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 |  Wall Street Journal - 4 hours ago Scripps Networks Interactive Inc.'s (SNI) third-quarter earnings rose 14% amid a prior-year charge as the company saw continued strength in its cable-television operations. paidContent.org - RTT News -
Nov-06-2009Scripps Networks 3Q Earnings Up 14% Amid 2008 Charge(topic overview)
CONTENTS:
- CINCINNATI — Scripps Networks Interactive Inc. said Friday its third-quarter profit climbed 37 percent, boosted by strong revenue at its Food Network and HGTV networks. (More...)
- The partnership will take on $878 million in third-party debt that will be guaranteed by Scripps and indemnified by Cox, the company said. (More...)
- As per the company's announcement on October 19, it had recorded a net income of $200 million or $0.13 per share for the third quarter of 2009. (More...)
- Scripps announced the plan Thursday, in which it will acquire a 65 percent interest in the Travel Channel. (More...)
- On the down side, the company's Interactive Services segment, which includes online comparison shopping services Shopzilla and BizRate, was down 25 percent to $39 million. (More...)
- How To Create A Successful Low-Cost Video Network On YouTube's most-viewed channel list you'll find the how-to video network ExpertVillage in second place for all time with 812 million views. (More...)
- Scripps beat competing bidder News Corporation ( NASDAQ:NWSA ) in its attempt to acquire a controlling stake in the channel. (More...)
- Back in June, when Cox first put it on the block, industry watchers figured it would fetch between $600 million and $700 million. (More...)
- News Corp. had been in the running for the channel but dropped out after the asking price approached $1 billion. (More...)
- Shares of TransDigm (NYSE: TDG ) have now pushed to session lows as an analyst at Davenport has just downgraded the stock from Buy to Neutral. (More...)
- APRIL 14, 2009 at the TIME & LIFE BUILDING, NYC. A one-day event where seasoned Mediaweek editors will help decipher the strengths and weaknesses among the broadcast and cable networks, TV syndicators and digital players. (More...)
- The Wall Street Journal notes the Scripps deal structure is similar to one being discussed by Comcast Corp. (NASADAQ:CMCSA) and General Electric Co. (NYSE:GE) for NBC Universal Inc. Besides the iffy cash component of that possible deal, a Chicago Tribune reporter argues a deal could pose regulatory questions. (More...)
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CINCINNATI — Scripps Networks Interactive Inc. said Friday its third-quarter profit climbed 37 percent, boosted by strong revenue at its Food Network and HGTV networks. The company had delayed its earnings by a day after announcing Thursday it is acquiring a majority stake in the Travel Channel in a joint venture with Cox Communications Inc. Scripps said Friday its net income totaled $65.3 million, or 39 cents per share, up from a profit of $57.3 million, or 35 cents per share, in the same period a year earlier. [1] A day after Scripps Networks Interactive ( NYSE: SNI ) confirmed its $975 million deal to acquire 65 percent stake in the Travel Channel from Cox Communications, the cable network said profits rose 14 percent to $65.3 million as total revenue remained flat as the recession dragged on. The Cincinnati-based owner of cable TV nets Food Network and HGTV said that the revenues in the Lifestyle segment, which includes those channels website ad sales, was up a respectable 4.3 percent. The unit's profit was up 8.3 percent to $150 million in Q3.[2] Scripps Networks Interactive Inc. has bought a majority stake in the Travel Channel from Cox Communications Inc. in a cash-and-debt deal that values the little-watched cable network at $975 million. Scripps is betting the channel will be a good fit with its other lifestyle networks, including Home & Garden TV and its majority stake in Food Network (which also counts Los Angeles Times parent Tribune Co. as an owner).[3]
Scripps Networks Interactive, owner and operator of the Food Network and HGTV lifestyle television networks, agreed yesterday to acquire from Cox Communications a controlling interest in the Travel Channel in a deal valuing the cable-television network at $975 million.[4]
As part of the deal, Scripps Networks Interactive Inc. said Thursday Cox Communications Inc. will contribute the Travel Channel, valued at $975 million, and Scripps will contribute $181 million in cash to a new partnership.[5] Scripps Networks Interactive Inc. (SNI) will take a 65% stake in Cox Communications Inc.' s (COX) Travel Channel by January as part of a venture between the two companies, in a deal that values the cable-television network at $975 million.[6] Scripps Networks Interactive has agreed to buy a controlling stake in the Travel Channel from Cox Communications outbidding a committed approach by News Corp. in a deal that values the cable-television network at $975 million.[7] Scripps Networks Interactive (SNI) will acquire a 65% stake in Travel Channel, under a $975 million deal with Cox Communications, The Wall Street Journal reports.[8]
NEW YORK, Nov 5 (Reuters) - Scripps Networks Interactive Inc (SNI.N: Quote, Profile, Research ) plans to buy a controlling stake in the Travel Channel under a deal with Cox Communications Inc that values the cable network at nearly $1 billion.[9] Scripps Networks Interactive is to buy a 65% stake in Cox Communications Travel Channel, the company said November 5. The deal is expected to be complete by January 2010. (Due to the announcement, Scripps Networks Interactive said it will delay reporting its third-quarter earnings until Friday, Nov. 6.) Scripps beat out other contenders including News Corp. and private equity firm Providence Equity (the latter had wanted to work with Discovery Communications, which still provides services to Travel Channel, once part of its corporate family).[10] Scripps Networks Interactive has agreed to buy a 65 percent stake in Travel Channel Media from Cox Communications in a deal that values the Travel Channel at nearly $1 billion.[11] Cox Communications has sold a 65 percent stake in Travel Channel Media to Scripps Networks Interactive as part of a joint venture the two companies announced Thursday morning.