Trading Update
12 Oktober 2009 - 4:15PM
UK Regulatory
TIDMIFC
RNS Number : 6299A
Indian Film Company Limited (The)
12 October 2009
Press Release12 October 2009
The Indian Film Company Limited
("IFC" or the "Company")
Trading Update
The Indian Film Company Limited (AIM: IFC), the leading Bollywood film
investment company today provides shareholders with the following trading
update.
Current projects
During the six month period ended 30 September 2009, IFC released three films:
'Shortkut - The Con is On', 'Luck' and 'Life Partner'.
* Based on revenues generated to date, the Directors believe that although
'Shortkut the Con is On' is initially likely to make a loss, it is expected to
break even over the term of its licence, though at this stage there can be no
certainty that this would be the case.
* As was announced on 14 August 2009, the Directors believe that the film 'Luck'
will be a loss making investment for the Company, based on the level of revenues
generated to date.
* 'Life Partner' has performed better than the other two films and based on the
revenues generated to date, the Directors anticipate that the investment in this
film can be expected to generate positive returns over the term of its licence.
Each year, as part of the annual slate of releases, the Company invests in a few
cornerstone projects. However, the Directors believe that the terms quoted for
the projects evaluated by the Company this year have not been commercially
viable and as a result, to date, IFC has not acquired any corner stone projects
for its film portfolio, which has also impacted the number of films the Company
expects to release during the current financial year.
The Company regularly monitors the film release schedule to ensure releases are
timed to have the best possible chance of maximising returns. IFC decided to
postpone the release of its film 'Fruit 'n' Nut', which was originally set for
release in September 2009, as a number of films were being released by other
producers during that month. 'Fruit 'n' Nut' is now expected to be released on
23 October 2009.
Trading environment and impact on profits
The disagreement on the revenue sharing model between the United Producers and
Distributors Forum ("UPDF") and the key national multiplex cinema chains in
India ("Multiplex") had an adverse impact on the Company's trading activities.
As announced on 9 June 2009, the two month long negotiations with the Multiplex
owners resulted in improved revenue sharing terms for the producers and
distributors. However, the prolonged negotiations in reaching an agreement on
the revenue sharing terms resulted in a two month delay in the planned film
release schedule resulting in a loss of theatrical revenues for that period.
Additionally, the challenging economic environment has continued to put pressure
on the advertising spend of broadcasters globally, which has also impacted the
revenues from the sale of satellite rights.
As a result of the impact of the global economic downturn, delayed film releases
due to the dispute between the UPDF and Multiplex owners, coupled with weak
performances of the films released to date, the Company is not expected to
report a profit for the six months ended 30 September 2009.
Outlook
The Directors believe that the recent signs of an upturn in the economy will
have a positive impact on the financial performance of the Company.
IFC is committed to creating, acquiring and distributing quality content and the
Directors firmly believe that by increasing the Company's focus on the multiple
revenue streams approach, better shareholder returns can be expected to be
delivered.
The Company expects to release five films in the second half of the current
financial year:
Fruit 'n' Nut - October 2009
Banda Yeh Bindaas Hai - December 2009
Kaun Bola - January 2010
Striker - February 2010
Ishq Unplugged - February/March 2010
The Company will keep the market updated for any further developments.
+----------------------------------------------------------------------------+--+
| For further information, please | |
| contact: | |
| The Indian Film Company Limited | |
| www.theindianfilmcompany.com | |
| Sandeep Bhargava Tel: +91 22 6629 1723 | |
| Grant Thornton Corporate Finance | |
| (Nominated Adviser) | |
| Fiona Owen Tel: +44 20 7383 5100 | |
| Elara Capital plc (Broker) | |
| Raj Bhatt/Mary Phelan Tel: +44 20 7486 9733 | |
| Oriel Securities Limited (Broker) | |
| Natalie Fortescue/Daniel Conti Tel: +44 20 7710 7600 | |
| Pelham Public Relations | |
| Alex Walters/Francesca Tuckett Tel: +44 20 7337 1500 | |
| | |
+----------------------------------------------------------------------------+--+
| | |
+----------------------------------------------------------------------------+--+
Notes to Editors
The Indian Film Company (the 'Company') is a specialist film investment company
which was admitted to trading on the AIM market in June 2007 and raised GBP 55
million in order to invest in a diverse portfolio of Indian films targeted at
the Indian audiences across varying genre, language and budgets. The Company is
managed by Film Investment Managers (Mauritius) Ltd., which is jointly and
equally owned by Viacom Inc. and BK Media Mauritius PVT. BK Media Mauritius PVT
is owned by Raghav Bahl, the founder and controlling shareholder of Network 18.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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