Press Release

• Adjusted Diluted EPS Increased 13% to $1.08 Per Share
• Media Networks Revenues Up 6% and Operating Income Rose 9%, Driven By Higher Affiliate and Advertising Revenues
• $2 Billion Returned to Investors in First Half of Fiscal 2014 Through Share Repurchases and Dividends

NEW YORK--(BUSINESS WIRE)-- Viacom Inc. (NASDAQ: VIAB, VIA):

Fiscal Year 2014 Results
		Quarter Ended														Six Months Ended
		March 31,										B/(W)				March 31,										B/(W)
												2014 vs.														2014 vs.
(in millions, except per share amounts)		2014					2013					2013				2014					2013					2013
Revenues		$	3,174				$	3,135				1	%			$	6,371				$	6,449				(1	)%
Operating income		872					847					3				1,832					1,644					11
Net earnings from continuing operations attributable to Viacom		502					481					4				1,049					954					10
Adjusted net earnings from continuing operations attributable to Viacom*		482					481					—				1,029					942					9
Diluted EPS from continuing operations		1.13					0.96					18				2.33					1.89					23
Adjusted diluted EPS from continuing operations*		$	1.08				$	0.96				13	%			$	2.29				$	1.87				22	%
* Adjusted measures referenced in this release are detailed in the Supplemental Disclosures at the end of this release.

Viacom Inc. (NASDAQ: VIAB, VIA) today reported revenue, earnings and EPS growth for the fiscal second quarter of 2014, ended March 31, 2014. Revenues of $3.17 billion increased 1%, reflecting higher affiliate fees and advertising revenues, partially offset by declines in Filmed Entertainment. Operating income rose 3% to $872 million, primarily due to higher Media Networks revenues. Adjusted net earnings from continuing operations attributable to Viacom increased to $482 million, and adjusted diluted earnings per share from continuing operations were up 13% to $1.08 per diluted share.

Sumner M. Redstone, Executive Chairman of Viacom, said, "Viacom's solid results were driven by pioneering content and outstanding leadership. Our management team is committed to building on this success and capturing the exciting long-term opportunities in our industry."

Philippe Dauman, President and Chief Executive Officer of Viacom, said, "Viacom posted another strong quarter, resulting from our relentless focus on developing quality creative content and delivering it around the world in innovative ways. Our Media Networks remain in high demand, commanding a premium position with advertisers and achieving significant continued growth with both traditional and emerging distribution partners. In addition, Paramount kicked off its highly-anticipated summer slate with the successful release of Noah at the end of the quarter, to be followed by Transformers: Age of Extinction, Hercules and Teenage Mutant Ninja Turtles in the coming months.

"In the first half of the fiscal year, Viacom returned another $2 billion to investors through our share buyback and dividends, highlighting our continued focus on delivering value to shareholders."

Revenues
					Quarter Ended														Six Months Ended
(in millions)					March 31,										B/(W)				March 31,										B/(W)
															2014 vs.														2014 vs.
					2014					2013					2013				2014					2013					2013
Media Networks					$	2,375				$	2,233				6	%			$	4,916				$	4,627				6	%
Filmed Entertainment					831					941					(12	)			1,512					1,916					(21	)
Eliminations					(32		)			(39		)			NM				(57		)			(94		)			NM
Total Revenues					$	3,174				$	3,135				1	%			$	6,371				$	6,449				(1	)%
NM - Not Meaningful

Quarterly revenues were $3.17 billion for the quarter. Media Networks revenues increased 6%, to $2.38 billion in the quarter, driven by higher affiliate fees and advertising revenues. Domestic affiliate revenues grew 11%, driven by rate increases, and worldwide affiliate revenues increased 10% in the quarter. Domestic advertising revenues increased 2%. Worldwide advertising revenues increased 3% to $1.12 billion in the quarter. Filmed Entertainment revenues declined 12% to $831 million, primarily due to lower carryover revenues from prior period releases. Theatrical revenues decreased 17% from the prior year, as strong domestic carryover revenues from The Wolf of Wall Streetwere more than offset by lower international theatrical revenues. Worldwide home entertainment revenues decreased 30%, primarily driven by fewer current quarter releases and a decrease in carryover revenues.

