Entertainment One Ltd – Full Year Results

ENTERTAINMENT ONE LTD. (eOne)

FULL YEAR RESULTS

FOR THE YEAR ENDED 31 MARCH 2018

STRONG UNDERLYING EBITDA PERFORMANCE

FINANCIAL HIGHLIGHTS

·	Group reported revenue at £1,045 million (2017: £1,083 million), with strong growth in Family & Brands and Television offset by lower performance in Film
·	Group reported underlying EBITDA up 11% at £177 million (2017: £160 million), driven by revenue growth in Family & Brands and Television and lower costs in Film
·	Group reported profit before tax up 116% at £78 million (2017: £36 million), Group adjusted profit before tax up 11% at £144 million (2017: £130 million)
·	Adjusted diluted earnings per share up 10% at 21.9 pence per share (2017: 20.0 pence per share)
·	Net debt leverage at 1.8x which is less than 2.0x as previously guided
·	Full year dividend of 1.4 pence per share (2017: 1.3 pence)

OPERATIONAL HIGHLIGHTS

·	Family & Brands generated US$2.4 billion in retail sales in the year, an increase of 60%, driven by rapid success of PJ Masks and the ongoing success of Peppa Pig
·	Television revenue 19% higher driven by the strong production slate
·	Reshaping of the Film distribution business from physical to digital, which began in FY16, has delivered the expected annualised cost savings of £10 million
·	Mark Gordon appointed as Chief Content Officer, Film, Television and Digital Division, bringing him and his team in-house to help drive both Film and Television content strategy and enhancing eOne's ability to attract creative talent and partners
·	On-going integration of Film, Television and Digital, including integration of The Mark Gordon Company (MGC), which is expected to generate £13-15 million of annualised cost savings by FY20
·	Independent library valuation of US$1.7 billion at 31 March 2017 (31 March 2016: US$1.5 billion) which does not include the value of any content produced or acquired since 1 April 2017
·	On-track to double the size of the business over the five years to FY20, including the impact of IFRS 15

ALLAN LEIGHTON, CHAIRMAN, COMMENTED:

“Entertainment One has delivered another year of double-digit growth in profits and earnings. This has been accomplished against the backdrop of continued change across the content industries and the evolution of the Group to fully align itself with its creative partners and customers. As we look forward to another year of continued performance, the Board is pleased to increase the dividend for the year to 1.4 pence per share, in line with the Group's progressive dividend policy.”

DARREN THROOP, CHIEF EXECUTIVE OFFICER, COMMENTED:

“It has been a strong year for the Group, as we combined our Film and Television operations into the Film, Television and Digital Division for FY19, completed the acquisition of the remaining stake in The Mark Gordon Company and continued the reshaping of our Film business. All of these initiatives sharpen our operational focus and facilitate success in today's evolving entertainment market.

The Family & Brands business goes from strength to strength, ahead of our expectations. Peppa Pig continues to engage and delight children in important markets such as the UK, the US and China, where we have just started to implement our licensing programme. We also started the global roll out of PJ Masks to consumer markets, where traction has been both immediate and strong.

In Television, our active pipeline delivered a number of new and recommissioned series across our scripted drama and unscripted reality slates. The completion of the MGC acquisition and the appointment of Mark Gordon as Chief Content Officer is an exciting milestone as he brings his proven skills, experience and talent relationships to bear on our current development pipeline to drive our creative direction.

The reshaping of the Film businesses is progressing well as we focus increasingly on our production activities with important partners such as Steven Spielberg and Brad Weston. This transition will enable us to improve the return on investment in film content and at the same time reduce risks across the business.

As ever, content is at the heart of everything we do. The value of our content library has grown once again as we add new, high quality shows and brands to our portfolio and our view remains that the best quality content will endure, even in a constantly-evolving entertainment market. Entertainment One is at the heart of this market and I remain confident that we will achieve our target of doubling the size of the business in the five years to FY20 and continue to deliver value to our shareholders.”
 

FINANCIAL SUMMARY 

 

 

	Reported
£m	2018	2017	Change
Revenue	1,044.5	1,082.7	(4%)
Underlying EBITDA ¹	177.3	160.2	11%
Net cash from operating activities	14.9	34.0	(56%)
Investment in acquired content and productions ²	440.8	407.9	8%

 

 

	Reported				Adjusted
£m	2018	2017?	Change		2018	2017	Change
Profit before tax ³	77.6	35.9	116%		144.4	129.9	11%
Diluted earnings per share (pence) ³	14.4	2.7	11.7		21.9	20.0	1.9

 

1. Underlying EBITDA is operating profit or loss excluding amortisation of acquired intangibles; depreciation; amortisation of software; share-based payment charge; tax, finance costs and depreciation related to joint ventures; and operating one-off items. Underlying EBITDA is reconciled to operating profit in the Other Financial Information section of this Results Announcement.

2. Investment in acquired content and productions is the sum of “investment in productions, net of grants received” and “investment in acquired content rights”, as shown in the consolidated cash flow statement.

3. Adjusted profit before tax and adjusted diluted earnings per share are the reported measures excluding amortisation of acquired intangibles; share-based payment charge; tax, finance costs and depreciation related to joint ventures; operating one-off items; finance one-off items; and, in the case of adjusted diluted earnings per share, one-off tax items. Refer to the Other Financial Information section of this Results Announcement for a reconciliation of adjusted profit before tax and Note 11 of the consolidated financial statements for the adjusted diluted earnings per share reconciliation.

4. Reported 2017 amounts have been restated, refer to Note 1 of the consolidated financial statements for further details.

 

Group reported revenue of £1,044.5 million (2017: £1,082.7 million) was 4% lower year-on-year and was positively impacted by strong growth in Family & Brands (56% higher) and Television (19% higher) offset by decline in Film due to the lower volume of releases in comparison to the prior year and the strength of the slate in FY17. On a constant currency basis (re-translating prior year reported financials at current year foreign exchange rates), Group revenue declined by 2% reflecting the net strengthening of the pound sterling against the Group's other operating currencies.