[12] Cox will retain a 35 percent stake in the company, which will be spun off into a joint venture with Scripps, which owns a stable of cable networks including the Food Network, DIY Network and HGTV. The structure will allow Cox to dodge a steep tax bill left over from the transaction it made with the media mogul John Malone in 2007 to exchange its interest in Discovery Communications for an interest in the Travel Channel. In June Cox said it had received unsolicited inquiries about the channel unit and hired Goldman Sachs to evaluate its options.[7] Cox will retain a 35 percent stake in the company and will spin it off into a joint venture with Scripps, which already owns several cable networks including the Food Network, DIY Network and HGTV. The new structure will permit Cox to avoid a hefty tax bill left over from its deal to acquire the Travel Channel in 2007. The deal's structure is expected to mirror that of the deal involving Comcast and General Electric, and their capture of NBC Universal. Both sides will be limited in their use of cash as part of the transaction due to the current uncertainty in the market and the reluctance of shareholders to invest such large sums directly.[13]
U.S. network Scripps is said to be close to a deal for a major stake in the Travel Channel, after striking a deal with their current owners Cox Communications, the nation's third-largest cable company. Sources close to the deal told the New York Times that a deal, estimated to be worth around $1bn, could be announced as early as this week, despite many experts viewing the price as being too high in the current market.[13] NEW YORK (Reuters) - Scripps Networks is close to an agreement to acquire a majority stake in the Travel Channel from Cox Communications, the nation's third-largest cable company, the New York Times' DealBook blog reported on Wednesday.[14]
Scripps touts itself as the "leader in lifestyle media," according to the network's Web site. Other channels the company owns include HGTV and the Food Network. "This solid partnership we're establishing today allows us to maintain an interest in Travel Channel while at the same time giving the network an opportunity to leverage the resources and expertise of a successful programmer like Scripps Networks Interactive," Cox Communications President Patrick Esser said in a statement.[12] Travel Channel'''s size and genre made it attractive, according to Scripps Networks Chief Financial Officer Joseph NeCastro. "This solid partnership we're establishing today allows us to maintain an interest in Travel Channel while at the same time giving the network an opportunity to leverage the resources and expertise of a successful programmer like Scripps Networks Interactive," said Cox Communications' President Patrick Esser.[15]
Scripps Networks Interactive will pay $181 million in cash to a newly created partnership with Atlanta-based Cox Communications and own 65 per cent of the Travel Channel, while Cox Communications will retain a 35-per cent minority stake in the network.[4] Under the terms of the agreement, Cox will contribute the Travel Channel while Scripps Networks Interactive will contribute $181 million in cash to the fresh partnership. The joint venture will take on $878 million in third-party debt that will be guaranteed by Scripps and indemnified by Cox, with the proceeds to be distributed to the latter party.[16] Cox Communications to contribute the Travel Channel, valued at $975 million, and Scripps Networks to contribute $181 million in cash to a newly created partnership.[17]
The company has agreed to take a 65% stake in Travel Channel and its related activities in a deal with Cox Communications that values the network at $975 million. That is well ahead of the original expectations of a $600 million-$700 million price tag. Industry executives have expressed continued interest in buying cable networks, highlighting that their dual revenue streams have allowed them to perform better amid the recession.[18] U.S. network Scripps is said to be close to a deal for a major stake in the Travel Channel, after striking a deal with their current owners Cox Communications, the nation's third-largest cable company.[13] Scripps Networks Interactive Inc. won the bidding for Cox Communications Inc.' s Travel Channel, in a rich deal to control one of a dwindling number of stand-alone U.S. cable networks.[19] After five months of bidding, Cox Communications announced Thursday a $1.1 billion deal to sell the Travel Channel to Scripps Networks Interactive.[20] They've got the home improvement, gardening and cooking enthusiasts locked up, and now Scripps Networks Interactive will be a player in the vacation and leisure arena after cutting a megabucks deal with Cox Communications to acquire a majority stake in the Travel Channel.[21] Scripps Networks Interactive has entered into an agreement to buy a majority stake in the Travel Channel from Cox Communications.[22]
Scripps Networks Interactive Inc. (NYSE:SNI) is taking a 65% stake in Travel Channel Media, valuing the cable network at about $975 million -- the high end of analyst valuations.[23] Scripps Networks Interactive Inc.' s $975 million takeover of the Travel Channel had been carefully laid out years before E.W. Scripps Co. severed the buyer in 2008.[24]
Cox will retain a 35% interest in the joint venture. "This solid partnership we're establishing today allows us to maintain an interest in Travel Channel while at the same time giving the network an opportunity to leverage the resources and expertise of a successful programmer like Scripps Networks Interactive," Cox CEO Patrick Esser said in a statement.[25] CINCINNATI — Scripps Networks says it will acquire a controlling stake in the Travel Channel as part of a joint venture with Cox Communications.[5] Scripps will pay $181 million, and the joint venture will take on $700 million in debt, according to Bloomberg. The sale marks a quick reversal for Cox, which in 2007 acquired the Travel Channel and other assets--including $1.3 billion in cash--in exchange for its 25 percent stake in Discovery Communications, according to Bloomberg.[26] The transaction will result in the partnership having about $696 million in net debt. The deal structure allows Cox to skip out on a substantial tax bill related to when it acquired Travel Channel in 2007 and received $1.3 billion in cash for its 25% stake in Discovery Communications Inc. (NASDAQ:DISCA).[23] For 2009, the Travel Channel is projected to have revenue of $186 million and cash flow of about $70 million, according to SNL Kagan. Cox got the channel two years ago as part of its deal to sell its stake in Discovery Communications Inc. joe.flint@latimes.com[3]
