- Revenue increased 18% to $112.6
million in Q1 2022, compared to $95.5
million in Q1 2021.
- Net loss of $21.4 million in Q1
2022, compared to net loss of $3.3
million in Q1 2021, mainly due to a non-cash, foreign
exchange loss of $13.0 million in the
current quarter vs a foreign exchange gain of $5.1 million in Q1 2021.
- Cash used in operating activities in Q1 2022 was $11.4 million, compared to $19.6 million provided by operating activities in
Q1 2021.
- Free Cash Flow1 for Q1 2022 was negative
$19.9 million, compared with negative
Free Cash Flow of $2.7 million in Q1
2021, primarily due to increased accounts receivables arising from
larger deals concluded during the quarter and timing of working
capital settlements.
- Adjusted EBITDA1 in Q1 2022 increased 13% to
$19.9 million, compared with
$17.5 million in Q1 2021.
- Consumer Products revenue grew 25% to $48.5 million in Q1 2022, compared to
$38.8 million in Q1 2021.
- WildBrain Spark ("Spark") revenue increased 73% to $15.4 million in Q1 2022, compared to
$8.9 million in Q1 2021.
HALIFAX, NS, Nov. 9, 2021 /CNW/ - WildBrain Ltd.
("WildBrain" or the "Company") (TSX: WILD), a global leader in
kids' and family entertainment, today reported its Fiscal 2022
first-quarter results for the three-months ended September 30, 2021 ("Q1 2022").
![WildBrain Logo (CNW Group/WildBrain Ltd.) WildBrain Logo (CNW Group/WildBrain Ltd.)](https://mma.prnewswire.com/media/1682929/WildBrain_Ltd__WildBrain_Reports_Q4_and_Full_Year_2021_Results.jpg)
Eric Ellenbogen, WildBrain CEO,
said: "Our first-quarter results reflected a return to growth at
WildBrain Spark as well as strong consumer products
performance. Spark revenue was up 73% in Q1 2022, driven by
improving advertising rates and our focus on higher-value
views. Our vast library of high-quality owned content is the
cornerstone of our leading digital network on YouTube, yielding
valuable data and insights. This, together with our holistic
approach to content monetization, is what really
differentiates us and continues to bring top IP partners to Spark.
As YouTube continues to favour quality content, we expect to
realize even greater benefits from our network. We're also
extending our capabilities across other digital platforms, such as
the recently announced exclusive direct-advertising services
partnership with Gamefam, one of the top game publishers on
Roblox."
Ellenbogen added: "In consumer products, we expect our momentum
to build in the coming quarters and years, supported by new brand
activations and content releases across Strawberry Shortcake,
Sonic, Teletubbies, Yo Gabba Gabba!
and others. For Peanuts, our consistent output of new content
on Apple TV+ is further engaging global audiences. Season 2
of Snoopy in Space debuts this week, and the first new
Peanuts special, For Auld Lang Syne, premieres in
December. As we switch on more and more IP, we're fully
harnessing our 360-degree capabilities across production,
distribution and licensing and, in turn, realizing the long-term
earnings' power of our assets."
Aaron Ames, WildBrain CFO, added:
"Q1 2022 reflected the early returns from the investments we've
made across our business. We continue to unlock new
monetization opportunities at Spark to generate a bigger portion of
revenue through nascent areas, including digital production, direct
ad sales and paid media, which collectively grew 128% in the
current quarter, over Q1 2021. We're also realizing synergies of
our vertically integrated business by aggregating our Peanuts
representation across Europe and
the Middle East, which contributed
to higher consumer products revenue in Q1 2022. Our
investments provide a solid foundation, positioning us for
sustainable growth and margin expansion in Fiscal 2022 and
beyond."
Q1 2022 Performance – Executing on Priorities
PRIORITIES
|
HIGHLIGHTS
|
Activate IP and
Grow Key Brands
|
- A multi-year global
exclusive partnership with Apple TV+ for the production of an
original series and licensing of the back catalogue on Yo Gabba
Gabba!, representing yet another IP activation from the
WildBrain library.
