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MGM’s Third-Quarter Profit Far Below Last Year’s Mark

Studio reports $5.3 million in worldwide theatrical revenue, an increase of $2.4 million compared to last year

MGM Holdings on Thursday reported revenue for the third quarter that was improved compared with the same period a year ago, but the company’s net income fell far short of last year’s mark.

In a filling on its investor relations website, MGM, which is a privately held company, said that revenue for the quarter ending Sept. 30 hit $380.2 million, up from $267.7 million during the same quarter last year.

The company’s net income, however, was $25.3 million, which was a decline compared with the $114.2 million in profits the company reported last year.

During the company’s third-quarter conference call with executives, however, which was previously recorded and posted later on Thursday, MGM chief financial officer Kenneth Kay said that the quarter’s results reflect “the investments we are making in long-term growth and value creation.”

He went on to say that the company’s net income reflected “A $56 million income tax benefit, which consisted of non-recurring benefits related to certain income exclusions and incremental deductions for prior years.”

MGM’s revenue, according to chief operating officer Chris Brearton, was driven, primarily, by the monetization of an increasing volume of “unique and differentiating” TV content.

MGM reported that TV licensing revenue for filmed content was $110.2 million for the three-month period, an increase of $23.3 million compared to $86.9 million a year ago. And home entertainment revenue was $21.8 million, an increase of $4.9 million compared to $16.9 million during the same three-month period a year ago. Worldwide theatrical revenue for film content was $5.3 million, an increase of $2.4 million compared with $2.9 million a year ago.

“With regard to our film business, we couldn’t be more excited about the creative direction of the next installment of our treasured evergreen franchise Bond 25… We look forward to commencing production in early 2019,” Brearton said during the conference call. “As for recently released films, the theatrical box office for ‘Operation Finale’ and ‘The Girl in the Spider’s Web,’ which we co-financed with Sony under performed our expectations.”

MGM’s “Operation Finale” has earned $17.6 million at the box office since opening Aug. 29. The film had a $24 million production budget, according to Box Office Mojo. And “The Girl in the Spider’s Web” opened to $7.8 million last week and had a $43 million production budget, according to Box Office Mojo.

Later this month, MGM’s Orion Pictures will debut a holiday zombie musical “Anna and the Apocalypse” as the banner’s first acquisition since relaunching.

In the film, a zombie apocalypse threatens the sleepy town of Little Haven at Christmas, and Anna and her high school friends must fight, sing and slash their way to survival.

“Anna and the Apocalypse” stars Ella Hunt, Mark Benton and Paul Kaye, along with a group of new talent: Malcom Cumming, Ben Wiggins, Sarah Swire, Christopher Leveaux and Marli Su.

The zombie musical premiered at the Fantastic Fest earlier this year, where it was met with critical acclaim. It also screened at Sitges Film Festival, where it won the award for Best Midnight X-Treme Feature Length Film.