("2nd UPDATE: Cablevision 1Q Profit Falls 45% After AMC Spinoff," at 11:45 ET, misstated Jim Dolan's full title in the seventh paragraph. The error also occurred in "UPDATE: Cablevision 1Q Profit Falls 45% After AMC Spinoff" at 10:01 ET. The correct version follows:) --Cablevision 1Q profit falls without AMC Networks --Board authorizes $500 million stock repurchase --Investors still worried about leadership, growth plans By William Launder Of DOW JONES NEWSWIRES Cablevision Systems Corp.'s (CVC) first-quarter profit fell 45% following the spinoff last year of its cable-networks division, even as the company added subscribers in all of its core video, broadband and phone businesses. Cablevision's shares have slumped more than 40% over the past year on concerns about how the company can grow amid new competition from the likes of Verizon Communications Inc.'s (VZ) FiOS service, which overlaps heavily in Cablevision's lucrative New York market. Further weighing on Cablevision's share performance are a slew of high-level executive departures in recent months, most notably Tom Rutledge, its well-respected chief operating officer. Cablevision has said that this year's financial results would reflect higher capital spending as it focuses on improving customer service, warning Thursday that 2013 could also be burdened by such initiatives. Shares fell 8.4%, to $13.47 in recent trading. The Bethpage, N.Y., company gained 7,000 video customers from the fourth quarter, while adding 42,000 high-speed data customers and 42,000 voice subscribers. Total customers reached 3.6 million, up 0.5% sequentially. The gains in video subscribers offset similar losses in the fourth quarter, and as cable operators industry-wide see their video businesses slowing because of a soft economy and as more viewers look to the Internet for TV entertainment. Bigger peers including Time Warner Cable Inc. (TWC) and Comcast Corp. (CMCSA, CMCSK) continued to shed video subscribers during the first quarter. Chief Executive and President Jim Dolan credited the video-subscriber gains in part to avoiding rate increases during the first quarter. Rates will remain flat in the second quarter, although increases later in the year can't be ruled out, Dolan told analysts. Looking forward, Dolan said Cablevision might not be ready to re-focus more on improving financial performance rather than customer service by next year. "Some of it is seeing how customers react. Certainly, we would love to be back in that other mode by 2013, I don't know for sure," Dolan told analysts during a conference call. Analysts are already skeptical about the Cablevision's prospects for growth and its leadership under Dolan. "The headwinds facing Cablevision seemingly go deeper (as evidenced in today's earnings report)," wrote ISI analyst Vijay Jayant. Dolan said he would likely continue to play a role in Cablevision's daily operations in the near future. Cablevision reported a first-quarter profit of $57.2 million, or 21 cents a share, down from $104.1 million, or 36 cents a share, a year earlier. Discontinued operations contributed 12 cents a share in the year-earlier period. Revenue edged up 0.2% to $1.66 billion. Analysts polled by Thomson Reuters were looking for a per-share profit of 19 cents on $1.67 billion in revenue. Cablevision said it would continue its share-buyback program, with its board authorizing a plan to repurchase $500 million of its own stock. Cablevision repurchased $59.2 million of its own stock during the first quarter. The company has refocused its business in recent years on its core cable operations, spinning off AMC Networks Inc. (AMCX) and Madison Square Garden Network Co. (MSG). It also acquired Bresnan Communications Inc. in a deal aimed at broadening its subscriber footprint. Cablevision said it was re-launching plans to sell its money-losing Clearview Cinemas business, which it acquired in 1998 for $160 million. -By William Launder, Dow Jones Newswires; 212-416-3412; william.launder@dowjones.com --Ben Fox Rubin contributed to this article.
