Friday, April 14, 2006

NBC Universal Underperforms For Parent GE

NBC covered and will cover the Olympics.
Lots of Olympic TV talk follows in this article.
UPDATE: NBC Universal Underperforms For Parent GE ((CBS), Coastal Bancorp Inc. (CBSA), Clear Channel Communications Inc. (CCU), Walt Disney Co. (DIS), General Electric Co. (GE), News Corp. Ltd. (NWS), (NWS.AU), (NWSA), (AU000000), (US254687), (US369604))| "While its broadcast of the Winter Olympics gave NBC Universal a boost in first-quarter revenue, the cost of covering the Torino Games and a soft primetime TV schedule dragged on the unit's bottom line, making it the standout underperformer in parent General Electric's vast portfolio.

On Thursday, NBC Universal reported revenue of $4.5 billion in the period, a 24% bounce from year ago levels, with the Olympics contributing about $684 million. But that same event scraped about $96 million off NBC's operating profits, which fell 8% across the board. Taking out the Olympics, revenue would have been up 5% and operating profit 6%.

However, GE (GE) said that the Olympics are likely to be 'slightly profitable' for the year when all the contributions from NBC affiliates come in.

The 'Olympics performed as expected even though in the quarter it was a loss,' said Chief Financial Officer Keith Sherin in a conference call. 'That is how we had profiled the year and what we really thought we were going to have.'

The company was more bullish on the next Summer Olympics, scheduled for 2008.

'The big megillah here is Beijing,' said Chief Executive Jeff Immelt. 'We have got a funnel of about $1.2 billion. I expect us to get maybe $800 million to $1 billion out of that.'

Immelt said that Torino was 'a tough venue, a tough set of dynamics' but the next round 'is going to be a whole other story.'

GE sees the Beijing games as key from a network standpoint in terms of viewer interest, and also from an infrastructure standpoint.

'I think it is going to be highly beneficial for both NBC and the rest the company,' he said.

The segment, which accounts for just 12% of GE's total revenue has also been having some rough sledding in prime time and the company is looking for revenue to be flat in the second quarter.
Games of 2008

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