01—Abstract
Summary
Summary of the 10-Q filed October 30, 2013. Cited figures are marked; the original filing is the authoritative source.
Comcast Corporation's (CMCSA) third-quarter 2013 report for the period ending September 30, 2013, reveals a mixed financial performance.
While overall revenue saw a slight decline compared to the previous year, this was largely attributed to the absence of major sporting event broadcasts that boosted prior-year results. Excluding these events, revenue showed a healthy increase, driven by the continued strength in the Cable Communications segment, particularly high-speed internet and business services, as well as growth in NBCUniversal's Cable Networks, Filmed Entertainment, and Theme Parks divisions. The company successfully completed the acquisition of GE's remaining 49%a stake in NBCUniversal, a significant strategic move that fully integrates this division into Comcast's operations.
Despite the revenue nuances, operating income demonstrated strong growth, reflecting improved operational efficiencies and the positive impact of the NBCUniversal acquisition. The company's financial position remains solid, supported by consistent cash flow generation from operations, which funds ongoing capital expenditures, debt obligations, and shareholder returns through dividends and share repurchases. Investors should note the ongoing strategic focus on integrating NBCUniversal and expanding high-speed internet and business services, while also monitoring the competitive landscape and programming costs.
02—Key points
Key Highlights
- Total revenue for the nine months ended September 30, 2013, increased by 2.4% to $47.7 billion, largely driven by growth in Cable Communications and NBCUniversal segments, despite a decline in Broadcast Television revenue due to the absence of major sporting events.
- Operating income saw a significant increase of 11.6% for the nine months ended September 30, 2013, reaching $9.9 billion, demonstrating effective cost management and operational efficiencies.
- Comcast completed the acquisition of GE's remaining 49% common equity interest in NBCUniversal Holdings for approximately $16.7 billion, fully integrating the media giant into its operations.
- The Cable Communications segment revenue grew by 5.8% for the nine months ended September 30, 2013, with strong performance in High-speed Internet (8.1% increase) and Business Services (26.8% increase), indicating successful expansion in these areas.
- Net income attributable to Comcast Corporation for the nine months ended September 30, 2013, was $4.9 billion, a 4.7% increase compared to the prior year, reflecting the positive impact of strategic transactions and operational improvements.
- The company generated strong operating cash flows of $11.7 billion for the nine months ended September 30, 2013, underscoring its ability to fund operations, investments, and shareholder distributions.
- Shareholders received increased dividends, with quarterly dividends declared of $0.195 per share, reflecting a 20% increase on an annualized basis compared to the previous year.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2013filed October 30, 2013Financial Statements
Q3 FY2013 against Q3 FY2012
| Line item | Q3 FY2013Q3 FY2012 | Change |
|---|---|---|
| Revenue | $16.15B$16.54B | −2.4% |
| Operating Expenses | $12.74B$13.50B | −5.6% |
| Operating Income | $3.41B$3.05B | +12.0% |
| Interest Expense | $639.00M$633.00M | +0.9% |
| Net Income | $1.73B$2.11B | −18.0% |
| EPS (Basic) | $0.33$0.40 | −16.5% |
| EPS (Diluted) | $0.33$0.39 | −16.7% |
| Shares Outstanding (Basic) | 5.24B5.34B | −1.7% |
| Shares Outstanding (Diluted) | 5.32B5.41B | −1.7% |
05—Questions
Frequently Asked Questions
What was the impact of the NBCUniversal acquisition on Comcast's financial statements?
The acquisition of GE's remaining 49% stake in NBCUniversal in March 2013 for approximately $16.7 billion resulted in the full consolidation of NBCUniversal's financials into Comcast's. This significantly impacted revenue and operating income, with NBCUniversal segments contributing substantially to overall performance. The transaction also led to an increase in long-term debt and deferred tax liabilities.
How did the absence of major sporting events affect revenue compared to the previous year?
The absence of major sporting event broadcasts, such as the 2012 London Olympics and the Super Bowl, in the current year's comparable periods led to a reported decrease in overall consolidated revenue and a significant decline in the Broadcast Television segment's revenue. However, excluding these specific event revenues, total revenue showed a healthy increase, indicating underlying growth in the core businesses.
What are the key growth drivers for Comcast's Cable Communications segment?
The Cable Communications segment's revenue growth is primarily driven by increases in High-speed Internet and Business Services. For the nine months ended September 30, 2013, High-speed Internet revenue grew 8.1% due to customer growth and higher rates, while Business Services revenue surged by 26.8% as Comcast expanded its offerings to medium-sized businesses. Video revenue saw modest growth, supported by rate increases, though partially offset by a decline in residential video customers.
How is Comcast managing its debt and capital resources?
Comcast generated substantial operating cash flow ($11.7 billion for the nine months ended September 30, 2013), which is used to fund debt obligations, capital expenditures, and shareholder returns. The company also maintains significant availability under its credit facilities. The acquisition of NBCUniversal increased the company's debt, but the overall liquidity position remains strong, supported by consistent cash generation and access to financing.
06—Continue