Group reported underlying EBITDA was 11% higher at £177.3 million (2017: £160.2 million), driven by strong growth in the high margin Family & Brands Division (48% higher) and Television (15% higher) offsetting a decline in Film (33% lower). The Family & Brands Division delivered financial performance ahead of expectations driven by significant growth in PJ Masks and the continued strong performance of Peppa Pig. Television Division underlying EBITDA was higher across eOne Television (18% higher), The Mark Gordon Company (12% higher) and Music (9% higher). Underlying EBITDA in Film declined by 33% reflecting the impact of lower revenue. The Film underlying EBITDA benefitted from gross margin improvement of 3.1pts due to lower amortisation and sales mix and cost savings arising from the divisional reshaping. On a constant currency basis, Group underlying EBITDA would have increased by 13%, reflecting the net strengthening of the pound sterling against the Group's other operating currencies.

Net cash from operating activities amounted to £14.9 million in comparison to £34.0 million in the prior year, driven by higher investment in acquired content and productions and timing of tax payments. This was partially offset by lower working capital outflows in comparison to prior year. Investment in productions was higher across all three segments which not only supports our current operations but also contributes to the value of our content library.

Adjusted profit before tax for the year was £144.4 million (2017: £129.9 million), due to the increase in underlying EBITDA, partly offset by increased interest costs. Reported profit before tax for the year was £77.6 million (2017: £35.9 million), impacted by lower one-off charges reflecting lower restructuring costs, partly offset by higher share-based compensation costs.

Adjusted diluted earnings per share were 21.9 pence (2017: 20.0 pence). On a reported basis, diluted earnings per share were 14.4 pence (2017: 2.7 pence) reflecting the higher reported profit before tax.

The Group adopted IFRS 15 Revenue from Contracts with Customers on 1 April 2018 on a fully retrospective basis and will present, within the 2019 financial statements, a restatement of the comparative periods. The most significant impact is to the Family Division where the recognition of minimum guarantees will now be spread over the consumption of the intellectual property as compared to recognition up front which is the current practice. The proforma impact of IFRS 15 to the current year is a reduction in Group revenue and Group underlying EBITDA of £15.5 million and £13.6 million, respectively. The expected impact to Group underlying EBITDA in FY19 is less than £2 million and the Company is still expected to double the size of the business over the five years to FY20 including the impact of IFRS 15. 

 

 

STRATEGY 

The content market today is characterised by consumers who are increasingly demanding freedom of choice. They want to watch what they like, when they like and where they like. With the exception of live sports, consumers now have less affinity to specific channels or networks and are increasingly focused on availability. The platforms that service this marketplace (which form eOne's core customer set) are focusing on creators who can provide them with the best content. This content is then used both to attract incremental audiences and to retain existing subscribers.

At eOne, we understand that in order to grow and prosper, the business needs to centre itself on building and growing a content portfolio of the very highest quality. We do this over a broad spread of entertainment formats, ranging from family brands, television shows, feature films and music.

Our strategy to achieve this is underpinned by three principles and successful execution enables us to forge long term partnerships with the very best content creators, monetise their content and share in the benefits:

Connect	We develop deep and lasting partnerships with the very best creative minds in our industries. We connect with this talent through our scale, track record and relationships with key customers in markets around the world
Create	Our partnerships with leading talent enable us to capture the content they create at an early stage. The creation process is enhanced as we bring our commercial experience to the development and production processes, with our ability to finance a key attraction for the creative community
Deliver	eOne uses its global footprint and extensive network of customer contacts across multiple platforms and formats to ensure that content is delivered and monetised as widely as possible. Our contacts touch all parts of the content value chain, from traditional formats like cinemas to the latest digital video platforms in developing markets like China

The execution of this strategy focuses on continuing to drive growth in revenue and underlying EBITDA within the Family & Brands and Television activities of the Group. In Film, we are continuing to transition the business away from content acquisition and more towards production activities, which over time will improve the returns on this business and reduce our risks further.

STRATEGIC PROGRESS

Over the last year, the Group has achieved strong progress against its strategic objectives:

·	Continued increase in the independent library valuation (as at 31 March 2017) from US$1.5 billion to US$1.7 billion, supported by the value of PJ Masks, which is starting to build as the brand rolls out internationally
·	The ongoing integration of the Film and Television Divisions to form a single, streamlined operating structure – Film, Television and Digital. Overall targeted annual savings from the integration of MGC and the creation of the Film, Television and Digital Division are estimated at £13-15 million by FY20
·	The acquisition of the remaining stake in The Mark Gordon Company. The transaction is earnings enhancing in the first full year of ownership and importantly brings Mark Gordon fully into the Group's management structure. He has been appointed Chief Content Officer and can now bring his proven skills, experience and talent relationships into the wider eOne Group
·	Ongoing transition of the Film business towards a production model gives the Group greater control of risk, improved access and control over global intellectual property rights and enhanced financial returns
·	Brad Weston is currently in production on the film A Million Little Pieces through Makeready, with a development pipeline covering both film and television content. This reflects an ongoing trend in the industry as talented content creators now work across both film and television, eroding the distinction between the two formats
·	Strong progress across our key brands such as Peppa Pig continues to delight and entertain children across all of our markets, including the UK and the US, and newly entered markets such as Japan and China, where we have started the licensing programme for the brand. PJ Masks continues to roll out globally across consumer markets, creating high levels of demand for consumer products
·	Family & Brands continues to develop new properties in its pipeline. It is currently working on eight projects at varying stages of market readiness, aimed at different segments of the pre-school demographic. This ensures a steady flow of internally-created properties with global appeal

 

FY19 OUTLOOK

The Divisional Operational and Financial Reviews below include further details on the Company's strategy and progress made during the financial year.

In summary:

Family & Brands is expected to generate strong revenue and EBITDA growth across the portfolio in FY19. Peppa Pig and PJ Masks will continue to be the main drivers, with close to 2,000 live licensing and merchandising contracts anticipated by the end of the financial year. An additional 117 episodes of Peppa Pig are currently in production with the original creators of the show, with delivery beginning in FY19 through to spring 2021.

In October 2017 the business entered into a global partnership with Merlin Entertainments, which has now opened in-park areas in its resort theme parks in Italy and Germany. Merlin expects its first standalone Peppa Pig attraction to open in China in 2018, with a second anticipated in 2019.

Underlying EBITDA margins will be somewhat lower in percentage terms as a result of the growth of PJ Masks as a proportion of total sales and continued increase in brand management costs which are necessary to facilitate growth and support brand longevity.

From 1 April 2018 the Company is combining the Film and Television Divisions into one reporting segment: Film, Television and Digital. This follows on from the combination of the operations. Therefore the 2019 outlook is provided for the new Division.

