DQ ENTERTAINMENT PLC 
By For immediate release | 9 August 2013 |
DQ Entertainment plc
("DQE" or the "Group")
Indian subsidiary financial results for the quarter ended 30 June 2013
DQE Entertainment (International) Limited ("DQE India" or "the Company"), the Bombay Stock Exchange and National Stock Exchange of India listed, production and distribution company, which is 75 per cent owned by DQE, has today announced its un-audited financial results for the quarter ended 30 June 2013 prepared under Indian GAAP.
I. Financial Highlights for the quarter ended June 2013:
- Revenue: INR 304m (US$5.47m) [2012: INR.309m (US$5.56m)]
- EBIDTA: INR 206m (US$3.70m) [2012:INR 31m (US$ 0.56m)]
- Profit before tax: INR 68m (US$1.21m) [2012: INR (92)m (US1.66m)]
- Profit after tax: INR 66m (US$1.19m) [2012: INR (91)m (US$1.63m)]
(An exchange rate of USD/INR: 55.66 has been used above.)
· With the challenging global economic situation, where many companies have suffered, DQ Entertainment has been resilient and generated a total revenue of Rs. 304m during the quarter ended June 2013 (2012: Rs. 309m).
· Our EBIDTA margins have substantially increased. This is due to a significant foreign exchange gain but also because of our well planned and structured cost reduction and operational policies, as well as improved production efficiencies across the organization.
· As previously reported, DQE's revenue and profitability has a clear seasonal pattern, similar to that of the rest of the global animation industry, wherein almost 60% of the annual revenue is achieved in the third and fourth quarter of the financial year and these results are in line with that trend. As of June 2013, the Company had recorded a net profit of Rs. 66 m. [2012: Rs. (91m)].
· The global financial liquidity crisis, especially in Europe and USA, has impacted the Company, resulting in slower recoveries of receivables.The Company has made considerable improvement in reducing its debtors.
II. Operational highlights:
· Success of own Intellectual Properties (IPs):
The Company's first home-grown international brand 'The Jungle Book', continues to gain traction in the worldwide market. The Jungle Book brand has reach in more than 169 countries and more than 300 categories of products have been developed through various licensees. Jungle Book Season 1 continues to go from strength to strength in North America with more networks like Knowledge Network and Univision broadcasting the show. The second season of The Jungle Book is in production and has already been pre-sold to more than 100 countries. The brand has generated over USD26m of contracts through various broadcast and licensee deals world-wide, of which over USD10m has already been cash flowed to date.
As part of the new digital initiatives DQE also has developed its own game called - "The Great Escape" based on The Jungle Book TV series - which is available on all android based devices.
Season 1 of DQE's second iconic brand 'The New Adventures of Peter Pan' is now being broadcast, with a very good response in various territories. The series has already been pre-sold to over 100 territories for broadcast and has attracted more than 10 licensees representing more than 20 categories of products. The brand has already attracted worldwide licensing and distribution deals of over USD10m to be earned over a period of three to four years.
Licensing and distribution revenues for other DQE IPs are increasing and the Company is confident of achieving its targeted growth in the years to come and improving its cash flow position.
Tapaas Chakravarti, Chairman & CEO, made the following statement:
"The macroeconomic environment in some markets, especially in Europe and Canada, remains very challenging even in the Children's Entertainment business. There is however a definitive improvement in the US Animation and Children's Entertainment segment where considerable effort is being paid by us to further enhance our footprint.
Meanwhile, substantial management time and attention is also being given to our long term markets in Europe and other areas which face challenging conditions, in order to keep it 'business as usual' at a time when substantial working capital distress is being seen across the industry as a direct impact of the overall economic environment.
Our core business fundamentals remain sound with a strong current order book, to be executed over the next 2-3 years. We are focusing on delivery of orders and sustainability with quality growth by exploring new verticals of content development and distribution, in order to accelerate growth in those areas which we believe to have very high potential, and the response to the Jungle Book and Peter Pan franchises supports this strategy.
Our business is global and we have had particular success in TV and Home Video distribution, licensing, merchandising and publishing for brands like The Jungle Book and Peter Pan, as well as for many other properties such as Iron Man, Casper, Charlie Chaplin, Tara Duncan and Little Prince.
