WWE pins down overseas profits
Company posts increase thanks to attendance
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A strong boost in attendance at the live events that World Wrestling Entertainment produced overseas during the last three months helped the company post a 69% increase in profits during the third quarter.
A growth in viewership around the world has encouraged the company to pursue the creation of its own WWE-branded TV channel, whose programming would be made up of original series and packages of its vast library of footage featuring its stable of wrestlers.
The company said it is in the "preliminary evaluation stage" of the venture but declined to disclose further details.
WWE hopes the new channel will not only generate more coin for the company's coffers but also attract new fans to its events and four weekly TV shows that currently air on USA Network, MyNetworkTV, Syfy and WGN America. Ratings were up 23% for those shows during the recent quarter, and they generated $28 million in TV rights fees, up from $24 million during the same period last year.
The company had hoped films would also expand its audience, but it's struggled over the years to produce a major hit.
It has yet to see any money from "12 Rounds," the $20 million-budgeted, Renny Harlin-helmed actioner that bowed in March and earned $17 million worldwide.
Division made $3 million from homevideo releases of its previous pics "See No Evil," "The Marine" and "The Condemned" plus the direct-to-DVD title "Behind Enemy Lines: Colombia."
"If you want to buy stock in terms of just the film business, this is not the company to be associated with," said WWE chairman Vince McMahon.
WWE is revising its "film philosophy" and will produce pics with budgets of around $5 million, many of which will have only limited theatrical releases, McMahon said.
It's wrapped production on its next movie, the comedy "Knucklehead," and has the direct-to-DVD actioner "The Marine 2" bowing early next year.
For the quarter ended Sept. 30, WWE earned $8.9 million from $111 million, up from nearly $109 million for the same quarter a year ago.
Overall, revs rose 17% for the company overseas, with the Asia Pacific region and Latin America growing 84% and 82%, respectively. Asia Pacific is the company's second-biggest market, earning $12.5 million during the quarter.
While the U.S. market is still WWE's strongest revenue generator, especially from live events, earnings were down 2% domestically to $81 million on lower ticket prices. Those lower prices, however, helped boost attendance by 9%.
Overall, WWE produced 94 events, 17 of them overseas.
WWE's biggest moneymakers, live events and TV shows, grew 13% during the period to $78 million, with the events side of the biz up 34% from higher attendance numbers.
But it took a 22% hit in its usually lucrative pay-per-view business, earning $14.5 million because of fewer buys. "SummerSlam," its second-largest PPV of the year, lost 108,000 buyers from last year.
Its consumer products arm, which handles licensing, homevideo, videogames, magazines and websites, fell 14% to $23 million.
McMahon downplayed the recent departures of his wife, Linda, as CEO, to run for Senate in Connecticut, and son, Shane, as the head of global media for the company, saying, "Some people perceive this to be a family business, but I do not."
