DreamWorks Ani Rides High on Shrek

The record-breaking box office performance of Shrek the Third made for a good second quarter for DreamWorks Animation SKG. The studio yesterday reported total revenue of $222.5 million and net income of $61.8 million for the period ended June 30. This compares to revenue of $74.9 million and net income of $13.7 million for the same quarter last year, when the company was still recouping costs on Over the Hedge and had to lean on pay TV and home video sales of Madagascar due to the weak domestic performance of Wallace & Gromit: Curse of the Were-Rabbit.

‘Despite the unprecedented level of competition, [Shrek the Third's] blockbuster success demonstrated the strength of our flagship property and the value of the company’s overall franchise strategy,” comments DreamWorks Animation’s CEO Jeffrey Katzenberg.’

Shrek the Third enjoyed the most successful domestic opening ever for an animated film, and contributed approximately $109.1 million in revenue for the quarter. Over the Hedge kicked in an additional $26.9 million of revenue with domestic pay television and home video business. Through the quarter, DreamWorks shipped an estimated 13.4 million copies of the CG critter comedy, net of actual returns and estimated future returns.

Flushed Away, which DreamWorks Animation was forced to take a write-down on when it performed poorly at the box office, brought in around $12.4 million during the quarter as approximately 5.1 million units of the movie shipped on home video formats. Wallace and Gromit: Curse of the Were-Rabbit did a bit better with a $14.7 million contribution, while catalog titles Madagascar and Shark Tale remained strong with $12.7 million and $10.7 million, respectively. The remaining film library contributed $36 million in revenue for the quarter, driven mainly by the enduring popularity of the first two Shrek movies.

The international box-office performance of Shrek the Third is expected to be the primary driver of revenue for the third quarter, while the film’s Nov. 13 home video release keeps the profit party rolling into the second half of 2007 as Bee Movie mines theaters for box office nectar starting Nov. 2.