Green ogre eats into DreamWorks Q2 figures

Poorer than expected sales of DreamWorks Animation's 'Shrek 2' DVD have been blamed for eating into the US animation studio's profit margin and tipping it into the red.
However, DreamWorks had already issued a profits warning in July on weak DVD sales and the final Q2 figures were not as poor as had been expected. DreamWorks had initially forecast losing between 7-9 cents a share. The company reported revenue of $35.4 million - a net loss of $3.7 million (£2 million), equivalent to 4 cents a share in Q2, 2005. This compared to a Q2 net income of $146.1 million in the preceding year.
However, the orgre's lacklustre DVD performance in his second outing, the movie was the top grossing box office film world-wide in 2004, was offset by a mighty theatrical run of the studio's latest animated animal extravaganza 'Madagascar'.
DreamWorks Animation's CEO Jeffrey Katzenberg said: "Results for the quarter are slightly ahead of where we said they would be on our July 11 conference call driven by the strength of Madagascar consumer products as well as our library.
"To date, Madagascar has performed very well achieving more than $432 million in worldwide box office, reaching over $242 million internationally."
"While we continue to analyze changing trends in the home video market, the performance of our 2004 releases is strong. Shrek 2 remains one of the best selling home video releases of all time and Shark Tale is the second highest selling DVD of 2005. We are looking forward to Madagascar's release in the home video market on November 15, 2005."
Industry analysts have pointed to a cooling off in the home entertainment market where sales have begun to reflect the theatrical movie release pattern where initial box-office sales set the final revenue trend.
DreamWorks Animation's next film 'Wallace & Gromit: Curse of the Were-Rabbit' is scheduled for a US theatrical release on October 7, 2005.
(SP)