Entertainment One (ETO) bombed at the box office this summer. But gains in the international distributor's TV division still pushed underlying cash profits up 31 per cent to about £37m.
Sales at the group's TV division rose nearly a third to £91m as its Peppa Pig franchise passed $1bn (£640m) in retail sales and landed nearly 200 new international broadcast and licensing deals. But the piglet is "only scratching the surface" in territories such as the US, says finance director Giles Willits. The group continues to view TV as a key growth driver, and plans to expand its production presence into the US, UK and Australia.
Meanwhile, a muted summer for movies sent theatrical revenues down 38 per cent, while home entertainment sales slid as consumers snubbed physical DVDs in favour of online streaming. The result was an 11 per cent slump in sales at the group's film division. Management expect upcoming releases, including the latest instalment of The Hunger Games, to revive growth.
Entertainment One incurred one-off costs of £12.8m, largely reflecting the acquisition and integration of US production business Force Four. It also hopes to spur organic growth through a new development fund that will invest in early-stage productions.
Broker Cenkos forecasts pre-tax profits of £87.1m, giving EPS of 21.7p, up from £77.9m and 20.9p.
| ENTERTAINMENT ONE (ETO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 310p | MARKET VALUE: | £912m | |
| TOUCH: | 309-311p | 12-MONTH HIGH: | 368p | LOW: 236p |
| DIVIDEND YIELD: | 0.3% | PE RATIO: | 65 | |
| NET ASSET VALUE: | 111p* | NET DEBT: | 81% | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 366 | 1.2 | 2.7 | nil |
| 2014 | 331 | 2.4 | 0.4 | nil |
| % change | -10 | +100 | -85 | - |
*Includes intangible assets of £315m, or 107p a share | ||||