- Relaunched
Strawberry Shortcake with a comprehensive global franchise program,
including an exclusive digital-first debut of an original animated
series on Spark, the launch of a brand-new Roblox game, brand
collaborations with Sunkist and others, publishing from Penguin
Random House and all-new toys set to roll out worldwide with Moose
Toys in 2022 and supported by WildBrain CPLG.
|
Maximizing the
Value of WildBrain Spark
|
- Spark revenue
increased 73% to $15.4 million in Q1 2022 vs $8.9 million in Q1
2021, reflecting ongoing recovery in advertising rates and our
focus on higher-value views.
- Enhanced
monetization of our large audience is driving growth in direct ad
sales, paid media and digital production. These nascent
revenues collectively increased by 128% in Q1 2022 vs Q1
2021.
- Subsequent to
quarter-end, Spark partnered with leading Roblox publisher, Gamefam
to provide exclusive direct-advertising services across Gamefam's
network globally. Gamefam titles are among the top 10 games
on Roblox — a platform where more than 20 million kids play games
daily. This partnership will give brands an opportunity to reach
kids through many of the most popular games on Roblox.
|
Deliver
Sustainable Growth
|
- Revenue increased
18% to $112.6 million in Q1 2022, compared to $95.5 million in Q1
2021.
- Adjusted EBITDA
increased 13% to $19.9 million in Q1 2022 vs $17.5 million in Q1
2021.
- We reaffirm our
expectations for Fiscal 2022 of achieving revenue in the range of
$480.0 million to $500.0 million and adjusted EBITDA between $87.0
million to $93.0 million.
|
Q1 2022 Financial Highlights
Financial
Highlights1
(in millions of
Cdn$)
|
Three Months
ended
September
30,
|
2021
|
2020
|
Revenue
|
$112.6
|
$95.5
|
Gross
Margin
|
$51.5
|
$43.3
|
Gross Margin
(%)
|
46%
|
45%
|
Adjusted EBITDA
attributable to WildBrain
|
$19.9
|
$17.5
|
Net Income (Loss)
attributable to WildBrain
|
$(21.4)
|
$(3.3)
|
Basic earnings (Loss)
per Share
|
$(0.12)
|
$(0.02)
|
Cash (Used In)
Provided by Operating Activities
|
$(11.4)
|
$19.6
|
Free Cash
Flow
|
$(19.9)
|
$(2.7)
|
In Q1 2022, revenue grew 18% to $112.6
million, compared with $95.5
million in the prior year, reflecting growth at Spark and
strong Consumer Products performance.
Content Production and Distribution revenue increased 3% to
$37.6 million in Q1 2022 vs
$36.3 million in Q1 2021, driven by
higher production revenues from premium projects including Sonic
Prime and multiple new series and family specials for
Peanuts.
Q1 2022 revenue at Spark increased 73% to $15.4 million vs $8.9
million in Q1 2021, as advertising rates continued to
recover and reflecting higher-value views. This was also
evident in other nascent AVOD revenues increasing 128% in Q1 2022
vs Q1 2021 through the value adds we bring to our IP partners in
direct advertising sales, paid media, data insights and digital
production.
Higher revenues at Spark in the current quarter reflect our
focus on building higher-quality viewership, driven by premium
content where we own the IP or share in consumer products.
Spark continued to attract a widely engaged audience, with 8.1
billion views across 50.1 billion minutes of video watched on our
network in Q1 2022. This compared to 10.7 billion views and
64.2 billion minutes in watch time in Q1 2021 as consumption
patterns normalize from last year's peak viewership during COVID-19
lockdowns. These metrics continued to improve sequentially into Q2
2022 with views and watch time up 27% and 36% respectively since
hitting a trough in April
20212. During this same period, advertising
rates, on average, have increased 120% since April 20211. Kids continued to
watch longer on Spark, averaging 6-minutes and 10-seconds per view,
up from 5-minutes and 59-seconds in Q1 2021.
Consumer Products revenue grew 25% to $48.5 million in Q1 2022, compared with
$38.8 million in Q1 2021. Higher
revenue in Q1 2022 was due to the strength of the Peanuts brand,
supported by a consistent output of new content, which will
continue over the coming years to drive consumer products globally.
We also benefited from continued growth at our licensing agency,
WildBrain CPLG, arising from synergies in representing Peanuts
across Europe and the Middle East, as well as expanding
representation of third-party partner IP and increasing new deal
volumes.
