Earnings Release • Dec 16, 2016
Earnings Release
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Saint-Denis, 16 December 2016 – EuropaCorp, film producer and distributor and one of the very first independent film studios in Europe, today announces its revenue and consolidated half-year results at 30 September 2016.
| € million | Sept. 30, 2016 (6 months) |
Sept. 30, 2015 (6 months) |
||
|---|---|---|---|---|
| Revenue | 60,6 | 76,6 | ||
| Cost of Sales | -70,4 | -55,9 | ||
| Operating margin | -9,8 | 20,7 | ||
| Operating profit (loss) | -33,6 | -4,1 | ||
| Financial income | -7,4 | -7,6 | ||
| Net income - Group share | -27,6 | -3,5 |
To be compliant with IFRS 5, the multiplex activity – which sale is under process - has been restated within the consolidated half-year 2016-2017 financial statement above. The net income for that specific line of business as of September the 30th, 2016 (-1.8M€) has been booked directly in « Net Income – Group Share ».
International Sales stand at €25.6 million, i.e. approximately 40% of total turnover, and comprise primarily international deliveries of the film Nine Lives, as well as royalties collected on films from the catalogue (notably Lucy and Taken 3). The drop in revenue observed over the half-year comes mainly from fewer royalties collected from the catalogue.
The revenue linked to Theatrical Distribution activity stands at €8.6 million compared to €8.1 million, and includes €1.6 million for the activity in France and €7.0 million for that in the United States. The activity was marked by the release of the following films:
The turnover for Television rights rose over the half-year to €14.8 million, i.e. 24% of total revenue, compared to €11.1 million during the first half-year of FY 2015/2016. This increase in turnover corresponds mainly to the opening of broadcasting rights windows on the period for the films The Transporter Refueled (in the United States and in France) and Taken 3 (France).
Given the lack of delivery over the period, the TV Series activity generated a €0.8 million revenue during the first half-year 2016/2017, compared to €3.4 million.
The consolidated operating margin is €(9.8) million, compared to €20.7 million for the first half-year of the previous financial year. This downgrade is explained by (i) the under-performance of the film Nine Lives in the United States and (ii) write-offs of films that are not yet released (€15,6 million) reflecting the latest revenue and cost predictions estimated by the Group.
The half-year financial result is at a loss of €7.4 million, stable in relation to last year, and mainly reflects the financial interest incurred over the period, notably on senior and secondary lines of credit as well as latent exchange rate effects.
After taking into account the positive tax effect for €15.4 million, the net half-year income share of the Group recorded a loss of €27.6 million.
The cash-flows generated by operations over the half-year amounted to €(6.0) million compared to €21.6 million during the first half-year of the previous financial year.
During this first half-year, the Group invested €97.5 million in the production of motion pictures and television fictions, compared to €84.6 million during the first half-year 2015/2016. These significant investments mainly concerned the production of English-language films with strong international potential (notably Valerian and the City of a Thousand Planets and Miss Sloane), French-language films (Room(h)ates) and TV series (mainly Taken).
Three major transactions have been closed since the beginning of FY2016/2017 thus allowing the Company to have additional significant resources to implement its strategy, namely to produce and distribute films and TV series with international potential:
As announced during the publication of the 2015/2016 annual results, the Group set itself the following priority objectives for the coming financial years and is mobilising its teams to deploy them:
The Group is thus building a solid line-up for the coming financial years:
Two productions in English and one in French have been released in cinemas since the end of the first half-year:
The second half-year will also see the releases of the following films:
Given the net loss recorded over the first semester of 2016/2017 and in view of the film line-up for the second semester, a net loss is expected for the 2016/2017 financial year.
The Group anticipates a return to a more dynamic growth in 2017/2018 with long-awaited films and series such as Valerian and The City of a Thousand Planets, Room(h)ates, Taxi 5, etc.
Other films in English, currently in post-production or finished, will be released in FY2017/2018:
Concerning productions in French for the coming financial years, EuropaCorp is currently developing:
As for the TV Series activity, the second half-year of the financial year will be marked by the delivery of 10 episodes of the series Taken, the prequel of the successful first eponymous film co-produced with Universal Television for NBC, and the delivery of two TV films for France 3 and Arte.
Among the other series and TV films produced by EuropaCorp Television and currently being filmed, the animated series Arthur and the Minimoys, in executive co-production with Studio 100 Animation (Maya l'Abeille, Vic le Viking…) is scheduled to be delivered during FY2017/2018.
