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Vice Swings to Profit in the U.K., Eyes International Partnerships

After a tumultuous period involving harassment scandals, job losses and restructuring, Vice has registered a small profit in the U.K., according to the company’s latest results. The uptick is welcome news for Vice as its new international boss, Dominique Delport, scopes out new production and partnership possibilities for the company’s content business.

The U.K. was the first territory of Vice’s expansion outside the U.S. and remains the company’s single largest international market as well as a hub for the EMEA region. Vice’s U.K. arm reported revenue of £103 million ($130 million) for 2017, compared to £92 million a year earlier, and reversed a £7.6 million loss in 2016 to eke out a £200,000 profit. The digital and creative agency work was Vice’s single biggest earner, generating revenue of £25.7 million and an EBIDTA profit of £2.5 million.

Delport joined Vice earlier this year from Vivendi as president of international and chief revenue officer. He acknowledged that the business had gone through a challenging period but said the U.K. numbers offered a positive sign for how the business can develop.

“They give a great explanation of how Vice is evolving, how Vice has diversified, and how Vice is on the way to profitability,” he told Variety. “That narrative may not fit into what we have heard around Vice as we have had quite a tough time.”

He said he wants to get rid of siloed activity at Vice as it sets out to become a global content studio.

“There is quite a radical shift in the way the business now is executed and operated at scale,” Delport said, “and you can see that with an entity like Vice in the U.K., which reached the £100 million [revenues] level and is very balanced in three of our main businesses: the traditional digital business, the TV business that is growing, and studio/production business.”

A damaging New York Times story about an abusive culture at Vice reverberated internationally, with new execs installed and new workplace guidelines put in place. The company has undergone wholesale management changes, with Nancy Dubuc joining as CEO and Delport at the helm of international. As in the U.S., the U.K. team has seen layoffs and new senior hires. Last month, Disney wrote down its stake in the firm.

Vice Studios launched in the U.K. in 2017 and brought in £2.9 million in revenue, turning a profit of £200,000. In line with Delport’s mission to build partnerships, Vice Studios has started winning commissions from third parties in the U.K., making “Britain’s Cocaine Epidemic” for Channel 5, the upcoming documentary about Salman Rushdie’s “The Satanic Verses,” and a game-show format for UKTV called “Beat the Internet.”

Delport said there would be more and deeper partnerships in the future, notably with the traditional TV players as they looks to build Generation Z audiences. This year, Vice struck a 900-hour content deal with Britain’s Channel 4 and also has deals with Hulu in the U.S., Bell Media in Canada and, more recently, Hooq in Asia. A Chinese deal is in the offing for early next year.

TV, film and advertising studio Pulse Films, which is owned by Vice, posted a £1.4 million loss on revenues of £41.8 million. But with projects including the £50 million Sky and Cinemax series “Gangs of London” coming through, the unit is thought to be close to profitability.

Vice runs a daily news show on HBO in the U.S., and news is another likely area of international expansion. “We want to develop news, we have discussion with partners,” Delport said. “We will keep chasing opportunity to extend the Vice news platform in Europe, in Asia, and the rest of the world because we feel it is a very strong pillar for us.”

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