Under the terms of the deal, Scripps will take a 65% stake in the Travel Channel and contribute $181 million in cash into the new entity.[3] With Scripps' cash contribution, the newly reorganized Travel Channel will be left with about $696 million in debt, Scripps said Thursday in announcing the deal, which is expected to close by January. The pricetag for Travel Channel reinforces the value of strong cable outlets, which is welcome news to cable-rich congloms such as Time Warner, Disney, Viacom and News Corp. The auction of Travel Channel was closely watched by the biz as a gauge of the industry's appetite for media M&A deals.[21] Early in the process, bidders included media giants like Time Warner Inc., Scripps, Viacom, News Corp., and a consortium including private equity giant Providence Equity. That list was pared down to News and Scripps in later bidding stages, as the price of the network continued to rise - initially, analysts had valued Travel Channel at between $600 million and $700 million.[25] The transaction, which is expected to close by January, values the Travel Channel at $975 million, the companies say. It comes after weeks of jockeying between cable-network owner Scripps and media company News Corp., which also had chased the network, people familiar with the auction said. Scripps emerged as the leader only in recent days, some of those people said.[19]
The partnership, which will be controlled by Scripps, will take on $878 million in third-party debt. Sources previously said that News Corp (NWSA.O: Quote, Profile, Research ) and private equity firms Kohlberg Kravis Roberts & Co, Thomas H. Lee Partners and Providence Equity were interested in the Travel Channel, known for programs such as "Anthony Bourdain: No Reservations" and "Bizarre Foods with Andrew Zimmern."[9] The partnership will have about $696 million of net debt, Scripps said. The Travel Channel is home to popular shows such as Anthony Bourdain's "No Reservations," where the sharp-witted author and chef trots the globe in search of tasty local cuisine and color. Many of its other popular shows, like "Bizarre Foods" and "Man v. Food," also revolve around eating.[27]
The partnership will take on $878 million in debt that will be guaranteed by Scripps and distributed to Cox. The Travel Channel has done a nice job of boosting its ratings over the last few years, but analysts say there is still room for growth.[3] Cox will contribute the Travel Channel, valued at $975 million and the partnership, in turn, will take on $878 million in third-party debt that will be guaranteed by Scripps and indemnified by Cox, with the proceeds to be distributed to Cox.[4] Cox will put Travel Channel Media into the venture, Scripps will contribute $181 million in cash and guarantee $878 million in debt that will be indemnified by Cox.[11] Scripps will invest $181 million into the joint venture and take on $878 million in third-party debt. The partnership will be controlled by Scripps and it will run the network as part of its lifestyle media brands. Others interested in Travel Chanel included Kohlberg Kravis Roberts & Company, Thomas H Lee Partners, Providence Equity, Time Warner, NBC Universal, Vivendi and Liberty Media, adds Reuters.[8]
Scripps Networks will pay $181 million to get 65 percent of the channel and Cox will keep the remaining stake, the companies have revealed in a statement. Cox will contribute the channel and their partnership will carry $696 million in net debt. The deal concludes an exploratory process that Cox began with their exclusive advisors Goldman, Sachs & Co. in June.[15]
Under the deal announced on Thursday, Scripps, which already owns the Food Network and HGTV, gets 65 percent of the Travel Channel and Cox Communications will hold on to the other 35 percent.[9] Scripps Networks noted that upon completion of the transaction, it will own 65% of the Travel Channel and Cox Communications retaining a 35% minority stake in the cable television network.[17] Cox Communications became the sole owner of the Travel Channel in 2007. "Among cable companies, Cox has an outstanding reputation for its vision and investment for the long-term success of its business," Kenneth W. Lowe, Scripps Networks Interactive chairman, president and CEO, said in a statement.[12] Scripps Networks appears to be running out ahead in the chase to buy the Travel Channel from cable company Cox Communications.[7] Scripps Networks announced on Thursday that it has entered an agreement with Cox Communications to acquire a controlling interest in the Travel Channel.[28]
Scripps Networks Interactive has announced a plan to acquire a controlling interest in the Travel Channel, rounding out its suite of lifestyle programming, which already includes Food Network and HGTV.[29] Mergers and acquisitions! Scripps Networks Interactive Inc., owner of the Food Network, HGTV, and the upcoming Cooking Channel, agreed to buy a controlling stake in the Travel Channel, reports Bloomberg. Anthony Bourdain originally got his start on television with the Food Network series A Cook's Tour that ran for two seasons, later decamping to the Travel Channel to host the similar program No Reservations. They wanted to do barbecue shows and ranch shows and chili taste offs.[30] "Combining the Travel Channel with Food Network and HGTV will make our fast-growing, young company the undisputed global leader in lifestyle programming," said Kenneth W. Lowe, chairman, president and chief executive officer of Scripps Networks Interactive. "This collection of popular lifestyle networks will be in great demand worldwide and promises to create substantial long-term value for all of our stakeholders.[10] Launched in 1987, the Travel Channel reaches about 95 million U.S. TV households. Scripps Networks runs such lifestyle networks as HGTV, Food Network and DIY Network.[11]
