Grupo Televisa SA one of the most important world’s Spanish-language broadcaster, reported profit that was little changed as more subscribers signed up for satellite and cable service, helping cover a drop in over-the-air advertising.

Second-quarter net income was 1.8 billion pesos ($154 million), even with a year earlier, Mexico City-based Televisa said today in a statement to the country’s stock exchange. Sales rose 4.7 percent to 15.1 billion pesos, compared with the 15 billion-peso estimate of three analysts compiled by Bloomberg.

Televisa tapped its pay-TV businesses for growth as over- the-air advertising revenue declined from last year, when broadcasts of soccer’s World Cup drew more customers. The company also is contending with the loss of ads from companies controlled by billionaire Carlos Slim in a dispute over pricing.

“Earnings were good operations-wise, so this could be a positive for the stock,” Gregorio Tomassi, an analyst at Banco Santander SA in Mexico City, said in a phone interview today. “The drop in year-over-year sales from TV broadcasting was slightly lower than I was expecting.” Tomassi advises holding on to Televisa shares.

The broadcast division, Televisa’s largest unit, reported a 5.9 percent decline in sales to 5.48 billion pesos, compared with Tomassi’s 5.43 billion-peso estimate. The unit’s operating profit fell 8.7 percent to 2.62 billion pesos.

Televisa fell 67 centavos to 54.99 pesos in Mexico City trading July 8. The shares had fallen 14 percent this year before today.

Pay-TV Gains

Leaving out sales to Slim’s businesses, broadcast revenue would have fallen 1 percent from a year earlier, Televisa said. The company didn’t provide a figure for sales growth leaving out revenue from the World Cup.

Revenue from U.S. broadcaster Univision Communications Inc., which pays royalties to Televisa for programming, gained 63 percent to $60.2 million. Televisa agreed in October to a new royalty arrangement with higher payments as part of a plan to invest $1.2 billion in Univision for a stake of as much as 35 percent.

Satellite subscriptions rose by almost 274,000 to 3.59 million, and the three cable carriers controlled by Televisa added almost 80,000 TV customers for a total of 2.09 million.

During the quarter, the company paid $1 billion in cash as part of its $1.6 billion transaction to acquire a 50 percent stake in Grupo Iusacell SA, Mexico’s third-biggest wireless carrier. The rest will be paid by the end of the year, the company said.

The transaction, which is being considered by Mexico’s antitrust agency, would put Televisa in direct competition in the mobile-phone industry with Slim’s America Movil SAB, the nation’s biggest wireless carrier, and Telefonica SA, the second-biggest.

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Portada Staff

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