Film, Television and Digital is well positioned for growth in FY19 in a landscape where premium original content is in demand more than ever before. The Division will continue to focus on early access to high quality premium content of all types by continuing to build deep partnerships with high quality creators.

In FY19, we anticipate 140 film releases, in total across all territories, of which 80 are expected to be unique titles. Investment in acquired content is expected to be lower at approximately £100 million. Investment in film production is expected to be higher than the current year at around £70 million reflecting the strategic shift towards content production.

The number of half hours of TV programming expected to be acquired/produced next year is expected to be over 1,000, with around 40% of the new financial year's budgeted margins already committed or greenlit. The Company currently has more than 30 scripted series set up with global platforms and broadcasters in the US, Canada and the UK, in various stages of development and a further 10 series expected to go to market in the next few months. Investment in acquired content is expected to be over £45 million and production spend is anticipated to be £309 million.

The integration of the Film, Television and Digital operations is ongoing with a number of opportunities identified to drive business efficiencies and centralisation of internal support functions from the combined operations. In addition, as part of the acquisition of the balance of The Mark Gordon Company completed in March 2018, MGC will be fully integrated into eOne. Overall annual cost savings are expected of approximately £13-15 million by FY20. Approximately half of these savings are expected to be realised in FY19.

 

 

DIVISIONAL OPERATIONAL & FINANCIAL REVIEW

The Divisional tables below are presented gross of inter-segment eliminations. For further information refer to Note 2 in the consolidated financial statements.

FAMILY & BRANDS

The Family & Brands business develops, produces and distributes a portfolio of children's television properties on a worldwide basis, its principal brands being Peppa Pig and PJ Masks, with much of its revenue generated through licensing and merchandising programmes across multiple retail categories.

 

£m	2018	2017	Change
Revenue	138.6	88.6	56%
Underlying EBITDA	82.3	55.6	48%
Investment in acquired content and productions	9.6	5.1	88%

 

Revenue for the year was up 56% to £138.6 million (2017: £88.6 million), driven by the continued strong performance of Peppa Pig and significant growth from PJ Masks which was ahead of management expectations.

Underlying EBITDA increased 48% to £82.3 million (2017: £55.6 million), driven by increased revenue. The underlying EBITDA margin was 3.4pts lower reflecting the changing revenue mix from different properties and increased infrastructure and brand management costs which were necessary to facilitate further growth.

Investment in acquired content and productions of £9.6 million (2017: £5.1 million) was £4.5 million higher than the prior year. Investment spend in the year included season five of Peppa Pig, season two of PJ Masks and new properties Cupcake & Dino: General Services and Ricky Zoom.

The Family & Brands business continued to perform strongly with the ongoing success of Peppa Pig and rapid growth of PJ Masks. The business generated US$2.4 billion of retail sales in the year (2017: US$1.5 billion) largely driven by the successful retail rollout of PJ Masksand continued growth of Peppa Pig. More than 1,000 new and renewed broadcast and licensing agreements were concluded in the year, an increase of 25% year-on-year. At 31 March 2018, the business had almost 1,500 live licensing and merchandising contracts across its portfolio of brands (2017: almost 1,100).

Peppa Pig has continued to grow with retail sales of US$1.3 billion (2017: US$1.2 billion) and revenue of £84.7 million (2017: £70.0 million), an increase of 21% or £14.7 million. Year-on-year growth was driven by continued strong performance across all revenue streams, including continued growth in mature markets and emerging markets such as the UK and China, respectively. Over 40 million books have been sold in China since Peppa Pig's launch in April 2016 demonstrating the strength of the brand in this territory. There are now 43 live licensing agreements in China (2017: 22) across all key licensing categories. Performance has been bolstered by significant broadcast exposure from state owned CCTV and all major VOD platforms in the region, including Tencent, iQiYi and Youku, with over 60 billion VOD views since launch in October 2015 in China, across all platforms. In addition, Peppa Pig was launched on TV Tokyo in Japan in October 2017 and Disney Junior in January 2018. Master licensing partner for the country, Sega Toys, recently hosted an exclusive retail event in spring 2018 which will be followed by a nationwide retail rollout in June 2018. The US continues to be a key market for Peppa Pig. New episodes premiered in FY18 and the show transferred to the main Nickelodeon channel where it has been a ratings success, driving strong licensing and merchandising revenues.

PJ Masks has been a key driver of revenue growth for the business in the year with total retail sales of US$1.0 billion (2017: US$0.3 billion) and revenue increasing 261% from £13.5 million to £48.8 million. Similar to Peppa Pig, licensing and merchandising sales continue to be a fundamental growth driver with an overall increase of 285% in the year driven by the successful global rollout of the licensing programme. The US continues to be an important market in this respect, contributing the largest proportion of total licensing and merchandising sales. Building on this momentum, almost 500 new licences and broadcast deals have been signed globally in the year, which is indicative of the rising popularity of the brand across all territories.

PJ Masks is broadcasting in all key territories on the global Disney Junior network, and on key terrestrial broadcasters like France Televisions, RAI in Italy and ABC in Australia. Recently premiering on Tencent, iQiYi and Youku VOD in China, it attracted over 70 million views in the first three days and over 395 million by April 2018. Following the success of the first season of PJ Masks, season two commenced airing on Disney Junior US in January 2018 to strong ratings, season three has been greenlit and season four is in development, further supporting growth expectations for FY19 and beyond.

The business is in production on a number of other properties, including: Ricky Zoom, a pre-school vehicle-based series of 52 episodes from the same creative team as hit series PJ Masks with major broadcasters attached in France, Italy, and Latin America and a master toy arrangement currently in the final stages of negotiation; and Cupcake & Dino: General Services, a high profile 52 episode comedy series which is in full production with broadcast commitments from Teletoon in Canada, Disney Channel in Brazil and worldwide SVOD rights with Netflix. These properties are expected to make their broadcast debuts in FY19.

The second half of the year saw the retail landscape affected by Toys R Us store closures in the US and UK. The Group expects there to be some impact for its brands in the short term and is monitoring the situation closely with its partners; this impact is not anticipated to be significant. Overall, eOne's brands performed well across the key holiday season with strong sell-through outside of Toys R Us stores.

2019 OUTLOOK FOR FAMILY & BRANDS

Peppa Pig and PJ Masks will continue to drive the growth of eOne's Family & Brands Division in FY19. The business is on target to having close to 2,000 live licensing and merchandising contracts by the end of FY19.