"Combining the Travel Channel with Food Network and HGTV will make our fast-growing, young company the undisputed global leader in lifestyle programming," Scripps chairman Ken Lowe said in a statement announcing the acquisition.[28] During the earnings call, Ken Lowe, Scripps Networks' chairman, president and CEO, began to discuss the Travel Channel deal following an overview of the company's ratings fairly solid ratings performance. "I have to say, it was one of the worst kept secrets in M&A history, so I'm sure the announcement didn't take many of you by surprise," Lowe said, before describing what he said was a "tremendous opportunity" to add a major lifestyle category to Scripps Networks' existing home and food channels.[2] The deal will be a joint venture for the ownership and management of Travel Channel Media which Scripps will control and the network will be run as part of the company's growing portfolio of popular lifestyle media brands.[15] Scripps and Cox are forming a new Joint Venture to own and run Travel Channel Media Cox keeps 35% and Scripps gets 65%.'''[31] In creating a joint venture, Cox will contributing the Travel Channel, which the two sides valued at $975 million, and Scripps will put in $181 million in cash.[9] The financials are as follows: Cox will contribute the Travel Channel, valued at $975 million, and Scripps will ante up $181 million in cash.[28]
Scripps said Thursday it will take a 65 percent stake in Cox Communications Inc.' s Travel Channel, which reaches about 95 million U.S. households.[27] Under the terms of the deal, Scripps will acquire a 65 percent stake in the Travel Channel and Cox will keep the rest.[26]
Robert Willens, a tax analyst at Robert Willens LLC, said the structure of the deal allows Cox to put off paying capital gains taxes on the stake sale until the debt related to the deal is repaid — something that can take years. Sometimes the Internal Revenue Service challenges the structure of such deals, he said, arguing that the debt's guarantee is not meaningful. Cox spokesman Todd Smith said the deal was structured this way so the company could keep a stake in the Travel Channel. "There are tax consequences to every business decision, but that was our primary motivating factor," he said.[27]
The company behind the Food Network is snapping up a controlling stake in the Travel Channel, giving the cable network a value of nearly $1 billion.[27] After a months-long auction process that included some of the biggest names in cable programming, Scripps Networks Interactive has emerged as the winner for the Travel Channel, agreeing to pay about $1 billion for a 65% interest in the network.[25] "Scripps has an outstanding reputation as a company, an employer and a programmer. Over the past 15 years, Scripps Networks Interactive has built a portfolio of leading lifestyle programming brands and we think this complementary expertise will be a boon to Travel Channel's future growth."[25]
News Corp., Discovery Communications Inc. and Time Warner Inc. were also in the running for the Travel Channel, noted Deutsche Bank analyst Doug Mitchelson. He said the channel is a good fit with Scripps' existing networks, and its strength as a brand should help the company as it pursues international growth.[27] News Corp. ran Scripps close and pushed the price higher than had been widely anticipated. The deal, which could be announced this week values the Travel Channel at about $1 billion which many feel is rich for the current market.[7] News Corp. was said to be an aggressive suitor for the Travel Channel, but Scripps ultimately outbid Rupert Murdoch's media conglomerate.[28]
"Adding the Travel Channel and its related enterprises provides us with a unique opportunity to meaningfully expand our portfolio into a lifestyle category that is highly desirable to media consumers, advertisers and programming distributors," Scripps chairman and CEO Kenneth Lowe said in a statement. "Among cable companies, Cox has an outstanding reputation for its vision and investment for the long-term success of its businesses. We look forward to partnering with them in this venture." Scripps was expected to report third quarter earnings later today, but has postponed its conference call with analysts until Friday.[25] The channel will be run by a joint venture that Cox and Scripps are forming called Travel Channel Media, according to a statement from Cox. A Nov. 3 Forbes.com story describes the bidding war and why the Travel Channel commanded such a lofty premium.[20] Cox previously said it was exploring joint ventures for Travel Channel, which it acquired from Discovery Communications two years ago. In June Cox said it had received unsolicited inquiries about the channel unit and hired Goldman Sachs to evaluate its options.[14]
The network for wanderers seems to be doing a bit of that itself these days. Cox Communications, which owns the Travel Channel, is shopping it around, with several companies expressing interest.[32] Travel Channel parent Cox Communications first put the network on the block in June after receiving unsolicited inquiries, and hired Goldman Sachs as a financial adviser.[25]
The odd thing is that even though they were sold to Cox in 2008, Travel Channel still shares some production commonalities Discovery Communications' networks, including the format of the end credit roll.[32]
Travel Channel, which was launched in 1987, now reaches about 95 million U.S. television households, according to the statement by Scripps Networks.[17] "Adding the Travel Channel and its related enterprises provides us with a unique opportunity to meaningfully expand our portfolio into a lifestyle category that is highly desirable to media consumers, advertisers and programming distributors," said Scripps Networks chairman, president and CEO Kenneth Lowe.[11] "The incredibly complementary nature of our lifestyle media businesses presents an abundance of opportunity to provide services for Travel Channel that will result in increased advertising and affiliate revenues and substantial cost synergies," said Kenneth Lowe, chairman, president and CEO of Scripps.[23]
Fine Living is becoming the Cooking Channel even though they already have the Food Network??? Explain that stupidity please. As for Scripps adding Travel Channel to its stable, in comparison to their other channels, it is like adding a race horse to a plow team. The Travel Channel might be able to help them but they won't be able to help it.[31] Scripps also has HGTV, Food Network, DIY, Fine Living (becoming the Cooking channel), and Great American Country. Travel fits its portfolio of underperformers.[31]
