Katzenberg bullish for DreamWorks Ani
Earnings growth predicted for 2009-10NEW YORK -- DreamWorks Animation CEO Jeff Katzenberg on Thursday touted his company's lack of exposure to the global recession and outlined its film slate through 2012, including latest installments of the "Madagascar" and "Kung Fu Panda" franchises.
At the company's investor and analyst day here, he said "Kung Fu Panda 2" is currently scheduled for a June 2011 release with "Madagascar 3" on the slate for summer 2012
In bullish opening remarks, Katzenberg highlighted DWA's lack of significant dependency on advertising and subscription businesses. "(This) clearly sets us apart," he said, adding that even in a difficult economy CG-animated family fare remains a profitable business.
Analysts have cited DWA's pure-play entertainment focus as a key reason for why its stock has held up much better than that of peers this years.
DWA shares on Wednesday closed at $24.24, between their 52-week low of $20.39 and high of $32.73, according to Yahoo Finance. That is only a minor decline from the 2007 close of $25.54.
Katzenberg told the Wall Street crowd at the venerable Ziegfeld movie theater in midtown Manhattan that his team has focused to address the company's biggest challenge -- consistency. He cited the success of "Shrek," "Madagascar" and "Panda" as evidence that it has made clear strides on this front.
More than $2 billion is the global boxoffice take to-date for "Panda," "Madagascar 2" and "Shrek 3," he said. Total boxoffice for all the films in the franchise top $4 billion, a video package shown said.
Katzenberg also touted that "Panda" and "Madagascar 2" will end inside the top 10 films of 2008.
"Our feature film slate is the strongest in our history," he said.
After 2009's releases of "Monsters vs Aliens," DWA's 2010 slate includes the fourth "Shrek," "How to train your Dragon" and "Mastermind."
President and CFO Lew Coleman predicted earnings growth for both years, with 2009 helped by "Madagascar 2" DVD sales despite only one theatrical release.
For 2011, Katzenberg said "Panda 2" is on tap for June 3, plus there will be an original film release as well that will be unveiled next year. Summer 2012 will bring "Madagascar 3" plus another original.
Katzenberg finished his opening presentation with three well-received 3D clips from "Monsters."
He also once again touted the upside potential for 3D, even in a downturn.
"There is tremendous resilience" in movie going, he said. "Wal-Mart and McDonald's are about the only businesses that can say that."
With consumers looking for bargains, "the greatest value and bargain that exists today is going to your local theater," and adding value via 3D will strengthen the value proposition, Katzenberg said.
The DWA CEO said the digital cinema rollout remains behind his hopes, but he said there will be enough screens set up for digital and 3D in time for "Monsters" to make it a solidly profitable film.
He also suggested that digital cinema consortium DCIP will likely not close its financing before late in the first quarter amid the current state of markets.
Asked about a possible SAG strike, Katzenberg said a short strike wouldn't have any impact, but a longer strike would affect the availability of voice talent.
"It just does not seem to make a lot of sense" in the current environment," he said about a strike.
"But it's Hollywood, and anything can happen."
Meanwhile, COO Ann Daly Thursday said the recession is having a "dramatic impact" on DVD sales and pricing, but DWA is holding up better than peers.
Daly also unveiled new TV and DVD product.
NBC has ordered two 2009 holiday TV specials -- a "Monsters" Halloween and a "Madagascar" Christmas special, she said. For 2010, a "Panda" and a "Shrek" special are planned.
Meanwhile, Nickelodeon has already greenlit a second season of "The Penguins of Madagascar," as well as a pilot based on "Panda."