RLJ Entertainment COO Penella Replaces CEO Green18 Jan, 2013 By: Erik Gruenwedel
Executive switch follows disappointing 2012 fiscal results for Image Entertainment
RLJ Entertainment Jan. 18 announced it has promoted COO Miguel Penella to CEO, replacing Ted Green, who is leaving the company by mutual agreement.
RLJ Entertainment, owned by B.E.T. founder Robert Johnson, is the newly created media company with assets including Image Entertainment and Acorn Media Group. Green previously was CEO of Image.
Penella previously was CEO of Washington, D.C.-based Acorn — a distributor of primarily British TV content, including Agatha Christie titles. RLJ Entertainment acquired Chatsworth, Calif.-based Image and Acorn Media last April for $127 million.
No reason was given for Green’s departure, but RLJ Entertainment disclosed that proforma 2012 fiscal results would fall below projections. The company expects to report (in March) revenue from $180 million to $185 million, which is 15% below previous estimates. It expects to post lower pre-tax earnings from $28 million to $30 million, due to a shortfall in Image revenue, which was partially offset by higher publishing and film licensing income generated from Acorn.
Indeed, Acorn's fiscal results were in line with previous projections, according to RLJ Entertainment.
The proforma accounting is a statement of the company's financial activities while excluding "unusual and nonrecurring transactions" when stating how much money the company actually made. Expenses often excluded from proforma results include company restructuring costs, a decline in the value of the company's investments or other accounting charges.
Since the acquisition, Johnson has said that Image and Acorn would up focus on delivering home entertainment to the urban and Hispanic markets, in addition to expanding lifestyle titles. Penella was president of Acorn’s direct-to-consumer operations, which led to revenue and free cash flow growth through the distribution of more than 17 million catalogs in 2006, an increase of 80% in just two years.
"While we are disappointed in our expected 2012 results, we are confident that the RLJ Entertainment will achieve revenue growth and continued improvement in our operating margins in 2013, driven by a strong new-release schedule and the further integration of the company’s operations,” Penella said in a statement.
Johnson said he and Penella “share the same vision” for the future of RLJ Entertainment, which he said includes capitalizing on their expertise in acquiring, distributing and developing entertainment content that uses new technology to reach targeted audiences and establishes a “very loyal, passionate” following from these consumer groups.
“Miguel has a wealth of industry experience, an ability to understand and capitalize on digital distribution opportunities and is a disciplined operator,” Johnson said in a statement. “We look forward to his leadership and his continued contributions to the growth of the business.”