Q1 2022 Gross Margin was 46% vs 45% in Q1 2021, due to higher
revenue in the quarter stemming from a slate of higher-margin
premium productions, return to growth at Spark and a strong
Consumer Products business.
Cash used in operating activities in Q1 2022 was $11.4 million, compared to $19.6 million provided by operating activities in
Q1 2021. Free Cash Flow for Q1 2022 was negative $19.9 million, compared with negative Free Cash
Flow of $2.7 million in Q1 2021,
primarily due to increased accounts receivables arising from larger
deals concluded in the quarter and timing of working capital
settlements. These included higher third-party participations
due to higher distribution and consumer products revenue, the final
payment of $2.9 million in tangible
benefit obligations related to our broadcast channels and
$8.8 million in accounts receivables
from production, which were received after quarter-end.
Adjusted EBITDA increased 13% to $19.9
million in Q1 2022, compared with $17.5 million in Q1 2021, driven by higher gross
margin, offset by investments in growth initiatives and higher
distribution to non-controlling interests.
Q1 2022 net loss was $21.4 million
vs net loss of $3.3 million in Q1
2021, primarily due to a non-cash, foreign exchange loss of
$13.0 million in the current
quarter vs a foreign exchange gain of $5.1
million in the prior year quarter.
- Free Cash Flow, Gross Margin, Adjusted
EBITDA and Adjusted EBITDA attributable to WildBrain are non-GAAP
financial measures. Free Cash Flow is defined as operating cash
flow less distributions to non-controlling interests, changes in
interim production financing, cash interest paid on our long-term
debt, bank indebtedness and lease liabilities and principal
repayments on our lease liabilities. Gross Margin means revenue
less direct production costs and expense of film and television
programs produced (per the financial statements). Adjusted EBITDA
represents income of the Company before amortization, finance
income (expense), taxes, reorganization and development expenses,
impairments, equity-settled share-based compensation expense, and
adjustments for other identified charges. Adjusted EBITDA
attributable to WildBrain means Adjusted EBITDA excluding the
portion of Adjusted EBITDA attributable to non-controlling
interests. Further details on the definitions of and reconciliation
to Free Cash Flow, Gross Margin, Adjusted EBITDA and Adjusted
EBITDA attributable to WildBrain can be found in the "Non-GAAP
Financial Measures" section of the Company's Q1 2022 Management
Discussion and Analysis ("MD&A").
- Growth in views and watch time from April
2021 to October 2021.
|
Q1 2022 Conference Call
The Company will hold a conference call on November 10, 2021 at 10:00
a.m. ET to discuss the results.
To listen, call +1 (800) 430-8332 toll-free or +1 (647) 792-1241
internationally and reference conference ID 9959611. Please allow
10 minutes to be connected to the conference call. Replay
will be available after the call on +1 (888) 203-1112 toll free or
+1 (647) 436-0148, under passcode 9959611, until November 17, 2021.
The audio and transcript will also be archived on our website
approximately two days after the event.
About WildBrain
At WildBrain we inspire imaginations to run wild, engaging kids
and families everywhere with great content across all media. With
approximately 13,000 half-hours of filmed entertainment in our
library – one of the world's most extensive – we are home to such
brands as Peanuts, Teletubbies, Strawberry Shortcake, Yo Gabba Gabba! Caillou, Inspector Gadget,
Johnny Test and Degrassi. At our
75,000-square-foot state-of-the-art animation studio in
Vancouver, BC, we produce such
fan-favourite series as The Snoopy Show, Snoopy in Space, Chip
& Potato, Carmen Sandiego, Go,
Dog. Go! and more. Our shows are enjoyed worldwide in more than
150 countries on over 500 streaming platforms and telecasters, and
our AVOD business – WildBrain Spark – offers one of the largest
networks of kids' channels on YouTube, garnering billions of views
per month from over 245 million subscribers. Through our leading
agency, WildBrain CPLG, we also license consumer products and
location-based entertainment in every major territory for our own
properties as well as for our clients and content partners. Our
television group owns and operates four family entertainment
channels that are among the most viewed in Canada. WildBrain is headquartered in
Canada with offices worldwide and
trades on the Toronto Stock Exchange (TSX: WILD). Please visit us
at www.wildbrain.com.
