Products push WWE quarterly gains
Linda McMahon discusses movies and broadcasting during call
JON WALDMAN -- SLAM! Wrestling
World Wrestling Entertainment is reporting a net income increase from last year, with a lot of the added dollars being attributed to added product from the first quarter of 2005's fiscal year.
The Fed's net income, which was made public on Wednesday, was $15.8 million in the first quarter of the 2006 fiscal year, compared to $7.6 million last year at this time. Total revenues were up as well, increasing from $81.6 million to $93.8 million.
The increase, however, can be partially attributed to the amount and formats of pay-per-views in the quarter. Last year's first quarter included four PPV broadcasts, while this year’s had five, including Backlash. The quarter also included the ECW One Night Stand event, which drew 4,000 more buys than Bad Blood last year.
Overall, PPV pick-ups were higher this year. The biggest difference was Vengeance, which outdrew last year’s event by 88,000 buys. Judgement Day gained 16,000 buys, while Great American Bash drew approximately the same numbers.
While the PPV numbers were up, live event revenues were down. While average attendance was up (4,600 compared to 3,800 last year domestically, 10,700 to 9,300 internationally), income fell from $17.9 million to $16.5 million. This can be attributed to a big drop in live events from 89 to 70 (including 10 international events in Q1 of 2005 to seven in Q1 2006).
Perhaps the most important gain was in the WWE Home Video division. DVD and video sales increased from $5.7 million to $8.5 million, a number which WWE CEO Linda McMahon attributes to one particular disc set.
"Our Home Video business also out-performed our estimates due in part to the success of our WrestleMania 21 title," McMahon said in a release, "which sold approximately 202,000 DVD units in the U.S. alone, making it one of our all-time best sellers."
Other strong sellers included Greatest Wrestling Stars of the '80s (approximately 95,000 sales) and the Road Warriors DVD (85,000 units sold).
Further revenues included $5.2 million in merchandise, up $1.5 million from last year, while licensing revenues increased by $4.5 million, primarily due to strong sales of Xbox's WrestleMania 21 game.
During a conference call with shareholders Wednesday, McMahon responded to investor questions. These included the following:
The lawsuit against THQ and Jakks/Pacific, is, according to McMahon, “slowly progressing through the courts.
Within the first six months of 2006, The Marine will release in theatres. The movie has done all principle shooting, with a couple scenes already been re-shot. WWE is aiming for a PG-13 rating. WWE is also close to a distribution agreement for The Condemned, with pre-production earliest being in early 2006.
McMahon admitted that Smackdown's move to Friday was not to a hotspot on the broadcasting radar, but she stated that, "I think that we have the opportunity to grow for UPN and for our fanbase, new viewers on Friday night...I think there’s good opportunity for us there."
McMahon added that there will be some pre-emption of Smackdown due to the Major League Baseball playoffs.
McMahon stated that there is a large video library, as well as a couple smaller ones, that WWE is looking to purchase. Currently, there are in excess of 75,000 hours of footage in WWE's library.
McMahon noted that WWE has signed in the neighbourhood of 60 to 65 former stars to Legends contracts.
With the move to USA, the number of television hours has been reduced from five to three hours. The weekend show will run on Saturday mornings, though no format has been announced. McMahon also noted that they will be discontinuing syndicated broadcasting.
Jon Waldman has been with SLAM! since 2000.