The partnership will have about $696 million of net debt. Scripps, which is also delaying its earnings report until Friday, already owns the Food Network and HGTV lifestyle television networks.[5] Analysts, on average, were expecting a profit of 36 cents per share on sales of $365.6 million. The company said the quarter's results "reflect strong affiliate fee revenue growth and improved advertising sales" at its flagship cable TV networks, Food Network and HGTV.[1] Food Network operating revenue was $119 million, up 5.1%, and reached 99 million subscribers, up from about 97 million at the end of the third quarter 2008.[33]
CBS Interactive Reports Earnings Drop Of 15% Reflecting a weakened display advertising market, CBS Corp.' s third quarter Interactive revenues declined 15%, the company said on Thursday. That amounts to $121.3 million -- down from $142.3 million during the same quarter last year.[22]
Lifestyle Media advertising revenue grew 0.5% to $237 million while affiliate fee revenue was up 16% to $81.1 million on higher rates for HGTV and expanding distribution of all of the company's television networks.[33] The company's Lifestyle Media segment posted profit of $150.5 million, up 8.3% from $138.9 million reported a year ago, on operating revenues of $325.5 million, up 4.3% from $312.0 million.[33]
The partnership will take on $878 million in third-party debt that will be guaranteed by Scripps and indemnified by Cox, the company said. [12] The partnership, in turn, will take on $878 million in third-party debt that will be "guaranteed by Scripps and indemnified by Cox," with the proceeds to be distributed to Cox.[23]
Scripps ( SNI - news - people ) will contribute $181 million in cash to the venture, which will take on $878 million in debt that will be guaranteed by Scripps and indemnified by Cox.[20] Under the joint venture agreement, Scripps Networks will contribute $181 million in cash.[27] The companies will form a joint venture to house Travel, to which Scripps will contribute $181 million in cash.[21]
Scripps Networks will pay $181 million in cash to the newly created partnership between the two companies.[12] Scripps will contribute $181 million in cash to a newly created partnership, according to the release.[10]
According to the deal, Scripps will pay $181 million in cash and guarantee a third-party loan for $878 million that will be distributed to Cox.[25] Its cash-and-debt deal with Cox Communications values the little-watched cable network at $975 million.[3]
When Cox first put Travel Channel on the block, most thought it would fetch $600 million to $700 million. Despite featuring such shows as Anthony Bourdain's "No Reservations" and "Bizarre Foods With Andrew Zimmern," the Travel Channel has no programs that regularly draw more than 1 million viewers.[3] Scripps also owns HGTV, with home improvement, decorating and do-it-yourself shows like "Real Estate Intervention" and "Renovation Realities." Cox began to explore its options for the Travel Channel in June.[27] Scripps Networks'and Cox will form a partnership, with Cox contributing the Travel Channel.[29] Cox said in June 2009 that it had received unsolicited offers for the Travel Channel, which it acquired from Discovery Communications back in 2007. Scripps was planning to announce quarterly results this morning but has now pushed back its earnings call until tomorrow morning.[16]
Questions in the Scripps deal will be about the future of the Travel Channel, which experts have said has weak brand positioning on the Internet with about 1.3 million unique visitors per month.[23] Under the deal, expected to close in the coming months, Cox will contribute Travel Channel Media.[18] A deal could be announced as soon as Thursday and values Travel Channel at about $1 billion, according to the website, which cited people briefed on the talks.[14]
Initially, media analysts and bankers expected Travel Channel to be valued in the range of $600 million to $700 million.[9] The Travel Channel was launched in 1987 and reaches about 95 million households in the United States. Its value is listed around $975 million.[29]
The Travel Channel reaches about 95 million U.S. television households, the company said.[28]
Scripps Networks, the owner of Food Network, HGTV and the DIY Network, gets a channel distributed in about 95 million U.S. homes.[15] Like other media companies, Scripps Networks--owner of HGTV and Food Network as well as Web sites Shopzilla and uSwitch--has faced a drop in advertising dollars, although Scripps Networks.[34] The network will join other Scripps channels like HGTV, Food Network, DIY and the Cooking Channel (formerly Fine Living), which will be on the menu next year.[25]
Cincinnati-based Scripps, which owns the Food Network and HGTV, will get a 65 stake, with Cox retaining 35 percent.[28] Scripps Networks and Cox will form a joint venture, controlled by the former with a 65 percent stake, over the next few months.[11] Atlanta-based Cox will keep a 35 percent stake in the network, the company said.[12]
There are three rivals fighting to acquire the 65% controlling stake from Cox Communications but Chase Carey, the News Corp CEO says the company would be "uniquely capable" of developing the product.[7] Cox Communications Inc. (NYSE:COX) will retain a 35% stake, spinning it off into a so-called leveraged joint venture.[23]
The joint venture will take on $878 million in debt that will be paid out in cash to Cox.[21] The channel is valued at $975 million, and the venture will take on $878 in debt.[35]
The partnership will take on $878 million in third-party debt, to be guaranteed by Scripps, resulting in the partnership having about $696 million in net debt. At this point, there's no clear indication whether the deal will mean more jobs for Knoxville.[29] The partnership will take on $878 million in guaranteed debt, the companies said.[28]
The transaction will result in the partnership having about $696 million in net debt.[17]
As per the company's announcement on October 19, it had recorded a net income of $200 million or $0.13 per share for the third quarter of 2009. [36] As updated, the company reported a net loss of $94 million or $0.06 per share in the third quarter.[36]
The company noted that the year-ago net income was reduced by $0.03 per share due to a $4.5 million charge that resulted from a re-measurement of the company's deferred tax liabilities. The re-measurement was related to the company's spinoff from its former parent.[33]
