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Sony Pictures Cuts Losses as Group Profits Surge

Sony Pictures reduced its losses in the three months to June but remained in the red, despite sales at the film and TV unit rising 12% to JPY203 billion ($1.85 billion).

Releasing figures for the first quarter of the April-to-March financial year, parent company Sony Corporation said Tuesday that net profits for the corporation nearly quadrupled in the three months to June, hitting JPY80.9 billion ($722 million), compared with JPY21.2 billion ($193 million) in the same period last year. Sales revenue was up a healthy 15% to $16.6 billion.

Operating losses at Sony Pictures, which spans film and TV, fell from JPY10.6 billion ($96 million) to JPY9.5 billion ($86 million), while revenue increased from JPY183 billion ($1.66 billion) to JPY203 billion. That was a 12% increase in yen, but a 9% increase in dollar terms.

Sony said that the boost in revenue was boosted by television productions, especially licensing fees for “The Last Tycoon” and “Better Call Saul,” and from its TV channels. But it said the movie side saw figures decline compared to a strong equivalent period in 2016 when it released “The Angry Birds Movie.” Pre-release marketing costs for “Spider-Man: Homecoming” also added to the net losses in the April-June quarter.

Film revenues dropped from $697 million to $632 million. TV productions revenue climbed from $408 million to $557 million. Media networks revenue increased from $588 million to $661 million.

During the first quarter, Sony Pictures Entertainment released three movies: “Smurfs: The Lost Village,” which grossed $195 million worldwide, “Rough Night” and “Baby Driver.” With the last two both having June outings, their revenue contributions during the quarter were minimal. In the current July-to-September quarter, SPE will have five movies in theaters, including the already-released “Spider-Man” and “The Emoji Movie,” plus “The Dark Tower,” “All Saints” and “Flatliners.”

On Monday, the group announced that Sony Pictures Television is to buy a substantial majority stake in U.S.-based, English-language anime platform Funimation.

Sony’s music division, which now spans Sony Music Entertainment and Sony/ATV Music Publishing, saw revenues increase from JPY142 billion ($1.29 billion) to JPY169 billion ($1.54 billion), a 12% increase in yen. The division’s net profits increased from JPY15.9 billion ($145 million) to JPY25 billion ($227 million), up 58%.

In April, when the group reported full-year results for 2016-17, Sony revised up its forecast for current-year revenues. It gave guidance of JPY8 trillion in revenues ($72.7 billion) and JPY255 billion ($2.31 billion) for net income to shareholders. This time, it further raised its forecast of revenues by 4%, but left the net income figure unchanged.

For the year to March 2017, Sony reported net income of JPY73.3 billion ($666 million.) In 2016-17 the Pictures division reported a net loss of JPY80.5 billion (reported in dollars as $719 million). In large measure that reflected a $962 million writedown of impaired goodwill at the movie studio.

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