Pinewood scoress hit despite X-rated write-off

Film studio Pinewood Shepperton's results received rave reviews, despite the unpleasant plot twist involving a massive write-off of costs relating to its Project Pinewood expansion project.

The company, which is changing its year end after becoming a subsidiary of Peel Holdings, reported figures for a 15-month period which showed it slipped into the red, after spending £3.67m on fighting the Peel takeover and writing off a five-year £7.07m investment on Project Pinewood, which got the thumbs down from the Secretary of State for Communities and Local Government, who refused planning permission for the project.

Finance costs of £4.56m also took a chunk out of operating profits, leaving a loss before tax for the 15 months to March 31st of £1.89m, versus a profit of £5.82m for the whole of 2012, when finance costs were just £3.31m and exceptional charges were negligible.

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Stripping out the exceptional charges, the company made a profit before tax of £9.5m, which probably accounts for the shares rising to 331.64p over the lunch-time trading session, up from 303.5p overnight.

EBITDA (earnings before exceptional items, interest, tax, depreciation and amortisation) was £17.9m (12 months to December 31st 2010: £12.8m).

Revenue for the 15-month period came in at £63.0m versus £43.4m for the 12-month period covering 2010.

Film revenues for the fifteen month period were £44.9m (December 31st 2010: £29.1m), while Digital Content Services (DCS) revenues for the fifteen month period were £8.0m (December 31st 2010: £5.8m). International revenues contributed £1.2m (December 31st 2010: £0.6m), while television revenues for the fifteen month period were £10.1m (December 31st 2010: £8.2m), reflecting the current television commissioning environment and competitive market conditions.

Ivan Dunleavy, Chief Executive, said: "Despite increasing global competition during the fifteen month period ended 31 March 2012, the company won significant business from big budget films for our facilities which resulted in the Studios achieving high utilisation.

"In television, the trend for large audience television shows continues. The Media Park, home to around 300 media businesses, remains attractive to the makers and producers of film, television, video games and the wider digital screen industries."

"The company is well placed to meet the increasing demand for content both at its UK studios and abroad and has embarked on a consultation for the future development of Pinewood Studios. The board looks forward to the future with confidence."

During the five quarter period, the company saw rising demand for its facilities, especially in film. This level of demand has continued into the start of the current financial year and bodes well for the future.

In light of the level of exceptional costs incurred in the period, the board has decided not to recommend a dividend for the period (year to December 31st 2010: 3.6p).

Cash at the end of the period fell to £0.4m, compared to £0.5m at the end of 2010.

NR