Crown Media Holdings, which O&O’s Hallmark Channel, crossed the $100M revenue threshold during the final quarter of 2012, based on a 3% gain over the previous year fueled by a 2% gain in advertising income. The gains were credited to a bigger audience and higher fees.
The company reported Q4 revenue of $102.3 million, a 3% increase from $99.6 million in Q4 2011. Ad revenue increased 2% to $83.1 million from $81.7 million in Q4 2011 due to Hallmark Movie Channel audience growth. Subscriber fee revenue increased 7% to $19.1 million from $17.8 million in Q4 of 2011 due to contractual rate increases.
Crown Media reported revenue of $349.9 million for 2012, an 8% increase from $323.4 million for 2011. Ad revenue increased 8% to $271.2 million during 2012 from $251.3 million during 2011. Subscriber fee revenue increased 9% to $78.0 million, from $71.7 million in the prior year.
For the fourth quarter of 2012, cost of services increased 1% to $39.8 million from $39.3 million during the same quarter of 2011. For 2012 cost of services decreased 1% to $148.3 million from $149.0 million during 2011. Within cost of services, programming expenses decreased $2.2 million to $134.5 million due to the expiration of a number of programming license agreements. Other cost of services including amortization of capital leases increased 12% from $12.3 million in 2011 to $13.7 million for 2012 due to increases in residual expense of $2.0 million from increased usage of original programming.
Over the course of its holiday schedule, from November 10 through December 30, Hallmark Channel ranked as the #1 cable network in weekend primetime (Sat-Sun, 8-11pm) among women 25-54, households, and total viewers according to Nielsen.
“We implemented a number of strategic initiatives and reached some key milestones in 2012 that positioned our business for strong results in fourth quarter and for the full year,” said Bill Abbott, President and CEO of Crown Media Family Networks. “Fourth quarter culminated in another highly successful run of Hallmark Channel’s ‘Countdown to Christmas’ campaign, which garnered record ratings and positively impacted advertising sales revenue. On the Hallmark Movie Channel side, the network continues to show impressive growth, recently reaching the key distribution benchmark of 50 million subscriber homes. At the outset of 2013, we have a strong foundation from which to further develop our business and monetize the gains we are seeing in ratings and distribution.”