Cbs The Winner's A Loser
CBS may be the most-watched television network, but its high ratings are no longer translating into the kind of high revenue they once did, given the belt-tightening of most advertisers during the current recession. Parent company CBS Corp. on Wednesday reported a 52-percent plunge in net income in its fourth quarter to $136.1 million from $285.2 million during the comparable period a year ago. The company, which has paid a high dividend despite declining sales, slashed its dividend 81.5 percent. CBS CEO Les Moonves said that by cutting its dividend, CBS would be able to "strengthen our financial flexibility to meet our debt obligations even in difficult credit markets." While the company said that revenue from TV advertising was down just 8 percent, it took its biggest hits from its outdoor advertising unit, which was down 75 percent, and radio, which was down 56 percent. On the other hand, its newly acquired CNET Networks along with other interactive operations reported a 1 percent uptick in revenue; likewise, its publishing company, Simon and Schuster, also reported a 1-percent rise. For the year, the company posted a loss of $11.7 billion versus a profit of $1.2 billion in 2007. CBS Corp. shares, which have declined 80 percent from a year ago, rose 4.6 percent following Wednesday's earnings call.