Versant Media Group on Thursday unveiled results for its most recent quarter — its first as a stand-alone company after separating from Comcast's NBCUniversal and beginning to trade on the Nasdaq earlier this year.
The report revealed continued pressure in the traditional pay TV bundle but highlighted growth in digital platform and licensing businesses.
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 — was down roughly 7% during the period to $1.01 billion. The company said that was due to subscriber declines and partially offset by rate increases.
Advertising revenue for the first quarter fell 5% to $368 million, which was considered 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, due largely to the licensing of the longtime reality TV series hit "Keeping Up With the Kardashians" and other related content to Disney's Hulu.
Versant has consistently touted its strength in sports and news. On Thursday the company highlighted viewership increases for CNBC and MS NOW as well as continued momentum for the Golf Channel and other live sports and events on its networks.
More than 80% of Versant's revenue comes from the pay TV business. However, executives have told Wall Street that it aims to eventually rebalance its revenue mix so that 50% is derived from its digital, platform, subscription, ad-supported and transactional businesses.
Versant reported first-quarter revenue from its platforms business, which includes Fandango, GolfNow and some of the already launched direct-to-consumer units, was up 9.5% to $192 million.
"We are executing our strategy by extending the reach of our brands, deepening our connection with audiences, and scaling our digital platforms," CEO Mark Lazarus said in Thursday's earnings release. "This performance across Platforms and our core brands reinforces our confidence in evolving the business over time and delivering long-term shareholder value."
Overall revenue for the period ended March 31 was $1.69 billion, down about 1% compared with the same quarter last year. Wall Street analysts polled by LSEG had expected revenue of $1.62 billion.
Net income attributable to Versant decreased 22% to $286 million, or $1.99 per share, for the quarter, which the company said was due to lower revenue, higher public company costs and interest expense following the spinout from Comcast. This was partially offset by lower taxes during the quarter, it said.
Adjusted earnings before interest, taxes, depreciation and amortization fell 7% from the same period last year to $704 million.
When compared with stand-alone adjusted EBITDA, a metric to more directly compare performance of the pre-spin portfolio companies to current results, adjusted EBITDA was up about 5%, Versant said. That was due to lower entertainment programming expenses and reduced selling, general and administrative costs, which offset revenue declines.
The company also continued on its earlier pledge of returning capital to its shareholders, mainly due to its light debt load.
The company on Thursday declared a quarterly cash dividend for the second quarter in a row, each time at 37.5 cents per share. The new dividend is payable on July 22 to shareholders of record as of the close of business on July 1.
Versant also announced Thursday that it expects to enter into a $100 million accelerated share repurchase agreement, beginning Friday, which it anticipates completing during the second quarter. Versant repurchased nearly 2.7 million shares of Class A common stock during the first quarter, with a remaining authorization of roughly $900 million as of March 31, it said.
