Discovery Communications reported higher than expected earnings in the year’s first quarter, thanks in part to an increase in distribution revenue.
The Discovery Channel, TLC and Animal Planet parent company grew distribution in the United States by 13% to US$362 million thanks to higher rates and the consolidation of kids network The Hub, which rebranded as Discovery Family Channel last October.
Meanwhile, advertising revenue increased by only 1% to $375 million. U.S. revenue in the first quarter went up 6% to $749 million compared with $709 million in the same period last year.
The cable giant’s international operations grew first quarter revenue by 10% to $735 million, compared with $667 million in the same period last year. Distribution increased by 17% to $396 million, while ad revenue declined by 1% to $312 million.
Discovery’s net income rose to $250 million, or 37 cents per share, from $230 million, or 33 cents per share, during the same period last year. Total income increased by 9% to $1.54 billion.
The company also expects total revenue, excluding currency, to grow in the high single to low double digit percentage range by the year’s end.
The profits came in higher than analyst predictions, sending shares up by 1.44% to $33.85 on Tuesday (May 5).
Discovery has aggressively expanded its international business in recent years as revenues abroad have outpaced those in the United States. Over the past year, the company restructured its cable operations in Europe, acquired a controlling stake in Eurosport France and signed a deal with Sony to make its portfolio of 18 channels available via a cloud-based streaming service.