Company posts better-than-expected earnings
DreamWorks Animation, which is readying to unleash “How to Train Your Dragon” in theaters next month, fired up a better-than-expected fourth quarter.
While the company posted a 16% decline in profits, which came in at nearly $44 million, and a 3% drop in revenue of $194 million during the last three months versus the same period a year ago, the numbers still came in higher than analysts had predicted.
Television contributed significantly to the bottomline during the quarter, with holiday specials “Monsters vs. Aliens: Mutant Pumpkins from Outer Space” and “Merry Madagascar,” both of which aired on NBC, and TV series “The Penguins of Madagascar,” on Nickelodeon, generating $50 million in revenue during the period. “Merry Madagascar” also sold well on DVD.
“Monsters vs. Aliens,” the only pic that DreamWorks Animation released last year, also earned strong DVD sales and pay-per-view buys, earning $29 million. It sold 6.6 million DVDs by the end of the period.
However, the 2007 release “Shrek the Third” still brought in more green, earning nearly $39 million in revenue during the quarter, largely from domestic network and international TV fees. “Shrek the Musical,” which ended its run on Broadway, Jan. 3, generated $10 million in revenue.
“Madagascar: Escape 2 Africa” ($23 million), “Kung Fu Panda” ($17.5 million) and “Bee Movie” ($2.3 million) rung up notable sales, as well, mostly from homevideo and international pay TV sales. Other library titles contributed $33 million.
“Thanks both to the success of our core business and the performance of our TV initiatives, DreamWorks Animation had a very strong fourth quarter,” said Jeffrey Katzenberg, CEO of DreamWorks Animation.
“Dragon,” which was bumped from DreamWorks Animation’s schedule last year to March 26, will be followed by “Shrek Forever After” on May 21 and “Megamind” on November 5. All will unspool in 3D as a way to boost the films’ moneymaking potential while playing in theaters. It’s the first time DreamWorks Animation has released three films in one year.
The company has been spending heavily to promote “Dragon,” airing a series of 30-second vignettes of characters playing winter sports tied to NBC’s broadcast of the 2010 Winter Olympics in Vancouver. The spots are also shown on NBC’s “Today Show,” USA Network, CNBC and MSNBC.
But as more studios like DreamWorks look to unspool films in 3D, they’ll have to compete for screens.
Warner Bros. will release a 3D version of “Clash of the Titans” on April 2, shortly after “Dragon’s” bow. And “Alice in Wonderland,” which Disney is releasing March 5, will still be playing.
Katzenberg, who has been 3D’s biggest cheerleader over the years, said he’s upbeat about the addition of more theaters this year.
By the fourth quarter, “there will be enough 3D theaters in the multiplexes that exhibition will be able to accomodate multiple releases,” Katzenberg told Daily Variety.
And he’s not concerned with the lack of screens this spring.
“It’s not stopping us from getting played,” he said. “We have a one time event here in the spring. In less than six months, this logjam at the local movie theater is going to go away.”