Trading update

Released : 31/03/2017 07:00

RNS Number : 1324B
Entertainment One Ltd
31 March 2017
 

Date:                           31 March 2017
On behalf of:               Entertainment One Ltd. ('the Group')
Embargoed until:         0700hrs

Entertainment One Ltd.

Trading update

Strong trading performance in line with management expectations

Entertainment One Ltd. provides the following trading update on the Group's performance for the year to 31 March 2017.

Highlights

·     Strong growth in Group reported revenue

·     Underlying EBITDA grew strongly

·     Strong growth in Television and Family and an improved second half performance in Film

·     Year-end adjusted net debt is anticipated to be around 1.2x - 1.3x underlying EBITDA

·     Performance for the year has been in line with management expectations, consistent with trends highlighted at the interim results on 22 November 2016

 

Television momentum continues as industry trends support growth

Reported revenues in the full year have shown significant growth, having almost doubled against the previous year, with underlying EBITDA anticipated to be materially ahead of the previous year.

This revenue performance was driven by a solid scripted production delivery pipeline from eOne Television (new series ICE, Ransom, Mary Kills People and Cardinal; new seasons of You Me Her, Private Eyes, Saving Hope and Rogue). Pre-production continues on Sharp Objects, starring Amy Adams, Patricia Clarkson and Chris Messina with full production commencing shortly. Total half hours of acquired and produced content is anticipated to be around 1,000 for the year, with a smaller than anticipated number of lower revenue unscripted half hours delivered.

The Mark Gordon Company ('MGC') has generated a significant increase in revenues, benefiting from the global success of Designated Survivor. Very strong audience ratings on ABC in the US and CTV in Canada have provided a positive backdrop for discussions for a second series, which are currently under way. Netflix remains the global distribution partner for the show in international markets outside North America.

MGC also has a strong film slate, with Molly's Game, Murder on the Orient Express and The Nutcracker and the Four Realms all currently in production. Development projects include Chronicles of Narnia: The Silver Chair and Cowboy Ninja Viking.

 

Family goes from strength to strength

The strong performance over the first six months has continued into the second half and reported revenues for the year are anticipated to be at least 25% higher than the prior year, with a similar trend in underlying EBITDA.

Following the successful wide licensing program launch of Peppa Pig in the US ahead of the Christmas period, key retailers such as Target have been broadening the product ranges available in-store. Peppa Pig retail revenues in the US totalled over US$200m in 2016, supported by over 65 licensing partners.

After the US broadcast launch of PJ Masks in September 2015, the show has now been rolled out to over 85 territories across the global Disney Junior network. The licensing programme for the brand started in September 2016 in the US followed by the UK, France and Spain in February 2017, with a staged introduction across more territories to follow during the course of the next 12 months. Although at an early stage, the retail performance of the brand has been ahead of expectations and momentum remains strong, supported by strong support from retailers such as Toys 'R' Us across multiple territories.

Across the Family brands, there are now over 1,000 live licensing and merchandising contracts globally.

 

Film delivers an improved second half performance

As anticipated, the rebound in box office revenues experienced in the first half of the financial year continued into the second half, driven by a strong release slate including The Girl on The Train, Arrival, La La Land, Jackie and Lion.

The Group expects the release of 170 titles across its territories during the financial year, with box office revenues for the year up by over 25% on the prior year. This strong performance has generated improved revenues in the ancillary release windows for the full year and beyond.

As signalled in the interim results announcement on 22 November 2016, the current financial year did see a more significant first half weighting in costs for the Film business, driven by the timing of P&A associated with high profile theatrical releases during the period. In the second half, against the challenging headwinds previously identified, the Film business experienced a significant improvement in profitability as those same films benefitted from strength in ancillary windows. As a result, the Group anticipates that full year underlying EBITDA will be in line with that of the prior year.

The distribution pipeline for the new financial year includes Luc Besson's Valerian and the City of a Thousand Planets, Steven Spielberg's The Post starring Tom Hanks and Meryl Streep, the Aaron Sorkin written and directed Molly's Game starring Jessica Chastain and Idris Elba and produced through MGC and George Clooney's Suburbicon.   

 

Darren Throop, Chief Executive, commented:

"The Group has had a good year, with strong performance in both Television and Family and major progress on the reshaping of the Film business.

Management anticipates that the Group will deliver a full year performance in line with expectations as it continues to deliver against its stated strategy of increasing the quality and value of its library of content."

 

The Group expects to announce its results for the twelve months to 31 March 2017 on 23 May 2017.

 

Enquiries:

 

 

 

Redleaf Communications

Rebecca Sanders-Hewett

Susie Hudson

 

+44 (0)20 7382 4730

eOne@redleafpr.com

Entertainment One Ltd.

Patrick Yau

+44 (0)20 3714 7931

 

 

 

 

 

 

Notes to Editors:

About Entertainment One

Entertainment One Ltd. (LSE:ETO) is a global independent studio that specialises in the development, acquisition, production, financing, distribution and sales of entertainment content. The Company's diversified expertise spans across film, television and music production and sales, family programming, merchandising and licensing, and digital content. Through its global reach and expansive scale, powered by deep local market knowledge, the Company delivers the best content to the world.

Entertainment One's robust network includes film and television studio The Mark Gordon Company; content creation venture Amblin Partners with Steven Spielberg, DreamWorks Studios, Participant Media, and Reliance Entertainment; leading feature film production and global sales company Sierra Pictures; unscripted television production company Renegade 83; world-class music labels Dualtone Music Group and Last Gang; and award-winning digital agency Secret Location.

The Company's rights library, valued at US$1.5 billion (as at 31 March 2016), is exploited across all media formats and includes more than 100,000 hours of film and television content and approximately 40,000 music tracks.

www.entertainmentone.com

 


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