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NEW YORK (AFX) - Marvel Entertainment Inc. said Monday its third-quarter earnings fell 44 percent year over year, but the results still beat Wall Street forecasts.
The New York-based home of Spider Man and the Incredible Hulk also boosted its full-year profit outlook and issued an initial forecast for next year, sending its share price higher.
Marvel's stock rose $1.45, or 5.8 percent, to finish at $26.50 Monday on the New York Stock Exchange. The day's strongest level of $28.72, on heavy volume, was a 52-week high surpassing the prior high of $26.44 set Oct. 23. There was a 52-week low of $13.83 last Nov. 10.
The company said third-quarter net income slid to $13.2 million, or 16 cents a share, from $23.4 million, or 23 cents a share, a year earlier.
Analysts surveyed by Thomson Financial had forecast, on average, earnings of about 12 cents a share for the latest quarter.
Marvel's earnings drop came as total expenses climbed to $62.9 million from $46 million and despite a 14 percent year-over-year rise in sales to $92.1 million.
Citigroup Research analyst Elizabeth Osur wrote in a research note that Marvel's largest sales increase came in the toys segment. That's where sales grew 49 percent to $33 million due to Marvel's own production of toys this year compared with mainly royalty recognition in 2005.
Comic-book publishing revenue rose 20 percent to $31 million. Licensing sales fell 15 percent to $28.3 million on nominal contributions from X-Men 3, given poor licensing terms for the movie.
Marvel raised its 2006 per-share earnings view to 61 cents to 64 cents from a prior forecast of 50 cents to 60 cents. The company also narrowed its sales projection to $330 million to $340 million from a prior range of $320 million to $350 million.
For 2007, Marvel anticipates earnings of $1.35 to $1.55 per share and revenue of $375 million to $435 million. It earned 97 cents a share on revenue of $391 million for 2005.
Marvel said 2007 was expected to be a pivotal year, marked by three licensed feature-film releases and the first full year of a toy license agreement with Hasbro Inc.
For 2007, Marvel Studios expects to begin principal photography on its first Marvel-produced feature film, "Iron Man," in the first quarter, and it expects filming on "The Incredible Hulk" to begin later in the year for a June 27, 2008, release.
For the first nine months of the 2006, Marvel's net income declined to $47 million, or 53 cents a share, from $76.9 million, or 71 cents a share, a year earlier.
Sales fell to $266.6 million from $273.4 million.
Citigroup does business with companies covered in its reports. Copyright 2006 Associated Press. All rights reserved. This material may not be
Copyright 2006 AFX News Limited. All Rights Reserved.
