BIG BIG NEWSNEWS
24 May 2018 | SHARES | 7T
ŚĞďĞŶĞĮƚƐŽĨŚĂǀŝŶŐƐƵĐĐĞƐƐĨƵůĨƌĂŶĐŚŝƐĞƐ
are made crystal clear in the latest results
from Entertainment One (ETO) and
Bloomsbury Publishing (BMY).
Both companies are riding high thanks to
ŽŶŐŽŝŶŐƐĂůĞƐĨƌŽŵĐĞƌƚĂŝŶƟƚůĞƐǁŚŝĐŚŚĂǀĞƚŚĞ
ŚĂůůŵĂƌŬƐŽĨďĞŝŶŐĞǀĞƌŐƌĞĞŶďƌĂŶĚƐ͕ƉŽƚĞŶƟĂůůLJ
ŐŝǀŝŶŐƚŚĞŵůŽŶŐĞǀŝƚLJĂƐŶĞǁŐĞŶĞƌĂƟŽŶƐĚŝƐĐŽǀĞƌ
their appeal in years to come.
Peppa Pig generated $1.3bn in retail sales in the
LJĞĂƌƚŽϯϭDĂƌĐŚϮϬϭΘ͕ƉƌŽǀŝĚŝŶŐάΘκ͘ϳŵƌĞǀĞŶƵĞ
to majority brand owner Entertainment One as
its cut from merchandise agreements. It makes
ĂĚĚŝƟŽŶĂůůŝĐĞŶƐŝŶŐŵŽŶĞLJĨƌŽŵdsĂŶĚĚŝŐŝƚĂů
ƉůĂƞŽƌŵďƌŽĂĚĐĂƐƟŶŐĂůƚŚŽƵŐŚƚŚĞĞdžĂĐƚĂŵŽƵŶƚ
isn’t disclosed as the income is lumped in with
Entertainment One’s overall Family division.
ŚŝĞĨĞdžĞĐƵƟǀĞĂƌƌĞŶdŚƌŽŽƉƐĂLJƐPeppa Pig
ŝƐƐƟůůŐƌŽǁŝŶŐŝŶďŽƚŚĞŵĞƌŐŝŶŐĂŶĚŵĂƚƵƌĞ
markets and that there is much further growth
to come. Broadening the opportunity for future
income will be more immersive experiences such
as new Peppa Pig theme parks and live shows.
Bloomsbury says sales of its ,ĂƌƌLJWŽƩĞƌ series
ŐƌĞǁďLJϯϭйŝŶƚŚĞLJĞĂƌƚŽϮΘ&ĞďƌƵĂƌLJϮϬϭΘʹĂ
remarkable feat given that the franchise launched
21 years ago. It says ‘every year these classics
ƌĞĂĐŚĂŶĞǁŐĞŶĞƌĂƟŽŶŽĨƌĞĂĚĞƌƐ͛͘dŚĞƉƵďůŝƐŚĞƌ
ĐŽŶƟŶƵĞƐƚŽĮŶĚŶĞǁǁĂLJƐƚŽŵŽŶĞƟƐĞƚŚĞǁŝnjĂƌĚ
ƐƚŽƌLJŝŶĐůƵĚŝŶŐŝůůƵƐƚƌĂƚĞĚĞĚŝƟŽŶƐ͘
Entertainment One isn’t solely reliant on Peppa
PigĂƐŝƚďŽĂƐƚƐŵƵůƟƉůĞĨƌĂŶĐŚŝƐĞƐŝŶŝƚƐƉŽƌƞŽůŝŽ͘
For example, PJ Masks is proving to be another
big hit and achieved $1bn retail sales in the past
ĮŶĂŶĐŝĂůLJĞĂƌ͕ƌĞƐƵůƟŶŐŝŶάκΘ͘ΘŵƌĞǀĞŶƵĞĨŽƌ
Entertainment One which shares ownership of the
ďƌĂŶĚǁŝƚŚŝƐŶĞLJĂŶĚŽƚŚĞƌƵŶĚŝƐĐůŽƐĞĚƉĂƌƟĞƐ͘
džƉůŽŝƟŶŐƐƵĐĐĞƐƐĨƵůĨƌĂŶĐŚŝƐĞƐŝƐĂůƐŽĂŬĞLJƉĂƌƚ
Entertainment One and
Bloomsbury are scooping up
the cash from big franchises
The ongoing appeal of Peppa Pig, Harry Potter and other big titles keeps the
income flowing for two media groupsŽĨ ŶƚĞƌƚĂŝŶŵĞŶƚKŶĞ͛ƐdsďƵƐŝŶĞƐƐǁŚĞƌĞŝƚŽǁŶƐ
ƟƚůĞƐƐƵĐŚĂƐThe Walking Dead and Ray Donovan.
Throop says the company likes to focus on popular
shows and to keep making more of them.
It also makes sure ongoing success doesn’t come
at a cost to the business, such as actors and crew
commanding higher salaries as shows increase
in popularity. ‘Some of our deals have ratchet
agreements whereby the broadcasters pay more
for each subsequent series,’ explains Throop.
dŚĞĂĐƋƵŝƐŝƟŽŶŝŶ:ĂŶƵĂƌLJŽĨƚŚĞƌĞŵĂŝŶŝŶŐ
κεйƐƚĂŬĞŝŶdŚĞDĂƌŬ'ŽƌĚŽŶŽŵƉĂŶLJŝƚĚŝĚŶ͛ƚ
already own means Entertainment One now boasts
popular medical drama Grey’s Anatomy in its
ƉŽƌƞŽůŝŽ͘dŚĞƚĞůĞǀŝƐŝŽŶƐŚŽǁŚĂƐďĞĞŶƌĞŶĞǁĞĚ
ĨŽƌŝƚƐĮŌĞĞŶƚŚƐĞĂƐŽŶ͕ŵĂŬŝŶŐŝƚƚŚĞůŽŶŐĞƐƚ
ƌƵŶŶŝŶŐƐĐƌŝƉƚĞĚƉƌŝŵĞͲƟŵĞƐŚŽǁĐƵƌƌĞŶƚůLJ
ĂŝƌŝŶŐŽŶƚŚĞŶĞƚǁŽƌŬŝŶƚŚĞh^͘
Entertainment One’s content library is
ĐƵƌƌĞŶƚůLJǀĂůƵĞĚĂƚΨϭ͘ϳďŶ͕ŚŽǁĞǀĞƌƚŚĂƚĮŐƵƌĞ
ŝƐĐŽŶƐŝĚĞƌĂďůLJŽƵƚŽĨĚĂƚĞŐŝǀĞŶƚŚĞǀĂůƵĂƟŽŶ
ǁĂƐĚŽŶĞŝŶDĂƌĐŚϮϬϭϳĂŶĚŝƚŚĂƐƉƌŽĚƵĐĞĚĂŶĚ
acquired a considerable amount of content in the
subsequent period.
ŶĞǁůŝďƌĂƌLJǀĂůƵĂƟŽŶǁŝůůďĞƉƵďůŝƐŚĞĚĂůŽŶŐƐŝĚĞ
ƚŚĞĐŽŵƉĂŶLJ͛ƐŚĂůĨLJĞĂƌƌĞƐƵůƚƐŝŶEŽǀĞŵďĞƌ͘;Ϳ