July 6, 2020
Home entertainment/over-the-top video distributor Cinedigm July 6 reported that it narrowed its fiscal-year 2020 (ended March 31) net loss 10% to $14.7 million, from $15.9 million in FY 2019. Revenue dropped 27% to $39.2 million, from $53.5 million, largely due to the shutdown of the theatrical business. Cinedigm attributed the revenue decline to its digital projection business.
Meanwhile, streaming revenue increased 59% year-over-year, primarily driven by 466% growth in ad-supported linear television and ad-supported video on demand (AVOD) ad revenue growth. Total streaming-related revenue increased 31% year-over-year, with total sales of $24.4 million. Streaming-related billings now represent more than half of Cinedigm’s entertainment business.
“Clearly, we have made remarkable progress as an OTT/Streaming company over the last year, including achieving profitability in our core business in this fourth quarter by increasing [pre-tax earnings] by $3.5 million or 125% over last year,” CEO Chris McGurk said in a statement.
McGurk said the distributor now markets a 16-channel OTT portfolio to include about 670 million global devices from more than 40 distribution partners worldwide.
“We grew ad-supported viewers on connected TV’s from zero to 13.2 million in 15 months, almost tripling viewers in just the last 7 months prior to May 31,” he said.
“We are rapidly scaling up our streaming business to capitalize on the ongoing and permanent [pay-TV] cord-cutting shift towards OTT entertainment,” McGurk said. “Heavy streaming adoption rates, particularly for free, ad-supported linear channels, continue to dramatically accelerate.”
Erick Opeka, president of Cinedigm Digital Networks, said the company’s revised model is driven by signing and launching new channels, increasing distribution footprint, growing viewership, and achieving monetization with scale partners.
“Our focus on these four key areas can be reflected in our results and our deals with the best companies in the industry,” Opeka said. “Given this, Cinedigm has enormous prospects for growth in the coming fiscal year.”
Cinedigm also strengthened its balance sheet with the addition of a 26% ownership interest in China’s Starrise and $15.5 million debt reduction.
“Reducing this debt decreased our interest expense by $3 million annually,” said COO Gary Loffredo.