DreamWorks Animation shares are down 5.2% in postmarket trading following the announcement in its Q1 earnings. The write-down “is evidence of the current challenges we face within our feature film segment, and restoring the strength in our core business is my number one priority today,” CEO Jeffrey Katzenberg says. He adds that DWA’s next release — How To Train Your Dragon 2, set to open June 13 — “will put us back on-track to once again reach the levels of box office success that we’ve achieved historically.” With the Mr. Peabody & Sherman damage, DWA generated a net loss of $42.4M in Q1, down from a $5.6M profit in the period last year, on revenues of $147.2M, +9.4%. The top line beat the consensus forecast for $137.2M, but the charge for the film contributed to a loss of 51 cents per share, far bigger than the 14 cent loss that the Street anticipated.
Although Peabody & Sherman has generated $261M in ticket sales at worldwide box offices, it only contributed $3M to DWA’s Q1 feature film revenues and left the studio still owing money to its distributor, Fox. All told, the feature film unit reported a $25.4M loss on $110.1M in revenues. Turbo accounted for $22.3M in sales, mostly from pay TV, while The Croods kicked in $41.7M from pay TV and home video. Sales of library titles came to $37.9M. The TV operation had a profit of $5.8M on revenues of $17.9M, while Consumer Products had a $6.0M profit from $12.1M in revenue.
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