Versant Media Group on Thursday it released its latest quarterly results – its first as a private company after the spin-off Comcast’s NBCUniversal also began trading on Nasdaq earlier this year.
The report highlighted continued pressure on pay TV bundles but highlighted growth in digital platforms and licensing businesses.
Versant stock rose nearly 10% in premarket trading.
Linear distribution revenue for its pay TV networks — which include CNBC, MS NOW and the Golf Channel as well as USA, E!, Syfy and Oxygen — fell about 7% in the period to $1.01 billion. The company said that was due to a decline in subscribers and partially offset by price increases.
Advertising revenue in the first quarter fell 5% to $368 million, which is seen as an improvement from the same period last year when it posted a 12% decline.
Revenue from content licensing, however, rose 113.5% to $121 million, thanks to the licensing of the long-running TV series “Keeping Up With the Kardashians” and other related content to Disney’s Hulu.
Versant has been touting its power in sports and news. On Thursday the company highlighted the increase in viewership of CNBC and MS NOW and the continued development of the Golf Channel and other live sports and events on its networks.
More than 80% of Versant’s revenue comes from its pay TV business. However, management told Wall Street that it intends to eventually rebalance its revenue mix so that 50% comes from its digital, platform, subscription, ad-supported and trading businesses.
Versant reported first-quarter revenue from its platforms business, which includes Fandango, GolfNow and other already launched direct-to-consumer units, rose 9.5% to $192 million.
“We are executing our strategy by expanding the reach of our brands, deepening our connections with audiences, and expanding our digital platforms,” CEO Mark Lazarus said in Thursday’s earnings release. “This functionality across all Platforms and our core products reinforces our confidence in growing the business over time and delivering long-term shareholder value.”
Total revenue for the period ended March 31 was $1.69 billion, down about 1% compared to the same quarter last year. Wall Street analysts polled by LSEG had expected revenue of $1.62 billion.
Versant’s net income fell 22% to $286 million, or $1.99 per share, in the quarter, which the company said was due to lower revenue, higher public company expenses and interest expenses following the Comcast exit. This was partially offset by lower taxes during the quarter, he said.
Adjusted earnings before interest, taxes, depreciation and amortization fell 7% from the same period last year to $704 million.
Compared to adjusted EBITDA alone, a metric that directly compares portfolio companies’ pre-spin performance with current results, adjusted EBITDA rose about 5%, Versant said. That was due to lower entertainment costs and reduced selling, general and administrative expenses, which reduced revenue.
The company also continued its earlier promise to return money to its shareholders, mainly because of its low debt load.
The company on Thursday announced quarterly cash dividends for the second quarter in a row, each time at 37.5 cents per share. The new dividend will be paid on July 22 to shareholders held as of the close of business on July 1.
Versant also announced Thursday that it expects to enter into a 100 million share repurchase agreement, effective Friday, that it expects to complete in the second quarter. Versant repurchased nearly 2.7 million shares of Class A common stock in the first quarter, with about $900 million remaining authorized as of March 31, it said.
Disclosure: Versant is the parent company of CNBC.
