DreamWorks Animation’s Profit Rises by 24 Percent

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DreamWorks Animation

DreamWorks Animation

DreamWorks Animation had net income of $24.4 million for the third quarter ended September 30, up 24% from $19.7 million for the same period in 2011, the studio announced Thursday.

For the quarter, the company reported total revenue of $186.3 million. This compares to revenue of $160.8 million for the same period in 2011.

“DreamWorks Animation’s third quarter results were driven by the blockbuster international box office success of Madagascar 3: Europe’s Most Wanted, which has earned nearly $720 million at the worldwide box office to date, to become the fifth highest-grossing film of the year on a global basis,” said CEO Jeffrey Katzenberg. “We are looking forward to the next major event film for the company during the fourth quarter, the November 21 theatrical release of Rise of the Guardians.”

Madagascar 3: Europe’s Most Wanted contributed about $47.1 million of revenue to the quarter, driven primarily by its performance at the worldwide box office. Released on June 8, the film has grossed over $216 million at the domestic box office and approximately $503 million at the international box office to date.

Puss In Boots contributed $44.8 million of revenue to the quarter, driven primarily by domestic and international pay television. The film reached an estimated 5.6 million home entertainment units sold worldwide through the end of the third quarter, net of actual and estimated future returns.

Kung Fu Panda 2 contributed $9 million of revenue to the quarter, driven primarily by international pay television. The film reached an estimated 6 million home entertainment units sold worldwide through the end of the third quarter, net of actual and estimated future returns.

Megamind contributed 700,000 of revenue to the quarter and reached an estimated 5.6 million home entertainment units sold worldwide through the end of the third quarter, net of actual and estimated future returns.

DWa’s library contributed approximately $50.6 million of revenue to the quarter. All other items, including non-feature film businesses, contributed $30.1 million of revenue to the quarter.

The company’s acquisition of Classic Media, which closed August 29, contributed about $4 million of revenue to the quarter, primarily from home entertainment.

Costs of revenue for the third quarter equaled $114 million. Selling, general and administrative expenses totaled $36.5 million, including approximately $3 million of stock-based compensation expense.

The company’s income tax expense for the third quarter was $14.3 million. Its combined effective tax rate — the actual tax rate coupled with the effect of the company’s tax sharing agreement with a former stockholder — was approximately 34.5% for the third quarter.

DreamWorks Animation’s fourth-quarter results are expected to be driven primarily by the continued performance of Madagascar 3: Europe’s Most Wanted in the international box office, as well as the global home video market. The November 21 theatrical release of Rise of the Guardians is also expected to contribute to the company’s fourth-quarter results.

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