No Ghost in Marvel's Earnings: Fool by Numbers

This morning, Stock Advisor selection Marvel Entertainment (NYSE: MVL  ) released earnings for the fourth quarter ended Dec. 31.

  • Overall, operating margins suffered due to the increasing cost of revenues, mostly in the toy division.
  • But the core business is still doing well. Publishing, for example, improved its operating margin by almost four percentage points.
  • Meanwhile, Ghost Rider, which debuted in theaters Feb. 16, has grossed more than $95 million worldwide in its first two weekends, according to Box Office Mojo.
  • But that's more of a win for distributor Sony (NYSE: SNE  ) than it is for Marvel. Management told analysts to expect no material impact to earnings from the success of Ghost Rider.

(Figures in thousands, except per-share data)

Income Statement Highlights

Q4 2006

Q4 2005

Change

Sales

$85,216

$117,095

(27.2%)

Net Profit

$11,698

$25,919

(54.9%)

EPS

$0.14

$0.26

(46.2%)

Diluted Shares

85,120

100,534

(15.3%)



Get back to basics with a look at the income statement.

Margin Checkup

Q4 2006

Q4 2005

Change*

Gross Margin

68.14%

88.92%

(20.78)

Operating Margin

30.94%

38.24%

(7.30)

Net Margin

13.73%

22.14%

(8.41)

*Expressed in percentage points

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q4 2006

Q4 2005

Change

Cash + ST Invest.

$31,945

$39,366

(18.9%)

Accounts Rec. (current)

$59,392

$59,108

0.5%

Inventory

$10,224

$9,177

11.4%



Liabilities

Q4 2006

Q4 2005

Change

Accounts Payable

$5,112

$3,724

37.3%

Long-Term Debt*

$17,000

$0

N/A

*Credit facility

Learn the ways of the balance sheet.

Cash Flow Checkup

Q4 2006

Q4 2005

Change

Cash From Ops.

$41,662

$80,454

(48.2%)

Capital Expenditures

$1,820

$1,353

34.5%

Free Cash Flow

$39,842

$79,101

(49.6%)



Find out why Fools always follow the money.

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Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

Fool contributor Tim Beyers, who is ranked 1,720 out of more than 23,300 in our Motley Fool CAPS investor intelligence database, still owns more than 2,000 comic books. Tim didn't own shares in any of the companies mentioned in this article at the time of publication. His holdings can be found at Tim's Fool profile. The Fool's disclosure policy always adds up.


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