RLJ Entertainment Posts Q4 Loss19 Mar, 2014 By: Erik Gruenwedel
Home entertainment distributor attributes loss to increased content license rights, among other costs
RLJ Entertainment March 19 reported a fourth-quarter (ended Dec. 31) loss of $2.1 million, compared with a profit of $1.6 million during the same period a year ago. Revenue declined $2 million to $57.5 million.
RLJ Entertainment features a portfolio of more than 5,300 titles, distributing brands such as Acorn Media Group (British TV), Image Entertainment (feature films, stand-up comedy), One Village (urban), Acacia (fitness), Athena (documentaries) and Madacy (gift sets). Content is distributed via broadcast television (including satellite and cable), theatrical and non-theatrical, DVD, Blu-ray Disc, digital download and digital streaming.
RLJ attributed the loss to an increase in cost of sales of $3.9 million — including $1.6 million in content rights and inventories — compared with $143,000 increase in cost of sales during the period of Oct. 3 through Dec. 31, 2012.
Through its relationship with Agatha Christie Ltd., a company that RLJ owns 64% of, RLJ manages the intellectual property and publishing rights Christie sleuths Miss Marple and Poirot. RLJ also owns all rights to popular U.K. mystery series “Foyle’s War.”
Last December, RLJ said it inked a license deal with 20th Century Fox Studios for the latter’s planned theatrical reboot of Murder on the Orient Express.
“The company’s 2013 year was a period of significant transition for RLJ Entertainment, CEO Miguel Penella said in a statement. “We made critical key hires at the management level, completed the integration of Acorn and Image, strengthened our content investment through capital reallocation and advanced the development of new proprietary subscription [streaming] digital channels, most notably through the expansion of programming on Acorn TV, the launch of our new Acacia TV channel and the development of our new urban network.”
Penella said 2014 would continue focusing on digital distribution initiatives and streamlining of the business to improve margins and pre-tax earnings.
“Our focus will be to re-deploy content capital from deals terminated in 2013 into content acquisitions that will meet or exceed our return on investment threshold,” he said.