On average, 13 analysts polled by Thomson Reuters expected the company to report earnings of $0.37 per share.[37]
Shares of Scripps Networks rose 62 cents to finish trading at $39.23. AP Technology Writer Rachel Metz in San Francisco contributed to this report.[27] Collins Stewart analyst Thomas Eagan on Thursday downgraded shares of Scripps Networks from "buy" to "hold." "We estimate that the (Travel Channel) venture is dilutive to Scripps' valuation," and the stock has had an "impressive run" with little near-term upside left, he argued.[18]
Cincinnati-based Scripps Networks Interactive is one of the leading developers of lifestyle-oriented content for television and the Internet, where on-air programming is complemented with online video, social media areas and e-commerce components on companion Web sites and broadband vertical channels.[4] Scripps Networks Interactive CEO Kenneth Lowe called the deal "a unique opportunity to meaningfully expand our portfolio into a lifestyle category that's highly desirable to media consumers, advertisers and programming distributors."[21]
NEW YORK — Scripps Networks Interactive Inc. is betting that food and travel are an ideal combination.[27] Scripps Networks Interactive Inc.' s (SNI) third-quarter earnings rose 14% amid a prior-year charge as the company saw continued strength in its cable-television operations.[34]
The company's media portfolio includes, Lifestyle Media, with popular lifestyle television and internet brands HGTV, Food Network, DIY Network, Fine Living Network (FLN) and country music network Great American Country; and Interactive Services, with leading online search and comparison shopping services BizRate and Shopzilla.[4] Scripps operates newspapers in 14 markets and 10 broadcast TV stations, and it owns the Food Network and HGTV lifestyle television networks.[20]
Deal calls for Scripps, whose lifestyle-oriented cablers include Home and Garden TV, Food Network and DIY TV, to acquire 65% of the cabler from Cox.[21]
As far back as 15 years ago, Scripps, then SNI's parent, was following a blueprint to become a "major presence in three distinct fields -- food, travel and home and garden," recalled Reese Schonfeld, who helped establish CNN and then later co-founded the Food Network. This is a free content preview.[24] I have pretty much as close to final cut as anyone who's ever worked in television has. Will Bourdain's new corporate overlords tolerate his expensive travel show? Will they accept his cartoon webisodes that mock their roster of stars? And what about Food Network's No Reservations knockoff, Extreme Cuisine with Jeff Corwin ? Reasonably, we fear the worst.[30] "Our vision for Travel follows the same script that's made Food Network and HGTV two of the most powerful brands in all of television."[28]
TC belongs at Scripps, although I worry that some shows, like Man Vs. Food, will get poached for Food Network or cancelled outright for being too similar to existing Scripps properties.[32]
New Report Says Oprah Is Jumping to OWN Broadcasting & Cable CBS' The Oprah Winfrey Show will depart broadcast syndication and move to Winfrey's new cable network, OWN, when the show's contract expires in 2011, according to a report published by Deadline Hollywood Daily. That. 'Gossip Girl' Protest Equals Free Promo for The CW Daily Finance The Parents Television Council has trained its rhetorical cannons on The CW Network, which has been promoting an upcoming episode of "Gossip Girl" featuring a three-way sexual romp between its teenage characters.[22] The cable industry has largely consolidated, and individual networks rarely go up for sale. That led to interest from Rupert Murdoch's News Corp., but this week the company backed away. NBC Universal also expressed some interest but soon became tied down in its own negotiations to be acquired by Comcast Corp.[3] The network, which will be controlled by Scripps, was put up for auction last Summer and attracted interest from other juggernauts such as News Corp and NBC Universal.[16]
Scripps announced the plan Thursday, in which it will acquire a 65 percent interest in the Travel Channel. [29] Dirk Smilie, 11.05.09, 09:40 AM EST Five months and $1 billion later, Scripps acquires Travel Channel.[20]
Travel Channel, which bowed in 1987, is available in 95 million cable and satellite TV homes.[21] Media consulting firm SNL Kagan says the carriage fees the Travel Channel charges cable and satellite operators amount to only 6 cents per subscriber a month, on the low end for the industry.[3] Travel Channel Media includes Internet, mobile and social-media applications.[12]
The company said it will discuss the Travel Channel deal on the Friday call.[25] Hell, the Travel Channel logo still includes a spinning globe, which is the 'mark' of the Discovery networks.[32] The Travel Channel is a popular leisure channel featuring documentaries and airs shows related to travel and leisure around the U.S. and throughout the world.[4] Mark Bowser, Cox's chief financial officer, says a genre ripe for growth on the channel is food and travel shows, which "have driven the value of the channel up." Or at least the price.[20]
The joint venture gives Cox some needed tax advantages and eases the cash burden for Scripps to take control of the channel.[20] Cox's offerings include cable-television distribution, phone and high-speed Internet services. It is owned by Atlanta-based Cox Enterprises Inc., a privately held diversified media company that also owns newspapers including The Atlanta Journal-Constitution and television and radio stations. It also owns AutoTrader.com, an auto-classifieds Web site. Scripps, which was spun off from newspaper chain E.W. Scripps Co. last year, also said it is delaying its third-quarter earnings report, by one day, until Friday.[27] Cox Communications is owned by Atlanta-based Cox Enterprises Inc., an Atlanta-based communications, auto services and media company, whose holdings include The Atlanta Journal-Constitution.[12]
Cox Communications will hold the other 35 percent. The transaction is expected to be completed by January of this coming year, if not earlier.[29]
