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DreamWorks Posts Q3 Results

DreamWorks Animation announces financial results for its third quarter, which ended September 30, 2012.

GLENDALE, CA --

DreamWorks Animation announced financial results for its third quarter ended September 30, 2012. For the quarter, the Company reported total revenue of $186.3 million and net income of $24.4 million, or $0.29 per share on a fully diluted basis. This compares to revenue of $160.8 million and net income of $19.7 million, or $0.23 per share on a fully diluted basis, for the same period in 2011.

"DreamWorks Animation's third quarter results were driven by the blockbuster international box office success of Madagascar 3: Europe's Most Wanted, which has earned nearly $720 million at the worldwide box office to date, to become the fifth highest-grossing film of the year on a global basis," said Jeffrey Katzenberg, Chief Executive Officer of DreamWorks Animation. "We are looking forward to the next major event film for the Company during the fourth quarter, the November 21st theatrical release of Rise of the Guardians."

Madagascar 3: Europe's Most Wanted contributed approximately $47.1 million of revenue to the quarter, driven primarily by its performance at the worldwide box office. The film was released on June 8, 2012 and has grossed over $216 million at the domestic box office and approximately $503 million at the international box office to date.

Puss In Boots contributed $44.8 million of revenue to the quarter, driven primarily by domestic and international pay television. The film reached an estimated 5.6 million home entertainment units sold worldwide through the end of the third quarter, net of actual and estimated future returns.

Kung Fu Panda 2 contributed $9.0 million of revenue to the quarter, driven primarily by international pay television. The film reached an estimated 6.0 million home entertainment units sold worldwide through the end of the third quarter, net of actual and estimated future returns.

Megamind contributed $0.7 million of revenue to the quarter and reached an estimated 5.6 million home entertainment units sold worldwide through the end of the third quarter, net of actual and estimated future returns.

Library contributed approximately $50.6 million of revenue to the quarter. All Other items, including non-feature film businesses, contributed $30.1 million of revenue to the quarter. The Company's acquisition of Classic Media, which closed on August 29, 2012, contributed approximately $4.0 million of revenue to the quarter, primarily from home entertainment.

Costs of revenue for the third quarter equaled $114.0 million. Selling, general and administrative expenses totaled $36.5 million, including approximately $3.0 million of stock-based compensation expense.

The Company's income tax expense for the third quarter was $14.3 million. Its combined effective tax rate — the actual tax rate coupled with the effect of the Company's tax sharing agreement with a former stockholder — was approximately 34.5% for the third quarter.

DreamWorks Animation's fourth quarter results are expected to be driven primarily by the continued performance of Madagascar 3: Europe's Most Wanted in the international box office as well as the global home video market. The theatrical release of Rise of the Guardians on November 21, 2012 is also expected to contribute to the Company's fourth quarter results.

Items related to the earnings press release for the third quarter of 2012 will be discussed in more detail on the Company's earnings conference call later today.

Source: DreamWorks Animation SKG, Inc.

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