Boat Rocker Media Reports Second Quarter 2024 Financial Results
Total cash of
Selected Financial Highlights3
- On
June 28, 2024 , Boat Rocker announced the close of the sale of its 51% interest inUntitled Entertainment LLC ("Untitled") toTPG Group, LLC ("TPG"). The Company received gross cash proceeds of$52.1 million , net equity with a fair value of$11.3 million , and recognized an after-tax gain of$50.3 million from the sale. - Untitled comprised the majority of Boat Rocker's Representation reporting segment, and is reported as a discontinued operation in accordance with IFRS 5, Non-current assets held for sale and discontinued operations ("IFRS 5"). Accordingly, Untitled's financial performance has been classified as discontinued operations.
- Q2 Adjusted EBITDA1 of
$2.6 million versus$5.4 million in Q2 2023, a decrease of$2.9 million . Year-to-date Adjusted EBITDA1 increased by$2.1 million or 58.2% to$5.8 million compared to$3.7 million in the prior year comparative period. - Net income of
$41.9 million in Q2, which includes the gain on the sale of Untitled, versus a net loss of$5.8 million in Q2 2023, an increase of$47.7 million . Year-to-date net income of$39.4 million versus a loss of$15.3 million in the comparative year period, an increase of$54.7 million or 357.6% - Q2 revenue of
$47.5 million versus$120.9 million in Q2 2023, a decrease of 60.7%. Year-to-date revenue of$90.5 million decreased$100.6 million or 52.6% compared to$191.1 million in the prior year period. - Debt-free2 with total cash at
June 30, 2024 of$123.7 million , including$77.6 million of Cash Available for Use1.
______________________________ |
1 This is a Non-IFRS measure. For more information on non-IFRS financial measures, see "Non-IFRS Measures" and "Reconciliation of Non-IFRS Measures" below and see "Non-IFRS Financial Measures" in the MD&A for the three and six months ended |
2 The Company currently has no corporate term debt, only interim production financing (including through two borrowing base facilities) in the ordinary course of operations. |
3 Selected Financial Highlights include net income (loss) and Adjusted EBITDA* from both continuing and discontinued operations. Revenue excludes amounts from |
Corporate Updates
Agreement to Purchase Non-Controlling Interest in
Pursuant to the
Normal Course Issuer Bid
The Board of Directors has approved Boat Rocker filing with the
Statement on Q2 2024 from
"Despite the media and entertainment industry continuing to face headwinds, our performance this quarter demonstrates solid deliveries from our Canadian unscripted business and a significant increase in cash reserves due largely to the recent sale of
Selected Content Highlights
Television
Scripted
-
Palm Royale, starring
Kristen Wiig ,Ricky Martin , withLaura Dern ,Allison Janney , and extra special guest starCarol Burnett , received 11 Primetime Emmy nominations. -
Orphan Black: Echoes, starring
Krysten Ritter andKeeley Hawes premiered on AMC, AMC+, and BBC America onJune 23rd . - Partnered with
Don Cheadle's production company, This Radical Act, to develop a scripted television adaptation of Mindset, an acclaimed science fiction mystery from Vault Comics.
Unscripted
- Season 10 of The Amazing
Race Canada premiered on CTV, CTV.ca, and the CTV app onJuly 2nd . -
War Game began a theatrical run on
August 2nd through Submarine Deluxe and will be available on Video on Demand in fall through Decal Releasing. -
Downey's Dream Cars, starring
Robert Downey Jr ., won a Daytime Emmy Award in the Lifestyle Program category. - Season 3 of Dark Side of the '90s premiered
July 16th on VICE TV. -
Taken Together: Who Killed Lyric and Elizabeth? premiered on Max on
August 8th .
Kids and Family
-
No Time to Spy: A Loud House Movie premiered on Nickelodeon and Paramount+ on
June 21st in theU.S. and on YTV onJune 22nd inCanada . - 2D animated series Exploding Kittens premiered
July 12th on Netflix.
