DreamWorks Animation reports 60% drop in earnings in the first quarter
DreamWorks Animation reported a nearly 60% drop in profit in the first quarter of this year, reflecting the absence of a theatrical release and weak DVD sales from its super-villain movie "Megamind."
The Glendale-based studio earned $8.8 million, or 10 cents a share, in the first three months of this year, down from $21.7 million or 24 cents a share in the same quarter of 2010. Revenue in the quarter dropped 33% to $108 million, the company reported Tuesday.
The results were in line with Wall Street's expectations. Analysts polled by Thomson Reuters estimated that DreamWorks would earn 10 cents a share on revenue of $108 million in the quarter.
"Megamind," which was released in November and misfired at the box office, contributed $18.1 million in the quarter, mostly from home video sales. Two other 2010 titles, "Shrek Forever After" and "How to Train Your Dragon," generated $19.9 and $8.7 million, respectively, also mainly from DVD sales.
"We now look forward to kick-starting the summer moviegoing season with "Kung Fu Panda 2" on May 26, as family entertainment -- and CG animation in particular -- has performed at the top of the box office charts so far this year," DreamWorks Animation Chief Jeffrey Katzenberg said.
Several analysts revised their long-term earnings outlook for DreamWorks earlier this year after the studio shuffled its film slate, delaying the release of some upcoming films. "The Croods," which had been scheduled for release in 2012, was pushed to 2013, and a sequel to "How to Train Your Dragon" will be released in 2014 instead of 2013.
A market leader along with Walt Disney Co. and its Pixar Animation Studios, DreamWorks is facing an increasingly crowded marketplace, with a growing number of studios releasing computer-animated movies, such as the recently released hit "Rio" from 20th Century Fox, "Hop" from Universal Pictures' Illumination Entertainment and Paramount Pictures' "Rango." The latter two have had more mixed results at the box office.
-- Richard Verrier