Gemstar To Take Another Charge To Write Down TV Guide Value
The eroding value of TV Guide, once the premier weekly publication in the country, continues to haunt Gemstar-TV Guide International Inc. as the company disclosed it was taking another charge against earnings -- of $1.3 billion -- because of the write-down of the magazine to its "fair market value."</br></br>The noncash charge triggered a loss of $953.8 million, or $2.32 a share, for the second quarter as the Pasadena, Calif., publisher of TV Guide and owner of patents for on-screen television-program guides finally released financial results for the quarter. In the first quarter, the company took a $5.3 billion charge against earnings related to its 2000 merger with TV Guide Inc. The second-quarter loss widened from a loss of $134.8 million, or 33 cents a share, a year earlier.</br></br>Gemstar failed to certify its financial results by the Securities and Exchange Commission's Aug. 14 deadline, as auditors continued to review its books for possible accounting problems. Gemstar's results remain uncertified until the auditors finish their review.</br></br>For the quarter, revenue fell 15% to $271.7 million. Gemstar had revenue declines at both its TV Guide and patent-licensing units, but revenue was up at its interactive unit because of increased "e-commerce" revenue and wagering activities on its horse-racing channels.</br></br>Once boasting a market capitalization of more than $25 billion, Gemstar now is struggling to remain listed on the Nasdaq Stock Market as its stock has collapsed to under $5 a share and a market cap of almost $2 billion. Gemstar executives met yesterday with Nasdaq officials in hopes of preventing its stock from being delisted. In 4 p.m. trading, Gemstar shares were off 10%, or 34 cents, at $2.90.