Bethpage, N.Y. - In an ongoing effort to reduce its costs, Cablevision Systems took a dramatic step by announcing yesterday it will exit the consumer electronics retail business by the end of the second quarter.
To that end, Cablevision will either close or sell The Wiz, its 17-unit CE retail operation, which recorded a 33 percent decline in revenue for continuing operations during the fourth quarter, ended Dec. 31, dropping to $77.1 million, from $115.6 million pro forma in the fourth quarter of 2001.
For the 12 months, The Wiz recorded a sales decline for continuing operations of 20.8 percent, decreasing to $293 million for the year, compared with $370 million pro forma for 2001.
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) for The Wiz in the fourth quarter remained virtually unchanged, compared with the previous year, an 0.8 percent pro forma drop to a negative $20.8 million, from a negative $21 million pro forma in the same quarter a year ago.
For the 12 months, The Wiz reported an EBITDA deficit of $83.3 million, a pro forma decline of 27.9 percent from the pro forma EBITDA deficit of $65.1 million recorded for 2001.
Cable operator Cablevision, which also owns the high profile New York Knicks and New York Rangers, both tenants of Cablevision-owed Madison Square Garden, pointed to stronger sales in its cable networks and telecommunications unit for a 3.8 percent increase in consolidated revenue from continuing operations in the fourth quarter. Sales hit $1.15 billion, up from $1.11 billion in the year-ago period.
For the 12 months, consolidated results saw revenue from continuing operations rise 5 percent, to $4 billion, compared with $3.8 billion in 2001.
Cablevision posted a loss from continuing operations of $155.2 million in the fourth quarter, down from a loss from continuing operations of $213.1 million in the same three months a year ago. For the 12 months, the company reported a loss from continuing operations, ballooning to $560.8 million, compared with income from continuing operations of $1.1 billion year over year.
Cablevision's net income for the fourth quarter hit $517.4 million, compared with a loss of $281.6 million in the same period in 2001. However, net income for the 12 months was reduced to $90.1 million, down from $1 billion in the year-ago 12 months.