NEW YORK (CNNfn) - Viacom Inc., owner of CBS, MTV and other media properties, cut its outlook for 2001, blaming the heavy costs of around-the-clock coverage in the wake of the worst terrorist attacks in U.S. history.|
The New York-based company said it expects 2001 cash flow -- earnings before interest, taxes, depreciation and amortization -- to be only slightly higher than it was a year ago, compared with its expectations of double-digit growth.
Advertisement-free broadcasting by CBS and its local affiliates after the Sept. 11 attacks on New York and Washington will cut into Viacom's revenue, though the company didn't specify how much money it lost. Viacom also lost revenue by canceling its slate of National Football League games and postponing the start of its new fall season of programming.
Still, Viacom President Mel Karmazin said, "Viacom remains fundamentally strong, and we continue to believe that the company is well positioned for the remainder of 2001 and over the long term."
Viacom said it expects to recover some of its losses from business-interruption insurance.
It also said some of its advertisers are revisiting their campaigns in light of the attacks to make sure they are appropriate, and concerns remain about additional programming disruptions after U.S. retaliation for the attacks.
"Most companies we spoke with believe they will return to normal advertising levels but are uncertain about the timing," Karmazin said.
Shares of Viacom (VIA: Research, Estimates), which also owns VH1, Paramount Pictures and several other media operations, closed Tuesday down $1.10 at $31.90. Viacom said it plans to buy back some of its own shares, but didn't specify how many.