58 cents.
The improvement was largely due to its movie business, which earned $86.3 million in the quarter versus a loss in the year-earlier period of $39.6 million.
Viacom’s cable networks business, which makes up the lion’s share of its operations, reported a 6% gain in profit to $809.9 million.
Overall revenue rose 32% to $3.59 billion with the addition of the DreamWorks studio to Viacom’s movie operations, which include the Paramount film studio.
New York-based Viacom said it would take about $70 million in charges in its 2007 fiscal year as it restructures its MTV division. Many of the charges will be for severance costs, with about $50 million being recorded in the first quarter of this year.
Viacom split from CBS Corp. at the beginning of 2006 and became a separate company.
Despite beating analysts’ estimates, Viacom’s Class B shares fell 47 cents to $38.57.
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