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  Nov 21, 2001



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READER ALERT: For all the latest wrestling happenings, check out our News & Rumours section.

WWF blames losses on Sept. 11, economy
By JOHN POWELL -- SLAM! Wrestling

The World Wrestling Federation is pointing the finger at the downturn in the U.S. economy and oddly enough, recent terrorist attacks on the U.S. and not the decline in popularity and quality of their overall product as the reasons why their earnings for the second fiscal quarter are down again.

The WWF announced today that total revenues for the quarter were $98.2 million versus $111.9 million in the prior year's quarter. Net income was $4.8 million compared to $9.5 million last year. Earnings per common share were $0.07 versus $0.13 in the second quarter of last year. Included in last year's earnings was an after tax charge of $2.9 million, or $0.04 per share, associated with discontinued operations (the XFL).

"We experienced some softness in our ratings, attendance, and pay-per-view buys during the quarter," said Linda E. McMahon, the WWF's Chief Executive Officer. "Our results were also impacted by the continued economic downturn and the impact of the September 11th tragedy. Nevertheless, the popularity of our entertainment remains strong."

McMahon went on to praise the advanced ticket sales for Wrestlemania as a positive sign for the company. "It is also worth noting that in the first weekend that tickets went on sale for our Wrestlemania event that will take place in Toronto, Canada on March 17, 2002, we sold approximately 52,000 tickets. This event will be the highest grossing event in the company's history. This is a further testament to the ongoing demand, popularity, and resilience of our brand," said Mrs. McMahon.

Earlier this month, the WWF cut 39 people, or 9 percent of its work force, and replaced its chief operating officer as the company's profits dropped off.

In the report released today the following information was also made public about the plight of the WWF.


Live and Televised Entertainment

  • Total revenues were $72.7 million for the quarter.

  • Live Event revenues revenues were $16.1 million for the quarter. There were 55 events during the quarter which was unchanged versus last year. Attendance was 475,000 compared to 630,300 in the second quarter last year. The average ticket price increased approximately 5 per cent to $33.87.

  • Total pay-per-view revenues for the quarter were $22.2 million. In period buys for the quarter were 1.2 million as compared to 1.7 million last year.

  • Television Rights Fees revenues increased 80 per cent to $13.5 million once again reflecting the positive impact from our agreement with Viacom. International rights fees increased 36 per cent for the quarter.

  • Television Advertising revenues were $20.9 million versus $22.5 million during the same period last year.


Branded Merchandise

  • Total revenues were $25.5 million for the quarter.

  • Licensing revenues rose 39 per cent primarily due to an increase in the sales of toys.
  • Merchandise sold at venues decreased 23 per cent.

  • Revenues in WWF publishing business were negatively affected by lower sell-through rates.

  • Home video revenues decreased to $3.3 million. During the quarter, the Company commenced its new distribution agreement with Sony Music Video which should significantly expand the distribution of WWFE's home video and DVD titles in current and untapped retail outlets in subsequent quarters.

  • New Media business was impacted by the declining internet advertising market.

  • Revenues at WWF New York declined principally due to the tragic events of September 11, 2001. Although there has been a slight rebound in business at WWF New York, the recent events in the New York City area will most likely continue to negatively impact this venue.




The total profit contribution for the quarter was $35.4 million compared to $49.3 million last year. The total profit contribution margin declined from 44% to 36% for both business segments. The WWF is predicting that total revenues for the year are projected to be in the range of $395 million to $415 million. Live and Televised revenues are forecasted to be approximately $300 million to $310 million. Branded Merchandise revenues are expected to be between $95 million to $105 million.




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