Discovery Communications Inc (NASDAQ:DISCA) Q3 2019 Earnings Conference Call Transcript

Nov 07, 2019 • 08:30 am ET

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Discovery Communications Inc (NASDAQ:DISCA) Q3 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, thank you for standing by and welcome to Ladies and gentlemen, thank you for standing by and welcome to the Discovery Third Quarter 2019 Earnings Conference Call. [Operator Instructions]. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions]

I would now like to hand the conference over to your speaker today, Andrew Slabin, Executive Vice President Executive Vice President, Global Investor Strategy. Please go ahead, sir.

Executive
Andrew Slabin

Good morning, everyone, and thank you for joining us for Discovery's third quarter 2019 earnings call. Joining me today are David Zaslav, our President and Chief Executive Officer; Gunnar Wiedenfels, our Chief Financial Officer; JB Perrette, President and CEO, Discovery Networks International; and Peter Faricy, CEO, Global Direct-to-Consumer.

You should have received our earnings release, but if not, feel free to access it on our website at www.corporate.discovery.com. On today's call, we will begin with some opening comments from David and Gunnar and then we will open the call for David, Gunnar, JB and Peter to take your questions.

Before we start, I would like to remind you that comments today regarding the Company's future business plans, prospects of financial performance are forward-looking statements that we make pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are made based on management's current knowledge and assumptions about future events and they involve risks and uncertainties that could cause actual results to differ materially from our expectations. In providing projections and other forward-looking statements, the Company disclaims any intent or obligation to update them. For additional information on important factors that could affect these expectations, please see our Annual Report for the year ended December 31st, 2018 and our subsequent filings made with the U.S. Securities and Exchange Commission.

And with that, let's turn the call over to David.

Executive
David M. Zaslav

Good morning, everyone, and thank you for joining us to discuss our Q3 results and outlook. Discovery reported an impressive quarter of operating and financial results, with performance at the top end of our competitive set. Across all businesses and regions, we met or exceeded our guidance, with a notable acceleration in our international segment, high single-digit growth. Overall, a very strong set of numbers by any measure.

I believe we have the best operating team in media today. I am proud of what we have accomplished both in the quarter and since our acquisition of Scripps early last year. It is a story of promises made and promises delivered and in most cases over delivered. To that point, well before we closed on Scripps, we talked about our goal of being able to generate $3 billion of free cash flow. Before the acquisition we were generating about $1.4 billion and Scripps was generating about $700 million. Today we are at $2.9 billion for the trailing 12-month period. And having generated nearly $900 million in free cash flow this quarter, we feel good about that goal.

Our net leverage, we had been relentlessly focused