Furthermore, three other series in English are currently at an advanced stage of development and have already been the subject of writing agreements for a pilot with US networks: Hunch with CBS, AI (Artificial Intelligence) with TNT, and Last Hope with NBC.
There are half a dozen series and TV films of varied genres of televised productions in French which are also at an advanced stage of development with, among others, TF1, France 2, France 3, Arte and ProSiebenSat.1, highlighting the Group's ability to collaborate with all French and international broadcasters.
The half-year financial report will be available 21 December 2016 on the website http://www.europacorpcorporate.com, section Publications/Periodical financial reports.
May 2017 Annual 2016/2017 revenue June 2017 Consolidated annual 2016/2017 income
EuropaCorp is one of Europe's leading film studios. Founded in 1999, EuropaCorp has operations spanning production, theatrical distribution, video and VOD, and French TV sales. EuropaCorp also has international rights, partnerships and licensing, production and soundtrack publishing activities. The Group has also been producing TV series since 2010. EuropaCorp's integrated business model allows it to benefit from diversified sources of revenue. With a line-up boasting various types of films and a very strong foothold in international markets, the Group has produced France's biggest international hits in recent years. In 2014, EuropaCorp entered direct distribution for its films in the United States. EuropaCorp was founded by French filmmaker, screenwriter and producer Luc Besson. The Group owns a catalogue of 500 movies and has 150 permanent employees. For more information, go to www.europacorp-corporate.com
EuropaCorp Group David Sebagh | Investors Relations | [email protected] Régis Lefèbvre | Communication | [email protected] Tel: +33 1 55 99 50 00 Financial communication NewCap | Julie Coulot | [email protected] | +33 1 44 71 94 94 Press Relations CLAI | Nicolas Obrist | [email protected] | +33 1 80 50 53 10
EuropaCorp is listed in Compartment C of Euronext Paris ISIN code: FR0010490920 – Ticker: ECP
| Revenue by segment (€ million) |
Q1 2016/17 |
Q1 2015/16 |
Q2 2016/17 |
Q2 2015/16 |
HY1 2016/17 |
HY1 2015/16 |
Δ |
|---|---|---|---|---|---|---|---|
| International sales | 5,1 | 3,6 | 20,5 | 32,7 | 25,6 | 36,4 | -29,6% |
| % of revenue | 25,0% | 20,8% | 51,0% | 55,3% | 42,2% | 47,5% | |
| Theatrical Distribution | 0,9 | 0,6 | 7,6 | 7,5 | 8,6 | 8,1 | 6,4% |
| % of revenue | 4,6% | 3,3% | 19,0% | 12,6% | 14,1% | 10,5% | |
| Video & VOD | 2,2 | 4,9 | 1,1 | 2,1 | 3,3 | 7,0 | -52,6% |
| % of revenue | 10,7% | 27,9% | 2,8% | 3,6% | 5,5% | 9,1% | |
| Television | 7,6 | 1,8 | 7,1 | 9,3 | 14,8 | 11,1 | 32,7% |
| % of revenue | 37,3% | 10,3% | 17,8% | 15,8% | 24,4% | 14,5% | |
| Subsidies | 3,1 | 0,9 | 0,1 | 1,5 | 3,2 | 2,4 | 30,2% |
| % of revenue | 15,1% | 5,1% | 0,2% | 2,6% | 5,2% | 3,2% | |
| TV series | 0,3 | 1,5 | 0,5 | 1,9 | 0,8 | 3,4 | -75,2% |
| % of revenue | 1,7% | 8,3% | 1,2% | 3,3% | 1,4% | 4,4% | |
| Events | 0,3 | 1,0 | 0,3 | 1,1 | 0,6 | 2,0 | -72,4% |
| % of revenue | 1,5% | 5,5% | 0,7% | 1,8% | 0,9% | 2,7% | |
| Multiplex * | - | 1,7 | - | 1,6 | - | 3,3 | -100,0% |
| % of revenue | 0,0% | 9,7% | 0,0% | 2,6% | 0,0% | 4,2% | |
| Other Activities | 0,9 | 1,6 | 2,9 | 1,4 | 3,8 | 2,9 | 28,9% |
| % of revenue | 4,2% | 9,0% | 7,3% | 2,3% | 6,3% | 3,8% | |
| TOTAL | 20,5 | 17,5 | 40,2 | 59,1 | 60,6 | 76,6 | -20,8% |
* cf. : comments on page 1 regarding the application of IFRS 5 on the half-year 2016/2017 consolidated financial statements.
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