eOne eyes growth with film, TV merger

Transatlantic producer and distributor Entertainment One (eOne) says it is merging its TV and film divisions in a bid to “underpin future growth.”

eOne’s popular children’s brand Peppa Pig

eOne, which is behind shows including children’s animation Peppa Pig and drama Designated Survivor, revealed the restructure yesterday after posting its annual results.

The company suffered a 22% drop in pre-tax profits, which fell from £47.9m (US$63m) in 2016 to £37.2m to the year to March 31, largely because of a write-down to revamp its movie arm.

The company will merge its TV and film arms into a single studio over the next year, having already combined its sales operations.

Earlier this month C21 revealed Carrie Stein, exec VP for global production at eOne Television, had resigned and would be leaving at the end of June.

That followed the appointment of Fox Television Studios exec Pancho Mansfield in 2015, who was named president of global scripted programming and to whom Stein reported.

It has been a tumultuous 18 months for eOne, which has offices in Toronto, LA and London. The company has been pursuing a strategy to double in size since 2014 – a target that CEO Darren Throop said would be achieved in 2020.

Having bought a number of firms over recent years, including Peppa Pig producer Astley Baker Davies and The Mark Gordon Company, it rebuffed a takeover bid by UK commercial broadcaster ITV last year. US private equity firm KKR & Co was also interested.

Prior to that it had seen its share price plummet amid fears about debt refinancing and the profitability of its movie business.

eOne’s annual results showed overall revenues up 35% at £1.08bn, with its TV department’s contribution up 75% compared with 2016 at £328m.

The company’s family division reported a 25% rise in sales to US$1.5bn, powered largely by Peppa Pig as well as new animated series PJ Masks. It revealed last week that a further 117 episodes of Peppa Pig were in the works.

Investment in production and acquired content rose to £407m, up almost 80% on 2016.

Within its kids-orientated family business, revenues rose to £88.6m, up 33% from £66.6m, driven by the strong performance of Peppa Pig and the growth of PJ Masks. Last week, eOne revealed it had put 117 new episodes of Peppa Pig into production.

Throop said: “The work undertaken during the year keeps us at the centre of the positive structural change ongoing in the industry, and is in line with the source, select, sell strategy which continues to serve eOne so well, underpinning our growth trajectory.

“The continued reshaping of the [film] division, where initiatives undertaken included integrating our physical distribution partnerships with Fox and Sony, and the refocussing of our film distribution arrangements, has positioned us well to retain our strong position catering to a changing global film market.”