UPDATE 2-Corus Entertainment quarterly profit misses on higher costs

(Reuters) – Canadian media company Corus Entertainment Inc’s (CJRb.TO) quarterly profit missed analysts’ estimate on Friday, as it spent heavily to create new content and compete with U.S. rivals such as Netflix Inc (NFLX.O) and Amazon.com Inc’s (AMZN.O) Prime Video.

Corus has also been spending on ramping up its video on-demand (VOD) platform, offered as an option to online streaming services.

Total costs rose eight-fold to C$13.2 million ($10 million)in the first quarter as Toronto-based Corus tries to attract more cord-cutters who shun traditional cable bundle for cheaper online streaming platforms.

Profit at Corus’ television business, which houses brands such as Nelvana and Global Television, rose about 10 percent to C$184.6 million. Advertising revenue for the unit rose 4 percent, the company said.

“We returned to growth in Television advertising revenue, driven primarily by a strong fall schedule and a significant improvement in television advertising demand,” Chief Executive Officer Doug Murphy said in a statement.

The company’s radio unit, however, reported a 4 percent dip in profit to C$13 million.

Corus’ net income attributable to shareholders fell to C$60.4 million ($45.81 million), or 28 Canadian cents per share, in the quarter ended Nov.30, from C$77.7 million, or 38 Canadian cents per share, a year ago.

Excluding items, Corus earned 33 Canadian cents per share, but missed the analyst average estimate of 40 Canadian cents per share, according to IBES data from Refinitiv.

Total revenue rose to C$467.5 million from C$457.4 million.

Analysts, on average, were expecting revenue of C$451.24 million.

Corus shares closed at C$5.36 on Thursday in Toronto Stock Exchange.

Reporting by Shanti S Nair in Bengaluru; Editing by Arun Koyyur and Shinjini Ganguli

JEFFREY LIPTON in BARBADOS – http://feeds.reuters.com/~r/reuters/companyNews/~3/khZ32DQo5qQ/update-2-corus-entertainment-quarterly-profit-misses-on-higher-costs-idUSL3N1ZB3CX