Digital distributor Cinedigm Corp. has reported a loss of $4.6 million, or 70 cents a share, for its first quarter that ended on June 30 — topping Wall Street estimates of a loss in the $1.25-a-share range.
The company made the announcement after the market closed on Monday. Revenues declined 1.3% to $22.5 million with content and entertainment revenues amounting to $6.8 million.
Prior to the announcement, shares of Cinedigm gained 6.9% on Monday, reaching $2.40 — more than double the all-time low of 90 cents a share on July 14. Shares were trading at nearly $7 a year ago, but declined sharply in the latter parts of 2015 as the company attempted to find traction by focusing on its over-the-top business strategy.
Cinedigm reported that its OTT channels Docurama, Comic-Con specialist CONtv, and faith-and-family-oriented Dove Channel continue to gain app downloads, registered users, and active subscribers — with approximately 60,000 active subscribers.
The company said it has increased its library to more than 58,000 films and TV episodes, with family and animated titles comprising more than 30% of that collection. Cinedigm asserted that the gain reflects growing global demand for those genres and underscores a key competitive advantage as the family-friendly Dove channel continues to expand.
Cinedigm also reported that it remains on track to achieve $9 million-plus in cost savings that were initiated in the previous year. It’s also in the process of engaging an investment bank to assist in securing the previously announced financing of up to $11 million in second lien secured debt.
“We continue to be pleased with our growth in OTT and hope to capitalize on several opportunities immediately front of us to further accelerate channel growth,” said Chairman and CEO Chris McGurk. “We are also aggressively taking advantage of new content opportunities in our base business that are resulting from favorable industry dynamics.”
After the earnings report, McGurk said during Monday’s call with analysts that Cinedigm is focusing on content with broad appeal for the OTT channels with premium offering consisting largely of library content.