DWA gets snailed

Studio salted with ‘Turbo’ writedown

Jeffrey Katzenberg’s DreamWorks Animation surprised Wall Street on Tuesday with a Turbocharge.

The Hollywood studio wrote down its $135 millionbudgeted movie “Turbo” after an underwhelming US box office of $83 million, plus disappointing DVD sales, failed to live up to expectations.

The writedown sparked a selloff in DreamWork shares after hours, with the stock falling about 8 percent, to $32.13.

DreamWorks reported another impairment charge of $6.7 million on “other content” and a gain of $6.4 million from the sale of a social app that was in development.

Net profit was $17.2 million, or 20 cents a share, in the December quarter, compared with a loss of $82 million in the year earlier period.

Revenue fell 23 percent, to $204.3 million.

Katzenberg told analysts that despite the modest sales performance for “Turbo,” the “Turbo Fast” series on Netflix is on track to be the most popular on their platform.

Katzenberg added that movies are no longer the single story at the independent company.

“We believe if you have good characters and good stories, there’s going to be meaningful value for them as we establish nontheatrical platforms. TV is one of them, but we’re seeing it in locationbased entertainment, consumer products — it’s our goal to try and establish as many revenue sources outside of DVD, digital and TV,” said CEO Katzenberg.

DreamWorks said it is establishing a children’s publishing venture called DreamWorks Press and is exploring a theme park in London called Shrek Far Far Away.

Tuna Amobi, entertainment analyst at Standard & Poors, said: “The key takeaway is that DreamWorks has become more of a diversification story, moving away from theatrical at its core. There was a lot of noise with writeoffs and charges.”