Selected Financial Information4
(Amounts in thousands CAD) |
Three months ended |
|||
|
2024 |
|
2023 |
% change |
Revenue |
|
|
|
|
Television |
36,444 |
|
102,232 |
(64) % |
Kids and Family |
11,044 |
|
18,662 |
(41) % |
Total revenue |
47,488 |
|
120,894 |
(61) % |
|
|
|
|
|
Net income (loss) |
41,888 |
|
(5,819) |
820 % |
Adjusted EBITDA* |
2,570 |
|
5,438 |
(53) % |
(Amounts in thousands CAD) |
Six months ended |
|||
|
2024 |
|
2023 |
% change |
Revenue |
|
|
|
|
Television |
66,877 |
|
156,770 |
(57) % |
Kids and Family |
23,669 |
|
34,333 |
(31) % |
Total revenue |
90,546 |
|
191,103 |
(53) % |
|
|
|
|
|
Net income (loss) |
39,402 |
|
(15,293) |
358 % |
Adjusted EBITDA* |
5,800 |
|
3,667 |
58 % |
|
*This is a Non-IFRS measure. For more information on non-IFRS financial measures, see "Non-IFRS Measures" and "Reconciliation of Non-IFRS Measures" below and see "Non-IFRS Financial Measures" in the MD&A for the three and six months ended |
______________________________ |
4 Selected Financial Information in the tables above include net income (loss) and Adjusted EBITDA* from both continuing and discontinued operations. Total revenue excludes amounts from |
Financial Review5
Revenue for the three months ended
Adjusted EBITDA* for the three months ended
Net income for the three months ended
Total cash at
(Amounts in thousands CAD) |
|
|
|
|
$ change |
|
% change |
Cash Available for Use* |
$ 77,649 |
|
$ 37,048 |
|
$ 40,601 |
|
110 % |
Cash Required for Use in Productions* |
46,067 |
|
35,493 |
|
10,574 |
|
30 % |
Total cash |
$ 123,716 |
|
$ 72,541 |
|
$ 51,175 |
|
71 % |
*This is a Non-IFRS measure. For more information on non-IFRS financial measures, see "Non-IFRS Measures" and "Reconciliation of Non-IFRS Measures" below and see "Non-IFRS Financial Measures" in the MD&A for the three and six months ended |
_________________________________ |
5 Financial information included in this section for all periods presented refers to net income (loss) and Adjusted EBITDA* from both continuing and discontinued operations. Revenue excludes amounts from |
Outlook
Boat Rocker reaffirms its expectation for Full Year 2024 Adjusted EBITDA* to be approximately
Boat Rocker also intends, where possible, to deploy capital to repurchase its subordinate voting shares pursuant to its NCIB which expires on
In light of the continuing industry wide slowdown in new content commissions, renewals, production, and paid development orders, Boat Rocker intends to pro-actively reduce costs to deliver savings in the current year and seek to set up the Company for long term success.
The Company's expected future performance is based on certain assumptions that are outlined in the Company's annual MD&A and MD&A dated
*This is a Non-IFRS measure. For more information on non-IFRS financial measures, see "Non-IFRS Measures" and "Reconciliation of Non-IFRS Measures" below and see "Non-IFRS Financial Measures" in the MD&A for the three and six months ended |
|
**The Company currently has no corporate term debt, only interim production financing (including through two borrowing base facilities) in the ordinary course of operations. |
__________________________________________ |
6 Such approval cannot be assured |
Fiscal 2024 Second Quarter Conference Call
Boat Rocker management will host a conference call to discuss its fiscal second quarter financial results at
The audio webcast can be accessed at https://app.webinar.net/1pJA3MWQXKy or on the Company's investor relations page at https://www.boatrocker.com/investor-relations/events-and-presentations/default.aspx
Or to participate by phone, dial 416-764-8650 (Local) or 888-664-6383 (North American Toll-Free).
Listeners should access the webcast or call 10-15 minutes before the start time to ensure they are connected.
To access a replay of the call, dial 416-764-8677 (Local) or 1-888-390-0541 (North American Toll-Free), Access Code 715491#. The replay will be available until midnight (EDT) on
About Boat Rocker
Boat Rocker (TSX: BRMI) is the home for creative visionaries. An independent, integrated global entertainment company, Boat Rocker's purpose is to tell stories and build iconic brands across all genres and mediums. With offices around the world, Boat Rocker's creative and commercial capabilities include Scripted, Unscripted, and Kids and Family television production, distribution, brand & franchise management, a world-class animation studio, and talent management through a minority stake in a new company launched by TPG. A selection of Boat Rocker's projects include: Invasion (Apple TV+), Palm Royale (Apple TV+), Orphan Black: Echoes (AMC), American Rust: Broken Justice (Prime Video), Beacon 23 (
Non-IFRS Measures
This press release makes reference to certain non-IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the Company's financial information reported under IFRS. The intent of using non-IFRS measures is to provide investors with supplemental measures of the Company's operating performance and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures, in addition to providing a greater understanding of the Company's liquidity position and available financial resources. The Company's management uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets, and to determine components of management compensation. The Company also believes that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers.
