XILAM (EPA:XIL) XILAM announces 2018 FY revenues up 16% at €28 million

Transparency directive : regulatory news

20/02/2019 18:00

Press release
Paris, 20 February 2019

                XILAM announces 2018 revenues: EUR28 million
                          Strong growth (nearly 16%)
                 Confirmation of delivery targets for 2020

Xilam Animation (ISIN Code: FR0004034072, Ticker: XIL), an independent producer
and distributor of animated programmes, has announced its revenue for 2018.

(in EUR thousands)    31.12.2018 (1)   31.12.2017   Change (%)   31.12.2017
restated IFRS15
published
New productions         11,690             10,186        +15%         9,218
Other income and
subsidies (2)            6,506              6,101         +7%         6,101
Total new productions   18,196             16,287        +12%        15,319
Catalogue                9,723              7,704        +26%         9,017
Other                       32                 62        -48%            62
Total revenue and
other income (2)        27,951             24,053        +16%        24,398

(1) unaudited data
(2) this figure excludes audiovisual tax credits

Market momentum continues to gather pace

The animation sector in which Xilam works is seeing very positive trends, with
strong demand across the range of traditional and digital platforms in France
and internationally. Against this background Xilam is developing an
ever-expanding catalogue of high-quality productions. Children's animation has
established itself as a central pillar of the strategy adopted by platforms to
meet the needs of a fast-growing population (Asia) and enable better subscriber
retention. Xilam has built a unique business model, well-suited to these market
trends, on the foundations of the strength and reputation of its proprietary
brands.

Strong growth in new productions, backed up by record price levels

Xilam enjoyed a particularly successful year in 2018, with revenue and other
income growing 16% to the record level of EUR28.0 million, including EUR18.2
million in sales of new productions and EUR9.7 million in sales from the
catalogue, representing 65% and 35% of sales respectively.

Xilam continued to deliver new productions in line with its roadmap (delivery
of 70 half-hours in 2018). In all, 69 half-hours were delivered in 2018 (from
63 in 2017), with a further increase in the price per half-hour to EUR264,000
(from EUR259,000 in 2017).

This continuous increase in prices per half-hour, to an exceptionally high
level, reflects not only the high quality of Xilam's productions, but also
increasingly intense competition in the broadcasting market and growing demand
for premium content, both from digital SVOD platforms such as Netflix and
Amazon and from TV channels in France (France Télévision, Gulli) and abroad
(Nickelodeon, Disney, Cartoon Network, etc.). New productions are a powerful
engine of growth in the catalogue, with a significant impact on both revenue
and profitability.

Solid growth (26%) in an increasingly substantial catalogue

Revenue from the programme catalogue grew significantly in 2018, even though
2017 was itself a record year. This growth was, however, held back by two
one-off factors: the volume effect relating to the growth in new productions
that has not yet fed through, as only a single new series was added to the
catalogue this year, having enjoyed an exceptional level of pre-sales; and the
fact that Xilam elected not to renew certain exclusive licences for digital
distribution of its catalogue in order to encourage distribution on YouTube,
which will give stronger growth and better visibility over the medium term.
Sales of catalogue programmes were nevertheless strong, both to digital
platforms (36%) and traditional broadcasters and with a strong international
component (71%) in the product mix. On average, recurrent revenue represents
some 60% of revenue from Xilam's catalogue.

20 years of Oggy and the Cockroaches: the resilience and quality of Xilam
animations

The 20 years of Oggy and the Cockroaches demonstrate the excellent resilience
of this animation, first created in Xilam's studios 20 years ago. The early
series are still broadcast around the world and the latest has substantial
pre-sales.

Digital transition: a focus on direct distribution via ADVOD platforms

Strengthened by unrivalled expertise and a strategy encouraging the transition
of the business model to digital, Xilam plans to accentuate i) direct
distribution of its programmes on ADVOD platforms such as YouTube and Facebook;
and ii) the monetisation and expansion of its offering through pre-school
programming and e-learning modules.

