The Q3 message for AMC Networks comes from William Shakespeare: All’s well that ends well. Although earnings were down, everyone knows the main reason — the court fight with Dish Network that led it in June to drop the company’s channels. And as AMC chief Josh Sapan reminds this morning, that’s past and his company is “delighted to partner with them again.” Meanwhile, AMC topped the Street’s expectations. It generated net income of $36.6M, -8.4% vs the period last year, on revenues of $332.1M, +17%. That revenue figure is well ahead of the $288.5M that analysts anticipated. And earnings at 51 cents a share beat expectations for 37 cents. The company’s National Networks (AMC, WEtv, IFC and Sundance Channel) generated $306.2M in revenues (+18.5%). Affiliate fees rose 24.3%, to $199M, as digital and licensing deals offset the lost revenue from Dish. Ad revenues increased 9.1% to $107M. But operating income dropped 2% to $98.5M in part due to litigation and other costs for the Dish dispute. The company’s grab-bag category for international networks and other operations — including IFC Films — recorded revenues of $29.3M (-4.6%) with an operating loss of $12.9M, an increase from last year’s $4M loss. The downturn includes litigation expenses from the breach of contract suit against Dish, which involved its decision to prematurely drop the now-defunct VOOM suite of HD channels. AMC says that the case had a “material impact” on the Q3 results. Dish agreed to pay $700M to AMC and its former parent, Cablevision, to settle the litigation; there’s no word in this morning’s release about how they’ll split the proceeds. With the case resolved, “we are fully focused on continuing our strategy of investing in quality original programming,” Sapan says.
By DAVID LIEBERMAN, Financial Editor | Thursday November 8, 2012 @ 8:40am ESTTags: AMC Networks, Dish Network
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