Plan to Shed Blockbuster Boosts Viacom

Local TV stations reaped 19% more Super Bowl ad revenue than they did in 2001, Karmazin said.

Radio revenue fell 3% to $551 million, and operating income fell 10% to $252 million, reflecting lower ad revenue.

While declining to specify, as the company has in previous quarters, the pace of advertising sales at the company's radio stations, Karmazin said he expected that every one of the company's 10 largest markets would report higher sales in the first quarter. Operating profit for radio in the first quarter will be higher as well, said Karmazin.

Radio's weak performance had been a sore point for Viacom throughout last year; in contrast to the expected first quarter 2004 performance, Karmazin pointed out that several of the company's top-ten markets reported revenue declines in the first quarter of 2003.

Nine of Viacom's 40 radio markets reported lower ad revenue in 2003 than in 2002, but Karmazin said that six of those nine would be up in 2004. "We have targeted those situations," he said. "We have taken action to turn around those situations."

Entertainment revenue grew 41% to $1.3 billion, boosted by DVD sales and higher Theaters revenue from movies such as School of Rock. Operating income grew 15% to $66 million.

Blockbuster's revenue grew 2% to $1.6 billion, while operating income, excluding the charges, grew 23% to $104 million.

Based on 2003 results excluding the charge, Viacom reiterated its growth targets for 2004. The company says revenue will grow in the range of 5% to 7%, operating income will be up 12% to 14%, and earnings per share will rise in the range of 13% to 15%.

Shares in Viacom rose 52 cents to $40.50 on Tuesday. The company's stock has ranged between $33 and $50 in the past year.

>To order reprints of this article, click here: Reprints