DreamWorks swings to profit on strong Shrek sales

By Sue Zeidler

LOS ANGELES (Reuters) - DreamWorks Animation SKG Inc on Tuesday swung to a quarterly profit after a loss a year ago, beating Wall Street forecasts with help from the strong performance of the DVD release of "Shrek the Third."

Fourth-quarter net income was $94.1 million, or 98 cents per share, compared with a loss of $21.3 million, or 20 cents per share, for the year-earlier quarter.

Revenue rose to $290.2 million from $204.3 million.

Analysts, on average, had forecast earnings of 72 cents a share on revenues of $274.5 million, according to Reuters Estimates.

DreamWorks shipped 15.6 million "Shrek the Third" DVD units worldwide, which was below the 33 million "Shrek 2" units sold in that DVD's first quarter of release.

The latest title contributed $179.4 million to fourth-quarter revenues, primarily through its release into the home video market and international box office receipts.

Analysts had projected a range of 9 million to 13 million units would ship in the fourth quarter, when competition in the home video market was heated.

"'Shrek the Third' DVD was not as bad as people feared, but on the other hand, it's below what they did on 'Shrek 2'," said JP Morgan analyst Barton Crockett, who said earnings overall beat his expectations.