Last updated: February 20. 2013 4:24AM - 84 Views

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(AP) Viacom Inc. said Thursday that net income rose sharply in its fiscal first quarter versus results depressed by a large accounting charge a year ago. But its revenue and adjusted earnings fell because of a drop at its Paramount studio business and lower advertising revenue at its television channels.

Net income rose to $470 million, or 92 cents per share, in the fiscal first quarter, compared with $212 million, or 38 cents per share, a year earlier. That period included $379 million in charges related to a contract battle with the maker of the Rock Band video games, Harmonix Music Systems Inc.

After adjustments, Viacom earned 91 cents a share, a penny above the 90 cents expected by analysts surveyed by FactSet. A year ago, adjusted earnings came to $1.06.

Revenue fell 16 percent to $3.3 billion from $3.95 billion a year ago. But the latest figure was short of the $3.48 billion expected.

Revenue at the Paramount filmed entertainment business fell 37 percent to $975 million, largely because the release schedule. The 2011 period included such hits as Mission: Impossible Ghost Protocol in theaters and a Transformer movie on home video. Viacom also saw declines in licensing fees from television shows it produces.

Viacom's larger business, the television networks such as MTV, Comedy Central and Nickelodeon, saw a 2 percent decline in revenue to $2.39 billion. Lower advertising revenue in the U.S. resulted from lower television ratings, though Viacom has long insisted that current measurement techniques do not fully capture its audiences, particularly online. The ad declines were partly offset by increases in the fees cable and satellite companies pay to carry Viacom's channels.

CEO Philippe Dauman said the company was seeing improvements from its investments in programming and blamed difficult short-term comparisons for the decline in the October-December period.

Viacom, which is based in New York, took an after-tax charge of $379 million in the 2011 quarter to cover an arbitration award won by the original shareholders of Harmonix.

Viacom had acquired Harmonix in 2006, but sold it back to its founders in 2010. The founders then sued, claiming that they were owed extra payments for the performance of Rock Band during its spell of popularity. They won an arbitration award of $383 million.

Its shares finished at $62.18 on Wednesday.

Associated Press
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