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| Friday, 30 March 2012, 08:00 HKT/SGT | |
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Source: IMAGI | |
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- Achieves Near Breakeven at EBITDA Level
- Newly acquired TE Group starts Revenue Contribution |
HONG KONG, Mar 30, 2012 - (ACN Newswire) - IMAGI International Holdings Limited ("IMAGI" and together with its subsidiaries, "the Group"; HKSE:0585) today reported its final results for nine months ended 31 December 2011.
Final Results for the nine months ended 31 December 2011
The Group reported the following:
-- Revenue surged to HK$117 million for the nine months ended 31 December 2011("period under review"), consists of licensing income derived from Toon Express Group ("TE Group") and income arising from the joint brand management agreement ("JBMA") with Creative Power Entertaining Limited Liability Company ("CPE") on commercial exploitation of cartoon characters.
-- Loss after tax was significantly narrowed down by 89% to HK$67.4 million.
-- Loss Before Interest, Tax, Depreciation and Amortisation was narrowed to HK$2.5 million. With the newly acquired business, IMAGI is on the right track and recorded a gross margin of 58% during the period under review.
-- TE Group's operating expense increased by 51%, mainly due to the increase in overall headcounts, setting up of overseas units in Taiwan and Singapore, renovation costs and rental costs of the new office, launch of new brand extensions and higher marketing expenses to build brand awareness in Greater China and beyond.
-- The Group expects to achieve operational profitability, before the annual amortization of intangible assets and the reversal of the corresponding deferred tax liabilities of approximately HK$74 million related to its acquisition of TE Group.
-- The appointment of Disney Enterprises Inc. ("Disney") as the master licensee since 1 Jan 2011 has resulted in the following:
- 41 new licensees
- 16 renewal contracts
- 2,869 new product designs
- HK$105.9 million minimum guarantee from new and renewal contracts over the next 2-3 years
Strong Financial Position and Debt-free
-- Healthy financial position with bank balances amounting to HK$281.3 million and a current ratio of 6.2 as at 31 December 2011
-- The Group had no bank or other borrowings and therefore had a zero gearing as at 31 December 2011
During the period under review, the Group acquired TE Group, which allows the Group to have a viable business operation through China's No 1 animation brand Pleasant Goat and Big Big Wolf. TE Group has successfully integrated the operations of both "IMAGI and Toon Express International Limited ("Toon Express"), and started its revenue contribution.
Mr Francis Leung Pak To, Chairman of IMAGI, said, "2011 was a major milestone for IMAGI and a significant move into the future as the Group acquired TE Group, a leading brand manager in China's animation industry. We are pleased to report that the Group has completed a financial restructuring and is now in a healthy state. We also achieved near breakeven at EBITDA level. The Group is now well positioned to achieve its vision "to be a branded leader in the Greater China region and beyond through the development of its merchandising, lifestyle, media and entertainment products and services". With well established brand recognition, we will continue to deepen and expand the brand franchise of Pleasant Goat and Big Big Wolf within Greater China and the rest of Asia Pacific."
The Group's core brand Pleasant Goat and Big Big Wolf remained as the market leader in China's animation market, while television ratings continue to achieve higher indices and movies continue to be the best performing locally produced animation movie for four years running.
Mr Soh Szu Wei, Chief Executive Officer of IMAGI said, "We have achieved remarkable performance during the period under review with TE Group's substantial contribution. We remain bullish on the Group's prospects given the sustained popularity of Pleasant Goat and Big Big Wolf brand. Leveraging on our leadership position in China's branded entertainment industry and deepened relationships with our two partners CPE and Disney, we are committed to expanding into the broader merchandising, lifestyle, media, entertainment and services markets. More importantly, we are well prepared to promote the brand overseas with South East Asia as the starting point in order to diversify our income stream. We are confident in delivering pleasant results and expect to achieve operational profitability in the near future."
On track to produce more TV episodes and movies to diversify brand portfolio
The Group is stepping up its efforts to further enhance the brand awareness and promote the brand through TV and movie segments. TE Group's strategic media content partner, CPE, will produce 220 TV episodes of Pleasant Goat and Big Big Wolf and Happy Family, while the live action and animation of the former's full feature movie will soon start production and scheduled for release in late 2013/14. CPE had also kicked off the planning and production of Pleasant Goat and Big Big Wolf Movie 5 to 7, following the record-breaking performance of Movie 4 "Mission Incredible: Adventures on the Dragon's Trail" with box office receipts exceeding HK$203 million. CPE will also produce a full feature movie for Happy Family, which is scheduled for release in the second half of 2012.
