But pledges to "earn back the confidence of shareholders"
HALIFAX – DHX Media is projecting a fourth quarter net loss of between $18 million – $20 million, says a preview of its financial results for the three month period ending June 30 released Thursday.
Final financial results for Fiscal 2018 will be reported before market opens on September 25, 2018. At that time, the special committee of the company's Board of Directors is also expected to provide an update on its strategic review.
The net loss, relative to the prior periods, was partially due to lower margins due to the new mix of business with Peanuts, and a $12 million combined write down of investment in film, television programs, acquired and library content and intangible assets, reads the company’s news release. Cash provided by operating activities for Fiscal 2018 was $13 million, or $37.4 million before acquisition and related refinancing costs of $24.4 million.
Fourth quarter revenues are anticipated to be $99 million, up from $87.6 million year-over-year, with top-line growth primarily driven by the acquisition of Peanuts and Strawberry Shortcake, and continued strong growth in WildBrain, the children's content and brands company added. Excluding acquisitions, revenue for Fiscal 2018 is expected to be down approximately 3% relative to Fiscal 2017.
Executive chair and CEO Michael Donovan said that the company’s “significant corrective actions to return to strong and sustainable organic growth” are not yet reflected in its reported results.
"These actions have included rebuilding the executive team and investing in stronger systems”, Donovan continued. “DHX Media intends to earn back the confidence of shareholders in the value of the Company's assets and the management team's ability to execute and surface value, as it reports results throughout fiscal 2019 and beyond.
Furthermore, management firmly believes that the recent decline in the Company's share price is not reflective of the current financial health of the business, the value of the Company's assets or the future earnings potential of DHX Media."
