Marvel reported a vastly improved second quarter this year, with a net profit of $4.2 million (after preferred dividend) vs. a loss of $11.4 million in the year ago period, with the release of the Spider-Man movie getting lots of direct and indirect credit. All three segments--licensing, publishing, and toys--were up in both revenue and profitability. Money from the release of the Spider-Man movie in the quarter came through in a variety of ways. There was the $2.5 million in gross box office points, the $5.3 million from the toy joint venture with Sony, the $12 million increase in toy sales that the company's report attributed to movie toys. Marvel also took in a $5 million advance for the second Spider-Man movie. That's about $25 million in Spider-Man movie bucks for Marvel in Q2 without even looking hard.
Publishing sales were up over 60% in the quarter, to $18 million. Comic sales were up 36% and trade paperback sales were up 197% for the quarter. Marvel attributed its increase in sales to both an increase in market size and an increase in market share. It also noted broader distribution of its books, with more space allocated in chains, and increased subscription sales. Subscriptions on Ultimate Spider-Man jumped from 4,000 to 10,000 a month when the movie came out, for example. Despite increased sales in all channels, comic book shops were singled out as the source of 90% of the company's publishing growth.
Marvel took a one-time charge for good will impairment, related to an accounting change, of $4.6 million. The charge was put into first quarter, for which earnings were re-stated from a loss of $3.4 million to a loss of $7.9 million. Had the charge been taken in second quarter, Marvel would have shown a loss for the period. Marvel has affirmed its profit guidance for the year (see 'Marvel Predicts 2002 Profit').