Getty Images Third Quarter 2004

Posted on 10/26/2004 by Jim Pickerell | Printable Version | Comments (0)

671

GETTY, THIRD QUARTER 2004



October 26, 2004


Getty Images has reported that third quarter revenue grew 17.4 percent to $153.5 million compared to $130.8 million in the third quarter of 2003. Excluding the effects of changes in currency exchange rates, revenue grew 12.4 percent. Operating income for the third quarter of 2004 grew 53.6 percent to $41.7 million, or 27.2 percent of revenue, compared to $27.2 million, or 20.8 percent of revenue, in the same quarter last year. Net income for the third quarter was $26.7 million or $0.44 per diluted share, compared to $9.4 million, or $0.16 per diluted share, for the same quarter in 2003.


"We achieved very strong results in the third quarter, with significant year-over-year growth in revenue, operating income and earnings," said Jonathan Klein, Getty Images' co-founder and CEO. "We have made excellent progress on all of our 2004 initiatives, and we have continued to see an acceleration in revenue growth while exceeding our operating margin goals for every quarter this year."


Business Outlook


For all of 2004 the company expects to report results at the upper end of the previous guidance with revenue of approximately $615 million and earnings per diluted share of approximately $1.70.


Revenue Breakdown


























































  

Q3 2002   

Q4 2002   

Q1 2003   

Q2 2003   

Q3 2003   

Q4 2003   

Q1 2004   

Q2 2004   

Q3 2004   

Rights Managed   

56%   

54%   

55.9%   

52%   

50%   

51%   

51%   

49%   

46%   

Royalty Free   

28%   

30%   

27.7%   

31%   

33%   

32%   

32%   

32%   

34%   

News/Sports/Entertain/Archival   

     

9.3%   

9.6%   

     

     

10.5%   

10.3%   

12%   

12%   

Footage   

     

5.5%

5.8%

  

  

5.5%

5.2%

5%

5.5%

Other (Assignment, etc.)

  

1.2%

1%

  

  

1%

1.5%

2%

2.5%





The above percentages translate into the following dollar figures for the last
nine quarters (in millions of dollars).










































































  

Q3 2002

Q4 2002

Q1 2003

Q2 2003

Q3 2003

Q4 2003

Q1 2004

Q2 2004

Q3 2004

Gross Revenue

$118.2

$117.7

$130.3

$127.7

$130.8

$134.4

$156.5

$150.3

$153.5

  

  

  

  

  

  

  

  

  

  

Rights Managed

$66.192

$63.56

$72.83

$66.4

$65.4

$68.5

$79.8

$73.65

$70.6

Royalty Free

$33.096

$35.31

$36.09

$39.59

$43.16

$43

$50.1

$48.1

$52.1

News/Sports/Entertain/Archival

  

$11

$11.7

$12.4

($15)

$14.1

$16.15

$18

$18.42

Footage

  

$6.5

$8.15

$6.9

($6.23)

$7.4

$8.1

$7.5

$8.4

Other (Assignment, etc.)

  

$1.33

$1.33

$1.65

($1)

$1.4

$2.35

$3

$3.8



It is interesting to note that stock photo revenues (RM plus RF), while still the major part of their business, represented 80% of revenues for the quarter and is trending down as a percentage of total revenues. This is a result of Getty's efforts to diversify and expand other parts of its business, but the trend should not be discounted by those involved in the stock image licensing business. The figures in percentages and total revenue are listed below.





























  

Q3 2002

Q4 2002

Q1 2003

Q2 2003

Q3 2003

Q4 2003

Q1 2004

Q2 2004

Q3 2004

Stock Photo Percentage

84%

84%

83.6%

83%

83%

83%

83%

82%

80%

Stock Photo Revenue

$99.288

$98.87

$108.92

$105.99

$108.56

$111.5

$129.9

$121.75

$122.7



Average Price Per Usage

The worldwide average price-per-image (ppi) rose in the quarter. For RM the average ppi was $591 up from $581 the previous quarter. For RF the average ppi was $202 up from $194 the previous quarter.

The average price for a film clip for the quarter was $654, up from $612 in the previous quarter and also up from a year ago.

There was a 38% growth in revenue generated from Assignments when compared to Q3 2003. Last quarter the growth was 82% compared with the quarter a year earlier. The slow down in growth on a year-to-year basis is certainly to be expected as the assignment segment grows.

Image Used Chart









































































































































  

Q3 2002

Q4 2002

Q1 2003

Q2 2003

Q3 2003

Q4 2003

Q1 2004

Q2 2004

Q3 2004

ROYALTY FREE

  

  

  

  

  

  

  

  

  

Gross Revenue (millions)

$33.096

$35.31

$36.09

$39.59

$43.16

$43

$50.1

$48.1

$52.1

****online sales

$26.477

$28.25

$28.87

$31.67

$34.89

$34.4

$40.93

$40.4

$44.3

Price Per Image

$107

$132

$131

$142

$157

$165

$193

$194

$202

Number Images Licensed

247,449

214,015

220,381

223,028

222,256

208,484

212,072

208,247

219,306

  

  

  

  

  

  

  

  

  

  

RIGHTS MANAGED

  

  

  

  

  

  

  

  

  

Gross Revenue (millions)

$66.192

$63.56

$72.83

$66.4

$65.4

$68.5

$79.8

$73.65

$70.6

Price Per Image

$509

$479

$550

$570

$576

$552

$605

$581

$591

Number Images Licensed

130,043

132,693

132,418

116,491

113,542

124,094

131,900

126,764

119,458

  

  

  

  

  

  

  

  

  

  

Total Images Licensed

377,492

346,708

352,799

339,519

335,798

332,578

343,972

335,011

338,764

Percent RF

66%

62%

63%

66%

67%

63%

62%

63%

65%

Percent RM

34%

38%

37%

34%

33%

37%

38%

37%

35%




Copyright © 2004 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-251-0720, e-mail: wvz@fpcubgbf.pbz

Jim Pickerell is founder of www.selling-stock.com, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to: http://www.jimpickerell.com/Curriculum-Vitae.aspx.  

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