Film rights distributor sees 80% dip in profits

A LIMERICK-based TV, video and film rights distributor had an 80% drop in pre-tax profits last year in spite of increasing revenues by 22% to $32.9 million (€22.7m).

According to accounts filed by Nelvana International Ltd, the company’s pre-tax profits decreased from $5.48m to $1.1m in the 12 months to the end of August last.

According to the directors’ report, the Canadian-owned company — located in Limerick’s National Technology Park — expects the general level of activity to continue for the foreseeable future.

The chief factor behind the drop in profits last year was the last increase in the non-cash amortisation charge, increasing from $2.2m in 2009 to $7m.

The directors explain the amortisation charge relates to film intangibles, stating that amortisation is calculated based on the future projected revenues that vary title by title.

The report states: “Merchandising revenue increased due to the increased popularity of the Bakugan brand and the relaunch of the Beyblade brand. Merchandising properties are normally cyclical in nature and dependent on the latest trends.”

The directors state that the company purchased new properties which will contribute to revenue into the future.

The figures show that the company’s operating profit was $1.35m compared to $5.8m in 2010.

The figures show that the company employed seven people last year with aggregate payroll costs of $453,330.