Kids producer and distributor DIC Entertainment has told investors that it will fail to hit its financial targets after a series of its shows failed to generate the sales expected. DIC is listed on the Alternative Investment Market (AIM) in the UK and shares were down over 50% in early trading.
The company said that revenue from TV and home entertainment will be below expectations. Following a series of non-cash write-downs 2007 EBITDA profit will be reduced by about $11.5 million it said in a trading statement. DIC also downwardly revised its 2008 revenue and profit growth estimates to reflect the more cautious outlook.
A company spokesman told TBIvision that the disappointing performance of a number of properties had necessitated today’s announcement. "The cost of a programme has to be amortized over ten years and if it’s going slower than anticipated the value in the books has to be recalculated," the spokesman said. "The figures have been re-evaluated in the face of poor performance; Trollz has been a disappointment and Slumber Party Girls has been a disappointment."
DIC has reworked its Saturday morning block on US network CBS and replaced Slumber Party Girls with a KEWLopolis-branded block, which is programmed in partnership with American Greetings.
DIC noted that despite the anticipated profit slip, 2007 revenue will be in line with expectations and the write-downs have no effect on the company’s cash position.