BONITA SPRINGS, Fla. (AFX) - Source Interlink Companies Inc., a marketing and fulfillment company for entertainment products such as CDs and DVDs, posted a 56 percent gain in its second-quarter profit on Monday but missed the Street's expectations.
Quarterly earnings rose to $4.1 million, or 8 cents per share, from $2.6 million, or 5 cents per share during the same period last year.
Results included amortization costs and relocation and severance charges. Excluding these items, profit totaled $6.3 million, or 12 cents per share.
Revenue grew 12 percent to $441.5 million, from $393.8 million during the year-ago quarter.
Source Interlink missed expectations of analysts polled by Thomson Financial, who forecast, on average, a profit of 16 cents per share on revenue of $470.8 million.
The company said it posted a 5 percent drop in revenue to $198.2 million from its CD and DVD fulfillment segment due to the loss of Musicland revenue and a soft release schedule during the quarter.
Its magazine fulfillment segment, however, saw revenue grow 34 percent to $223.2 million in the quarter, 'despite the lack of material profit contribution from our most recent service area acquisitions which will build over time,' said the company's chairman and chief executive, Leslie Flegel.
Shares of Source Interlink rose 7 cents to $10.11 in after-hours electronic trading. They closed the regular Nasdaq session down 19 cents to $10.04.
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