(Adds information about possible spinoff of MSG business,
updates stock price.)
Cablevision Systems Corp. (CVC) swung to a first-quarter profit,
helped by strong results at its telecommunications-services
business, and said it will explore a spinoff of its Madison Square
Garden business.
Shares jumped 12% to $20.47.
Looking at a possible spinoff for MSG, which includes the New
York Knicks and Rangers, comes after Chief Executive James Dolan
said in February there was "no change" in the company's plans to
spend $500 million renovating the iconic arena.
Meanwhile, Cablevision reported a profit of $20.2 million, or 7
cents a share, reversing a year-earlier loss of $31.6 million, or
11 cents a share. The loss on derivative contracts narrowed to
$33.7 million from $106.3 million.
Revenue rose 11% to $1.9 billion.
Analysts polled by Thomson Reuters expected earnings of 15 cents
a share on revenue of $1.9 billion.
At Cablevision's telecommunications business, by far the
company's largest, revenue rose 5.3% and earnings jumped 14%,
driven by broadband-subscriber growth and higher rates. In
February, Chief Operating Officer Thomas Rutledge said
cable-subscriber growth in the quarter to that point was ahead of
last year's results.
MSG revenue rose 2.3% as its operating loss narrowed sharply
amid a prior-year write-down. The company's Rainbow unit - which
includes cable channels such as AMC and IFC - posted an 11% revenue
rise while operating income rose 40%. Cable networks have been a
rare bright spot in the media industry as they are less
advertising-dependent.
-By Mike Barris, Dow Jones Newswires; 201-938-5658;
mike.barris@dowjones.com