Regal profit paves Street
EmptyRegal Entertainment impressed investors Thursday by reporting a better-than-expected profit, though a decline in admissions and concession sales suggests that all is not rosy in the movie exhibition business.
However, Wedbush Morgan Securities analyst William Kidd said that he expects Regal's outperformance has more to do with its stake in theater advertiser National CineMedia than it does with favorable moviegoing trends.
The company earned $23.2 million in the fourth quarter, down 21% from a year ago. But on a per-share basis, the company earned 15 cents, which was 4 cents better than Wall Street expected.
Revenue dropped about 9% to $599.9 million, less than analysts predicted, but investors focused on the positive and the shares rose fractionally Thursday to $18.57.
Admissions revenue was down 6% to $404.1 million and concessions revenue was off 8% to $158.4 million.
Elsewhere on Thursday, a couple of new-media companies also posted results, with Activision impressing its shareholders, while RealNetworks depressed theirs.
RealNets shares, up 3% to $6 during the regular session, sunk as much as 5% after the closing bell, when the company forecast 2008 revenue below Wall Street's expectations.
The company earned $2.7 million in the fourth quarter, down from $39.3 million last year when it was helped by payments from Microsoft's antitrust settlement. Revenue was up 25% to $157 million.
RealNets, operator of online games and a distributor of Internet video, recently struck a deal for replacing Yahoo Music Unlimited with Rhapsody, the music-subscritpion business owned by RealNets.
As for Activision, its "Call of Duty 4: Modern Warfare" and "Guitar Hero III: Legends of Rock" games propelled it to a fiscal third-quarter profit of $272.2 million, up 90% from a year ago. Revenue leapt 80% to $1.5 billion.
Activision is in the process of merging with Vivendi Games, publisher of online game "World of Warcraft," to create what's expected to be the largest video game company in the world.
Activision also raised its outlook for the current fiscal year.
Shares of the company, which were up 1.5% during the regular session to $26.29, rose another 1% in after-hours trading.