Metrodome Group Posts Operating Losses in First Half of 2012 as Net Profits Rise
The British outfit, listed on the stock market, said difficult market conditions and putting TV distribution division Target into administration hit the books.
LONDON – Metrodome, the U.K. distribution, finance and sales group, posted red ink for the six months ending June 30, 2012 with its operating losses hitting £180,000 ($286,000) after a small profit of £35,000 ($55,500) during the same six months last year.
The return to the red came despite posting rising revenues from continuing operations for the first six months of this year to £4.32 million ($6.86 million), up three per cent from 2011's first half figure of £4.2 million ($6.7 million).
Metrodome CEO Mark Webster said the first six months of 2012 have shown "the strength and resilience of the film business in difficult market conditions."
The company posted a net profit of £4.98 million ($7.91 million) during the first six months of 2012, up from a net loss of £871,000 ($1.38 million) during the same period last year.
Webster said that "despite early setbacks" the company is "committed to look for the right opportunities to grow our business both organically and by M&A."
The company shut down its TV distribution business when Target Entertainment was placed into administration on Feb. 28, 2012.
While the now defunct TV business accumulated losses, Metrodome pushed through an exceptional charge of £6.9 million ($11 million) on its balance sheet which meant in the first half of 2012, the net liabilities of Target have been removed from the Group results, resulting in a profit from discontinued operations of £5.2 million ($8.2 million).
Webster said following the time and money spent on Target's administration and disposal, the company now plans to "focus all our attention on the stability and growth of the continuing businesses of U.K. film distribution and worldwide sales agency."
Underlying EBITDA hit £139,000 ($220,778) in the first half of 2012, up from £101,000 ($160,428) "in difficult trading conditions."
Webster noted in his statement that he fully expects digital exploitation to grow for his company on the back of new entrants such as Netflix in the market.
Metrodome's Hollywood Classics division, the sales and distribution label for the theatrical distribution and marketing of classic film libraries from Universal, Paramount, Twentieth Century Fox, Warner Bros. and the U.K. Film Council, is "well positioned to exploit this growth in the digital market while also retaining a presence in the DVD market "which will remain a significant market for some years to come."
Hollywood Classics operates in the worldwide market whereas Metrodome Distribution operates in the U.K. and Eire.
Webster noted: "Whilst it is difficult to get industry data for the worldwide market, evidence suggests the economic problems in the eurozone and general global austerity programmes are suppressing market growth."
U.K. film distribution revenues fell by 13 percent compared to the same period last year.
Metrodome's business included five theatrical releases in the first half of the year.
Metrodome release highlights were In Darkness, nominated for an Oscar for best foreign language film in 2012, and A Royal Affair, the period drama starring Mads Mikkelsen and Alicia Vikander.
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