MGM posts net income of $12 million in fourth quarter, down 70%

Ian McKellen stars in "The Hobbit: The Desolation of Smaug," which MGM co-produced and co-financed. The film has grossed nearly $1 billion worldwide.

By Daniel Miller

March 26, 2014 2:47 PM PT

MGM Holdings Inc., the parent of Metro-Goldwyn-Mayer Inc., posted fourth-quarter net income of $12.2 million, down 70% from a year earlier, when MGM had net income of $40.2 million and benefited from the release of the blockbusters “Skyfall” and “The Hobbit: An Unexpected Journey.”

MGM reported revenue of $464 million in the fourth quarter, down 49% from $903 million a year earlier.

The film and television company produced two films that were released during the quarter that ended Dec. 31. It co-produced and co-financed “The Hobbit: The Desolation of Smaug” with Warner Bros.’ New Line Cinema unit. The film, which cost about $225 million to produce and was released Dec. 13, has taken in $944 million worldwide, according to Box Office Mojo.

The other picture, a “Carrie” remake, came out Oct. 18 and grossed $85 million worldwide.

The Beverly Hills company also said Wednesday that it had net income of $122 million for fiscal 2013, down 5% from net income of $129 million in 2012.

ON LOCATION: Where the cameras roll

However, MGM said that after excluding the nonrecurring gains and related tax provision from strategic asset divestitures in 2012, net income was up $60 million, or 97%, in 2013.

In 2012, MGM sold its Latin American pay-television assets to Chellomedia, a division of telecommunications and TV company Liberty Global Inc.

MGM also reported fiscal 2013 revenue of $1.53 billion, up 11% from a year earlier.

The privately held company, which emerged from bankruptcy in December 2010, attributed its success in 2013 in part to two blockbusters that came out in late 2012 and had their home entertainment releases last year. The James Bond film “Skyfall,” released in November 2012, grossed $1.1 billion worldwide. “The Hobbit: An Unexpected Journey,” released in December 2012, took in $1 billion globally.

“To top the groundbreaking year we had in 2012 is truly an incredible achievement,” Gary Barber, MGM’s chairman and chief executive, said in a statement. “Growth in revenue and profitability was above our expectations.”

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