October 23, 2008 / 6:06 PM / in 10 years

UPDATE 2-Corus profits drop, but CEO keeps upbeat tone

*Corus Entertainment profit drops, but outlook unchanged

*Revenue falls short of analysts’ outlook

*Specialty-TV advertising rises 5 percent

*Shares fall 4.3 percent

(Adds CEO comments)

By Wojtek Dabrowski

TORONTO, Oct 23 (Reuters) - Canadian media and entertainment company Corus Entertainment Inc (CJRb.TO) posted a lower quarterly profit on Thursday as revenue stayed almost flat, but it said it is confident it will be able to grow despite a challenging economy and it kept its profit outlook unchanged.

Chief Executive John Cassaday told analysts on a conference call that the company is now “assessing the potential impact” that the global economic slowdown could have on its business and advertising revenue.

“Clearly, there has been a historical link between ad growth and the growth of the economy overall,” he said.

However, he said Corus would leave its fiscal 2009 profit forecast of between C$270 million ($214.3 million) and C$280 million unchanged.

“Despite the economic circumstances, we have confidence in our brands and our business,” Cassaday said.

Still, Corus shares fell 73 Canadian cents, or 4.3 percent, to C$16.15 on the Toronto Stock Exchange shortly after the results were published.

Corus, which owns television and radio assets as well as the Nelvana animation house, said it earned C$17.4 million ($13.8 million), or 21 Canadian cents a share, in the three months ended Aug. 31. That was down from a profit of C$21.2 million, or 25 Canadian cents a share, in the same period a year earlier.

Analysts were expecting Corus to earn 26 Canadian cents a share before one-time items, according to Reuters Estimates.

Revenue nudged lower to C$185.8 million from C$187.2 million a year earlier, missing analyst predictions of C$194.9 million.

Corus’s TV operations contributed revenue of C$104.8 million, up 1 percent, and the company said specialty advertising growth was 5 percent.

Analysts are closely watching media companies’ earnings reports this quarter for signs of whether the global economic slowdown is translating into reduced advertising spending.

$1=$1.26 Canadian Reporting by Wojtek Dabrowski; editing by Peter Galloway

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