Cinedigm: OTT/Streaming Revenue Up 31%; COVID-19 Drops FY 2020 Revenue 27%,

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.

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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.

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“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.

Cinedigm Acquiring AVOD Platform ‘Future Today’ for $60 Million

Cinedigm March 15 announced it has entered into a definitive agreement to acquire Future Today, one of the largest ad-supported VOD networks, for $45 million in cash and $15 million in Cinedigm common stock.

The acquisition increases Cinedigm’s over-the-top video footprint to over 7.6 million monthly active users and 67 million total app installs.

The Los Angeles-based home entertainment distributor said Future Today, which owns and operates more than 700 content channels with more than 60 million app installs, and manages more than 200,000 film, television and digital content assets,generated about $23.9 million in revenue in 2018.

Future Today brands include Fawesome.tv, focused on general entertainment movies & television shows, and HappyKids.tv, providing age-specific edutainment in the connected TV market.

Alok Ranjan and Vikrant Mathur, co-founders of Future Today, will continue to lead the subsidiary as co-presidents, entering into long-term employment agreements with Cinedigm upon the deal closing.

“Building our stake in the rapidly surging AVOD business is a top priority for Cinedigm, and the acquisition instantaneously transforms our company into the world’s largest provider of premium [ad-supported] content,” Chris McGurk, chairman/CEO of Cinedigm said in a statement.

Future Today’s cloud-based technology and ad-based monetization platform manages OTT services for more than 350 content owners, producers, distributors and major media companies helping them launch and monetize connected TV channels across all devices.

“Alok and Vikrant have built Future Today into one of the most respected and fastest growing companies monetizing video content today,” said Erick Opeka, president of Cinedigm Digital Networks. “Their entrepreneurial spirit and deep knowledge of the video ad space, combined with Cinedigm’s content and relationships, will be a formidable and compelling combination in the rapidly growing AVOD segment.”

The transaction is expected to close in the second calendar quarter of 2019 and is subject to customary closing conditions.

DEG Meeting to Focus on Doing Business In, and With, China

DEG: The Digital Entertainment Group is hosting a special membership meeting Sept. 25 at the Luxe Sunset Boulevard Hotel in Los Angeles about doing business in and with China.

The meeting starts at 2 p.m. and will be followed at 5 p.m. by a networking session.

“Creative Collaboration with China” is hosted by Cinedigm, the film company majority-owned by Hong Kong private equity group Bison Capital.

Amy Jo Smith, president of DEG: The Digital Entertainment Group

Cinedigm in January announced an alliance with leading China-based Starrise Media Holdings Ltd. to release movies in China theatrically and digitally. The deal also paved the way for Cinedigm to distribute Chinese films in North America.

“Part of DEG’s mission is to provide members with leading-edge knowledge and resources about emerging trends and technologies to prepare for growth,” said Amy Jo Smith, CEO and president of DEG. “In this vein, this program will delve into how media and entertainment companies in the U.S. and China can work more closely to refine storytelling and script development to improve content performance across existing and emerging distribution platforms, and how the evolving distribution landscape may affect future revenue potential for content in both markets.

In the keynote address, Cinedigm Entertainment Group president Bill Sondheim will provide introductory remarks. “We are making a concerted effort to build meaningful bridges between the U.S. and China film industries and I see great enthusiasm in China and Hollywood because both sides see economic benefits,” Sondheim told Media Play News.

Sondheim’s remarks will be followed by a “chat” with Cinedigm chairman and CEO Chris McGurk and Bill Mechanic, the former 20th Century Fox studio chief (and, before that, the home video head for the Walt Disney Co.) who now heads Pandemonium Films. Bennett Pozil, EVP of East West Bank, will moderate. Variety once said, “Pozil has become the go-to financier for those at the intersection of Hollywood and China’s film markets.”

The keynote will be followed by a panel discussion on distribution strategies, consumption patterns and content creation trends in China and the United States.

Panelists include Marc Gareton, EVP, International Asia-Pacific and International Productions for Warner Bros. Home Entertainment; Doris Pfardrescher, president and CEO of Well Go USA; and Daniel Solnicki, EVP, Business Operations, as NBCUniversal. Stewart Till will moderate.

In addition to the speakers, about 15 delegates traveling from China will attend, including representatives from the highest levels of government and companies like Tencent.

“We are very honored to have been able to develop this program as a knowledge exchange with Film and TV Import and Export Association (FTIEA) members from China and to host a delegation from FTIEA that has traveled to Los Angeles to participate in the program with U.S. producers, distribution experts and business development executives,” Smith said.

The meeting is free for DEG members. To RSVP, or to inquire about non-member attendance, email Shannon@degonline.org.