Viacom CEO vows to unveil new strategic vision for company this week

Bob Bakish
Viacom CEO Bob Bakish

Viacom CEO Bob Bakish is promising to cut through some of the noise surrounding the company during this week’s earnings call.

According to Variety, the chief executive used today’s Viacom shareholders meeting to promise that a new strategic vision and framework would be unveiled shortly. Bakish praised Viacom’s “incredibly strong foundation” and said Thursday’s earnings call would include a “strategy for Paramount going forward,” according to the report.

RELATED: Viacom CEO says $345M Telefe buy is part of its independent growth strategy

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UBS analyst Doug Mitchelson posed questions about Viacom’s future in a research note this weekend. He wondered how much capital it will take to get Paramount back on its feet and how MTV and BET can improve programming without sinking an unreasonable amount of money into the effort.

“Bulls expect Cable Networks will return to stable-to-growing EBITDA as tough comps expire and new management rebuilds pay TV distribution relationships, see the potential for meaningful upside if MTV, Comedy Central or Paramount can be turned around, and see valuation as very attractive (given value of Paramount, Epix, India JV and int'l networks),” wrote Mitchelson. “Bears expect continued viewing and advertising share losses given its younger demo focused networks, see risk that its networks could be dropped by pay TV distributors who are struggling with video margin pressures of their own, and its 4x debt leverage limits flexibility to invest and is at risk of being downgraded to junk status.”

Questions about the future of Paramount, Viacom’s struggling film division, may have relaxed somewhat given the company’s recent announcement of a $1 billion investment from two Chinese firms. Shanghai Film Group and Huahua Media have both pledged to finance 25% of Paramount’s films over the next three years.

RELATED: Paramount getting $1B investment from Chinese firms

Leading up to Viacom’s strategic outline this week, Bakish has taken the reins and begun guiding Viacom toward an independent growth strategy. It’s the direction Viacom is headed after National Amusements, controlling shareholder in both Viacom and CBS, decided to abandon its push to merge the two companies.

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