Scripps Networks Interactive reported higher fourth-quarter
earnings but slower ad revenue growth and climbing expenses.
Earnings and revenue growth were below forecasts by Wall
Street analysts, and Scripps Networks stock tumbled more than 4% in Thursday
morning trading.
Net income for the fourth quarter was $305.8 million, or
2.02 a share, up from $135 million, or 84 cents a share, a year ago. The
results include a $213 million tax benefit. Excluding special items, income
from continuing operations was 84 cents a share, compared with 77 cents a share
a year ago.
Revenues rose 9.2% to $605 million.
Advertising revenue rose 5.1% to $414 million. Affiliate fee
revenue rose 18% to $174 million.
Expenses were up 14% to $339 million.
The company said that for the full year 2013, it expected
revenue to rise 7% to 9%, while costs of services would go up 7% to 9%. It also
said selling, general and administrative expenses are expected to increase 7%
to 9%.
"Our solid fourth-quarter and full-year operating results
demonstrate the popularity and superior marketing power of our lifestyle
television networks and related interactive businesses," chairman and CEO Ken
Lowe said in a statement. "Since the launch of HGTV in 1994, our lifestyle
media businesses have generated 18 consecutive years of growth, creating
tremendous value for our shareholders, delivering uncommon value to our
advertisers and distributors and engaging media consumers at the highest
levels. Underpinning the company's success is our commitment to remain focused
on lifestyle content categories that touch and inspire the everyday lives of
media consumers."
Revenues rose at all of the company's cable networks. Food
Network was up 5.2% to $215 million; HGTV, up 5.1% to $200 million; Travel
Channel, up 5.9% to $71.1 million; DIY Network, up 13% to $30.4 million; and
Cooking Channel, up 38% to $24.7 million. Even Great American Country rose 16%
to $7.6 million.
Revenue
for the company's digital businesses, including the network-branded websites,
was up 9.1% to $33.2 million.