Family & Brands continues to focus on building Peppa Pig into the most loved pre-school brand in the world. Asia, North America and Germany will be the key territories of growth for the brand. China will drive the growth in Asia building on the growing popularity of the brand thanks to strong VOD exposure in the region with expected growth in licensing and merchandising revenue aided by new toy partnership with Alpha and increased publishing formats. There is a growing franchise in Germany where broadcast started on Super RTL in March 2018. Leading toy firm, Jazwares is developing an extensive line of figures, playsets and plush toys that will launch from September 2018 ahead of the back to school and Christmas season.

The strong pipeline of content is a fundamental element of securing the evergreen status of the brand. The brand celebrates its 15^th anniversary in the UK and Australia in 2019 with an exciting calendar of events anchored by a fresh pipeline of content. An additional 117 episodes of Peppa Pig are currently in production with the original creators of the show, with delivery beginning in FY19 through to spring 2021. This new content will introduce new characters, storylines and themes to keep the series relevant to each new generation of pre-school fans.

In October 2017, the business entered into a global partnership with Merlin Entertainments, to develop and operate location-based entertainment attractions based on Peppa Pig. Merlin have opened in-park areas in its resort theme parks in Italy and Germany, and expects its first standalone attraction to open in China in 2018, with a second anticipated in 2019.

PJ Masks will see a wider international licensing roll-out with the UK and China expected to be the key territories of growth. China will be a new licensing market in FY19 and a full product launch will commence in June 2018 with toy partner Alpha following a successful VOD launch. The UK will build upon the very successful toy roll-out in FY18. In the US it is expected that licensing revenue will continue to grow following the successful release of season two in January 2018. The second season is set to air in other territories from spring 2018 driving further licensing momentum.

Both Cupcake and Dino: General Services and Ricky Zoom will make their broadcast debut in FY19. In addition to this new content, Family & Brands currently has eight other projects in development.

The Division is expected to generate strong revenue and EBITDA growth across the portfolio in FY19. It is also expected that underlying EBITDA margins will be somewhat lower in percentage terms driven by the growth of PJ Masks as a proportion of total sales and continued increase in brand management costs which are necessary to facilitate growth and support brand longevity.

 

 

TELEVISION

The Television Division comprises eOne Television, The Mark Gordon Company, the Group's Music operation and Secret Location. The Division's primary focus is on the development, production and acquisition of high quality programming for sale to broadcasters and digital platforms around the world.

 

£m	2018	2017	Change
Revenue	539.0	452.7	19%
Underlying EBITDA	72.0	62.8	15%
Investment in acquired content	31.9	37.3	(14%)
Investment in productions	240.7	222.9	8%

Revenue for the year was 19% higher at £539.0 million (2017: £452.7 million), driven by larger productions and higher international distribution sales across key titles. Television revenue is calculated net of intra-segment eliminations of £66.7 million (2017: £49.5 million) between eOne Television, The Mark Gordon Company and Music. The financial tables below are presented gross of intra-segment eliminations.

Underlying EBITDA increased by 15% to £72.0 million (2017: £62.8 million), driven by higher revenue. Investment in acquired content reduced by 14% and investment in productions increased by 8% driven by higher production volume.

eONE TELEVISION

 

£m	2018	2017	Change
Revenue	382.1	328.2	16%
Underlying EBITDA	36.4	30.9	18%
Investment in acquired content	27.8	34.1	(18%)
Investment in productions	159.5	121.4	31%

Revenue for the year increased 16% to £382.1 million (2017: £328.2 million), driven by larger productions and higher international distribution sales across key titles. Underlying EBITDA was 18% ahead at £36.4 million (2017: £30.9 million), driven by revenue growth with underlying EBITDA margin percentage broadly in line.

Investment in productions grew by 31% in the year due to investment in premium series from eOne productions and was partly offset by lower investment in acquired content. 876 half hours of new programming were produced/acquired in the year compared to 1,023 in the prior year with the decrease due to fewer shows in the Canadian unscripted business and a lower volume of acquired content.

Key scripted deliveries in the year include the highly anticipated Sharp Objects, starring Amy Adams and airing on HBO in summer 2018, first season of legal drama Burden of Truth, which has been renewed for a second season, first season of The Detail, second season of Antoine Fuqua's Ice, second season of Private Eyes which has also been renewed for a third season, second and third seasons of detective show Cardinal and third season of comedy You Me Her.

The unscripted US business delivered season three of Growing Up Hip Hop, season two of spin-off Growing Up Hip Hop Atlanta, Ex on the Beach and new production Siesta Key where audiences continue to grow since the season premiere on MTV where the show ranks in the top 5 series of 2017/18 season across all demographics. Renegade 83 also delivered new seasons of Naked and Afraid, with four different seasons of the franchise providing revenue in the year. In addition, Aaron Hernandez was delivered and debuted on Oxygen as the highest-rated true crime programme in the network's history.

Key acquired content driving performance in the year included season three of Fear the Walking Dead, season eight of The Walking Dead, season two of Into the Badlands and the fourth and final seasons of both Halt & Catch Fire and Turn. International sales for Designated Survivor seasons one and two were strong due to a world-wide streaming deal with Netflix outside of North America.

THE MARK GORDON COMPANY (MGC)

 

£m	2018	2017	Change
Revenue	174.2	119.9	45%
Underlying EBITDA	29.4	26.2	12%
Investment in productions	81.2	101.5	(20%)

Revenue for the year was up 45% to £174.2 million (2017: £119.9 million), driven by an increase in the number of Designated Survivorepisodes delivered, delivery of new series of Youth & Consequences for YouTube Red, and delivery of MGC's first feature film with eOne, Molly's Game. Underlying EBITDA increased 12% to £29.4 million (2017: £26.2 million), driven by higher revenue. Underlying EBITDA margin percentage was lower than prior year reflecting a change in revenue mix.

Investment in productions decreased 20% to £81.2 million (2017: £101.5 million) due to phasing of productions, including Molly's Gamewhere the majority of spend was incurred in FY17.

The studio continues to benefit from a strong library of television and film titles which have demonstrated enduring popularity and commercial success. The relatively high margins attributable to the library favourably contributes to the bottom line and cash generation. During the year MGC had five series airing on US network and premium cable, all with continued strong viewership including season twelve of Criminal Minds (renewed for season thirteen), season two of Criminal Minds: Beyond Borders, season five of Ray Donovan (renewed for season six), season two of Quantico (renewed for season three) and season thirteen and fourteen of Grey's Anatomy (renewed for season fifteen) making it the longest running scripted prime-time show currently airing on the ABC network. The year also saw a straight-to-series order by ABC of the Grey's Anatomy spinoff, Station 19, which premiered in March 2018.

