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Alliance Atlantis up again

Second quarter revenue increased 18%

MONTREAL — After a lengthy period of lackluster results following the merger in September 1998 of Alliance and Atlantis, Alliance Atlantis Communications posted its second straight quarter of robust results, with strong growth in revenue and net earnings.

The boffo performance by the Canuck entertainment company was due to strong ticket sales by the motion picture division, growth in both subscriber and advertiser revenue for the broadcasting group and increased revenues from finance arm Alliance Atlantis Equicap.

Revenue for the second quarter ended Sept. 30 increased 18% to C$190.3 million ($128 million), compared to $109 million in the same quarter last year. (All results are presented on a pro forma combined basis, as if the merger of Alliance and Atlantis had taken place on April 1, 1998. The two companies actually merged in September.)

Cash flow for the second quarter was $18 million, up 48% from $12.3 million a year earlier. Net earnings for the second quarter were $6.2 million or 20¢ per share (based on a weighted average of 29.9 million shares), compared to a net loss of $28 million or $1.26 per share in the second quarter last year.

Excepting merger and restructuring costs last year, the net earnings for the second quarter last year were $4.4 million or 18¢ per share.

“We improved our TV margins and reduced operating costs. It’s showing that the merger worked, and we’re getting the cost savings we thought we’d get,” said Paul Laberge, veepee of corporate development at Alliance Atlantis.

Revenue was down 7% for the television group, to $64 million this quarter from $69 million last year.Revenue for the motion picture group was up 62% to $43.5 million, compared to $26.9 million last year. The increase in revenue was largely due to the expanded slate of theatrical releases in Canada, and the strong performance of “The Blair Witch Project” and “Austin Powers: The Spy Who Shagged Me.” Both titles were recently released on video and DVD.

Revenue for the broadcasting division increased 13% to $13 million in the quarter, compared to $12 million in the same quarter last year.

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