Earnings Preview: Viacom 2nd-quarter profit seen down on weaker film slate, fewer sales

Earnings Preview: Viacom 2Q seen down

NEW YORK — Viacom Inc., the media conglomerate controlled by Sumner Redstone and which owns Paramount Pictures and the “Rock Band” video-game franchise, reports its second-quarter earnings before the market opens on Tuesday. The following is a summary of key developments and analyst opinion related to the period.

OVERVIEW: A weak advertising market and slower video-game sales is expected to hurt the media giant.

Its movie studio profits are also expected to fall despite blockbuster movies such as “Star Trek” and “Transformers: Revenge of the Fallen.” Two flops, “Dance Flick” and “Imagine That,” hurt results as did fewer distribution deal releases.

This summer, it had one such release, DreamWorks Animation’s “Monsters vs. Aliens,” compared with three from last year, “Kung Fu Panda” and “Madagascar: Escape 2 Africa” from DreamWorks Animation, and “Iron Man” from Marvel Studios.

BY THE NUMBERS: Analysts, on average, expect Viacom to see revenue fall 9 percent to $3.5 billion, with earnings per share of 48 cents, down from 64 cents a year ago, according to a survey by Thomson Reuters.

ANALYST TAKE: On Monday, Benchmark analyst Frederick Moran kept a “Hold” rating on the stock with a $25 target price. He said the company has “shown vulnerability to the global recession.”

He expects the company to bring in revenue of $3.3 billion and earn 51 cents per share.

WHAT’S AHEAD: Paramount will release “G.I. Joe: The Rise of Cobra” on Aug. 7.

STOCK PERFORMANCE: Viacom shares rose 31 percent to $22.70 on June 30, up from $17.38 on March 31.