Pic unit up but group posts 33% profit drop
PARIS — French communications group Pathe has reported first-half net profits of 102 million francs ($17 million), a 33% drop on the same time last year, despite a radical improvement in the group’s film production and distribution activities.
Revenues for the first six months of the year rose 8% to $183 million, while earnings before interest, taxes, depreciation and amortization rose to $49.5 million from $42 million.
The drop in profits is largely due to the performance of BSkyB (in which Pathe has a 17% stake) and French digital platform Canal Satellite. BSkyB’s investment in digital expansion has weighed on the company’s results, and BSkyB’s contribution to Pathe’s EBITDA amounted to $39.6 million compared to $47.5 million for the same period last year.
Canal Satellite is also investing heavily in its digital platform, posting first half losses of $31 million. Pathe sources told Daily Variety that results for the first half of 1997 had been boosted by a one-off sale of Canal Plus shares, and that there had been no similar exceptional gains in 1998.
The upside for Pathe is in its operating performance, particularly in the movie division. Having provisioned heavily last year against “Lolita” and a handful of underperforming theatrical releases such as “Lucie Aubrac,” EBITDA showed a $500,000 profit compared to a $27 million deficit last year.
Pathe’s continued building of multiplexes and an upturn in cinema attendance has helped drive movie theater revenues to $83.5 million from $66 million. Pathe operates screens in France and the Netherlands.