Forward-Looking Statements
This press release
contains "forward looking statements" under applicable securities
laws with respect to WildBrain including, without limitation,
statements regarding the growth strategy of WildBrain, WildBrain's
production pipeline and projects in development, WildBrain's brand
strategies (including its plans for developing and monetizing
Peanuts, Strawberry Shortcake and other franchises), the activation
of WildBrain's IP and the results and benefits therefrom,
WildBrain's direct ad sales business, the value of WildBrain's
assets, leverage ratio and cash flow forecasts, use of capital for
investments and other growth opportunities and expected returns
therefrom, improved monetization of WildBrain Spark and expansion
to additional platforms, the business strategies and operational
activities of WildBrain, the markets and industries in which
WildBrain operates, and the growth and future financial and
operating performance of WildBrain. Although WildBrain believes
that the expectations reflected in such forward looking statements
are reasonable, such statements involve risks and uncertainties and
are based on information currently available to WildBrain. Actual
results or events may differ materially from those expressed or
implied by such forward looking statements. These forward looking
statements are made as of the date hereof, and WildBrain assumes no
obligation to update or revise them to reflect new events or
circumstances, except as required by law.
Forward-looking statements are based on factors and assumptions
that management believes are reasonable at the time they are made,
but a number of assumptions may prove to be incorrect, including,
but not limited to, assumptions about (i) WildBrain's future
operating results, (ii) the expected pace of expansion of
WildBrain's operations, (iii) future general economic and market
conditions, including debt and equity capital markets and the
availability of financing on acceptable terms, (iv) the impact of
increasing competition on WildBrain, (v) changes in the industries
and changes in laws and regulations related to the industries in
which WildBrain operates, (vi) consumer and consumer preferences,
(vii) the ability of WildBrain to execute on acquisition and other
growth strategies and opportunities and realize the expected
benefits therefrom, (viii) the ability of WildBrain to execute on
production, distribution and licensing arrangements, (ix) the
availability of investment opportunities at acceptable valuations
and the ability of WildBrain to execute on such investment
opportunities, * the timing for commencement and completion of
productions, (xi) the ability of WildBrain and its partners to
execute on its brand plans and consumer products programs, (xii)
changes in the markets and industries in which the WildBrain
operates and the ability of WildBrain to adapt to such changes,
(xiii) changes to YouTube and in advertising markets, (xiv) the
ability of WildBrain to commercialize consumer products related to
its brands, and (xv) changes in foreign exchange and interest
rates.
Forward-looking statements are inherently subject to risks and
uncertainties that may be general or specific and which give rise
to the possibility that expectations, forecasts, predictions,
projections or conclusions will not prove to be accurate, that
assumptions may not be correct and that objectives, strategic goals
and priorities will not be achieved. Known and unknown risk
factors, many of which are beyond the control of the Company, could
cause actual results to differ materially from the forward-looking
statements in this press release. Factors that could cause actual
results or events to differ materially from current expectations
include, among other things, the current outbreak of COVID-19 and
the magnitude and length of economic disruption as a result of such
outbreak, market factors, WildBrain's ability to close and execute
on anticipated production, distribution, licensing and other
contracts, the ability of WildBrain to realize the expected value
of its assets, and other factors discussed in materials filed with
applicable securities regulatory authorities from time to time
including matters discussed under "Risk Factors" in WildBrain's
most recent Annual Information Form and Management Discussion and
Analysis filed with the securities regulatory authorities in
Canada and available under the
Company's profile on SEDAR (www.sedar.com).
Non-IFRS Measures
In this press release, WildBrain
uses certain non-IFRS financial measures, including "Free Cash
Flow", "Gross Margin", "Adjusted EBITDA", and "Adjusted EBITDA
attributable to WildBrain", to measure, compare and explain
WildBrain's operating results and financial performance. These
measures and other non-IFRS measures are commonly used by entities
in WildBrain's industry as useful metrics for measuring
performance. However, they do not have any standardized meaning
prescribed by IFRS and are not necessarily comparable to similar
measures presented by other publicly traded entities. These
measures should be considered as supplemental in nature and not as
a substitute for related financial information prepared in
accordance with IFRS. For further details on these non-IFRS
measures, including relevant definitions and reconciliations, see
"Non-GAAP Measures" in WildBrain's most recent MD&A.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/wildbrain-reports-q1-2022-results-301420459.html
SOURCE WildBrain Ltd.