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'Solid' Release Slate Doubles Rentrak Q4 Profit

8 Jun, 2006 By: Erik Gruenwedel

A 24% increase in pay-per-transaction (PPT) video commerce based in part on a strong second-half movie release schedule, helped Rentrak Corp. post fourth-quarter (ended March 31) income of nearly $1.6 million, compared to $760,000 during the same period last year.

PPT revenues totaled $24.8 million, compared to $20 million last year.

“We are very pleased with those results, particularly against the backdrop of overall rental industry trends, which were flat-to-down a couple of percentage points during March,” said Paul Rosenbaum, chairman, president and CEO of Rentrak, in a call with investors.

Total revenue was $28.3 million, $3.1 million of which was from the Portland, Ore.-based company's nascent Advanced Media & Information (AMI) unit — $100,000 less than last year. The burgeoning box office and cable video-on-demand tracking business segment was offset by unspecified declines in direct-revenue services.

Rentrak has data-tracking agreements with 30 providers of VOD-related content for cable.

Fiscal year 2006 revenue declined 5.2%, from $98.5 million to $93.4 million, impacted by the continued fallout from expiration in 2005 of the revenue-sharing agreement with Hollywood Video, which at the time represented 32% of Rentrak's revenue.

“With our fourth-quarter revenue, it is abundantly clear to me that we have managed to more than replace the revenue we lost as the result of that expiration, and that our profitability is also continuing to improve,” said Rosenbaum.

“Our PPT business performed exceptionally well in the second half of fiscal 2006, benefiting from a solid movie release schedule. Our PPT and AMI businesses each generated positive operating cash flow during fiscal 2006.”

Rentrak plans to launch box office measurement operations in select European, Latin American and Asian markets beginning in the first half of fiscal 2007.

With the addition of Warner Bros. in April, Rentrak now measures domestic box office returns for all the major studios.

The company also is bowing separate retail and advertising measurement businesses, the former designed to collect point-of-sale information from retailers for a range of products, including DVD, VHS, UMD, HD DVD and Blu-ray Disc.

AdTraker would capture census-level data regarding viewing patterns of on-demand advertising and provide next-day reports to marketers and their advertising agencies.

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