- Underlying revenue up 3 per cent
- EBITDA up 24 per cent
- Free cash outflow continued
- Maiden dividend
Annual adjusted profits before tax from film and television rights group Entertainment One slightly disappointed, despite their 45 per cent increase.
Revenues of £819.6m, were up 30% thanks to the January 2013 acquisition of Alliance Films, or if adjusted pro forma to include Alliance for the whole year, a 3% rise.
Adjusted earnings before interest, tax, depreciation and amortisation jumped 24% at constant currency to £92.3m, ahead of expectations from the pre-close statement thanks to better cost savings.
But profit before tax came in at £77.9m, compared to forecasts from broker N+1 Singer of "over £92m", and free cash outflow rose £13m to £17.1m) as a result of higher investment in acquired content rights and productions, partly offset by higher cash from operating activities.
However, the board declared their confidence in medium- and long-term prospects with a maiden dividend of 1p per share.
Chief Executive Darren Throop hailed a positive year: "This strong operating performance again demonstrates the strength of our strategy of investing in content rights and exploiting them across multiple territories and multiple consumer platforms.
"The company's entry into the FTSE 250 and the payment of an inaugural dividend mark another milestone in eOne's development and continues our track record of delivering an improved return on investment for our shareholders."
He said that, based on the foundation of strong financial performance and consistently delivering on its strategy, the group outlook for the new financial year was "very positive".
The Film Division has a slate of over 275 films set for release in the coming year and a much larger library of titles for exploitation.
In Television Production & Sales, healthy demand remains for content from digital platforms and traditional television networks.
Revenues from new TV output agreements will start to be delivered during the new financial year, with continued growth in the roster of new programming and renewals.
Singer noted that since year-end the Cannes Film & MIP both performed at sales levels, while TV should continue to make "significant headway" based on the positive TV market backdrop and the modest scale of the division compared to Film, where the group already has large leading positions.
With the shares
having backed off significantly since early March the broker concluded: "While there is good opportunity to build the TV business materially and expand the film business further the poor cash generation and lack of new upgrades could mean the stock does not recover the lost ground soon."
Shares in Entertainment One were down 2.24% to 272.76p at 09:11 on Tuesday.