Updated with CEO comments: The deck was stacked against MGM for the first three months of 2016, which was manifested in the so-so Q1 financial report it just released.
MGM generated $57.1 million in net income, up 0.4% vs last year’s Q1, on revenues of $311.3 million, down 14.6%.
In a call with investors, CEO Gary Barber described it as “another strong quarter” that bodes well for “another great year for MGM.”
He noted that the April release Barbershop: The Next Cut has performed “somewhat below our expectations due to significant competition from the record breaking Jungle Book.” Still, he’s confident that the film starring Ice Cube will make a “productive contribution.”
As for Q1, the Film Content business saw adjusted cash flow (measured by earnings before interest, tax, depreciation and amortization) decline 9.3% to $102.7 million on revenues of $242.8 million, down 21.6%
Theatrical revenues suffered as the James Bond film, Spectre — released in October — started to run out of gas during the first three months of 2016. By contrast, last year’s Q1 was able to benefit from The Hobbit: The Battle of the Five Armies which was still fresh after its December 2014 release.
TV Licensing also couldn’t keep up, which the company says was “as expected.” Last year’s Q1 included “a significant television license” plus initial television availabilities for Skyfall, The Hobbit: An Unexpected Journey, Hercules, 22 Jump Street and If I Stay.
Home Entertainment fared better, helped by video release for Spectre, as well as “the tail-end of our worldwide home entertainment promotion for the James Bond franchise.”
And Other Revenue was up as the company was able to begin recognizing revenues from co-productions Max and Creed.
The Television Content business had a better story following the consolidation in January of United Artists Media Group. Cash flow rose 56.3% to $21.6 million on revenues of $49.3 million, up 37.8%. MGM licensed new episodes of Vikings, Survivor, The Voice, Shark Tank, Beyond the Tank, and Lucha Underground.
MGM’s recognized $10.9 million, down 25.7%. from its 19.1% stake in Epix.