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RHI revenue plummets

New York-based miniseries and telefilm producer/distributor RHI Entertainment has suffered a whopping 41% drop in revenue for the first quarter of 2009, compared with the same period last year.

The decrease was mainly due to a 25% fall in library sales in Q4 2008 that was reflected in the latest results. RHI began to see a pick-up in back-catalogue sales over the past few months, according to a company statement.

RHI was also hit by a reduction in advertising sales at US network Ion, with which RHI has an exclusive development and broadcast deal. Ion’s problems led to a US$1.5m fall in revenue at RHI.

Significantly, the NASDAQ-listed company did not engage in any production activity in Q4 2008, meaning that no projects were delivered during the last quarter and there was therefore no revenue to be made from production.

However, RHI stressed in its statement that demand had increased during Q1 2009 and that this had been reflected in a renewal of production activity. RHI currently has eight miniseries and 18 telefilms at various stages of production and hopes to deliver a slate of between 30 and 35 projects this year.

“Our financial results for Q1 reflect the natural seasonality of our business as the majority of our revenue is booked in the second half of the year,” said RHI president and CEO Robert Halmi Jr. “As we expected and planned for, the unfavourable market conditions that we experienced in Q4 2008 carried over into 2009. The good news, however, is that demand for original movies and miniseries, and library content from broadcast and cable networks began to come back in January.

“We are enthusiastic about our prospects for 2009 as market signals suggest that our cost value proposition continues to hold its appeal.”

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