CBS Corp. takes it on the chin

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The weak advertising market brutalized CBS Corp. earnings.

The media company that owns CBS network, television and radio stations and billboards, reported a net loss of $55.3 million for the first quarter of 2009, or 8 cents per diluted share. During the first quarter of last year, CBS mustered net income of $244.3 million, or $0.36 per diluted share.

‘It should come as no surprise that our results reflect the economic downturn,’ said Leslie Moonves, chief executive of CBS, during a conference call with analysts.

But Moonves also echoed comments by Disney chief Bob Iger and News Corp. head Rupert Murdoch about seeing a stabilization in the critical signs of the economy. ‘We are seeing early signs of improvement in the advertising market both nationally and locally. It’s premature to call it a full recovery, but the trends are encouraging.’

CBS saw its business suffer as the recession drove away advertisers in droves. Revenue dropped 13% to $3.16 billion for the quarter. Analysts had been expecting about $3.26 billion in revenue, according to Thomson Reuters.

Unlike its more diversified competitors, which depend on the more dependable stream of cable affiliate fees, CBS derives fully two-thirds of its revenue from advertising. Its major presence in cable is the premium Showtime Networks.

But that was hardly enough to staunch the bleeding. Television revenues were down 12%; radio revenues were down 29% and outdoor advertising was down 24%.

-- Meg James