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MGM Reports Narrowed Q2 Loss

Jul 29, 2004  •  Post A Comment

Metro-Goldwyn-Mayer, the movie studio currently in talks with Sony Pictures Entertainment about a possible merger, on Thursday reported a narrowed second-quarter loss of $19.7 million, or 8 cents a share, compared with a year-earlier loss of $133.6 million, or 55 cents a share.

Revenue tumbled 17 percent to $406.1 million, largely the result of lower home entertainment revenues, compared with the company’s year-earlier results, which included the highly successful release of “Die Another Day” on home video, which alone generated $140.1 million in revenue last year.

Offsetting some of that lost revenue was a strong performance by MGM’s television operations, which successfully launched “Stargate Atlantis,” an expansion of its “Stargate” series franchise, as well as the continued expansion of MGM-branded television networks overseas.

The studio is holding talks with both Sony and Time Warner about a possible sale of the company.

Initially, Sony, along with two private equity firms, had proposed a $5 billion offer of cash and debt, but that offer has run into problems as the partners sort out the logistics of ownership and control of a Sony-MGM entity.

As that unfolds, MGM is also entertaining an offer from Time Warner in which the media giant pays nearly $4.7 billion in cash for the studio, which is considered a prize because of its valuable film library.

MGM executives declined to discuss the status of those discussions Thursday.