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Articles 

Arbitron Inc. Reports Operating Results (10-Q)

November 06, 2012 | About:

Arbitron Inc. (ARB) filed Quarterly Report for the period ended 2012-09-30.

Arbitron Corporation has a market cap of $954.5 million; its shares were traded at around $37.19 with a P/E ratio of 16.6 and P/S ratio of 2.3. The dividend yield of Arbitron Corporation stocks is 1.1%. Arbitron Corporation had an annual average earning growth of 2.5% over the past 10 years. GuruFocus rated Arbitron Corporation the business predictability rank of 3-star.

Highlight of Business Operations:

Revenue. Revenue increased by 8.3% or $8.8 million for the three-month period ended September 30, 2012, as compared to the same period in 2011, due primarily to a $4.9 million increase in PPM-based ratings service revenue, in particular the nearly completed phase-in of contracted PPM price increases, and a $2.3 million increase in Diary rating service revenue, a $0.9 million increase in custom service revenue and a $0.7 million increase in PPM International revenue.

Cost of Revenue. Cost of revenue increased by 9.0% or $4.5 million for the three-month period ended September 30, 2012, as compared to the same period in 2011. Cost of revenue increased primarily due to a $1.4 million increase in PPM variable costs, including higher survey participant incentives and panel management costs resulting from a higher average number of panelists for the three-month period ended September 30, 2012, as compared to the same period of 2011, a $1.4 million increase in aggregate costs associated with address based sampling, in-person recruiting and cell-phone household recruiting, and a $0.8 million increase associated with our Arbitron Mobile service.

Revenue. Revenue increased by 7.6% or $23.0 million for the nine-month period ended September 30, 2012, as compared to the same period in 2011, due primarily to a $17.3 million increase in PPM-based ratings service revenue, in particular the nearly completed phase-in of contracted PPM price increases, a $3.0 million increase in Diary-based ratings service revenue, a $1.8 million increase in our Scarborough qualitative service revenue, and a $0.8 million increase associated with our Arbitron Mobile service.

Cost of Revenue. Cost of revenue increased by 5.4% or $8.4 million for the nine-month period ended September 30, 2012, as compared to the same period in 2011. Cost of revenue increased primarily due to a $2.1 million increase in PPM variable costs, including higher survey participant incentives and panel management costs resulting from a higher average number of panelists for the nine-month period ended September 30, 2012, as compared to the same period of 2011, a $2.0 million increase in aggregate costs associated with address based sampling, in-person recruiting and cell-phone household recruiting, a $1.6 million increase in costs associated with Arbitron Mobile, which was acquired in July 2011, and a $1.4 million increase in Scarborough royalty costs associated with higher Scarborough revenue for the nine-month period ended September 30, 2012, as compared to the same period in 2011.

Net cash provided by operating activities for the nine-month period ended September 30, 2012, was also positively impacted by a $12.2 million increase in deferred revenue primarily due to price escalators associated with our PPM ratings service and a $2.4 million increase in long-term retirement and employee incentive liabilities, partially offset by a $5.1 million decrease in Scarborough royalty accruals and a $3.1 million decrease in payroll, bonus, and benefit accruals for the nine-month period ended September 30, 2012.

Read the The complete Report

About the author:

10qk
Charlie Tian, Ph.D. - Founder of GuruFocus. You can now pre-order his book Invest Like a Guru on Amazon.

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