Strong Q1 Results for DreamWorks Animation

GLENDALE: DreamWorks Animation posted revenues for the first quarter of $190.4 million, up 14.4 percent on the prior-year period, led by solid performance in the TV series and specials, consumer products and new-media segments.

“I am happy to report another strong quarter of financial results, which I believe reflect continued execution on our strategy of transitioning DreamWorks Animation into a global family entertainment company,” said Jeffrey Katzenberg, the CEO of DreamWorks Animation. “I’m excited to be passing the baton to Comcast, as I know they will continue to build on the foundation we’ve established over the past 22 years.”

Revenues for the quarter ended March 31 from the TV series and specials segment increased to $57.0 million, compared to $18.1 million during the 2015 comparable period. The revenues increase was thanks to a significantly higher number of episodes delivered under its episodic content licensing arrangements. Segment gross profit increased to $21.1 million, up from $3.5 million in the prior-year period. The increase was primarily driven by higher revenues and lower marketing expenses.

Quarterly revenues from the feature films segment were $94.3 million, lower than the $128.7 million in the prior-year period. This is because revenues a year ago were favorably impacted by the worldwide pay-TV distribution of How to Train Your Dragon 2 and Mr. Peabody and Sherman, higher home-entertainment sales and recoveries of $6.3 million from previously established home-entertainment reserves related to sales through DWA’s former primary theatrical distributor. Segment gross profit for Q1 2016 of $26.1 million compares to $38.1 million in the prior-year period, primarily due to lower revenues.

Revenues from the consumer products segment increased to $21.4 million in the quarter, compared to $14.3 million in the same period last year. The increase was primarily due to revenues earned from location-based entertainment initiatives during the current quarter. Revenue for both the current and prior-year quarters also included contributions from merchandise licensing arrangements. Segment gross profit increased to $15 million from $9.4 million in the prior-year period, as revenues earned from location-based entertainment initiatives have lower associated costs.

In the new-media segment, revenues were $15.2 million, compared to $4.6 million in Q1 2015. This increase was primarily from the revenue generated from licensing and distribution of content, and to a lesser extent, brand sponsorship and talent management arrangements. Segment gross profit for the quarter increased to $6.5 million from $2.1 million in the prior-year period, thanks mostly to higher revenues.

Operating income for the quarter was $13.8 million, compared to an adjusted operating loss of $3.4 million in the prior-year period, primarily due to higher revenues and segment gross profit.