Originally written May 02, 2013 on Ring Side News:
WWE reported First Quarter 2013 revenue and earnings earlier this morning: - Revenue was $124.0 million compared to $123.1 million in the prior-year quarter. The comparison is skewed due to WWE receiving more revenue from their content distribution deals compared to Q2-2012 (additional hour of Raw, addition of Saturday Morning Slam, addition of Main Event, and Hulu online distribution contract). WWE also benefited from a 12 percent increase in PPV revenue based on increases in Royal Rumble and Elimination Chamber buys. Also, WWE reported that average-revenue-per-buy increased 5.0 percent due to an increase in the percentage of customers buying higher-priced HD version of PPVs. - WWE's profitability was off 80 percent compared to the prior year quarter. WWE reported Net Income of $3.0 million, as compared to $15.3 million in Q1-2012. WWE says profit was affected by recording a $4.7 million impairment loss on the "Dead Man Down" movie, which WWE says "generated lower domestic box office receipts than anticipated." The profit decline was also affected by "investments in content production, including talent and staff costs, lower profits from Home Entertainment, and lower sales of licensed products." The investments in content production include more expenditures for a "potential Network" and presumably WWE's new training facility in the Orlando area. - In his quarterly remarks, WWE CEO Vince McMahon continued to stress his view that WWE can "leverage demand" for their product to "transform business." McMahon based this on the performance of PPV buys and live event attendance in the quarter, as well as initial WrestleMania metrics. (Official Mania business will be reported in Q2-2013.) “In the first quarter, our performance reflected investments to enhance our brand strength, which we view as a critical determinant of our long-term growth,” stated McMahon. “Operating metrics such as pay-per-view buys and live event attendance, which are key leading indicators, continued to show improvement. Demonstrating the ongoing demand for WWE content, we successfully staged WrestleMania in April, which attracted more than 80,000 fans and is expected to deliver more than one million pay-per-view buys globally, ranking the event as the highest grossing and most profitable pay-per-view event in our history. Looking ahead, we are confident that we can leverage this demand to transform our business." “Several anticipated factors contributed to the decline in our first quarter OIBDA results, which - while down - were essentially in-line with our guidance," said CFO George Barrios. "These factors included investments in our content production and talent, lower profits from home entertainment and weakness in international licensing sales. Based on our assessment of these factors, we continue to believe that our results, excluding the impact of the film impairment associated with Dead Man Down, will fall within the range previously communicated, which was 'plus or minus 10 percent' from our 2012 OIBDA results."
PLAYERS: Vince McMahon
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