Post by Snitsky on May 7, 2009 14:25:20 GMT -5
VINCE MCMAHON SAYS WWE DID 'FAIR TO POOR' THIS QUARTER, WWE 'CHOMPING AT THE BIT' TO WORK WITH MATTELL, LINDA MCMAHON BARELY SAYS A WORD FOR THE FIRST TIME ON AN INVESTOR CONFERENCE CALL
by Buck Woodward @ 2009-05-07 11:42:04
WWE held an investor conference call today to discuss the first quarter numbers which were released this morning. Participating in the call were Chairman Vince McMahon (his first time participating), Chief Executive Officer Linda McMahon, Chief Financial Officer George Barrios and Chief Operating Officer Donna Goldsmith.
Vince McMahon said he was participating on the call to help "lend a vision" to WWE's future. He said their first quarter performance was "fair to poor" in his opinion, but he feels they are "set up for success in the future" and put a positive spin on their recent cost-cutting, saying they are becoming more efficient and that they have found that "fewer people can do more things" in helping the company grow. Vince pointed out that they maintain "number one status" on every network they are on over the course of the year (USA, SciFi, MyNetwork). Vince feels that they can "do better on all counts" but put over that their product is "innovative" and that because they are such a "unique" product, they have been an "island onto ourselves" and that they are engaging in an "education process" to become more a part of the entertainment mainstream. Vince also talked about the new "PG" attitude, and that while they don't sell their own advertising, they will be able to bring more advertisers to their shows now and thus get higher fees from the networks.
Vince said that their "reaching out" to the media and other entertainment environments will help them to expand their product, noting their recent connection with "The View". Vince said it wouldn't "put any moment in our pockets at the moment" but that it would show a different audience what they are. Vince said eventually they will be seen as an "overnight sensation" by those that don't understand or view their product now. Vince talked about WWE being involved in so many ancillary businesses, including publications, music, films, etc., and how they will continue to grow in those areas. Vince said he will continue to participate in these calls going forward.
Statements on their first quarter numbers were read, with them stressing that Wrestlemania was not included in the first quarter this year, resulting in a huge difference when you compare this quarter to the first quarter of 2008. They also pointed out that WWE did cut back greatly on the costs of doing business, as they vowed to do at the end of 2008. The drop in foreign exchange rates was also mentioned numerous times as a reason for the overall decrease in revenue this year. They stated that they feel Wrestlemania is "on track" to reach one million PPV buys (although most indicators have it falling short of that mark). The success of the WWE Kids magazine was praised for helping in their publications revenue. They expect that their WWE Films portfolio (including 12 Rounds and Behind Enemy Lines: Columbia) will surpass the "break even" point this year. The reorganization and restructuring of their operating expenses (in other words, the layoffs) continues as they work towards cutting $20 million off their costs. Even when they adjusted for the loss of Wrestlemania, the overall numbers were not positive (thus Vince stating they did "fair to poor" earlier).
Interesting to note, there were no opening prepared statement from Linda McMahon or George Barrios which usually takes place on these calls.
- Concerning the switch to Mattell from Jakks for their toy line, Vince called it "night and day" and praised Mattell as being a "very good partner" that will help them in markets they aren't in at the moment. Goldsmith said Mattell will pursue toys in three areas, collector's business, kid's business (which she stated Jakks didn't pursue strongly) and the basic action figure lines. She also stated that they were "chomping at the bit" for 2010 to come and have their partnership officially begin.
- Vince was asked about PPV rollouts in other countries, and Vince stated they feel all of their PPVs will be offered in Mexico going forward, noting they got Wrestlemania on their "at the last minute". Vince noted that there are many countries where "Pay-per-view just doesn't exist" yet.
- Concerning lower ticket prices for their inexpensive seats at live events, Vince noted that they aren't seeing a diminishing demand for the higher priced ringside tickets as a result, and they are able to put more people in the arenas, which then allows them to reach more people with their product. Vince called it a "grass roots" movement.
- Regarding the relationship with their DVD distributor, Genius (who have had financial issues), Linda McMahon (in her only comment on the call) directed the question to Donna Goldsmith, who put over Genius for getting them in more retail outlets and that they were paid by them on time, so they are having no issues with them despite their publicized problems.
- Concerning their new television production facility, which was planned for construction at one point, Vince said it is on the "back burner" but they would pursue it in the future. Vince said that with their reduction in staff, they are finding better ways to utilize their current facility.
- Regarding the split dividend, which essentially saw the McMahon family give up payment to them in order to pay a dividend to their shareholders, Vince said it was solely due to "generosity" on their part, which he joked about, saying many on Wall Street were shocked by that.
- On whether "12 Rounds" will break even, George Barrios pushed the idea that overseas business and DVD sales will allow them to get past the break even point for it. Vince McMahon pointed out their profits with the film division are not impressive, but that it should be seen as part of their overall business. Vince said he doesn't see them doing another $20 million dollar production for theatrical release going forward, saying there is "no need" to do so. He said they will emphasize direct-to-video releases and will always use their own performers and properties, rather than paying a huge star like Brad Pitt to be in their productions. Vince said they need to work on better characters and stories in the films, rather than emphasizing bigger (and more expensive) action sequences. Vince said being in the film business is just "part of what we do" and said if anyone is a film buff, they should be investing in Warner Brothers, not WWE.
- When asked about the difference between the product now versus the 90's when there were more "established stars" hanging around the industry (which the person asking the question claimed might have been due to the "Turner company"), Vince stated that despite using older performers in a "minor role" at Wrestlemania, their focus is on new faces, with a few established stars (naming Triple H and Undertaker) mixed in. He said that they have several younger stars ready to "break out" and that they are a different company than they were in the 90's, and that it is almost a different business now.