Definitions and reconciliations of non-IFRS measures to the relevant reported measures can be found in our MD&A. Such reconciliations can also be found in this press release under the heading Reconciliation of Non-IFRS Measures. The non-IFRS measures the Company uses include: EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Cash Available for Use, and Cash Required for Use in Productions.
EBITDA is defined as net income or loss before interest, taxes, depreciation, amortization of property and equipment, right-of-use assets and other intangible assets.
Adjusted EBITDA is defined as EBITDA before certain expenses, costs, charges or benefits incurred in the period which in management's view are not indicative of continuing or discontinued operations, including: amortization of non-cash program intangibles, change in fair value of other financial liabilities related to put options, certain other financial liabilities, convertible debt and contingent consideration, share-based compensation, professional and consulting fees relating to non-core operating activities, non-recoupable COVID-19 costs, goodwill impairment, reorganization costs, loss on debt modifications, gain on settlement of loans and borrowings, gain or loss on sale of assets, unrealized gains or losses on foreign exchange, unrealized gains or losses on forward currency contracts, and other costs not indicative of the Company's core operating results. Adjusted EBITDA is used by management as a measure of the Company's operating performance.
Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by revenue, expressed as a percentage.
Cash Available for Use is defined as the total cash of the Company less Cash Required for Use in Productions. Cash Available for Use funds ongoing working capital requirements, principal and interest payments on corporate debt (if any) as well as ongoing development and growth efforts and thus is an important liquidity measure that management uses to monitor the business on an ongoing basis.
Cash Required for Use in Productions is defined as cash required for the funding of productions in progress that is not considered by the Company to be available for other uses. The cash is not legally restricted and has not been classified as Restricted Cash on the consolidated statement of financial position. This cash has been provided by buyers and third-party IP owners that have engaged the Company to provide services, as well as banks with whom Boat Rocker has contracted to provide interim production financing. Management uses the amount of Cash Required for Use in Productions to determine the Company's Cash Available for Use.
Forward-Looking Statements
This press release may contain forward-looking information within the meaning of applicable securities laws, which reflects the Company's current expectations regarding future events. Forward-looking information is based on a number of assumptions, many of which are beyond the Company's control. Such assumptions include, but are not limited to, the factors discussed under "Outlook" in the Company's annual MD&A dated
RECONCILIATION OF NON-IFRS MEASURES
Reconciliation Tables
Reconciliation from Net Income (Loss) to Adjusted EBITDA*
The following table presents the reconciliation from net income (loss) from continuing operations to Adjusted EBITDA* for the three months ended
(Amounts in thousands CAD) |
|
Three Months Ended |
||||||
|
|
2024 |
|
2023 |
|
$ change |
|
% change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) from continuing operations |
|
$ (10,558) |
|
$ (5,725) |
|
$ (4,833) |
|
(84) % |
Amortization of property and equipment, right-of-use assets and other |
|
1,889 |
|
2,353 |
|
(464) |
|
(20) % |
Finance costs, net |
|
1,577 |
|
1,935 |
|
(358) |
|
(19) % |
Income tax expense |
|
1,453 |
|
1,267 |
|
186 |
|
(15) % |
EBITDA* from continuing operations |
|
$ (5,639) |
|
$ (170) |
|
$ (5,469) |
|
(3217) % |
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
Change in fair value of unsettled forward exchange contracts1 |
|
(72) |
|
(145) |
|
73 |
|
(50) % |
Change in fair value of other financial liabilities2 |
|
2,385 |
|
(39) |
|
2,424 |
|
(6215) % |
Unrealized (gains) losses on foreign exchange3 |
|
(58) |
|
1,100 |
|
(1,158) |
|
105 % |
Amortization of acquired program intangibles4 |
