Third-quarter profit up 39%, but Marvel lowers '09 forecast
EmptyMarvel was a victim of its own success Tuesday, reporting that money from "Iron Man" has poured into its coffers earlier than expected.
That dynamic translated to Marvel crushing estimates for its third-quarter financial performance, though it also means that the company will underperform expectations next year.
Investors took most of the trading session to decide whether the good news outweighed the bad. In the end, Marvel stock nearly sat out a powerful Election Day rally. Its shares finished up 1.9%.
Profit at Marvel rose 39% to $50.6 million on revenue that surged 48% to $182.5 million. About $60 million of those sales can be attributed to "Iron Man" revenue that Marvel originally predicted wouldn't be recognized until next year.
With no new Marvel-produced releases set for next year and a bunch of "Iron Man" money already accounted for, Marvel was forced to significantly rein in its 2009 forecast while beefing up its full-year 2008 forecast.
Marvel now sees revenue of up to $460 million next year, while analysts were looking for $610 million. For this year, revenue could go as high as $670 million, while it previously predicted about $480 million.
Marvel's next big theatrical events are "Iron Man 2" and "Thor" in 2010, and the company also expects that by the end of that year its "Spider-Man" Broadway musical will have premiered.
"We are not funding the show, but we are co-producing it and have a meaningful first-dollar gross participation," Marvel Studios chairman David Maisel said.
Marvel brass said they haven't seen any negative effects from a downshifting economy as far as the film division is concerned, though the downturn has cut into its comic book business a tad.
Executives also worried Tuesday about the ability of some partners to make and distribute Marvel-related toys and games.
"The real concern that we have on a global basis is the credit availabilities for all of our licensees that are manufacturers," CFO Kenneth West said. (partialdiff)