MUSIC

 

£m	2018	2017	Change
Revenue	49.4	54.1	(9%)
Underlying EBITDA	6.2	5.7	9%
Investment in acquired content	4.1	3.2	28%

Revenue for the year decreased by 9% to £49.4 million (2017: £54.1 million), primarily due to the full year impact of lower physical sales driven by the termination of a number of distributed labels when the business outsourced physical distribution in January 2017 and lower performance of The Lumineers' second album, Cleopatra, which was released in the prior year. Underlying EBITDA increased 9% to £6.2 million (2017: £5.7 million) and underlying EBITDA margin increased 2.0pts, due to the continued shift of the business from physical to digital. ADA, a member of Warner Music Group, now handles all physical sales and distribution in the US and Canada which has allowed the business to focus on higher margin digital distribution and artist management.

Key titles during the year included continued strong performance of The Lumineers' highly successful first and second albums, The Lumineersand Cleopatra, 2Pac's All Eyez on Me, Snoop Doggy Dogg's Doggystyle, Dr Dre's The Chronic and the late Chuck Berry's new album Chuckdemonstrating the strength of both new and catalogue music within the Music Division. In addition, numerous high profile signings were completed in the year bringing on board new artists including Dionne Warwick, Lil' Kim and Timbaland.

Additional growth has come from the Artist Management and Publishing businesses. In Artist Management Jax Jones had a third number one song Breathe and Kah-Lo had a number one dance record in the UK.

In its Publishing and Music Supervision operations, the business continued to work in partnership with eOne television and film projects, including Makeready's A Million Little Pieces, Ice (season two), Let's Get Physical, as well as supervising the music on the recent PJ Masks Live! tour and providing the theme song for the upcoming Ricky Zoom series in Family & Brands.

The number of albums released in the year was marginally higher at 84, versus 79 in the prior year, and digital singles released remained steady at 205, compared to 206 in the prior year, demonstrating the robust pipeline of content driving the business forward.

 

 

FILM

eOne's Global Film Group is one of the world's largest independent film businesses with operations in the US, Canada, the UK, Australia, the Benelux, Germany and Spain. The Division's primary focus is on the development, production and acquisition of high quality film productions for direct distribution in its territories and sales around the world.

£m	2018	2017	Change
Revenue	402.2	594.2	(32%)
Theatrical	57.1	97.2	(41%)
Home entertainment	79.2	149.3	(47%)
Broadcast and digital	141.4	189.4	(25%)
Production and international sales	78.1	108.0	(28%)
Other	48.5	54.5	(11%)
Eliminations	(2.1)	(4.2)	50%
Underlying EBITDA	35.1	52.7	(33%)
Investment in acquired content	118.8	143.2	(17%)
Investment in productions	47.0	(0.6)	7,933%

As a result of lower volume in the year, revenue and underlying EBITDA decreased 32% and 33% to £402.2 million (2017: £594.2 million) and £35.1 million (2017: £52.7 million), respectively. Underlying EBITDA benefitted from gross margin improvement of 3.1pts driven by lower amortisation costs and sales mix and significant cost savings resulting from the reorganisation commenced in FY16 and substantially completed in FY17. The Group has achieved the targeted annualised cost savings of approximately £10 million related to the continued reduction of physical distribution infrastructure in this financial year. In addition, cost savings from the integration of the Film and Television Divisions of £1-2 million were realised in FY18 with a full run rate impact expected by FY20 of £13-15 million (including the integration of MGC).

Investment in acquired content reduced by £24.4 million to £118.8 million (2017: £143.2 million) driven by lower volume and mix of acquired titles. Investment in productions was higher by £47.6 million at £47.0 million (2017: (£0.6 million)), a significant increase over the prior year, reflecting the Group's strategic shift towards direct production of content over which it has ownership and control.

THEATRICAL

Overall, theatrical revenue decreased by 41% as a result of lower box office takings, (box office of US$207.6 million in FY18 versus US$337.4 million in FY17). The total number of film theatrical releases was 144 compared to 172 in the prior year and the number of individual film theatrical releases in the year was 85 compared to 102 in the prior year. The decrease in revenue is a result of volume and mix of titles compared to the higher profile releases in the prior year, which included The BFG, The Girl on the Train, and Arrival. The lower number of releases and spending on acquired content is consistent with the Group's strategy to shift investment towards content production.

The current year releases include Oscar nominated Molly's Game, a Mark Gordon Company production written and directed by Aaron Sorkin; Oscar nominated The Post from Amblin Partners, starring Meryl Streep and Tom Hanks and directed by Steven Spielberg; and Oscar nominated I, Tonya for which Allison Janney won Best Supporting Actress, which Sierra/Affinity sold internationally. eOne released the first film under its new partnership with Annapurna Pictures, Detroit directed by Academy Award winning director Kathryn Bigelow. Other key releases in the year included A Dog's Purpose, The Death of Stalin, Wonder and Finding Your Feet.

HOME ENTERTAINMENT

Revenue decreased by 47% as a result of the lower volume of releases, continued shift from physical to digital formats, and the discontinuation of certain labels in the US and Canada as planned.

In total, 255 DVDs and Blu-ray titles were released during the year (2017: 366), a decrease of 30%, including key titles such as John Wick: Chapter 2, La La Land, season seven of The Walking Dead, Mom and Dad, Ballerina, A Dog's Purpose, Power Rangers and Jungle.

BROADCAST AND DIGITAL

The Division's combined broadcast and digital revenues were 25% lower on a reported basis and 12% on a like-for-like basis, which excludes the prior year digital revenues generated in the Film Division from the US Distribution business that related to music sales. The like-for-like revenues were lower reflecting the impact of fewer releases and the reduced volume of larger titles to support incremental sales opportunities.

Key broadcast and digital titles included The Girl on the Train, A Dog's Purpose, Arrival, John Wick: Chapter 2 and Bon Cop Bad Cop 2.

