MONTREAL — Malofilm has a new name but it still has the same bad news to report.
Just days after officially changing its name from Malofilm to Behaviour Communications, the Montreal-based company reported some of the worst financial results ever recorded by a publicly traded entertainment company in Canada, and execs at Behaviour said shareholders shouldn’t expect any cheery financial news for at least two more years.
Following on the heels of three quarters of dire results, Behaviour announced a net loss in the fourth quarter of C$5.5 million ($3.9 million) compared to net earnings of C$704,000 ($502,000) in the last quarter last year, and its year-end losses totaled $32.2 million or $3.30 per share, compared to net income of $1.6 million or 21¢ per share last year.
The huge losses were blamed primarily on the restructuring since Richard Szalwinski bought Malofilm from founding owner Rene Malo last year and on poor results from the distribution division, traditionally Malofilm’s strongest unit.
To make matters worse for Behaviour, the company also announced Friday that Paramount Pictures has decided to end its 10-year association with Malofilm and start doing its own distribution in Quebec for its French-lingo videos. The Par output deal, only for French-language video, was worth about $700,000 annually.
Carole Labrie, vice president of video at Behaviour, said Par’s decision to stop working with Behaviour in Quebec had nothing to do with the Montreal company’s financial woes.
Revenues for the year ended Sept. 30, 1997, were up to $55.4 million, compared to $34.4 million the previous year, largely thanks to the contribution of the new Behaviour-owned companies, Filmline Intl. and Image Organization. The two units provided revenue of $28 million. Revenue from distribution dropped by $4 million and revenue from animation producer Desclez Prods. dipped $4.4 million.
Revenues for the three-month period ended Sept. 30 were $5.3 million, compared to $11.7 million for the fourth quarter last year. The decline in revenue was due to delivery schedules from the production units, according to Behaviour execs.