Monday, August 03, 2015

Cartoon Makers' Earnings Projections

Now with Add On!

The big:

... Disney shares are trading at an all-time high, up nearly 45 percent over the past 12 months.

Expectations continue to rise ahead of results due out Tuesday afternoon. Disney is projected to grow revenue 6 percent to $13.225 billion, while earnings are projected to grow 11 percent to $1.42 per share. ...

Projections [are] that "Star Wars" will gross around $2.2 billion globally. ... "The Avengers" is expected to bolster the quarter's studio results, but analysts are projecting the company will take a write-down of $130 million to $140 million on "Tomorrowland." The upside — since the film is not part of a franchise -- that box office disappointment [won't] "ripple" into Disney's other earnings streams. ...

And the less big:

DREAMWORKS ANIMATION EARNINGS FORECAST: Second-quarter net loss of 26 cents a share is the consensus of analysts surveyed by Thomson Reuters, compared with a loss of 18 cents a share in the year-earlier period. Though the studio released the hit “Home” during the quarter, earnings could still be hit by costs associated with the company’s restructuring plan -- a turnaround announced in January that cut 500 jobs and scaled back its film production to two releases a year, from three.

The specter of this year’s layoffs still hangs over DreamWorks, and Chief Executive Jeffrey Katzenberg’s assurances to investors that a turnaround is in motion has split the analyst community. Some believe the studio is playing a smart long game, while others caution that it is too little, too late.

REVENUE FORECAST: Analysts forecast a revenue of $167 million, compared with last year’s $122 million.

When I was a wee tot, Walt Disney Productions (as it was then named) was the small, sick studio of Hollywood. It made few movies and its animation staff, though working in pleasant surroundings -- there were ball fields and ping pong tables scattered about -- made wages that were low compared to other animation studios.

Dad would come home from Disney's with his paltry pay check, and make ends meet with freelance work. The studio would sweeten the low pay with stock options, but Disney stock was never worth very much, and the shares paid almost nothing in dividends.

Disney storyman Larry Clemmons recalled how he came back to the studio while a writer on Bing Crosby's network radio show, and was viewed with awe and envy by former co-workers: "Gee Larry, you're working for real Hollywood!"

But all that was a lifetime ago. Then, Disney's was the DreamWorks Animation of its day. Now, the Disney Company is a gargantuan powerhouse of an entertainment conglomerate, no longer sick, no longer struggling.

And what studios will be prospering and which gone bankrupt a lifetime from today? I can make a semi-educated guess, but I really haven't a clue. It'll probably be a company that is currently a mere blip on the horizon.

Add Ons:

The DWA actuals:

While DreamWorks Animation seemed to be getting Wall Street off its back when the company’s share price rose more than 52% from late January to early June, it has since retreated about 13.3%. That was the mindset going into today’s quarterly earnings report from the animation company. In a call with Wall Street today, DWA CEO Jeffrey Katzenberg revealed that the quarter ending June 30, 2015 has resulted in an increase in revenues that represents a 39.7% jump from the same period last year. Specifically revenues were $170.8M (which beat forecasts), coming from the expansion of the company’s television and new media businesses and from the theatrical success of its last animated film. Also, the Television segment revenues more than doubled year-to-year to $55M.

The operating loss, however, was $21.8 million logging in a net loss of $38.6 million, which is a greater net loss than anticipated. That translates to .45 cents per share. The restructuring-related charges totaled $20.9M or a loss of .25 cents per share. ...

... and the Mouse:

Disney shares continued to fall in post market trading today after execs, in a conference call, told analysts that some financial results will come in lower than it expected — due in part to declining pay TV subscriptions for its biggest profit generator: ESPN.

The company says its cable unit’s operating income through the fiscal year ending September 2016 will rise by a mid-single digit percentage. That’s down from its projection in April for high single digit growth. Revenues will continue to grow by high single digits. ...


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