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Liberty Media reports mixed 3rd quarter; Starz shines, QVC slumps

Sandy Shore, Rocky Mountain News

Published November 9, 2007 at midnight

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Liberty Media Corp. said today its third-quarter revenue climbed, although a solid performance by the Starz cable TV channel was offset by lower sales in the QVC home-shopping network.

The diversified media holding company, founded by cable pioneer John Malone, was expected to release full consolidated financial statements later today.

Liberty, based in suburban Englewood, has divided its assets into two groups, Liberty Interactive Group, which includes QVC and other e-commerce businesses, and Liberty Capital Group, which consists of Starz Entertainment LLC. Each has its own tracking stock.

Liberty said its interactive group reported a 10 percent drop in operating income to $231 million from $257 million last year.

Revenue edged up to $1.69 billion from $1.65 billion.

QVC Chief Executive Officer Mike George blamed the results on soft QVC sales due to a sluggish retail environment in the United States, Germany and Japan.

"We chose not to adopt a heavily promotional focus in the quarter and were able to maintain stable margin rates despite the slower sales growth," he said in a statement.

At Liberty Capital, revenue rose 11 percent to $282 million, reflecting a $5 million increase in rates for Starz services and a $6 million increase due to more Starz subscribers. The unit nearly doubled operating income to $78 million from $40 million last year.

Liberty Media will include a third unit when it completes the planned acquisition of satellite TV operator DirecTV from Rupert Murdoch's News Corp.

Liberty Interactive stock fell 45 cents, or 2.2 percent, to $20.06 a share while Liberty Capital stock fell 92 cents, or 1 percent, to $121.99 a share in trading this morning.