No Ghost in Marvel's Earnings: Fool by Numbers
By Tim Beyers
February 26, 2007
This morning, Stock Advisor selection Marvel Entertainment (NYSE: MVL) released earnings for the fourth quarter ended Dec. 31.
Overall, operating margins suffered due to the increasing cost of revenues, mostly in the toy division.
But the core business is still doing well. Publishing, for example, improved its operating margin by almost four percentage points.
Meanwhile, Ghost Rider, which debuted in theaters Feb. 16, has grossed more than $95 million worldwide in its first two weekends, according to Box Office Mojo.
But that's more of a win for distributor Sony (NYSE: SNE) than it is for Marvel. Management told analysts to expect no material impact to earnings from the success of Ghost Rider.
(Figures in thousands, except per-share data)
Income Statement Highlights
Q4 2006
Q4 2005
Change
Sales
$85,216
$117,095
(27.2%)
Net Profit
$11,698
$25,919
(54.9%)
EPS
$0.14
$0.26
(46.2%)
Diluted Shares
85,120
100,534
(15.3%)
Get back to basics with a look at the income statement.
Margin Checkup
Q4 2006
Q4 2005
Change*
Gross Margin
68.14%
88.92%
(20.78)
Operating Margin
30.94%
38.24%
(7.30)
Net Margin
13.73%
22.14%
(8.41)
*Expressed in percentage points
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
Assets
Q4 2006
Q4 2005
Change
Cash + ST Invest.
$31,945
$39,366
(18.9%)
Accounts Rec. (current)
$59,392
$59,108
0.5%
Inventory
$10,224
$9,177
11.4%
Liabilities
Q4 2006
Q4 2005
Change
Accounts Payable
$5,112
$3,724
37.3%
Long-Term Debt*
$17,000
$0
N/A
*Credit facility
Learn the ways of the balance sheet.
Cash Flow Checkup
Q4 2006
Q4 2005
Change
Cash From Ops.
$41,662
$80,454
(48.2%)
Capital Expenditures
$1,820
$1,353
34.5%
Free Cash Flow
$39,842
$79,101
(49.6%)
Find out why Fools always follow the money.
Related Foolishness:
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David Gardner thinks Marvel is still marvelous.
Find out why Foolish colleague Steven Mallas loves Marvel.
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