DreamWorks Animation SKG Inc. has given chairman Roger Enrico more control over finances and legal matters for the company as the Securities and Exchange Commission conducts an informal probe into financial disclosures and trading of DreamWorks shares, according to BLOOMBERG NEWS.
CFO Kristina Leslie and general counsel Katherine Kendrick will report to Enrico and chief exec Jeffrey Katzenberg. They previously reported to Katzenberg and coo Ann Daly, who will primarily focus now on film production and home video sales, the company said.
The people running DreamWorks come from a creative background, not the corporate financial sector, said David Baker, a principal at Boston-based investment management firm North American Management Corp. Enrico will direct changes at the management level and bring in people with sharp pencils, BLOOMBERG reported.
Shares of DreamWorks have declined 16% since the company reduced its profit forecast July 11, 2005, due to lower-than-expected sales of SHREK 2 DVDs.
Daly will, devote 100% of her time to oversee the production of our movies, run the studio and, in particular, oversee the most important revenue source of our business, home video, Katzenberg said in a statement.
Enrico, named chairman at DreamWorks in October, is taking on more responsibility as the company changes its formula for predicting DVD sales.
Pixar Animation Studios, maker of THE INCREDIBLES, also recently disclosed that it miscalculated DVD sales, generating concern that growth of home video sales might be tapering off after boosting earnings over the last year.
In a July 11 conference call with analysts, Katzenberg said that DreamWorks did not know whether the lower-than-expected sales of DVDs were a short-term retail problem or a shift in consumer spending.