DreamWorks swings to loss as SEC probes write-down

DreamWorks Animation has reported a quarterly loss with its movie business underperforming. However, as the features side of the business suffered, the US-listed firm said that it will ramp up activity in the TV sector.

Reporting second quarter financials, the studio also said that the US Securities and Exchange Commission is investigating a write-down DreamWorks recorded relating to Turbo, the feature film that spawned the Turbo F.A.S.T. original TV series on Netflix. Management declined to give any further details on a post-results conference call.

DreamWorks reported a loss of US$15.4 million for the quarter to end-June compared with a profit of US$22.3 million a year earlier. Revenues crashed to US$122.7 million from US$213.4 million a year earlier.

DreamWorks shares were down sharply in the wake of the results and announcement of the SEC probe.

However, CEO Jeffrey Katzenberg  (pictured) was upbeat about the prospects for the company’s TV division. A programming pact with Netflix is a key driver of activity in TV, Katzenberg said, noting it will debut three new TV series this year and seven in 2015.

“We continue to expect that our 2015 television revenue will exceed $250 million and that our profit margin for this segment will approach 30%, as we ramp up production and delivery,” Katzenberg told analysts.

The company has been staffing up. This week it added former Disney exec Mark Zoradi to its executive ranks, sparking a management reshuffle.