On the down side, the company's Interactive Services segment, which includes online comparison shopping services Shopzilla and BizRate, was down 25 percent to $39 million. [2] Bad economy or no, online radio is poised to boom. Total online revenues are expected to grow 12% in 2009 to $441 million, according to a new forecast from SNL Kagan, followed by 20% growth in 2010, when they should top $530 million.[22] Operating revenues increased to $364.46 million from $364.19 million in the same quarter last year.[37] Quarterly operating revenues edged up 0.1% to $364.5 million from $364.2 million reported in the corresponding quarter of the previous year.[33]
Operating revenue at HGTV was up 6.4% totaling $153 million for the latest quarter.[33] Eleven Wall Street analysts had a consensus revenue estimate of $365.62 million for the quarter.[33]
The company will pay $296 million on behalf of Guidant to settle the DOJ investigation. Boston Scientific also updated its third quarter results to include the the charge related to the settlement and now indicating a net loss of $94 million for the quarter. The company also cut its GAAP earnings outlook for fiscal 2009.[36] Accordingly, the company recorded a charge of $294 million in the third quarter, on a pre-tax as well as after-tax basis. This amount represents the $296 million charge associated with the agreement net of a $2 million reversal of a related accrual. Based on the charge, the company has updated its financial results for the third quarter and nine months ended on September 30, 2009.[36]
According to Boston Scientific, it had previously disclosed an investigation by the U.S. Attorney's Office in Minneapolis into alleged violations of the Food, Drug, and Cosmetic Act by Guidant. Commenting on the deal, Ray Elliott, President and Chief Executive Officer of Boston Scientific, stated, "We are pleased this investigation has been resolved." "Guidant and its employees acted in good faith and believed they complied with applicable laws and regulations. We elected to resolve this matter so we could put it behind us and devote our full energies and resources to developing our innovative technologies," Elliott added. Boston Scientific said that the agreement has to be recorded in its recently closed third quarter based on U.S. Generally Accepted Accounting Principles, or GAAP, as it occurred after the October 19th release of the company's third-quarter financial results and before the filing of the Quarterly Report on Form 10-Q.[36]
News Corp. had also been in the running for the channel, but recent reports said a deal became too expensive for it.[11] Wearing the undergarments present some practical problems, Rachel Dodes. Unilever Price Cuts Surprise Analysts; Soap Deal Lifts Costs Bloomberg When Paul Polman became CEO of Unilever at the beginning of the year, he promised to stoke sales growth. He's done so by boosting advertising, accelerating the introduction of new products and, it turns out, by cutting prices by as. After Mickey's Makeover, Less Mr. Nice Guy New York Times Concerned that Mickey Mouse has become more of a corporate symbol than a beloved character, Disney is re-imagining him for the future, Brooks Barnes reports.[22] Q+A Douglas Ferguson How will we consume media in five and 10 years' time? Ferguson: When everything is digitized and libraries offer materials, we will have access to anything and everything whenever we choose, at a trivial long-tail price. Q+A Lance Broumand How will get your news in a few years? Broumand: I think it's one page that looks a lot like what the Drudge Report looks like right now.[22]
Jeff Zucker Is Not Going Anywhere Jeff Zucker, CEO and president of NBC Universal, has been trying to turn digital dimes into digital dollars for years. Currently he's delivering tv programs online through Hulu, transforming nbc tv stations into hyper local Web destinations, and selling tv advertising based on the Internet's automated, targeted model. Jonathan Miller Preaches the Agnostic Gospel of the Cloud Jonathan Miller is more determined than ever to crack interactive media's money-making code in his new job as News Corp.' s digital chief. He's got plenty of learning experience to draw from, both as a partner at venture capital firm Fuse Capital and as the chairman and CEO of.[22] The nyc Wine and Food Festival had taken over half the Meatpacking District for the weekend, putting the focus. Trim Marks Original online video took a beating this year, but the shine hasn't quite worn off yet. Despite a string of high-profile broadband start-up flops earlier in the year, media companies like Alloy Media + Marketing, studios like Generate and Web destinations such as the Sony-owned Crackle continue to.[22]
How To Create A Successful Low-Cost Video Network On YouTube's most-viewed channel list you'll find the how-to video network ExpertVillage in second place for all time with 812 million views. [22] At the time, analysts said the channel's value was between $600 million and $700 million.[14]
Ecommerce Declines For Two Consecutive Years For The First Time Ever During the third quarter of the year, ecommerce spending was down 2% year-over-year to $29.6 billion, according to new comScore research.[22] Smartphone sales continued to hum along in the third quarter, with worldwide shipments up 4.2% in the period compared to a year ago, according to new data from technology research firm IDC. The total of 43.3 million smartphones, which IDC calls "converged devices," also increased 3.2% from the.[22]
With an average delivery of 19.4 million viewers, the six-game World Series outdrew last year's. Gannett's 'Buzz' Services Attract New Advertisers Editor & Publisher USA Today reports that offerings on its offshoot Web site -- the Buzz Bureau -- represent around 1% of its advertising revenue, so far.[22] Opponents say the Hollywood proposal to. DirecTV's Costs Offset Higher Revenue in 3Q The Associated Press DirecTV, the nation's largest satellite TV operator, says its revenue grew 10% in the third quarter as it added more new customers, but its results suffered from higher marketing costs used to attract them.[22]
Scripps beat competing bidder News Corporation ( NASDAQ:NWSA ) in its attempt to acquire a controlling stake in the channel. [35] Cox will retain a 35% ownership stake in the partnership, giving Scripps 65% interest.[20]
