Univision Trims 2002 Earnings Estimates

Spanish-language broadcasting giant Univision Communications Inc. on Wednesday lowered its earnings estimates for the rest of this year, saying TV advertising sales have been slower than expected and that start-up costs for its young TeleFutura broadcast network have been higher than anticipated.

The Los Angeles-based company revised its outlook during a conference call with analysts to announce its second-quarter earnings. The company posted a 22% decline in its second-quarter net income to $22.2 million, or 9 cents a share, from a profit of $28.6 million, or 12 cents a share, in the same period last year.

Revenue in the latest quarter increased 36% to $322.8 million from $237.5 million in 2001.

However, Univision’s quarterly operating expenses increased 84% to $157.8 million as the company spent more on programming and to promote TeleFutura, its second broadcast network that was launched in January.

Univision also lost money on the World Cup soccer tournament, which was played in South Korea and Japan. The difference in time zones meant that most matches aired in the U.S. in the early morning hours with limited viewership.

During the second quarter, Univision recorded revenue from the World Cup of $63 million and expenses of $55 million, said Chief Financial Officer Andrew Hobson. He estimated that Univision “lost approximately $10 million to $15 million on an operating basis” on the World Cup.

Univision also trimmed its revenue forecasts for the year to between $1.10 billion and $1.14 billion. Three months ago, it predicted 2002 revenue of between $1.13 billion and $1.18 billion.

“The economy is not rebounding, so Univision pulled in its horns for the rest of the year,” said David Joyce, media analyst for the Miami-based investment banking firm Guzman & Co.

Shares of Univision fell $1.40, or 6.4%, to $20.50 in after-hours trading. They fell $2.01 to $21.90 on the New York Stock Exchange. The stock has fallen 46% this year.