The Group entered into a new multi-year exclusive SVOD deal with Amazon in the first half of the year, for the first Pay TV window in the UK. This new deal gives Amazon Prime members exclusive access to all new releases in the territory during the window. In addition the Group entered into a new output deal with Amazon in Spain, extended its Pay TV output deal with Bell Media in Canada and executed an SVOD catalogue and second Pay TV deal with Netflix in the UK.

PRODUCTION AND INTERNATIONAL SALES

Revenue for production and international sales decreased by 28% to £78.1 million (2017: £108.0 million) as a result of the timing of the Sierra production slate, which did not include any deliveries in FY18 compared to Lost City of Z and Atomic Blonde in FY17.

During the year eOne delivered The Ritual which was released theatrically in the UK with the balance of worldwide distribution rights sold to Netflix, and Just Getting Started.

Sierra's key sales titles included I, Tonya, 24 Hours to Live, Molly's Game, Mark Felt and Anon.

2019 OUTLOOK FOR FILM, TELEVISION AND DIGITAL

From 1 April 2018 the Company is combining the Film and Television Divisions into one reporting segment: Film, Television and Digital. This follows on from the combination of the operations. Therefore the following 2019 outlook is provided for the new Division.

Film, Television and Digital is well positioned for growth in FY19 in a landscape where premium original content is in demand more than ever before. The Division will continue to focus on early access to high quality premium content of all types by continuing to build deep partnerships with high quality creators.

In FY19, we anticipate 140 film releases, in total across all territories, of which 80 are expected to be unique titles. Investment in acquired content is expected to be lower at approximately £100 million. The pipeline for the year is driven by releases from the Division's strategic partners, including Amblin Partners' The House with a Clock in Its Walls starring Cate Blanchett and Jack Black; On the Basis of Sex, a biopic of US Supreme Court Justice Ruth Bader Ginsburg, starring Felicity Jones and Armie Hammer; Green Book, a period drama starring Viggo Mortensen and Mahershala Ali; Annapurna Pictures' If Beale Street Could Talk based on the James Baldwin novel and directed by Moonlight'sBarry Jenkins; and Backseat, Adam McKay's project following his success on The Big Short about former US Vice President Dick Cheney starring Christian Bale, Amy Adams, Sam Rockwell and Steve Carrell.

Investment in film production is expected to be higher than the current year at around £70 million reflecting the strategic shift towards content development and production. Films in production currently include: A Million Little Pieces, the first feature from Brad Weston's Makeready starring Aaron Taylor-Johnson, Charlie Hunnam and Billy-Bob Thornton; Mary, a low budget supernatural thriller starring recent Academy Award winner Gary Oldman, where eOne has enjoyed previous success with the Sinister and Insidious franchises; Official Secrets, starring Ralph Fiennes and Keira Knightley and is directed by Gavin Hood, who also directed the eOne feature Eye in the Sky; Sierra/Affinity's Hauntand Australian co-production Nekromancer. Other Film titles in various stages of development and production include The Nutcracker and the Four Realms (Disney), The Killer (Universal), Scary Stories to Tell in the Dark (CBS), and Come From Away. In addition, the Group expects production to continue to ramp-up as internal as well as partner development projects enter the packaging stage.

The television slate for FY19 will deliver a straight to series order from ABC, The Rookie, starring and executive produced by the former Castle star Nathan Fillion. eOne will handle all international distribution rights outside of the US. The production was featured in The Hollywood Reporter's Hot List for MipTV demonstrating the expected strong interest from the market. Also delivering are the remaining eight episodes of Ransom season two and renewed seasons of Burden of Truth, Private Eyes and Mary Kills People. There are a number of projects currently in development which are expected to be greenlit in the year including productions for sale to over the top platforms.

The US unscripted business will continue to grow with expected deliveries from the Growing Up Hip Hop franchise, Siesta Key and TheHollywood Puppet Show season two. Renegade 83 has a strong pipeline and is expected to deliver season five of the hugely popular Naked and Afraid, Sugar for YouTube and Buried in the Backyard for Oxygen. A majority stake in Whizz Kid Entertainment, a UK reality business, was acquired in April 2018 to further expand eOne's unscripted development and production capabilities in new territories. The slate for FY19 also includes Ex on the Beach season ten and the British Academy Film Awards 2019.

For international distribution, sales of third party titles Fear the Walking Dead and The Walking Dead are expected to continue at their existing robust levels with new seasons confirmed and although the AMC/Sundance output deal has now ended for new productions, Into the Badlandsis selling strongly and a fourth season has been confirmed.

The number of half hours of TV programming expected to be acquired/produced next year is expected to be over 1000, with around 40% of the new financial year's budgeted margins already committed or greenlit. The Division currently has more than 30 scripted series set up with global platforms and broadcasters in the US, Canada and the UK in various stages of development from packaging through pilot and a further ten series expected to go to the market in the next few months. Investment in acquired content is expected to be over £45 million and production spend is expected to be £309 million.

The integration of Film, Television and Digital operations is ongoing with a number of opportunities identified to drive business efficiencies and centralisation of internal support functions from the combined operations. In addition, as part of the acquisition of the balance of The Mark Gordon Company completed in March 2018, MGC will be fully integrated into eOne. Overall annual cost savings are expected of approximately £13-15 million by FY20. Approximately half of these savings are expected to be realised in FY19.

Secret Location, eOne's new and emerging platforms group, is primarily focused on the fast-growing virtual reality and augmented reality business. VUSR, Secret Location's patented virtual reality content distribution platform, partners with large media companies including Discovery, The New York Times, AMC and Frontline to deliver their VR/AR content to consumers.

The Music Division expects revenue growth in FY19. The transition to higher margin digital sales will continue to drive profit growth into FY19. Releases scheduled from high profile artists such as Brandy in FY19 will drive growth of both legacy and new content. The Division will continue to develop new initiatives to position eOne as a worldwide Music brand. The Music Supervision business will continue to work in close partnership with eOne television and film projects, maximising Group synergies in this area. In January 2018, the Music Division acquired Round Room Entertainment, a leading live entertainment company, which expands eOne's comprehensive offering to artists and brands. The business is focused on live entertainment for family content and special events, this will lead to incremental revenue and EBITDA within the Music Division.

 

 

OTHER FINANCIAL INFORMATION

Adjusted operating profit increased by 12% to £173.7 million (2017: £155.3 million), reflecting the growth in the Group's underlying EBITDA. Adjusted profit before tax increased by 11% to £144.4 million (2017: £129.9 million), in line with increased adjusted operating profit, partly offset by higher underlying finance costs in the year. Reported operating profit increased by 69% to £114.4 million (2017: £67.6 million), with the Group reporting a profit before tax of £77.6 million, an increase of 116% over the prior year (2017: £35.9 million).

