Cablevision Spending Plans Dissatisfy Wall St.

Cable television operator and sports team owner Cablevision Systems Corp. disappointed Wall Street on Tuesday by saying it would spend more than expected to upgrade its systems, as it reported higher first-quarter profit.

Playing into Wall Street analysts’ worst fears, the company said it plans to spend $1.5 billion to $1.7 billion in 2002 mostly to upgrade its cable systems to allow digital cable, up from $1 billion to $1.1 billion expected in 2001.

“In 2002, most analysts were expecting capital spending to flatten out,” said Credit Lyonnais Securities analyst Jea-Hun Shim. “Cablevision’s capital expenditures for 2002 are more than many of us were expecting.”

Shares fell $4.70 to close at $59.80 on the New York Stock Exchange, hitting as low as $59--the lowest level in nearly a year.

Cablevision, which also owns the New York Knicks and New York Liberty basketball teams and the New York Rangers hockey franchise, reported a first-quarter profit of $1.13 billion, or $4.97 a share, which includes $1.43 billion from the sale of its Massachusetts cable assets to AT&T; Corp.

In the year-earlier period, it posted a loss of $115.5 million, or 67 cents a share. Net revenue rose 8% to $1 billion on a pro forma basis.