Stage shows and carnivals to strengthen brand recognition
Pleasant Goat and Big Big Wolf's 3rd sequel stage show, "Wilie's Cherished Desire" will be launched in the second quarter of 2012. A total of 138 stage shows have been signed up so far for the year. In Taiwan, about 30 stage shows will be organized by Jinho Dissemination Co, Ltd. between June to August throughout the island to support new TV series "Smart Dodging" launch in momo Kids Channel. CPE is working with Mactus Pte Ltd, an experienced event organizer in Asia, to launch Pleasant Goat and Big Big Wolf carnivals. Six carnivals have been confirmed.
Expansion of core franchise to diversify revenue stream
The Group is expanding the demographic coverage of Pleasant Goat and Big Big Wolf by introducing brand extensions to broaden consumer base beyond 4-8 years old. TE Group has launched new images, including Babies, Pink Category, Freedom n Power and Avant Garde - Happy Simple Life, to target different age group for licensed products. The launch of all these different images will be supported by marketing initiatives.
Overseas Expansion via different Delivery Channels
The broadcast of Pleasant Goat and Big Big Wolf episodes through Disney Channels in Asia Pacific allowed the brand to be gradually exposed to the target audience. CPE had recently closed the second broadcasting deal with Disney, under which another 100 episodes of the Pleasant Goat and Big Big Wolf TV series will be broadcast exclusively in 46 territories within the Asia Pacific region starting from 1 March 2012.
The Group has also started brand building activities in Taiwan and Singapore, while negotiations are underway to bring the brand to Malaysia in 2012. Taiwan's momo Kids Channel has been showing the "Smart Dodging" TV series since January, 2012 and has scheduled "Happy Happy Bang Bang" in June for viewing. The next brand event will be working with Carrefour to stage the "Pleasant Goat and Big Big Wolf Children's Day Roadshow" in early April. The Group is also discussing with a major Taiwanese telecommunication company and free-to-air TV channels to bring the cartoon to a bigger audience. It is expected that Taiwan will soon become another major market for the brand to monetize.
Singapore is also the key market in the Group's South East Asia expansion plan. Mediacorp's Channel 8 has been broadcasting Pleasant Goat and Big Big Wolf cartoon since late 2010, with rising interest level towards the brand.
Interactive media Initiatives and E-strategy to tap internet and mobile markets
The Group also plans to tap fast-growing internet and mobile markets as its products are suitable to be converted into e-products at minimal cost. Subsequent to a mobile game app department which was established last year, TE Group is exploring with major partners on other aspects of its e-strategy. Amid rapid emergence of smartphones, the Group is also working with its licensees on a mobile app for retailing related products of Pleasant Goat and Big Big Wolf to strengthen brand interest, purchase satisfaction, and long-term loyalty.
Appointment of Executive Deputy Chairman, Executive Director and CEO
Apart from announcing its final results, IMAGI also announces that Mr Soh Szu Wei has resigned as the Chief Executive Officer of the Group. Mr Soh will remain as the Group's Senior Advisor until 30 June 2012. Mr Soh will remain as an Executive Director of IMAGI. Subsequently, Mr Yung Tse Kwong, Steven, age 62, will assume the position as Executive Deputy Chairman, Executive Director and CEO of IMAGI. Mr Yung has recently served as the Director and Chairman of Clear Media Limited (from 2001 to 2008) and as an Independent Non-executive Director of Kingmaker Footwear Holdings Limited (from 2009 until present), both of which are public companies whose securities are listed on the Main Board of The Stock Exchange of Hong Kong Limited. Both Mr Soh's resignation and Mr Yung's appointment will be effective from 1 April 2012.
Mr Francis Leung Pak To, Chairman of IMAGI, said, "During the past year, Mr Soh has led the Group to reach various business achievements. IMAGI and the TE Group have now been successfully integrated and our core brand "Pleasant Goat and Big Big Wolf" continues to grow in China. With all our milestones achieved, the board of directors has accepted Mr Soh's request to resign as CEO of the Company and respect his decision to spend more time with his family in Australia and pursue his other interests. On the other hand, we are pleased to announce the appointment of Mr Yung Tse Kwong, Steven as the Executive Deputy Chairman, Executive Director and CEO of the Company. With Mr Yung's extensive management experience earned from leading multinational companies in the media, entertainment, consumer and retail industries, we are looking forward to Mr Yung's contribution to drive IMAGI reaching another new height."
Contact:
Strategic Financial Relations Limited
Heidi So, +852 2864 4826, heidi.so@sprg.com.hk
Mandy Go, +852 2864 4812, mandy.go@sprg.com.hk
Roby Lau, +852 2114 4950, roby.lau@sprg.com.hk
Cornia Chui, +852 2864 4853, cornia.chui@sprg.com.hk
Fax: +852 2527 1196
Website: www.sprg.com.hk
Topic: Earnings
Source: IMAGI
Sectors: Film & Video, Daily Finance, Broadcast, Film & Sat
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From the Asia Corporate News Network
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