DreamWorks Animation SKG Inc. DWA reported second-quarter 2015 loss of $38.6 million or 45 cents per share compared with loss of $15.4 million or 18 cents in the prior-year quarter. However, adjusted loss of 13 cents per share was narrower than the Zacks Consensus Estimate of a loss of 29 cents.
Quarterly revenues climbed 45.1% year over year to $170.8 million but missed the Zacks Consensus Estimate of $171 million. The upside in revenues can be mainly attributed to the success of the movie Home. Segment-wise, Feature Film revenues climbed 26% to $87.8 million; revenues from the Television Series and Specials unit totaled $54.5 million, up 172.5%; while Consumer Products revenues fell 31.4% to $12.7 million. New Media Segment reported revenues of $14.6 million in the second quarter of 2015, up 27%.
Selling and marketing expenses amounted to $12.1 million in the second quarter, down 9% year over year while general and administrative expenses rose 51.6% to $80.7 million.
At the end of the reported quarter under review, the company had $122.2 million of cash and cash equivalents and no outstanding debt as against $34.2 million of cash and cash equivalents and no outstanding debt at the end of 2014.
Operating cash flow at the end of the first six months of 2015 were $7.34 million versus operating cash consumption of $66.4 million at the end of the same period last year. Free cash flow in the reported period totaled $2.75 million compared with free cash consumption of $84.1 million in the same period last year.
Meanwhile, DreamWorks struck a deal with Google Inc.’s GOOGL video-sharing site YouTube and DreamWorks’ AwesomenessTV for the release of several feature films on the website over the next two years. The films will be launched across the globe on YouTube before they are made available elsewhere.
Stocks to Consider
DreamWorks presently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the broader sector are IMAX Corporation IMAX and News Corporation NWS, both carrying a Zacks Rank #2 (Buy).
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