We are in the process of rescheduling DQE India's working capital facilities necessary to execute our new order pipeline and complete production and delivery of high brand equity properties such as The Jungle Book series II, Peter Pan series II, 5 Children & IT series I, Lassie series I, Little Prince series III, Robin Hood series I, besides several other productions.
Our global flagship brand "The Jungle Book" saw the world-wide release of series I last year for television broadcast in over 169 countries, while the famous Peter Pan TV series was launched four months ago and has already been broadcast in over 100 countries.
Jungle Book licensing has seen an upsurge globally, including a promotional deal with Burger King for over 15,000 outlets world-wide. Others include: NetFlix (USA), Toys R Us, Universal Music, Amazon, Target and Walmart .
We are delighted that our shows continue to attract high ratings on famous international networks such as TF1- France, France Television, ZDF TV and Kika - Germany, DeA Kids - Italy, RAI Italy, ABC Australia, ATV - Turkey, Disney channel, TVO Canada and many others worldwide.
We have given a special focus to strengthening our balance sheet by putting an extraordinary effort into the collection of receivables from our clients and partners, which will further help in improving our working capital position.
I remain cautiously optimistic that we will end the fiscal year in a satisfactory position as planned. We are very resolute in creating value for our shareholders and employees through long term sustainability of the business model adopted by us and to face the new economic challenges globally with even better results."
· Production Update
1. Projects completed:
- NFL Rush Zone Season 2- 24 x 22' - CGI & 2D TV Series with Nicktoons, USA
- Rising Star Season 1- 26 x 17' - 2D HD TV Series with TMS Entertainment & Kodansha, Japan
- Keymon Ache Season 2- 52 x 11' 2D TV series with Nickelodeon
2. Ongoing projects:
- The Jungle Book Season 2- 52 x 11'- CGI TV series with ZDF Germany, and TF1 France
- Jungle Book Christmas Special- 42'- CGI TV Feature, ZDF Group, Disney
- Lassie & Friends- 52 x 11' 2D HD TV series with Classic Media & Super Prod, TF1, ZDF
- Robin Hood, Mischief in Sherwood- 52 x 11' - CGI TV series with Method Animation and TF1 France, ZDF Germany, ATV Turkey, DeA Kids Italy
- Lanfeust- 26 x 22' - CGI TV series with Gaumont Animation, France, M6 TV Channel
- Little Prince Season 3- 26 x 22' - CGI TV series with Method Animation, WDR Germany, France Television, RAI TV Italy
- NFL Rush Zone Season 3 - 24 x 22' - CGI & 2D TV Series with Rollman Entertainment, USA for Nicktoons
- Iesodo- 10 x 13' - CGI TV Series with Zaya Toonz LLC, USA
- Manav - 1 x 60' - 2D TV feature for Disney
3. New projects signed/in development:
- Peter Pan Season 2- ZDF Germany, De Agostini Italy and Method Animation, France TV
- Leo & The Pisa Gang- 52 x 11' - CGI TV Series with MPP Production and Penta TV, Germany
- Raz & Benny- 52 x 11' - CGI TV Series with Foothill Entertainment, USA
- 5 & IT - 52 x 11' - CGI TV Series with ZDF Germany
- The Wind in the Willows- 52 x 11' HD TV Series under development by DQE IP team
- Several other TV Series are in development with Rollman Entertainment Group, USA
· Licensing & Distribution update
DQE has adopted a 360 degree monetization strategy across TV, online, mobile, gaming, feature film, merchandising effectively, in a global market place.
During the quarter, eight new broadcasting deals have been signed for:
- Iron Man 2 in the UK, Canada, French speaking Africa and Malaysia
- Jungle Book Season 1 in Malaysia, USA, Puerto Rico and British Columbia and
- Peter Pan in Malaysia
In merchandising, we have signed seven new deals with Nestle, Inkology, Play Wow, Budge Studios, Technoplast, Bendon Publishing etc. for The Jungle Book and Peter Pan in USA, Canada, Australia, Italy, San Marino, Vatican City etc.
For further information, please contact:
DQ Entertainment plc Tapaas Chakravarti - Chairman and CEO Rashida Adenwala - Director Finance & Investor Relations | Tel: +91 40 235 53726 |
Allenby Capital Limited Jeremy Porter / Alex Price | Tel: +44(0) 20 3328 5656 |
Buchanan Mark Edwards/Clare Akhurst www.buchanan.uk.com | Tel: +44 (0)20 7466 5000 |
Below is an extract from the unaudited financial results of DQE India for the quarter ended 30 June 2013. Thefull unaudited results are available from the DQE India section of the BSE website (www.bseindia.com) and NSE website (www.nseindia.com), as well as on DQE's website (www.dqentertainment.com).
