UPDATE 1-Viacom posts higher Q4 revenue on strong ad growth
(Adds analyst quote, details on performance)
Nov 14 (Reuters) - Viacom Inc reported a nearly 9 percent rise in fiscal fourth-quarter revenue on Thursday, driven by strong advertising growth at its cable networks and improved television ratings.
The company, which owns cable networks MTV and Comedy Central and the movie studio Paramount Pictures, said domestic and global advertising revenues both increased 10 percent in the quarter, helped by "positive ratings trends."
TV ads rates are closely aligned with ratings. The more people who watch a show like "SpongeBob SquarePants," which appears on its juggernaut Nickelodeon kids cable channel, the more money a network can get for a commercial.
Pivotal Research Group analyst Brian Wieser said the advertising bump of 10 percent beat his estimate of 6 percent.
"Advertising revenue was well ahead of expectations" which is a good sign, Wieser said, because advertising is one of the most important metrics on which Viacom investors focus.
For the same quarter, rival cable network Discovery Communications Inc reported a 12 percent gain in advertising, while Time Warner Inc said advertising for its cable networks was up 11 percent.
Analysts noted that ratings at Viacom's Nickelodeon, MTV, Spike, BET and Comedy Central networks all increased in the quarter.
Earlier this year, Viacom struggled with ratings, especially around Nickelodeon, but it was able to turn the network around with a revamped programming lineup in recent quarters.
Wieser said Thursday's results helped alleviate "the fears that kids were gravitating away from TV and that advertisers would follow suit."
Viacom posted total revenue of $3.65 billion, compared with $3.363 billion a year ago. Analysts expected $3.6 billion, according to Thomson Reuters I/B/E/S.
Revenue at the filmed entertainment unit increased 11 percent to $1.21 billion, driven by zombie movie "World War Z" and "Star Trek Into the Darkness" which both did well when they hit the home release market.
Viacom net income totaled $804 million, or $1.68 per share, compared with $650 million, or $1.26 per share, a year ago.
Adjusted for items such as restructuring, diluted EPS from continuing operations was $1.55, which beat Wall Street estimates by 11 cents.
(Reporting by Liana B. Baker; Editing by Jeffrey Benkoe)