 

	Reported			Adjusted
	2018	Restated 2017²		2018	2017
£m	£m	£m		£m	£m
Revenue	1,044.5	1,082.7		1,044.5	1,082.7
Underlying EBITDA	177.3	160.2		177.3	160.2
Amortisation of acquired intangibles	(39.6)	(41.9)		–	–
Depreciation and amortisation of software	(3.6)	(4.9)		(3.6)	(4.9)
Share-based payment charge	(12.6)	(5.0)		–	–
One-off items	(7.1)	(40.8)		–	–
Operating profit¹	114.4	67.6		173.7	155.3
Net finance costs	(36.8)	(31.7)		(29.3)	(25.4)
Profit before tax	77.6	35.9		144.4	129.9
Tax	0.6	(12.3)		(27.9)	(27.1)
Profit for the year	78.2	23.6		116.5	102.8

1. Adjusted operating profit excludes amortisation of acquired intangibles, share-based payment charge and operating one-off items.

2. Reported 2017 amounts have been restated, refer to Note 1 of the consolidated financial statements for further details.

AMORTISATION OF ACQUIRED INTANGIBLES, DEPRECIATION AND AMORTISATION OF SOFTWARE

Amortisation of acquired intangibles, depreciation and amortisation of software has decreased by £3.6 million in the year. The decrease is primarily attributable to assets having been fully amortised in the prior year, resulting in a lower charge in FY18.

SHARE-BASED PAYMENT CHARGE

The share-based payment charge of £12.6 million has increased by £7.6 million during the year, reflecting additional awards issued in the period and also due to the fair value of the FY18 awards increasing as a result of the increase in the Company's share price in the year.

ONE-OFF ITEMS

One-off items resulted in a net charge of £7.1 million, compared to a net charge of £40.8 million in the prior year. The costs include restructuring costs of £8.0 million (2017: £51.0 million) and other costs of £1.0 million (2017: £2.5 million). These are partially offset by net acquisition related gains of £1.9 million (2017: £12.7 million).

The restructuring costs of £8.0 million consist of:

·	£4.4 million of costs associated with the integration of the Television and Film Divisions and includes £3.6 million related to severance and staff costs and £0.8 million related to consultancy fees;
·	£2.0 million related to the integration of the unscripted television companies within the wider Canadian television production Division. The costs primarily include severance, staff costs and onerous leases; and
·	£1.6 million of costs associated with completion of the 2017 strategy related restructuring programmes. The costs include additional severance, onerous leases and write-off of inventory.

Acquisition gains of £1.9 million consist of:

·	Credit of £3.9 million on re-assessment of the liability on put options in relation to the non-controlling interests over Renegade 83 and Sierra Pictures put options;
·	These gains are partially offset by banking and legal costs of £1.6 million associated with the creation and set-up of Makeready in the current year; and
·	Charge of £0.6 million on settlement of contingent consideration in relation to Renegade 83 settled in the year, partially offset by escrow of £0.2 million received in relation to the FY16 acquisition of Last Gang Entertainment.

Other costs of £1.0 million in FY18 primarily related to costs associated with aborted corporate projects during the year.

NET FINANCE COSTS

Reported net finance costs increased by £5.1 million to £36.8 million in the year. Excluding one-off net finance costs of £7.5 million, adjusted finance costs of £29.3 million (2017: £25.4 million) were £3.9 million higher in the year, reflecting the higher average debt levels year-on-year. The weighted average interest rate for the Group's senior financing was 6.5% compared to 6.6% in the prior year.

The one-off net finance costs of £7.5 million (2017: £6.3 million) comprise:

·	£7.9 million (2017: £6.4 million) net losses on fair value of derivative instruments; which includes: –      £5.2 million charge (2017: £7.6 million) in respect of losses on five forward currency contracts not in compliance with the Group's hedging policy. See Note 1 of the consolidated financial statements for further details; –      £1.6 million charge (2017: gain of £1.2 million) in respect of fair-value losses (2017 were fair value gains) on hedge contracts which reverse in future periods; and –      £1.1 million charge (2017: nil) in respect of fair-value losses on hedge contracts cancelled as a result of the re-negotiation of one of the Group's larger film distribution agreements in 2017;
·	£3.0 million charge (2017: £2.9 million) related to unwind of discounting on put options issued by the Group over the non-controlling interest of subsidiary companies; and
·	The costs above are partly offset by a credit of £3.4 million (2017: net credit of £3.0 million) relating to the reversal of interest previously charged on tax provisions, which were released during the year.

TAX

On a reported basis, the Group's tax credit of £0.6 million (2017: charge of £12.3 million), which includes the impact of the release of tax provisions and one-off items, represents an effective rate of 0.8% compared to 33.6% in the prior year (excluding impact of JV loss of £0.7 million in FY17). On an adjusted basis, the effective rate is 19.3% compared to 20.9% in the prior year, driven by a different mix of profit by jurisdiction (with different statutory rates of tax). The FY19 effective tax rate on an adjusted basis is expected to be approximately 20%.

 

 

CASH FLOW & NET DEBT

The table below reconciles cash flows associated with the net debt of the Group, which excludes cash flows associated with production activities which are reconciled in the Production Financing section below.

 

			2018						2017
£m	Family & Brands	Television	Film	Centre & Elims	Total		Family & Brands	Television	Film	Centre & Elims	Total
Underlying EBITDA	83.1	48.1	35.1	(12.1)	154.2		55.6	56.2	52.1	(10.9)	153.0
Amortisation of investment in acquired content rights	1.0	32.1	87.5	(6.7)	113.9		0.5	36.4	131.4	–	168.3
Investment in acquired content rights	(4.3)	(31.9)	(118.8)	6.8	(148.2)		(0.9)	(37.3)	(143.2)	–	(181.4)
Amortisation of investment in productions	2.4	71.3	7.2	(8.6)	72.3		1.3	30.9	0.6	–	32.8
Investment in productions, net of grants	(3.2)	(81.6)	(27.4)	0.4	(111.8)		(2.8)	(31.2)	(0.2)	–	(34.2)
Working capital	4.9	0.2	(33.8)	7.3	(21.4)		(3.3)	(7.6)	(48.1)	–	(59.0)
Joint venture movements	–	–	–	–	–		–	0.6	–	–	0.6
Adjusted cash flow	83.9	38.2	(50.2)	(12.9)	59.0		50.4	48.0	(7.4)	(10.9)	80.1
Cash conversion (%)	101%	79%	(143%)		38%		91%	85%	(14%)		52%
Capital expenditure					(3.2)						(3.2)
Tax paid					(31.8)						(16.2)
Net interest paid					(25.5)						(24.2)
Free cash flow					(1.5)						36.5
Cash one-off items					(33.4)						(15.9)
Cash one-off finance items					(14.1)						(1.7)
Transactions with equity holders and acquisitions, net of net debt acquired					(118.5)						(9.6)
Net proceeds of share issue					52.0						–
Dividends paid					(13.0)						(8.3)
Foreign exchange					1.4						(7.6)
Movement					(127.1)						(6.6)
Net debt at the beginning of the year					(187.4)						(180.8)
Net debt at the end of the year					(314.5)						(187.4)

