Negative foreign-exchange impacts sliding profits
MONTREAL — Troubled Canadian kids-TV producer Cinar Corp. reported Friday that its net earnings dipped in the first quarter, with the Montreal-based company announcing a loss of C$3 million ($2 million) for the quarter ended Feb. 28, 2003. That’s down from a net profit of $1.3 million in the same period a year earlier.
The company said its earnings were impacted negatively by a foreign-exchange loss of $3.2 million that was due to the stronger Canadian dollar and its effect on a U.S.-dollar-denominated loan from the company’s education division to the parent company.
Revenues overall declined 5.4% from $14.7 million to $14 million, mainly due to a decrease in revenues from the entertainment division. Entertainment revenues dipped from $3.8 in the first quarter last year to $3 million in this quarter, due to the fact that Cinar had no deliveries in the first quarter.
Cinar CEO Stuart Snyder said the results are actually encouraging because they reflect improved margins and improved net earnings from the core entertainment and education businesses.
“We will drive profits from a growing and diverse range of recognized brands and new programs addressing markets that we intend to expand to, including 6- to 11-year-olds,” Snyder said.
Snyder, who stepped in as CEO in February, has said that the company will diversify into live entertainment while continuing to produce TV shows and be active in educational publishing. Cinar has been plagued by financial scandal for much of the past three years.