The continued success of Peppa Pig and PJ Masks has offset restructuring costs which affected profits.
Entertainment One recorded a one-off charge of £57m as the company took measures to deal with challenges in its home entertainment market, following an “unprecedented” pace of change in consumer behaviour within the content industry.
For the six months to the end of September, eOne reported a pre-tax loss of £40.1m compared with a profit of £2.3m a year earlier, while revenue fell modestly to £404.9m from £412m. Positive growth in Family & Brands was offset by a decline in Film & Television which the company blamed on fewer film releases and deliveries and the accelerated decline of the home entertainment market, notably a substantial decrease in DVD sales.
The Family & Brands division is expected to generate strong revenue and underlying earnings (EBITDA) growth across the portfolio in FY19, driven by the strong performance of Peppa Pig across core markets, with Asia touted as a key region of growth for the second half.
A company statement read: “In anticipation of the 15th anniversary of Peppa Pig and the Chinese Year of the Pig, the Family & Brands business has planned an exciting calendar of events and has partnered with Alibaba for a Peppa Pig Chinese feature film which will launch in cinemas in early 2019.” The statement went on to say that Peppa Pig and PJ Masks are expected to continue to drive the growth of eOne’s Family & Brands Division in the second half of the financial year, with almost 1,900 live licensing and merchandising contracts expected by the end of 2019.
Darren Throop, CEO, said, “Looking ahead, we anticipate further progress for the Family & Brands properties in China and around the globe, a number of initiatives for Peppa Pig will consolidate its position as one of the leading pre-school brands in the world, and the merchandising phase for PJ Masks in China will widen. There is a full pipeline of development projects across Film & Television which will help drive future growth. Prospects remain bright and eOne is on track to deliver FY19 financial performance in line with management expectations.”