DQ ENTERTAINMENT (INTERNATIONAL) LIMITED
Un-Audited Consolidated Financial Results for the quarter ended 30 June 2013
(Rs in million) | |||||
Sl. | Particulars |
For Quarter ended |
For Quarter ended |
For Quarter ended |
For Year ended |
(Un-audited) | (Un-Audited) | (Un-audited) | (Audited) | ||
1 | Net Income from Operations | 304.25 | 885.43 | 309.31 | 2,294.08 |
2 | Expenditure | ||||
a | Production Expenses | 16.49 | 65.33 | 44.95 | 178.61 |
b | Employee Expenses | 202.22 | 203.75 | 238.12 | 875.83 |
c | Other Expenses | 63.43 | 74.57 | 59.10 | 250.24 |
d | Depreciation, Amortisation and Impairment | 90.85 | 241.55 | 87.42 | 526.99 |
e | Foreign exchange (gain) / loss | (183.96) | 42.97 | (59.36) | (17.97) |
f | Expenses transferred to Capital Account | - | (35.60) | (4.59) | (125.44) |
Total Expenses [2a to 2f)] | 189.03 | 592.57 | 365.64 | 1,688.26 | |
3 | Profit / (Loss) from Operations before Other Income, Interest and Finance expense and Exceptional Items [ 1 -2 ] | 115.22 | 292.86 | (56.33) | 605.82 |
4 | Other Income | 2.50 | 1.93 | 10.86 | 16.29 |
5 | Profit / (Loss) before Interest and Finance expense and Exceptional Items [ 3+ 4 ] | 117.72 | 294.79 | (45.47) | 622.11 |
6 | Interest and Finance Expenses | 50.19 | 60.75 | 46.69 | 209.44 |
7 | Profit / (Loss) after Interest and Finance expense but before Exceptional Items. [ 5 - 6 ] | 67.53 | 234.04 | (92.16) | 412.67 |
8 | Exceptional items | - | - | - | - |
9 | Profit / (Loss) from Ordinary Activities before tax | 67.53 | 234.04 | (92.16) | 412.67 |
10 | Less: Tax expense (net off MAT credit entitlement) | 1.21 | 1.10 | (1.28) | 39.62 |
11 |
Profit / (Loss) from Ordinary Activities after tax | 66.32 | 232.94 | (90.88) | 373.05 |
12 | Extraordinary Item | - | - | - | - |
13 | Profit / (Loss) for the period [11-12] | 66.32 | 232.94 | (90.88) | 373.05 |
14 | Paid-up equity share capital [Face value Rs.10 per share] | 792.83 | 792.83 | 792.83 | 792.83 |
15 | Reserves excluding Revaluation Reserves as per balance sheet of previous accounting year | - | - | - | 3,528.32 |
16 |
Earnings Per Share [Face value Rs.10 per share] | ||||
a) Basic | 0.84 | 2.94 | (1.15) | 4.71 | |
b) Diluted | 0.84 | 2.94 | (1.15) | 4.71 | |
17 | Public Shareholding | ||||
a) Number of Shares | 19,820,782 | 19,820,782 | 19,820,782 | 19,820,782 | |
b) Percentage of shareholding | 25% | 25% | 25% | 25% | |
c) Shares held by custodians against depository receipts | - | - | - | - | |
18 | Promoters and Promoter group Shareholding | ||||
a) Pledged / Encumbered - No. of Shares | - | - | - | - | |
Percentage of shares (as a % of the total share holding of promoter and promoter group) | - | - | - | - | |
Percentage of shareholding (as a % of the total share capital of the company) | - | - | - | - | |
b) Non encumbered - No. of Shares | 59,462,218 | 59,462,218 | 59,462,218 | 59,462,218 | |
Percentage of shares (as a % of the total share holding of promoter and promoter group) | 100% | 100% | 100% | 100% | |
Percentage of shares (as a % of the total share capital of the company) | 75% | 75% | 75% | 75% | |
c) Shares held by custodians against depository receipts | - | - | - | - | |
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