Losses at Alibaba Pictures Group deepened to $83.7 million (RMB561 million) in the six months to June. Revenue pointed in the opposite direction and nearly quadrupled from RMB257 million to $158 million (RMB1.06 billion). The company, part of Chinese commerce giant Alibaba, said that it expects to enter “a new phase of development in the near future.”
The net losses compare with $69.4 million (RMB466 million) in the same period last year. And the company pointed to foreign exchange movements and the ongoing cost of subsidies need to build the market position of online ticketing firm Tao Piao Piao.
The unit sells tickets across 97% of cinemas in China and also provides marketing, distribution and promotion services to film rights owners and distributors. It claimed partial credit for the box office success of India’s “Dangal,” in which the China gross exceeded the film’s performance in its native India, and “A Dog’s Purpose,” where the China result was bigger than the North American score. APG’s parent company, Alibaba owns a minority stake in Steven Spielberg’s Amblin Partners, producer of “Purpose.”
Following several management changes in the past year, APG positions itself these days more as a technology platform and services provider than as a film producer or rights owner. However, it continues to invest in film and TV content. In the half year these earned revenue of $6.40 million (RMB43) and lost $6.7 million (RMB45 million). Its titles on release between January and June included “Ferry Man,” “Mr Pride vs Ms Prejudice,” and “This is not What I Expected.” Titles for release in the second half of the year include “Once Upon A Time” (released earlier this month), and romance “21 Carats.” Other titles in development include game adaptation “Swords of Legend 2.”
The company is a subsidiary of Alibaba that has its own share listings in Hong Kong and Singapore. In early Hong Kong trade on Thursday, following the overnight results announcement, the shares dropped nearly 3% to HK$1.32, implying a market capitalization of $4.97 billion (HK$33.3 billion).
In a related move, Alibaba Digital Media Entertainment Group this week revealed the signing of a two-year deal with top Chinese rock music group Black Panther to develop and promote merchandising for the band. Alibaba Pictures is expected to be deeply involved in the marketing.