Back in June, when Cox first put it on the block, industry watchers figured it would fetch between $600 million and $700 million. [32] The Cincinnati, Ohio-based company's third-quarter net income attributable to SNI was $65.3 million, up 13.9% from $57.3 million in the year-ago quarter.[33] Income from continuing operations attributable to SNI totaled $64.6 million, compared to $58.2 million in the same quarter of last year.[33] Income from continuing operations, net of tax was $84.42 million, compared to $77.53 million in the prior year quarter.[37]
Consolidated expenses for the quarter dropped 4.5% to $220.2 million from $230.5 million incurred in the three months ended September 30, 2008.[33]
News Corp. had been in the running for the channel but dropped out after the asking price approached $1 billion. [21] According to several reports, News Corp. was said to be in the lead for the network, but dropped out of the bidding last week when it determined the price was too rich.[25] HBO Sports senior vice president Mark Taffet discusses the PPV performance prospects for the Sept. 19 Floyd Mayweather Jr. -Juan Manuel Marquez boxing event as well as the network's PPV fight schedule for the rest of the year during a recent'' interview with Multichannel News.''[25] Fox Soccer Channel : America'''s premier destination for the world'''s game, offering unprecedented coverage of live and premier world-class soccer, news and original shows throughout the year.[25]
The Travel Channel hasn't landed yet, and it could take a while for the dust to settle.[32]
Shares of TransDigm (NYSE: TDG ) have now pushed to session lows as an analyst at Davenport has just downgraded the stock from Buy to Neutral. The firm also lowered its price target to $42. The firm said its downgrade was "driven by an ~40c/share increase in 2010 interest expense from the recent $425 debt offering, but more importantly, our belief that a 2H'10 return in commercial aftermarket demand is more wishful thinking than reality." Davenport points out that as the major airlines are still falling short on covering their costs, it believes the "next 6-12 months will see one or all of the following bad-for-aftermarket trends: lower in-service utilization rates, more aircraft groundings, mergers, or outright failures." [38] On average, 13 analysts polled by Thomson Reuters expected the company to post earnings of $0.37 per share.[33]
APRIL 14, 2009 at the TIME & LIFE BUILDING, NYC. A one-day event where seasoned Mediaweek editors will help decipher the strengths and weaknesses among the broadcast and cable networks, TV syndicators and digital players. [11] The ultimate valuation underscores the appetite in the industry for cable networks, which draw revenue from distribution fees as well as advertising.[9] Cable Up! is the cable network programming resource for media planners and buyers during the crucial upfront selling season.[11]
The Wall Street Journal notes the Scripps deal structure is similar to one being discussed by Comcast Corp. (NASADAQ:CMCSA) and General Electric Co. (NYSE:GE) for NBC Universal Inc. Besides the iffy cash component of that possible deal, a Chicago Tribune reporter argues a deal could pose regulatory questions. [23]
SOURCES
1. The Associated Press: Scripps Networks posts higher 3Q profit
2. Scripps Networks Profits Rise 14 Percent, Travel Channel Deal 'Worst Kept Secret In M&A History' | paidContent
3. Scripps Networks Interactive buys majority stake in the Travel Channel -- latimes.com
4. domain-b.com : Scripps Networks Interactive to acquire controlling interest in Travel Channel
5. The Associated Press: Scripps to get majority stake in Travel Channel
6. Scripps Networks To Buy 65% Stake Cox's In Travel Channel - WSJ.com
7. Scripps close on Travel Channel deal | News | Breaking Travel News
8. emii.com: Scripps To Buy $975M Travel Channel Stake
9. REFILE-UPDATE 2-Scripps lands deal for the Travel Channel | Industries | Technology, Media & Telecommunications | Reuters
10. Scripps Networks Wins Travel Channel Bidding - 2009-11-05 10:05:32 EST | Broadcasting & Cable
11. Scripps Acquires 65% of Travel Channel
12. Scripps Networks buys 65 percent stake in Travel Channel from Cox Communications | ajc.com
13. Scripps closes in on Travel Channel stake
14. Scripps may announce Travel Channel deal Thurs: report | Entertainment | Industry | Reuters
15. Scripps beats News Corp. to Travel Channel deal | News | Breaking Travel News
16. Scripps Buys 65% Stake In Travel Channel, Sets Up Joint Venture With Cox
17. RTTNews - Latest Earnings,Upcoming Earnings, Pos Pre Announcements, Pos Pre Announcements , Positive Surprises, Negative Surprises, Hot Stocks, Stock Split Calendar, Stock Buybacks, Dividends, Negative, Positive PreAnnouncements,Surprises .
18. Scripps secures 65% of Travel Channel
19. Scripps Wins Travel Channel Deal - WSJ.com
20. Travel Plans - Forbes.com
21. Scripps cuts deal for Travel Channel - Entertainment News, TV News, Media - Variety
22. MediaPost Publications - Home of MediaDailyNews, MEDIA and OMMA Magazines
23. Scripps wins Travel Channel, Cox avoids tax (Corporate Dealmaker)
24. Scripps Network tunes in Travel Channel (Dealscape - Pipeline)
25. Scripps Snaps Up Travel Channel In $1B Deal - 2009-11-05 10:06:42 EST | Multichannel News
26. Dow Lohnes, Skadden on Travel Channel Sale
27. The Associated Press: Scripps to get majority stake in Travel Channel
28. Done Deal: Scripps to Acquire Travel Channel | The Wrap
29. WBIR.com | Knoxville, TN | Scripps television to pick up Travel Channel
30. Anthony Bourdain Back in Bed With the Food Network Eat Me Daily
31. Scripps wins Travel Channel bidding - TV Ratings, Nielsen Ratings, Television Show Ratings | TVbytheNumbers.com
32. Travel Channel to find new home | Gadling.com
33. RTTNews - Latest Earnings,Upcoming Earnings, Pos Pre Announcements, Pos Pre Announcements , Positive Surprises, Negative Surprises, Hot Stocks, Stock Split Calendar, Stock Buybacks, Dividends, Negative, Positive PreAnnouncements,Surprises .
34. Scripps Networks 3Q Earnings Up 14% Amid 2008 Charge - WSJ.com
35. Scripps Beats News Corp for Stake in The Travel Channel (SNI,NWSA) - Comtex SmarTrend Alert
36. Boston Scientific Settles DOJ Guidant Probe For $296 Mln.; Takes Q3 Charge, Lowers FY09 GAAP EPS View - Update
37. RTTNews - Latest Earnings,Upcoming Earnings, Pos Pre Announcements, Pos Pre Announcements , Positive Surprises, Negative Surprises, Hot Stocks, Stock Split Calendar, Stock Buybacks, Dividends, Negative, Positive PreAnnouncements,Surprises .
38. StreetInsider.com
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