- When it was announced that there were no further questions, Vince said "don't be bashful" and made jokes about the operator of the call holding people back.
pwinsider.com
by Buck Woodward @ 2009-05-07 11:42:04
WWE held an investor conference call today to discuss the first quarter numbers which were released this morning. Participating in the call were Chairman Vince McMahon (his first time participating), Chief Executive Officer Linda McMahon, Chief Financial Officer George Barrios and Chief Operating Officer Donna Goldsmith.
Vince McMahon said he was participating on the call to help "lend a vision" to WWE's future. He said their first quarter performance was "fair to poor" in his opinion, but he feels they are "set up for success in the future" and put a positive spin on their recent cost-cutting, saying they are becoming more efficient and that they have found that "fewer people can do more things" in helping the company grow. Vince pointed out that they maintain "number one status" on every network they are on over the course of the year (USA, SciFi, MyNetwork). Vince feels that they can "do better on all counts" but put over that their product is "innovative" and that because they are such a "unique" product, they have been an "island onto ourselves" and that they are engaging in an "education process" to become more a part of the entertainment mainstream. Vince also talked about the new "PG" attitude, and that while they don't sell their own advertising, they will be able to bring more advertisers to their shows now and thus get higher fees from the networks.
Vince said that their "reaching out" to the media and other entertainment environments will help them to expand their product, noting their recent connection with "The View". Vince said it wouldn't "put any moment in our pockets at the moment" but that it would show a different audience what they are. Vince said eventually they will be seen as an "overnight sensation" by those that don't understand or view their product now. Vince talked about WWE being involved in so many ancillary businesses, including publications, music, films, etc., and how they will continue to grow in those areas. Vince said he will continue to participate in these calls going forward.
Statements on their first quarter numbers were read, with them stressing that Wrestlemania was not included in the first quarter this year, resulting in a huge difference when you compare this quarter to the first quarter of 2008. They also pointed out that WWE did cut back greatly on the costs of doing business, as they vowed to do at the end of 2008. The drop in foreign exchange rates was also mentioned numerous times as a reason for the overall decrease in revenue this year. They stated that they feel Wrestlemania is "on track" to reach one million PPV buys (although most indicators have it falling short of that mark). The success of the WWE Kids magazine was praised for helping in their publications revenue. They expect that their WWE Films portfolio (including 12 Rounds and Behind Enemy Lines: Columbia) will surpass the "break even" point this year. The reorganization and restructuring of their operating expenses (in other words, the layoffs) continues as they work towards cutting $20 million off their costs. Even when they adjusted for the loss of Wrestlemania, the overall numbers were not positive (thus Vince stating they did "fair to poor" earlier).
Interesting to note, there were no opening prepared statement from Linda McMahon or George Barrios which usually takes place on these calls.
- Concerning the switch to Mattell from Jakks for their toy line, Vince called it "night and day" and praised Mattell as being a "very good partner" that will help them in markets they aren't in at the moment. Goldsmith said Mattell will pursue toys in three areas, collector's business, kid's business (which she stated Jakks didn't pursue strongly) and the basic action figure lines. She also stated that they were "chomping at the bit" for 2010 to come and have their partnership officially begin.
- Vince was asked about PPV rollouts in other countries, and Vince stated they feel all of their PPVs will be offered in Mexico going forward, noting they got Wrestlemania on their "at the last minute". Vince noted that there are many countries where "Pay-per-view just doesn't exist" yet.
- Concerning lower ticket prices for their inexpensive seats at live events, Vince noted that they aren't seeing a diminishing demand for the higher priced ringside tickets as a result, and they are able to put more people in the arenas, which then allows them to reach more people with their product. Vince called it a "grass roots" movement.
- Regarding the relationship with their DVD distributor, Genius (who have had financial issues), Linda McMahon (in her only comment on the call) directed the question to Donna Goldsmith, who put over Genius for getting them in more retail outlets and that they were paid by them on time, so they are having no issues with them despite their publicized problems.
- Concerning their new television production facility, which was planned for construction at one point, Vince said it is on the "back burner" but they would pursue it in the future. Vince said that with their reduction in staff, they are finding better ways to utilize their current facility.
- Regarding the split dividend, which essentially saw the McMahon family give up payment to them in order to pay a dividend to their shareholders, Vince said it was solely due to "generosity" on their part, which he joked about, saying many on Wall Street were shocked by that.
- On whether "12 Rounds" will break even, George Barrios pushed the idea that overseas business and DVD sales will allow them to get past the break even point for it. Vince McMahon pointed out their profits with the film division are not impressive, but that it should be seen as part of their overall business. Vince said he doesn't see them doing another $20 million dollar production for theatrical release going forward, saying there is "no need" to do so. He said they will emphasize direct-to-video releases and will always use their own performers and properties, rather than paying a huge star like Brad Pitt to be in their productions. Vince said they need to work on better characters and stories in the films, rather than emphasizing bigger (and more expensive) action sequences. Vince said being in the film business is just "part of what we do" and said if anyone is a film buff, they should be investing in Warner Brothers, not WWE.
- When asked about the difference between the product now versus the 90's when there were more "established stars" hanging around the industry (which the person asking the question claimed might have been due to the "Turner company"), Vince stated that despite using older performers in a "minor role" at Wrestlemania, their focus is on new faces, with a few established stars (naming Triple H and Undertaker) mixed in. He said that they have several younger stars ready to "break out" and that they are a different company than they were in the 90's, and that it is almost a different business now.
- When it was announced that there were no further questions, Vince said "don't be bashful" and made jokes about the operator of the call holding people back.
pwinsider.com
