CEO Bob Bakish during the virtual annual shareholder meeting said the recombined firm has "undeniable momentum in streaming" and mentioned "green shoots" in advertising amid the pandemic.
ViacomCBS is moving quickly to reap the benefits of the recombined company and its "significant" upside opportunity, non-executive chair Shari Redstone said during the firm's virtual annual shareholder meeting on Monday, which was webcast.
"These are extraordinary times," she said about the novel coronavirus pandemic before emphasizing her “passion for our incredible company." Touting its "unmatched content assets," she said: "Together, CBS, Paramount and our portfolio of brands … are a global multi-platform content powerhouse."
Redstone also highlighted the company's audience share in the U.S. and argued that "our content has never been in greater demand among audiences around the world.” And she vowed the firm was focused on realizing the "power of the combination."
Management is "transforming our business" for the future and has "moved quickly" over the first five months since the merger that has created a team with "one vision, one strategy, one cultural and one set of values" to develop "decade-defining content" and long-term shareholder value, among other things, she said.
While "the media landscape is changing rapidly…, we embrace" the change and opportunity that provides, Redstone also said. "The board and I are strongly believe in what the company can achieve," she concluded, highlighting "significant growth opportunities we are moving quickly to capture."
In the first annual meeting since the December recombination of Viacom and CBS into the new ViacomCBS, controlled by the Redstone family, Bakish then took over for a video conference overview and said the firm was positioned to be a leader and touted early moves into the right direction, while also again arguing the stock was "significantly undervalued." For example, he said that "our momentum in streaming is undeniable." He later in the meeting argued that the market would ultimately recognize the company's value, with Redstone concluding: "We totally believe that the stock is dramatically undervalued." She said the differentiated strategy of the firm means the market is waiting for proof it can make good on its promises.
Asked about her long-term vision for ViacomCBS, Redstone said on a combined basis the firm has "unrivaled ability" to create value and upside.
Asked about how the combined company thinks about M&A, Redstone said "our primary focus is on executing our strategy." Added Bakish: "We are fundamentally focused on executing the transformation." That said, he said this team would look for opportunities like the recent deal for a 49 percent stake in Miramax. "There are no must-have assets" for the firm and investors should not expect any "material" deals in the current environment, emphasizing several times that any M&A would be done in a disciplined way.
Asked during the Q&A session about second-quarter advertising trends, Bakish said May and June scatter ad demand trends are showing improvement over April, providing some "green shoots," but the firm previously said the quarter would be harder hit that the first. Bakish said the company's broadcast unit was strongest in ad trends, followed by cable networks and digital. He mentioned at auto, restaurants, travel and movies/entertainment as key hard-hit areas.
ViacomCBS on May 5 unveiled plans for a virtual upfront, becoming the first media conglomerate to go ahead with something resembling a full-fledged presentation to advertisers.
Bakish on Monday mentioned that ViacomCBS' most recent earnings update was a sign of the early momentum and benefits of the merger. In its recent second financial report since the recombination of Viacom and CBS Corp. in December and its first for a full quarter of the merged firm, ViacomCBS posted lower first-quarter earnings and revenue, including advertising revenue, as the novel coronavirus pandemic led to the cancellation of March Madness and the delay of a key film release. But its stock jumped as results exceeded Wall Street expectations and the company touted growth in streaming and an expanded carriage deal with YouTube TV.
Bakish recently said ViacomCBS would be in good shape for the fall TV season if productions can restart by the summer after the novel coronavirus pandemic, saying: "We are optimistic that our fall schedule won’t be materially disrupted … assuming we can get back to production sometime this summer."
He also recently outlined planned summer changes to the CBS All Access streaming service, saying it would be beefed up with a broad array of Viacom programming and a "critical" mass of sports content. On Monday, Bakish reiterated the plans for this and the firm's hope to launch an international streaming service, sharing during the shareholder meeting that this would happen over the next year.
ViacomCBS shares were up more than 6 percent as of 10:10 a.m. ET.