|
105 |
|
235 |
|
(130) |
|
55 % |
Transaction-related and other costs5 |
|
— |
|
40 |
|
(40) |
|
100 % |
Share-based compensation6 |
|
243 |
|
1,163 |
|
(920) |
|
79 % |
Reorganization costs7 |
|
612 |
|
311 |
|
301 |
|
(97) % |
Adjusted EBITDA* from continuing operations |
|
$ (2,424) |
|
$ 2,495 |
|
$ (4,919) |
|
(197) % |
Adjusted EBITDA* from discontinued operations8 |
|
4,993 |
|
2,943 |
|
$ 2,050 |
|
70 % |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA* |
|
$ 2,569 |
|
$ 5,438 |
|
$ (2,869) |
|
(53) % |
* This item is a non-IFRS measure. See "Non-IFRS Measures" section for further information. |
|
|
|
1 Change in fair value of the unrealized forward currency contracts. |
||
2 Change in fair value of other financial liabilities represents the non-cash accretion and changes in fair value on other liabilities. |
||
3 Movements in balances denominated in non-functional currencies not yet realized through settlement. |
||
4 Amortization of program intangibles acquired in business combinations included in production, distribution and service costs. |
||
5 Includes professional fees and other expenses related to transactions and special projects which are not related to or are not reflective of regular business operations. |
||
6 Non-cash expenses associated with share-based compensation granted to certain officers, directors and employees. |
||
7 Restructuring charges primarily related to personnel costs. |
||
8 Represents net income from discontinued operations adjusted for i) in the three months ended |
The following table presents the reconciliation from net income (loss) from continuing operations to Adjusted EBITDA* for the six months ended
(Amounts in thousands CAD) |
|
Six Months Ended |
||||||
|
|
2024 |
|
2023 |
|
$ change |
|
% change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) from continuing operations |
|
(15,477) |
|
(15,743) |
|
266 |
|
2 % |
Amortization of property and equipment, right-of-use assets and other |
|
3,915 |
|
4,687 |
|
(772) |
|
16 % |
Finance costs, net |
|
3,165 |
|
3,496 |
|
(331) |
|
9 % |
Income taxes |
|
1,406 |
|
1,106 |
|
300 |
|
(27) % |
EBITDA* from continuing operations |
|
(6,991) |
|
(6,454) |
|
(537) |
|
(8) % |
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
Change in fair value of unsettled forward exchange contracts9 |
|
129 |
|
(418) |
|
547 |
|
(131) % |
Change in fair value of other financial liabilities10 |
|
2,356 |
|
(63) |
|
2,419 |
|
(3840) % |
Unrealized (gains) losses on foreign exchange11 |
|
(257) |
|
1,378 |
|
(1,635) |
|
119 % |
Amortization of acquired program intangibles12 |
|
210 |
|
600 |
|
(390) |
|
65 % |
Transaction-related and other costs13 |
|
425 |
|
169 |
|
256 |
|
(151) % |
Loss on sale of assets14 |
|
48 |
|
— |
|
48 |
|
N/A |
Share-based compensation15 |
|
673 |
|
1,437 |
|
(764) |
|
53 % |
Reorganization costs16 |
|
1,334 |
|
548 |
|
786 |
|
(143) % |
Adjusted EBITDA* from continuing operations |
|
$ (2,073) |
|
$ (2,803) |
|
$ 730 |
|
26 % |
Adjusted EBITDA* from discontinued operations17 |
|
7,873 |
|
6,470 |
|
1,403 |
|
22 % |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA* |
|
$ 5,800 |
|
$ 3,667 |
|
$ 2,133 |
|
58 % |
* See "Non-IFRS Measures" |
______________________________ |
9 Change in fair value of the unrealized forward currency contracts. |
10 Change in fair value of other financial liabilities represents the non-cash accretion and changes in fair value on other liabilities. |
11 Movements in balances denominated in non-functional currencies not yet realized through settlement. |
12 Amortization of program intangibles acquired in business combinations included in production, distribution and service costs. |
13 Includes professional fees and other expenses related to transactions and special projects which are not related to or are not reflective of regular business operations; comparative period amounts include incremental non-recoupable production costs specifically incurred due to COVID-19. |
14 Loss on sale of equity investment. |
15 Non-cash expenses associated with share-based compensation granted to certain officers, directors and employees. |
16 Restructuring charges primarily related to personnel costs. |
17 Represents net income from discontinued operations adjusted for i) in the six months ended |
SOURCE