Stupid ideas that made money and brought the company back from financial ruin. \-----\

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Brian, are you serious? The publishing division did not bring the company back from any ruin... get a clue. The editor in chief of the comic line isn't even making the publishing decisions let alone the decisions for the other lines of business.

Here is what saved Marvel from financial ruin: Bankruptcy.... you see its simple... when you owe banks hundreds of millions of dollars, you can declare bankruptcy and eliminate most, if not all of the debt.

You can then cancel your stock (as Marvel did with their old symbol MRV). You can then reorganize and re-issue stock for the new company (Marvel Entertainment NYSE symbol MVL). In this "new company's" IPO, the company accumulates literally hundreds of millions of dollars (aka capital) to fund its business.

It used this capital from the MVL ipo to fund its own film division. This is where the money is, my friend.

It didn't hurt when the sold "lifetime" movie rights for Spider-man, FF, X-men, and other properties for cash to stay afloat.

Look up the earnings announcements... nothing JQ has done saved any company from "financial ruin." Editors just don't have that juice... the crafty business men take care of that...

http://money.cnn.com/2006/02/22/commentary/mediabiz/

Even in 2006, the writing was on the wall. 70% of income from licensing.... publishing division "stodgy" and not performing.

A large flaw in Marvel management (the executives... not the lowly editors) has been their reluctance to make changes in management despite poor results.

I won't over do it, but you can find notes like this for every earnings announcement (they're quarterly) for the last 4 years.

Hard to pull data since symbol MVL doesn't trade anymore due to the Disney merger.

Great post James.

It would be very good for adult comic book fans if we had the habit to read the publish houses financials, at least once a year...

Being a shareholder would also give you the right to complain about the bad decisions on the publishing business, there are many SEC regulations to protect the investors (minoritary investors? not sure if this is the right translation)

Re: what was Marvel Knights

... it was an imprint under Marvel's banner.

Much like DC has Vertigo or Wildstorm.

At the time, 1998, books other than X-men and Spiderman weren't selling well. Marvel hired Joe Quesada to run an Marvel Knights imprint. He was the editor of that imprint. They were given B/C level characters to work with.

Quesada was successful getting meagerly talented Hollywood writers to work for his imprint, and they created a hype machine.

Marvel management was happy enough with the Marvel Knights stuff that it made Quesada the EIC of Marvel comics.

If you like current Marvel books, you would like Marvel Knights books. If you don't like current Marvel books, you prboably wouldn't like Marvel Knights books.

That is what gets interesting about Marvel when it traded under MVL.

They weren't held by a lot of large investors (i.e. mutual funds, banks, etc).

GE's shares are 50% owned by mutual funds. PNC Bank 65%.

It is strange that a stock that was experiencing exploding growth was not being held by the wall street funds. 

The only reason I can think of is the risk in Marvel's business plan. They only had $22 million in cash at a time (2006) that they borrowed $526 million to make movies. Their cash flow was non-existent (answering the question of why solict before a book was complete: they can't afford not too. they can't sit on a finished #1 waiting for #2, 3, 4. They needed the income).

 One movie becoming a bust would have been enough to end the company.... because there was no money in publishing and limited money in licensing.

The real headscratcher isn't that they sold to Disney. The real question is why the hell Disney paid $5 billion for a company that was profting $400 million per year in 2008 (in a year that Iron Man was a huge hit) and $100 million forecasted in 2009 (no movie releases)!

Trust me when I say, as an experience analyst, that Disney has to have plans to shake things up. If they keep "business as usual", it would take 10 to 20 years for this acquistion to attribute to earnings.

They must have seen something that they feel they can exploit in profitable ways.