Shares recovered from a slight dip in early after-market trading as investors sorted through CBS’ Q2 results. Net earnings came in at $427M, +8.1% vs last year’s Q2, on revenues of $3.48B, -3.1%. Analysts expected revenues to come in a tad higher at $3.53B. But earnings, at 65 cents a share, were well ahead of the consensus forecast of 59 cents. CBS says that last year it received a jolt of cash from its initial streaming deal with Netflix, the third cycle domestic syndication of Frasier, and from the NCAA Division I Men’s Basketball Championship, which aired this year in Q1. Revenues for the Entertainment unit — which includes the CBS network, studios, and interactive operations — fell 7% to $1.7B. The division’s operating income before depreciation and amortization (a measure of cash flow known as OIBDA) dropped 3% to $426M. Cable Networks including Showtime fared better with revenues +8% to $446M and OIBDA +8% to $190M. At the Publishing unit, which includes Simon & Schuster, revenues were up 3% to $189M while OIBDA dropped $10M to $9M which the company says it due to outlays for a legal matter. Growing ad buys from political campaigns and auto makers contributed to the 2% rise in revenue at CBS’ local TV and radio stations to $704M with OIBDA +8% to $248M — although the company says that the radio revenue was -2% from a drop in retail and financial services ad sales. Finally, CBS Outdoor revenues dropped 2% to $481M due to unfavorable exchange rates while OIBDA increased 8% to $93M. CBS chief Les Moonves says the company should have “a record year” noting that “the U.S. presidential election will be a major factor in our second half results, and the London Olympics will give a considerable lift to our Outdoor business.” The company recently announced a major increase in its stock repurchase plan and dividend.
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