Blockbuster Has Strong Fourth Quarter

By Mike Sachoff - Thu, 03/06/2008 - 16:55

Cost reductions paying off

Blockbuster reported fourth quarter net income of $41 million, or 18 cents a share for 2007. Compared with $11.2 million, or four cents a share the year before.

Not including charges, per share earnings increased to 26 cents from 11 cents. Revenue grew 3.6 percent to $1.57 billion. Analysts polled by Thomson Financial had expected earnings of 18 cents per share or revenue of $1.4 billion.

Blockbuster Logo
(Photo Credit: Blockbuster)

"The year 2007 was one of transition for Blockbuster. During the last half of the year, we established financial stability and took decisive steps to grow our rental business, diversify revenue streams and broaden channels of distribution," said Jim Keyes, Blockbuster Chairman and CEO.

"Most notably, through aggressive cost reductions, the repositioning of our subscription programs, and a renewed focus on store merchandising, we gained momentum in both sales and earnings. Building on our fourth quarter growth in year-over-year revenues and improvement in operating income, we are well positioned to return the Company to profitability in 2008."

Blockbuster projects 2008 net income of $5 million to $25 million, while analysts estimate a $6.83 million loss.

News Tags: Financial, Jim Keyes, Blockbuster

About the author:
Mike is a staff writer for WebProNews.

1 Comment

By Heather (WPN reader) - Tue, 03/11/2008 - 18:32

What about the Writer's Strike?

Don't you think that the Writer's Strike could have been a factor in Blockbuster's rise in sales and rentals? With nothing decent on tv, alot of people looked for cheap alternatives to entertain themselves and their children. Not to mention that snowfall records have been set all over North America, in 2007 and in 2008. Most businesses maybe dead in a blizzard but local Blockbusters are always busy and the worse the weather gets the more profit they make.