Fiction
Eros Now partly assuages Eros International’s syndication declines
BENGALURU: Eros International Plc (Eros) reported 49.1 percent decline in aggregate revenue to $23.1 million for the quarter ended 30 September 2019 (Q2 2019, quarter or period under review) as compared to the corresponding year ago quarter’s $63.4 revenue. Eros explains that lower revenue was mainly due to lower syndication revenue for Q2 2020, which was partially offset by increase in revenues from the Eros Now business. “Our Eros Now business continues to ramp up and grow its paid user base worldwide, supported by one of the largest libraries of Indian movies, along with its unparalleled market position and brand name,” says a statement by Eros.
In Q2 2020, the Eros film slate comprised 11 films of which 11 were low budget as compared to 17 films in Q2 2019, of which four were medium budget and 13 were low budget. In Q2 2020, the company’s slate of 11 films comprised two Hindi films and nine regional films as compared to the same period last year where its slate of 17 films comprised five Hindi films and 11 regional films and one Tamil/Telugu regional film.
Operating adjusted EBITDA declined to less than a third (declined by 2.53 times) y-o-y to $7.8 million in Q2 2020 as compared to $27.5 million in Q2 2019. Eros claims that the decrease in Adjusted EBITDA was on account of increase in administrative costs due to expected credit loss expense accounted as per default method under IFRS 9.
Gross profit for the period under review declined 38.7 percent y-o-y to $15.5 million from $25.3 million in Q2 2019. Eros reveals that the decrease was mainly due to lower amortisation, marketing, advertising and distribution costs for Q2 2020 which was partially offset by increase in administrative cost.
The company reported a lower operating loss of $13.6 million for Q2 2020 as compared to an operating loss of $261.9 million in the year ago quarter.
The company says that cost of sales decreased by 55.6 percent to $16.9 million in Q2 2020 compared to $38.1 million in Q2 2019. Eros says that the decrease was mainly due to lower amortisation costs. Administrative cost increased by 72.2 percent in Q2 2020 to $29.1 million compared to $ 16.9 million in Q2 2019. The increase was mainly due to increase in expected credit loss accounted as per default method under IFRS 9.
For Q2 2020, Eros’s net finance costs increased by 866.7 percent to $2.3 million, compared to $(0.3) million in Q2 2019 mainly due to increase in finance costs and reduction in interest income on account of unwinding of credit impairment loss.
Eros says that as of 30 September 2019, Trade Receivables decreased to $189.8 million from $196.4 million as of March 31, 2019 after considering expected credit loss reserve upon adoption of new accounting standards during the period.
Company speak
Excerpts of a statement made by the company:
“This quarter we generated $32.3 million of top-line revenue and $7.8 million in adjusted EBITDA. Our Eros Now business continues to ramp up and grow its paid user base worldwide, supported by one of the largest libraries of Indian movies, along with its unparalleled market position and brand name. As of 30 September 2019 our Eros Now OTT platform reached 23.5 million paid monthly subscribers and 177.7 million registered users, increases of 81percent and 39 percent, respectively, over the same period last year. This represents net additions of 4.7 million paid subscribers and 23 million registered users during the first half of Fiscal Year 2020. Eros Now currently garners viewership from over 150 countries around the world. Eros has a strong slate of films and original series scheduled for release over the coming quarters, and we expect this to help drive continued growth in our Eros Now business as well as box-office revenue.
“For the full fiscal year 2020, we are reiterating our consolidated revenue guidance in the range of $200-220 million, and Adjusted EBITDA of $80-$95 million. We have a healthy balance sheet with net debt of $112.6 million and $99.4 million of cash and cash equivalents.”
Fiction
Banijay merges with All3Media in $6.65 billion deal
Marco Bassetti will lead the combined company as CEO
PARIS: Six years after acquiring Endemol Shine at the height of the pandemic, Banijay has struck again. The European production heavyweight is merging with All3Media in a deal that will create a television titan with $6.65 billion in revenue and redraw the contours of a fast-consolidating market.
The combined company will trade under the Banijay name and be owned 50 per cent each by Banijay Group and RedBird IMI, which acquired All3Media in 2024. The transaction is expected to close by autumn, subject to regulatory approvals.
Banijay Entertainment CEO Marco Bassetti, will take the top job at the enlarged group. All3Media CEO Jane Turton becomes deputy CEO. RedBird IMI CEO Jeff Zucker will serve as chairman.
The logic is scale. Broadcasters are commissioning less, streamers are tightening budgets and global buyers are fewer but bigger. Against that backdrop, heft matters. The merged entity will generate roughly $6.65 billion in revenues based on 2024 figures, giving it sharper elbows in rights negotiations and deeper pockets for franchise-building.
“Entrepreneurialism, ambition and creativity” remain core to Banijay’s DNA, Bassetti said, flagging plans to invest more heavily in new intellectual property, live events and emerging platforms. Turton struck a similarly bullish note, pointing to All3Media’s journey from a 2003 start-up to a global supplier of hit formats and high-end drama.
Between them, the two groups control a formidable slate. Banijay’s catalogue spans MasterChef, Big Brother, Survivor, Black Mirror, Peaky Blinders and Deal or No Deal. All3Media’s labels include Studio Lambert, producer of The Traitors and Squid Game: The Challenge; Two Brothers, behind The Tourist; and Neal Street, currently producing the forthcoming Beatles biopics directed by Sam Mendes for Sony.
The back catalogue is equally muscular. Banijay Rights holds some 220,000 hours, while All3Media International adds around 35,000 hours, forming one of the industry’s largest libraries.
Banijay, controlled by French entrepreneur Stéphane Courbit and listed in Amsterdam, counts more than 130 production companies across 25 territories. All3Media operates over 40 labels, with strong positions in the UK, US and Germany. The enlarged group will also lean into live entertainment, building on Banijay’s Balich Wonder Studio, which produced the opening ceremony of the Milan-Cortina Winter Olympics, and the Independents.
The deal marks a shift in tone. As recently as October, Bassetti suggested that mergers and acquisitions were not a priority. But the drumbeat of consolidation has grown louder. Mediawan has moved for Peter Chernin’s North Road. David Ellison’s Paramount has agreed to a $110 billion takeover of Warner Bros, with plans to combine HBO Max and Paramount plus. ITV has explored selling its media and entertainment arm to Comcast-owned Sky, though talks have reportedly slowed.
