Chuck E. Cheese's parent blames movies for profit decline
Chuck E. Cheese's parent company blamed 'Shrek 3,' 'Spiderman 3' and 'Pirates of the Caribbean 3' for its drop in profit during the second quarter.
CEC Entertainment Inc.(NYSE: CEC) President Mike Magusiak said Chuck E. Cheese's faced significant competition from family movies during the quarter. That, coupled with pressures on consumer disposable income because of higher gas and food prices and falling home values, negatively impacted the company's sales, CEC's Chief Financial Officer Chris Morris, said in an earnings conference Tuesday.
Magusiak said the sales trend over the last 11 weeks of the second quarter were about 8 percent below the sales trend for 2006 and the first 15 weeks of 2007. Box office receipts, however, increased about 55 percent to from $824 million in the second quarter of last year to $1.27 billion in the second quarter of this year, he said.
"Our sales trends during the last 11 weeks of the quarter correlates to the timing in movie box office receipts and significant decreases in family disposable income," Magusiak said.
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Source - bizjournals.com
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