 

ADJUSTED CASH FLOW

Adjusted cash inflow at £59.0 million was lower than prior year by £21.1 million primarily due to an increase in spend on acquired content and productions of £44.4 million partly offset by an increase in EBITDA and reduced working capital outflow. The underlying EBITDA to cash flow conversion was 38% (2017: 52%).

FAMILY & BRANDS

Family & Brands adjusted cash inflow increased 66% to £83.9 million (2017: £50.4 million) representing an underlying EBITDA to adjusted cash flow conversion of 101% (2017: 91%), driven by the increase in underlying EBITDA and working capital inflows, partly offset by increased investment in acquired content and productions. Working capital inflows grew year-on-year driven by the increase in creditors as a result of increased royalties and agency commission associated with Peppa Pig and PJ Masks due to higher revenue in the year partially offset by the increase in receivables. The investment in acquired content and productions spend related to season five of Peppa Pig, season two of PJ Masks and new properties Cupcake & Dino: General Services and Ricky Zoom.

TELEVISION

Television adjusted cash inflow for the year was £38.2 million (2017: £48.0 million), representing an underlying EBITDA to adjusted cash flow conversion of 79% (2017: 85%). The reduction of cash inflow is driven by significantly higher investments in production due to ramp up in productions, particularly in unscripted US and MGC, including productions in progress and development spend. The working capital was broadly flat in the year reflecting inflows from the increase in royalty accruals and increase in intercompany trade payables relating to productions from MGC (which are offset within the Television working capital movement under production financing), offset by an outflow in movements in receivables from higher revenue in the last quarter.

FILM

Film adjusted cash outflow of £50.2 million was higher than prior year (2017: outflow £7.4 million) driven by lower underlying EBITDA, lower amortisation of investment in acquired content rights, higher investment in productions, net of grants, partly offset by lower investment in acquired content and lower working capital outflow.

The reduced investment in acquired content rights was driven by the lower volume and profile of theatrical releases in the year which has led to lower amortisation. The increased investment in productions mainly relates to spend on the Sierra production, How It Ends, which will be delivered to Netflix in FY19. Working capital outflow of £33.8 million was primarily due to a decrease in payables driven by the timing of payments in the distribution territories partly offset by greater collection of receivables.

FREE CASH FLOW

Free cash outflow for the Group of (£1.5 million) was £38.0 million lower than the previous year primarily due to higher investment in acquired content and productions spend, timing of certain tax payments of approximately £10 million offset by lower working capital outflow and EBITDA growth.

NET DEBT

At 31 March 2018, overall net debt of £314.5 million was £127.1 million higher than the prior year due to the lower free cash flow, higher one-off items, including payment of prior years' restructuring charges, higher one-off finance items and the impact of the MGC transaction.

Refer to the Appendix to this Results Announcement for the definition of adjusted cash flow and free cash flow and for a reconciliation to net cash from operating activities.

PRODUCTION FINANCING

Overall production financing decreased by £33.6 million year-on-year to £118.7 million reflecting the timing of certain programming. For example, in MGC within Television there were cash outflows associated with Conviction in FY17 and then the loan was repaid in FY18. There was not an equivalent MGC network show in FY18.

 

	2018					2017
£m	Family & Brands	Television	Film	Total		Family & Brands	Television	Film	Total
Underlying EBITDA	(0.8)	23.9	–	23.1		–	6.6	0.6	7.2
Amortisation of investment in productions	0.2	153.7	4.2	158.1		0.9	138.6	41.1	180.6
Investment in productions, net of grants	(2.0)	(159.2)	(19.6)	(180.8)		(1.4)	(191.7)	0.8	(192.3)
Working capital	0.8	7.8	16.5	25.1		0.5	4.4	(11.4)	(6.5)
Joint venture movements	–	–	–	–		–	0.1	–	0.1
Adjusted cash flow	(1.8)	26.2	1.1	25.5		–	(42.0)	31.1	(10.9)
Capital expenditure				–					(0.3)
Tax paid				(0.7)					(2.2)
Net interest paid				(0.7)					(0.1)
Free cash flow				24.1					(13.5)
Cash one-off items				(3.5)					(0.9)
Acquisitions, net of net debt acquired				–					(0.7)
Foreign exchange				13.0					(19.2)
Movement				33.6					(34.3)
Net production financing at the beginning of the year				(152.3)					(118.0)
Net production financing at the end of the year				(118.7)					(152.3)

 

The production cash flows relate to non-recourse production financing which is used to fund the Group's family brands, television and film productions. The financing is arranged on an individual production basis by special purpose production subsidiaries which are excluded from the security of the Group's corporate facility. It is short-term financing whilst the production is being made and is paid back once the production is delivered and the sales receipts and tax credits are received. The Company deems this type of financing to be short term in nature and it is therefore excluded from net debt.

FINANCIAL POSITION AND GOING CONCERN BASIS

The Group's net assets decreased by £45.3 million to £706.0 million at 31 March 2018 (2017: £751.3 million).

The directors acknowledge guidance issued by the Financial Reporting Council relating to going concern. The directors consider it appropriate to prepare the consolidated financial statements on a going concern basis, as set out in Note 1 to the consolidated financial statements.

A presentation to analysts will take place at 9.00am on Tuesday, 22 May 2018 at eOne's UK office (45 Warren Street, London, W1T 6AG). For more information, or to register to attend, contact Alma PR +44 7961 075 844 or rsh@almapr.co.uk).