Outerwall (yes, that’s the company’s name) also announced a new president for Redbox: Mark Horak, who’ll move from Warner Bros Home Entertainment on March 17 to run the DVD kiosk company. But the financial disclosures are probably most responsible for the 10%+ jump in Outerwall’s share price in post market trading. Net income at $22.7M was down 1% vs last year, on revenues of $593.7M, +5.4%. The revenue number was slightly below analyst forecasts for $596.1M. But diluted earnings from continuing operations at $1.55 a share beat predictions for $1.22. The results show, though, that Redbox is feeling its age. It contributed $496.4M to revenues, +1.7%. Operating income at $111.3M was +39.2% — but that included $7M from an accounting change that’s “expected to reverse in the first quarter of 2014,” the company says. Redbox had 192M rentals in the quarter, +2.2%, with revenue per kiosk +2.1%. Sales at kiosks open at least a year was up 0.9%. Blu-ray discs accounted for 14.2% of rentals and 16.3% of revenue and October rentals were weak and December “did not perform as well as we expected” — partly due to a later than usual Thanksgiving — the company says. But November was “an exceptional month” helped by White House Down and Grown-Ups 2. Video games accounted for 2.7% of rentals, a slight pull back from last year’s 3%. Outwall’s board increased the stock repurchase authorization to $500M, bringing the total to $650M. Directors also authorized a $350M tender offer; the company expects shares to sell for as much as a 20% premium over the previous closing price. Execs declined to divulge significant new details about the Redbox Instant streaming venture with Verizon.
By DAVID LIEBERMAN, Financial Editor | Thursday February 6, 2014 @ 4:48pm ESTTags: Outerwall, Redbox
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This article was printed from http://www.deadline.com/2014/02/redbox-owners-shares-rise-after-it-reports-strong-q4-results-and-a-buyback/