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IN BRIEF / Entertainment

Blockbuster Reports 2nd-Quarter Profit

July 25, 2002|Bloomberg News

Blockbuster Inc., the world's biggest video-store chain, posted a second-quarter profit as DVD and game sales rose and the company said expenses declined because of an accounting change.

Net income was $41.7 million, or 23 cents a share, compared with a loss of $15.6 million, or 9 cents, a year earlier. Sales rose 3.7% to $1.06 billion from $1.03 billion, Blockbuster said.

Dallas-based Blockbuster's results in the recent quarter were boosted by an accounting change that lowered acquisition-related costs, said spokeswoman Mary Bell. The company also sold and rented more DVDs and games than in the year-earlier period.

Blockbuster's goodwill balance in the second quarter was reduced by $1.82 billion, Bell said. The year-earlier period included $43.1 million, or 24 cents, in expenses for amortizing goodwill. New accounting rules as of Jan. 1 eliminated quarterly amortization expenses.

Operating expenses declined 5.8% to $681.6 million from $723.2 million a year earlier, mostly attributable to the accounting change, Bell said.

Shares of Blockbuster rose $2.16, or 11%, to $21.26 on the New York Stock Exchange. They had fallen 16% this year.

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