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WWF beats Street, suit
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June 28, 2000: 12:22 a.m. ET
World Wrestling Federation wins court ruling and beats Wall Street estimates
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NEW YORK (CNNfn) - World Wrestling Federation Entertainment Inc. said Tuesday its fourth-quarter profit fell amid a barrage of hits from the dangerous tag team of legal fees and start-up costs from a foray into football. But the numbers still beat Wall Street estimates.
Also on Tuesday a Chancery Court judge ruled in favor of the WWF in its contract dispute with USA Networks (USAI: Research, Estimates).
WWF (WWFE: Research, Estimates), whose shows combine testosterone-laced slapstick with soap-opera story lines, reported net income of $12.8 million, or 19 cents a share for the fourth quarter ended April 30, down from $13.1 million or 23 cents a share in last year's fourth quarter.
 Yet the WWF profit exceeded First Call/Thomson Financial's estimates of 16 cents a share, weathering a chokehold from $1.1 million in start-up costs for the planned XFL professional football league and $4 million in legal and accounting fees.
The fees were incurred as the company settled a lawsuit, got an investment from General Electric Co.'s (GE: Research, Estimates) NBC television network, and danced around the ring with other potential broadcast partners.
Net revenue climbed to $116.4 million from $93.8 million in the fourth quarter, aided by advertising and pay-per-view revenue and higher television ratings from UPN's "Smackdown" and USA Network's "Raw is War."
Despite past advertiser protests by Coca-Cola Co. (KO: Research, Estimates) and AT&T Corp. (T: Research, Estimates), and criticism over its mix of staged violence and racy scripts, "Smackdown" is the most watched program on the UPN network, while "Raw is War" is the top-rated show on USA Network.
For the fiscal year, net revenue increased 51 percent to a record $379.3 million compared to $251.5 million the prior year. Pro forma diluted earnings per share rose 36 percent to $0.80 from $0.59.
Regarding next year's results, Chief Executive Linda McMahon, who is also married to Chairman and Pro Wrestler Vincent McMahon, said in a statement, "We look forward to solid growth in fiscal year 2001."
Judge favors tag team with Viacom
This forecast does not include any increase in revenue from a new contract with Viacom (VIA: Research, Estimates) or USA Networks, both of whom are bidding for broadcast rights.
USA filed suit against the WWF claiming it negotiated a deal with Viacom while still under contract with USA Networks. But in a ruling rendered Tuesday, the court decided entirely in WWF and Viacom's favor, paving the way for a broad strategic alliance between the two companies.
We are obviously pleased by the decision," said Mel Karmazin, Viacom president and chief operating officer. "This is a huge win for WWF as they continue to build their powerhouse brand, and a huge win for Viacom as we look to capitalize on the incredible breadth of our media holdings to drive our growth and financial performance."
The five-year agreement with Viacom includes the airing of WWF programs, promotion of the programs on television, radio, and billboards, the creation of WWF television specials and a one-hour drama series, pay-per-view events in Canada, and events at Viacom's Paramount Parks.
Shares of WWF ended Tuesday trading up 1-1/16 at 18-1/16. 
- from staff and wire reports
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