Revenue Drops at Jetix Europe

AMSTERDAM/LONDON, May 15:
Revenues at Jetix Europe for the six months ended March 31, 2008, fell 19
percent to 71.2 million euros, while net profit was flat at 20.6 million euros.

The company noted that the
revenue fall was in line with management’s expectations and primarily due to
changes in deals with channel distributors. Channels and online revenue
decreased 9 percent to 57.9 million euros. Subscription revenue decreased 16
percent to 33.7 million euros. Advertising revenue, however, increased 9
percent to 22.7 million euros, led by Italy, Central and Eastern Europe and
Poland.

Program distribution
revenue, meanwhile, dropped 44 percent to 6.4 million euros, as a result of the
timing of deliveries of programming to broadcasters, lower sales to Disney-ABC
Cable Network Group in the U.S. and the depreciation of the U.S. dollar against
the euro. And consumer products revenue decreased by 45 percent to 6.9 million
euros.

Paul Taylor, the CEO of
Jetix Europe, said: “As expected, we have seen the impact from a number of
specific deals reflected in the financial results we are announcing today.
However, excluding adverse exchange rate movements, the results are broadly in
line with our expectations. Although we have been affected by the renegotiation
of specific channel carriage deals and the decision not to continue producing A.T.O.M., most of our underlying businesses have continued
to perform well. We have increased our advertising revenue, despite a worsening
economic environment and continued stiff competition, we are investing in our
websites in advance of a re-launch planned for summer 2008 and we have seen our
in-house merchandising activities continue to grow. We are also in the final
stages of negotiating a major new initiative with our parent company, The Walt
Disney Company.”

Taylor continued: “Disney
has recently created an integrated television distribution division, which
brings together sales of its programming, channels and new media products,
offering its business customers a single point-of-sales contact. Jetix is
negotiating to secure access to this division’s sales capability for our
channels and digital media products, which would then be sold alongside
Disney’s world-leading content and channels. This would extend the relationship
that we already have in place to sell our programming through Disney-ABC
International Television. We believe that, if completed, this new deal will
allow us to benefit from Disney’s strong brand and market presence, delivering
significant benefits to Jetix Europe over the medium and long term. Whilst
negotiations are close to completion, this deal is still subject to contract
and supervisory board approval.”

He concluded: “There is no
doubt that our business faces a number of challenges, such as pay television
consolidation, strong competition and a declining economic outlook. However the
actions we are taking to ensure we have the best content possible, to leverage
our relationship with Disney and to develop new businesses as technology
allows, should enable us to return to growth as quickly as possible.”

—By Mansha Daswani