Hit movies lift revenue at Viacom

Viacom Inc. posted a bigger-than-expected quarterly profit Thursday, boosted by DVD sales and the box-office hit “Shrek the Third,” sending shares up 4%.

Executives at the New York-based owner of MTV Networks, Paramount movie studios and the Nickelodeon cable channels also expected U.S. cable network advertising to improve in the third quarter, from a 4% gain in the second quarter.

Viacom’s second-quarter profit fell less than 1% to $434 million from $437.3 million a year earlier. Earnings per share rose to 63 cents from 61 cents, as a result of a lower share count due to a buyback.

The results come as Chairman Sumner Redstone, who split off the company’s broadcast divisions into the separately traded CBS Corp. in 2006, is embroiled in a public battle with his daughter, Shari, once seen as his successor.

Excluding special items, Viacom’s profit was 54 cents a share, beating Wall Street estimates of 50 cents, according to Reuters Estimates.

Gabelli & Co. analyst Christopher Marangi said quarterly results were strong and global ad revenue growth of 6% met expectations.

Viacom’s revenue in the second quarter rose 13% to $3.19 billion, ahead of Wall Street expectations of $3.06 billion, according to Reuters Estimates.

Movie studio revenue rose 20% to $1.3 billion and profit rose $17 million to $21.4 million, helped by a string of theatrical hits that also included “Blades of Glory” and “Disturbia.”

Revenue from cable network divisions including MTV Networks rose 10%. Profit rose 3%, hurt by $11 million in restructuring charges and higher programming expenses as the company invested in new shows.

Viacom attracted 68% more visitors to its websites in the last quarter compared with the year-earlier period. The company will record a third-quarter gain from the $370-million sale of music publisher Famous Music to Sony/ATV Music Publishing.