Operating Income (Loss)
			Quarter Ended														Six Months Ended
(in millions)			March 31,										B/(W)				March 31,										B/(W)
													2014 vs.														2014 vs.
			2014					2013					2013				2014					2013					2013
Media Networks			$	949				$	873				9	%			$	2,063				$	1,903				8	%
Filmed Entertainment			11					65					(83	)			(63		)			(74		)			15
Corporate expenses			(52		)			(57		)			9				(103		)			(117		)			12
Equity-based compensation			(31		)			(29		)			(7	)			(63		)			(60		)			(5	)
Eliminations			(5		)			(5		)			NM				(2		)			(8		)			NM
Operating income			$	872				$	847				3	%			$	1,832				$	1,644				11	%
NM - Not Meaningful

Quarterly operating income increased 3% to $872 million in the quarter. Media Networks adjusted operating income increased 9%, reflecting higher revenues partially offset by an increase in programming expenses. Filmed Entertainment adjusted operating income declined to $11 million reflecting the number and mix of current fiscal year releases.

Quarterly adjusted net earnings from continuing operations attributable to Viacom increased to $482 million. Adjusted diluted earnings per share from continuing operations for the quarter were $1.08, a 13% improvement from the prior year's comparable quarter.

Stock Repurchase Program

For the quarter ended March 31, 2014, Viacom repurchased 10.0 million shares under its stock repurchase program, for an aggregate purchase price of $850 million. As of April 30, 2014, Viacom had $8.01 billion remaining in its $20 billion stock repurchase program. As of March 31, 2014, Viacom had 432 million shares of common stock outstanding.

Debt

At March 31, 2014, total debt outstanding, including capital lease obligations, was $13.38 billion, compared with $11.89 billion at September 30, 2013. The Company's cash balances were $2.58 billion at March 31, 2014, an increase from $2.4 billion at September 30, 2013. Subsequent to the end of the quarter, the Company redeemed $600 million of outstanding 4.375% Senior Notes due September 2014.

About Viacom

Viacom is home to premier global media brands that create compelling television programs, motion pictures, short-form video, apps, games, consumer products, social media and other entertainment content for audiences in more than 160 countries and territories. Viacom's media networks, including MTV, VH1, CMT, Logo, BET, CENTRIC, Nickelodeon, Nick Jr., TeenNick, Nicktoons, Nick at Nite, Comedy Central, TV Land, SPIKE, Tr3s, Paramount Channel and VIVA, reach approximately 700 million households worldwide. Paramount Pictures, America's oldest film studio, is a major global producer and distributor of filmed entertainment.

For more information about Viacom and its businesses, visit www.viacom.com. Viacom may also use social media channels to communicate with its investors and the public about the company, its brands and other matters, and those communications could be deemed to be material information. Investors and others are encouraged to review posts on Viacom's company blog (blog.viacom.com), Twitter feed (www.twitter.com/viacom) and Facebook page (http://www.facebook.com/viacom).

Cautionary Statement Concerning Forward-Looking Statements

This news release contains both historical and forward-looking statements. All statements that are not statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements reflect our current expectations concerning future results, objectives, plans and goals, and involve known and unknown risks, uncertainties and other factors that are difficult to predict and which may cause future results, performance or achievements to differ. These risks, uncertainties and other factors include, among others: the public acceptance of our programs, motion pictures and other entertainment content on the various platforms on which they are distributed; technological developments and their effect in our markets and on consumer behavior; competition for audiences and distribution; the impact of piracy; economic conditions generally, and in advertising and retail markets in particular; fluctuations in our results due to the timing, mix and availability of our motion pictures and other programming; changes in the Federal communications laws and regulations; other domestic and global economic, business, competitive and/or regulatory factors affecting our businesses generally; and other factors described in our news releases and filings with the Securities and Exchange Commission, including but not limited to our 2013 Annual Report on Form 10-K and reports on Form 10-Q and Form 8-K. The forward-looking statements included in this document are made only as of the date of this document, and we do not have any obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances. If applicable, reconciliations for any non-GAAP financial information contained in this news release are included in this news release or available on our website at http://www.viacom.com.

