'WrestleMania' helps propel profits
World Wrestling Entertainment muscled up a stronger-than-expected second quarter, driven mostly by its annual “WrestleMania” event.
Profits more than doubled to nearly $20 million from $7 million a year ago on a 7% surge in revenue to nearly $139 million in the three-month period ended June 30.
Much of that coin can be attributed to the fact that the 25th installment of “WrestleMania” took place during the second quarter rather than the first, as is usually the case for WWE.
“WrestleMania 25” alone generated $15 million in profits for the company during the quarter from revenue of around $32 million — $21 million of which came from 960,000 pay-per-view buys.
Last year, “WrestleMania 24” earned $7 million in profits from $31 million.
Without the event during the quarter, WWE said it would have seen revenue from PPV drop off 18%. But with “WrestleMania 25,” revenue from pay TV rose to nearly $36 million from $18 million a year ago. Company produced three other PPV specials during the period, in which viewership was down 4%.
WWE’s TV shows proved strong performers for the period, with revenue from TV rights fees rising to $28 million from $25 million, mainly thanks to its new “WWE Superstars” show on WGN America. It’s readying to renegotiate its deal for “Monday Night Raw” with USA Network.
While the company’s live events biz was down overseas, due mainly to lower ticket prices and attendance, revenue from events in North America was up 4%, with attendance up 19%. Lower ticket sales helped attract fans.
But “WrestleMania” essentially helped offset losses in WWE’s other divisions, including homevideo, which was down 54%, while its licensing and digital divisions were flat. WWE shipped 36% fewer DVDs during the quarter. Its magazine publishing biz was off 30%, because of fewer subscriptions and newsstand sales.
Its film division also stumbled, earning just $800,000 vs. $2.6 million during the year-earlier quarter. While “See No Evil” and “The Condemned” contributed to WWE’s bottom line, it has yet to see any money from its fourth pic, the Renny Harlin-helmed actioner “12 Rounds,” which disappointed with $12 million at the box office earlier this year, or direct-to-DVD release “Behind Enemy Lines: Colombia.” It collects coin from those pics once distribution, print and advertising costs are recouped by Fox.
WWE chairman Vince McMahon said he believed the film arm will eventually show a small profit and that the performance of those pics is helping WWE “learn a great deal of how we want to operate in the film industry as part of our overall product mix.”
Last year, WWE reacted to forecasts of an economic downturn and cut costs. That’s resulted, company CEO Linda McMahon said, “in a dramatic increase in profit margins that has more than offset the softness in revenues from a weak economy and adverse consumer trends.”