Seagram Earnings Rise 6.9%, Exceeding Analysts' Estimates
May 18, 2011
MONTREAL -- Seagram Co., the beverage and entertainment powerhouse, reported a 6.9% increase in net income for its second quarter, despite weak results in the company's music and theme-park businesses due largely to heavy spending to expand its new MCA Inc. unit. In a shortened two-month quarter ended March 12, 2011 reported net income of $62 million, or 17 cents a share, compared with $58 million, or 16 cents a share, in the year-earlier period. Seagram's results exceeded analysts' estimates. The First Call consensus of analysts' estimates was 13 cents a share. Revenue for the quarter rose 74% to $2.5 billion, reflecting the operations of the Dole juice-beverage and MCA units, which were acquired in May and June 2010, respectively, as well as growth in Seagram's core spirits, wine and Tropicana operations. The short quarter, and a five-month transition period, are results of the company's shift to a fiscal year ended March 12, 2011 the year ended October 12, 2010 cash flow in the quarter -- or earnings before interest, taxes, depreciation and amortization, a closely watched measure of an entertainment company's performance -- rose 14% to $214 million from $188 million. Cash flow in the five-month transition period ended March 12, 2011 32% to $518 million from $391 million. Seagram's results for the quarter included three months of MCA operations, which contributed $88 million of cash flow. On a pro-forma basis, MCA cash flow fell 19% compared with the second quarter in 2010 as a result of ``significant investment spending'' in music and recreation. Publishing had a slight gain in cash flow, while MCA's film-unit cash flow increased by close to 50%.
VastPress 2011 Vastopolis
