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International revenues, profit slip at Discovery

International revenues and profit fell at Discovery Communications in the most recent quarter, with the US channels giant blaming currency issues and the disposal of part of its SBS Discovery radio business.

David ZaslavSales from the international networks division were US$790 million for the three months to end-June compared with US$801 million in the same period last year.

Adjusted profit, also slipped, and was down 6% at the global division, taking the total to US$249 million.

While distribution revenues from the channels were up in the quarter and half-year, with Discovery pushing hard for higher affiliate fees, the international advertising business was down 8% year-on-year. The company has inked a new extensive deal for its cable nets, announced today, guaranteeing them long term carriage on Liberty Global’s network of pay TV platforms.

Operating costs, meanwhile, increased 9% owing to, Discovery said, production and sport content costs.

Discovery said that stripping out the effects of currency fluctuation and the disposal of the SBS Discovery Radio business to Bauer Media last year, revenues actually climbed 8% in the quarter.

Measured across the first six months of the year, international revenues were down 2% at US$1.5 billion, and profit fell by 10%, taking the total to US$434 million.

Discovery has placed international growth at the centre of its strategy, along with new digital initiatives.

Across the US-listed company, half-year revenues climbed 2% to US$3.3 billion and profit was up 3% at US1.3 billion.

“Discovery posted a solid quarter of growth and financial results by investing in premium and diversified content that fuels the passion of superfans on pay-TV, free-to-air, direct-to-consumer and digital platforms,” said David Zaslav, president and CEO of Discovery (pictured). “Our differentiated portfolio of non-fiction, sports and children’s content in more than 220 markets positions Discovery for continued growth and shareholder value creation in the months and years to come.”

The firm said in May it would make staff cuts in order to save up to US$60 million, which would free up funds to invest in digital and content strategies.