VIACOM INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
		Quarter Ended										Six Months Ended
		March 31,										March 31,
(in millions, except per share amounts)		2014					2013					2014					2013
Revenues		$	3,174				$	3,135				$	6,371				$	6,449
Expenses:
Operating		1,538					1,539					3,012					3,302
Selling, general and administrative		712					689					1,416					1,386
Depreciation and amortization		52					60					111					117
Total expenses		2,302					2,288					4,539					4,805
Operating income		872					847					1,832					1,644
Interest expense, net		(152		)			(110		)			(301		)			(220		)
Equity in net earnings of investee companies		10					16					36					40
Other items, net		(3		)			(6		)			(3		)			1
Earnings from continuing operations before provision for income taxes		727					747					1,564					1,465
Provision for income taxes		(216		)			(258		)			(496		)			(494		)
Net earnings from continuing operations		511					489					1,068					971
Discontinued operations, net of tax		—					(3		)			—					(6		)
Net earnings (Viacom and noncontrolling interests)		511					486					1,068					965
Net earnings attributable to noncontrolling interests		(9		)			(8		)			(19		)			(17		)
Net earnings attributable to Viacom		$	502				$	478				$	1,049				$	948
Amounts attributable to Viacom:
Net earnings from continuing operations		$	502				$	481				$	1,049				$	954
Discontinued operations, net of tax		—					(3		)			—					(6		)
Net earnings attributable to Viacom		$	502				$	478				$	1,049				$	948
Basic earnings per share attributable to Viacom:
Continuing operations		$	1.15				$	0.98				$	2.38				$	1.92
Discontinued operations		—					(0.01		)			—					(0.01		)
Net earnings		$	1.15				$	0.97				$	2.38				$	1.91
Diluted earnings per share attributable to Viacom:
Continuing operations		$	1.13				$	0.96				$	2.33				$	1.89
Discontinued operations		—					—					—					(0.01		)
Net earnings		$	1.13				$	0.96				$	2.33				$	1.88
Weighted average number of common shares outstanding:
Basic		436.1					492.0					440.5					496.8
Diluted		444.6					500.3					449.3					504.7
Dividends declared per share of Class A and Class B common stock		$	0.30				$	0.275				$	0.60				$	0.55

VIACOM INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
		March 31,					September 30,
(in millions, except par value)		2014					2013
ASSETS
Current assets:
Cash and cash equivalents		$	2,580				$	2,403
Receivables, net		2,674					2,987
Inventory, net		717					770
Deferred tax assets, net		51					58
Prepaid and other assets		574					508
Total current assets		6,596					6,726
Property and equipment, net		1,011					1,040
Inventory, net		4,087					3,945
Goodwill		11,096					11,079
Intangibles, net		258					279
Other assets		814					760
Total assets		$	23,862				$	23,829
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable		$	341				$	316
Accrued expenses		792					1,074
Participants' share and residuals		968					1,110
Program rights obligations		576					576
Deferred revenue		216					230
Current portion of debt		618					18
Other liabilities		403					466
Total current liabilities		3,914					3,790
Noncurrent portion of debt		12,761					11,867
Participants' share and residuals		373					437
Program rights obligations		461					527
Deferred tax liabilities, net		562					649
Other liabilities		1,160					1,169
Redeemable noncontrolling interest		210					200
Commitments and contingencies
Viacom stockholders' equity:
Class A Common stock, par value $0.001, 375.0 authorized; 51.0 and 51.1 outstanding, respectively		—					—
Class B Common stock, par value $0.001, 5,000.0 authorized; 380.5 and 398.2 outstanding, respectively		—					—
Additional paid-in capital		9,607					9,490
Treasury stock, 356.6 and 336.3 common shares held in treasury, respectively		(17,525		)			(15,825		)
Retained earnings		12,410					11,629
Accumulated other comprehensive loss		(68		)			(101		)
Total Viacom stockholders' equity		4,424					5,193
Noncontrolling interests		(3		)			(3		)
Total equity		4,421					5,190
Total liabilities and equity		$	23,862				$	23,829

SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION

The following tables reconcile our results for the quarter and six months ended March 31, 2014 and the six months ended March 31, 2013 to adjusted results that exclude the impact of certain items identified as affecting comparability ("Factors Affecting Comparability"), including discrete tax benefits. We use consolidated adjusted operating income, adjusted net earnings from continuing operations attributable to Viacom and adjusted diluted earnings per share ("EPS") from continuing operations, as applicable, among other measures, to evaluate our actual operating performance and for planning and forecasting of future periods. We believe that the adjusted results provide relevant and useful information for investors because they clarify our actual operating performance, make it easier to compare Viacom's results with those of other companies and allow investors to review performance in the same way as our management. Since these are not measures of performance calculated in accordance with accounting principles generally accepted in the United States of America ("GAAP"), they should not be considered in isolation of, or as a substitute for, operating income, net earnings from continuing operations attributable to Viacom and diluted EPS as indicators of operating performance, and they may not be comparable to similarly titled measures employed by other companies. There were no adjustments to our results for the quarter ended March 31, 2013.

(in millions, except per share amounts)
			Quarter Ended
			March 31, 2014
																		Diluted
								Pre-tax Earnings					Net Earnings from					EPS from
			Operating					from Continuing					Continuing Operations					Continuing
			Income					Operations					Attributable to Viacom					Operations
Reported results			$	872				$	727				$	502				$	1.13
Factors Affecting Comparability:
Discrete tax benefits (1)			—					—					(20		)			(0.05		)
Adjusted results			$	872				$	727				$	482				$	1.08
			Six Months Ended
			March 31, 2014
																		Diluted
								Pre-tax Earnings					Net Earnings from					EPS from
			Operating					from Continuing					Continuing Operations					Continuing
			Income					Operations					Attributable to Viacom					Operations
Reported results			$	1,832				$	1,564				$	1,049				$	2.33
Factors Affecting Comparability:
Discrete tax benefits (1)			—					—					(20		)			(0.04		)
Adjusted results			$	1,832				$	1,564				$	1,029				$	2.29
			Six Months Ended
			March 31, 2013
																		Diluted
								Pre-tax Earnings					Net Earnings from					EPS from
			Operating					from Continuing					Continuing Operations					Continuing
			Income					Operations					Attributable to Viacom					Operations
Reported results			$	1,644				$	1,465				$	954				$	1.89
Factors Affecting Comparability:
Discrete tax benefits (1)			—					—					(12		)			(0.02		)
Adjusted results			$	1,644				$	1,465				$	942				$	1.87

(1) Adjusted results for the quarter and six months ended March 31, 2014 exclude $20 million of discrete tax benefits, principally related to the recognition of capital loss carryforward benefits. Adjusted results for the six months ended March 31, 2013 exclude $12 million of discrete tax benefits, principally reflecting the release of tax reserves with respect to certain effectively settled tax positions.

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Viacom Inc.
Press:
Jeremy Zweig, 212-846-7503
Vice President, Corporate Communications
jeremy.zweig@viacom.com
Mark Jafar, 212-846-8961
Vice President, Corporate Communications
mark.jafar@viacom.com
or
Investors:
James Bombassei, 212-258-6377
Senior Vice President, Investor Relations
james.bombassei@viacom.com
Pamela Yi, 212-846-7581
Director, Investor Relations
pamela.yi@viacom.com

Source: Viacom Inc.

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