Viacom profit drops 12% in fiscal first quarter

Viacom Inc., owner of MTV Networks and Paramount Pictures, posted a 12% decline in fiscal first-quarter profit as a drop in home-entertainment sales lowered earnings at the Paramount Pictures film unit.

Net income fell to $610 million, or $1 a share, from $694 million, or $1.14, a year earlier, New York-based Viacom said Thursday. Sales in the period ended Dec. 31 declined 4.8% to $3.83 billion, missing the $4.08-billion average of estimates compiled by Bloomberg.

Film-unit earnings dropped 77%, as “How to Train Your Dragon� and the latest “Shrek� DVD sales failed to match “Transformers,� “Star Trek� and “GI Joe� titles in the year-earlier period. Profit rose at cable networks including MTV and Comedy Central, as shows such as “Jersey Shore� helped lift ratings at MTV.

“Filmed-entertainment results were a bit worse than we expected despite the strong box office,� said Alan Gould, an analyst at Evercore Partners in New York. Home-entertainment revenue declined “due to the very difficult comparisons.�

Shares of Viacom, controlled by Chairman Sumner Redstone, fell 42 cents to $43.55.

Excluding one-time items, profit was $1.02 a share, compared with the 99-cent average analyst estimate. The company’s tax rate was lower than estimated, helping earnings per share exceed analysts’ estimates, Gould said.

Film-unit sales fell 16%, as box-office revenue from movies including “Jackass 3-D� and Oscar nominee “True Grit� was offset by the decline in DVD sales. Paramount distributes the “Shrek� and “Train Your Dragon� movies for DreamWorks Animation SKG.

“Jersey Shore� has posted record ratings in its third season, which began last month, and ranked No. 1 in the 18-to-49 age group advertisers covet, beating broadcast networks, MTV said last week. The company has ordered a fourth season.

On Wednesday, the company reached an agreement with Hulu that restores Comedy Central’s “The Daily Show With Jon Stewart� and “The Colbert Report� to the ad-supported Hulu.com video service.

Viacom pulled the content in March 2010 and said then it would consider returning. As part of Wednesday’s deal, “Jersey Shore� episodes will be available on the $7.99-a-month Hulu Plus service that competes with Netflix Inc. 21 days after the programs air on MTV.