In 2018, digital revenue represented 30% of total sales. This was split between
the sale of programmes (new and catalogue) to SVOD platforms and direct revenue
from ADVOD platforms.

Sales on YouTube represented 9% of total revenue, an increase of 55%, driven by
a US market which accounted for nearly 30% of this revenue.

By the end of December 2018, Xilam had exceeded 10 billion total views on
YouTube, confirming the rapid acceleration of its dedicated offering. The
number of its videos viewed on YouTube rose by 44% to nearly 4 billion in 2018,
boosted by 100% growth in the USA. This trend was also reflected in the 162%
increase in the number of subscribers to its channels, to 6.3 million by end-
2018 (from 2.4 million at end-2017).

International: a growing share of the product mix, boosted by digital

The final component of its growth model, international sales represented 61% of
the total in 2018. International revenue reflected not only the expansion of
the distribution zone for major platforms (with the full deregulation of
consumer access to non-domestic programmes), but also the continued rise in
prices, notably in digital.

Unchanged outlook: strong growth and diversification

Prospects for 2019 are strong, with a delivery target of 80 half-hours of new
productions (from 85 previously indicated), the addition to the catalogue of
new productions that were fully delivered in 2018 and numerous licence renewals
for series delivered in earlier years. The level of pre-sales for new
productions is set to continue to rise, benefiting from ever more positive
pricing effects. The share of revenue from ADVOD platforms is also set to grow,
with Xilam expecting growing numbers of views of its YouTube channels in
particular.

Marc du Pontavice, Xilam's Chairman and Chief Executive Officer, observed:
"Over and above the success and durability of our flagship Oggy franchise, we
are delighted in the rising contribution from new franchises such as Zig &
Sharko, which has already overtaken Oggy on YouTube, and Mr Magoo, which will
benefit in 2019 from a global launch on the biggest TV channels. On the
strength of this creativity and our expertise, we enjoy good visibility on our
medium-term growth and can confirm our development plan for 2020, namely
delivering 100 half-hours of new production, accelerating our penetration of
digital platforms and continuing our international expansion, particularly in
China and India. The pre-school market is another area of diversification that
the company has identified, offering strong potential for referrals,
monetisation and merchandising over digital platforms. We would also reiterate
that we will consider acquisition opportunities through studio boutiques,
talent collectives and other complementary pools of expertise."

About Xilam

Xilam is one of Europe's leading animation companies, producing and
distributing original children's and family entertainment content across TV,
film and digital media platforms. Founded in 1995 by Marc du Pontavice, the
award-winning Paris-based company owns a catalogue of more than 2,000 animated
series episodes and 3 feature films, including such household brands such as
Oggy & the Cockroaches, Zig & Sharko, The Daltons, Rolling with the Ronks! and
its first preschool property, Paprika. Broadcast in over 190 countries on all
the major global children's TV networks, these series are also breaking records
on all the major digital platforms, including YouTube with over 300 million
views per month, ranking Xilam among the top global content providers in the
realm of animation. Xilam employs over 400 people, including 300 artists, who
work in its four studios, located in Paris, Lyon, Angouleme and
Hô-Chi-Minh-Ville in Vietnam. Xilam is listed on the Euronext Paris stock
exchange, Compartment B - Eligible investment for French Deferred Settlement
Service (SRD long) and Equity Savings Plans (PEA)

Contacts

Marc du Pontavice - CEO
François Bardoux - CFO
Tel: +33 (0) 1 40 18 72 00

     57 boulevard de la Villette 75010 Paris - Tél : (33) 01 40 18 72 00
                                 www.xilam.com
    Société Anonyme au capital de 491 150 - R.C.S PARIS : 423 784 610 -
                   SIRET : 423 784 610 00036 - APE 921 A

XILAM's latest news

27/03/2019 18:00

XILAM (EPA:XIL) XILAM announces 2018 FY revenues up 16% at €28 million

Transparency directive : regulatory news

XILAM's latest news

Other stories