China's Wanda Projects $612M in Legendary Revenue for 2016
The Chinese real estate and investment conglomerate — led by China's richest individual, Wang Jianlin — predicts 30 percent overall growth in its entertainment business this year.
Chinese real estate and investment conglomerate Dalian Wanda Group on Monday projected a 30 percent surge in revenue for its entertainment businesses in 2016.
Last week, Wanda reached a deal to buy U.S. film studio Legendary Entertainment for $3.5 billion — the largest acquisition of its kind ever in China. The Chinese conglomerate on Monday forecast that Legendary will contribute RMB4.02 billion ($612 million) in revenue this year.
Wanda released the 2016 forecasts following its annual meeting, convened over the weekend by chairman Wang Jianlin at Xishuangbanna International Resort, a $2.8 billion theme park that Wanda opened last year in Yunnan Province.
The Wanda Cultural Industry Group — the umbrella term the company uses for its various privately held and publicly listed entertainment holdings — is expected to achieve revenue of $10.1 billion this year.
The company said Wanda Pictures, its film production and financing arm, aims to grow revenue by 71 percent over last year to hit $152 million. Wuzhou Film Distribution, Wanda's film distribution business, is targeting annual box-office receipts of nearly $1.4 billion and annual revenue of $267.7 million, a 10.6 percent annual increase over 2015.
Wanda's movie theater chain Wanda Cinema Line — China's largest by screen count — said it would open 77 new theaters and add 698 screens this year, excluding acquisitions. Wanda didn't provide a revenue forecast for Wanda Cinema Line, whose stock is traded on the Shenzhen Stock Exchange. The chain currently operates 292 cinemas totaling 2,557 screens.
Wanda saw steady growth across its entertainment portfolio in 2015, with revenue climbing 45.7 percent year-on-year to reach $7.79 billion.
Wanda predicts that overall group revenue will fall 12.4 percent year-over-year to $38.7 billion in 2016 as its core commercial real estate business slows amid a slump in the Chinese property sector. Despite the revenue dip, Wang said net profit is expected to "maintain relatively higher growth."
Over the past several years, Wanda has been making bold acquisitions in entertainment, sports and tourism to diversify its holdings, while tapping the gradual rise in Chinese middle-class consumer spending, which the Chinese government has made a central priority to help boost the overall economy.
In addition to the Legendary deal, Wanda has in recent years acquired U.S. theater chain AMC Entertainment, Infront Sports & Media AG, a large stake in Spain’s Club Atletico de Madrid soccer team and World Triathlon Corp, organizer of the Iron Man Triathlon races.