Market Minute: Coinstar Profit Drops in Fourth Quarter

BELLEVUE, Wash. (AP) - Coinstar Inc.'s (CSTR) fourth-quarter profit fell 27 percent due to poor performance at its new ventures. It forecast disappointing earnings ahead, and its shares tumbled in after-hours trading Thursday.

The company, based in Bellevue, Wash., owns the Redbox DVD kiosks and its namesake coin-counting sites. It also offers DVD rentals through additional kiosks that it acquired from NCR Corp. (NCR) in June. Coinstar recently expanded its business to include streaming movies, a ticket-selling service and kiosk coffee dispensers. The new ventures took a toll on profitability during the quarter.

Net income was $22.9 million, or 75 cents per share, for the quarter that ended Dec. 31. That's down from the $31.5 million, or $1 per share, in the same quarter a year ago. Sales rose 8.4 percent to $564.1 million on gains at Redbox kiosks.

Paul Davis, chief executive officer of Coinstar, Inc.
Paul Davis, chief executive officer of Coinstar, Inc. (Getty Images)

Analysts forecast 74 cents per share on revenue of $577.2 million.

Coinstar expects to earn 77 to 92 cents per share from continuing operations in the first quarter on revenue of $568 million to $593 million. Analysts polled by FactSet estimated $1.22 per share on revenue of $628.8 million.

For the full year the company expects to make $4.91 to $5.51 per share on revenue of $2.38 billion to $2.56 billion. Analysts forecast earnings of $5.15 per share on revenue of $2.5 billion.

Coinstar shares fell $4.53, or 8.7 percent, to $47.57 in after-hours trading.

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It's hard to beleive anybody out here has a good forecast except the Barn builders to house people and the system of getting grain to them to eat.

February 08 2013 at 10:40 AM Report abuse +1 rate up rate down Reply