Marvel Entertainment’s first quarter publishing revenues and profits slipped in a stronger than expected first quarter, according to the company’s financial reports released today. Publishing sales were down $700,000 to $25.8 million for the quarter, reflecting lower ad sales, partially offset by higher cover prices and increased sales in the mass channel. Publishing operating income declined to $7 million for the quarter, compared to $9.9 million in the year ago period, with $1 million in investment in Marvel’s digital initiatives contributing to the decline.
Over-all sales were up 75% to $197 million for the quarter, primarily due to a $90 million increase in film production revenue. Over two thirds of the film production revenue came from Incredible Hulk DVD sales, with most of the remainder from Iron Man DVDs.
Marvel’s net profit for the quarter was $44.5 million, or $.57 a share, blowing away analysts’ projections of $.37 a share.
Licensing sales dipped 4% to $80.8 million, a smaller than expected drop. Marvel received $19 million in settlement payments from two licensees related to the termination of their interactive license agreements.
Marvel raised its sales guidance for the rest of the year to $450 to $485 million in sales, from $415 to $460 million. Marvel also raised the lower end of its net income guidance from $80 to $86 million for the year, maintaining the high end of expectations at $105 million in profits.
The company expects its publishing sales for the year to be in the $115 million to $125 million range, and expects to spend a total of $6 million on its digital initiatives.
