RLJ Entertainment Significantly Narrows Q2 Loss13 Aug, 2014 By: Erik Gruenwedel
RLJ Entertainment Aug. 13 reported a second-quarter (ended June 30) net loss of $2.2 million, compared with a net loss of $16.9 million during the prior-year period. Revenue dipped 6.5% to $32 million.
Bethesda, Md.-based RLJ Entertainment owns and operates home entertainment distributors Image Entertainment and Acorn Media Group, the latter including subscription video service Acorn TV.
It attributed the revenue decline primarily to the termination of a wholesale feature film output deal by Image Entertainment. The termination resulted in a revenue decline of $3.5 million. But the agreement, which ended March 31, had generated an operating loss of $7.5 million during the prior-year period.
Although primarily a distributor, Image has over the years underwritten select independent feature films, including The Tall Man with Jessica Biel and 44 Inch Chest with Ray Winstone, among others.
“The discontinued content output deal was not a core component of our long-term strategy,” CEO Miguel Penella said in a statement.
RLJ said it increased direct-to-consumer revenue, which included $1.2 million in catalog title sales and $661,000 from digital channels. The company’s hallmark subscription streaming service, Acorn TV, topped 89,000 subscribers at the end of the fiscal period.
“Following the successful combination of Acorn and Image, we have been hard at work securing cost savings, refining and strengthening our investment in unique IP content, accelerating our digital distribution approach and improving our balance sheet. Our strong results in the second quarter clearly indicate that we are now at an important inflection point,” Penella said.