Strong sales of skein drove Q3 earnings growth

MONTREAL — Canuck entertainment company Alliance Atlantis Communications Friday announced strong revenue and earnings growth for the third quarter ended Sept. 30, partly thanks to boffo second-window sales for its “CSI” franchise.

Net earnings were C$17.7 million ($15.7 million), up from $10.8 million in the same quarter last year on revenues up $67 million to $286 million.

One of the major drivers was strong sales of the three “CSI” series. The hit skeins posted revenue of $124 million in the third quarter, up from $44 million, mainly due to second-window license fees. Alliance Atlantis generated $81 million in revenue from second-window “CSI” sales in the quarter.

Broadcasting revenues from Alliance Atlantis’ 13 Canuck specialty channels was up 4% to $59 million in the quarter, year on year.

Subscriber revenue from the channels grew 10% to $29 million. Advertising revenue decreased by $1 million to $28 million.

Revenue from Motion Picture Distribution, which operates film distribution companies in Canada, the U.K. and Spain, was down 8% to $95 million in the quarter — the latest bad news for the struggling distribution division. Execs said this was due to a more modest slate of theatrical releases.

Distrib’s cash flow was almost halved to $8.3 million, compared to $15 million in the third quarter last year, due to lower theatrical revenues.

Execs predict that advertising revenues will follow the normal annual sales cycle and increase in the fourth quarter; the “CSI” franchise is also expected to continue to generate strong revenue.

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