After much speculation in the financial press over the past few months, Entertainment Rights has this morning revealed its interim results for the eight month period to August 31st 2008.
The company revealed turnover for the period of £20.3 million (this is compared with £17.3m for the six months to June 30th 2007), but impairment of assets was £83.0 million resulting in a loss before tax of £105.0 million.
A review of the operational and financial position of the company has been undertaken, and a minimum of £5 million of fixed cost savings have been identified and will be implemented by year-end for full benefit in 2009 and beyond.
Reduction of debt is the primary objective, which will be approached with selective disposal of non-core assets, fixed cost savings and a reduction of capital expenditure.
Discussions with ER's lending bank have led to a short-term covenant waiver and additional interim funding.
ER chairman Rod Bransgrove admitted that the period under review had been one of "considerable disruption" to its financial results and represented something of a watershed for the company. He said he was "personally committed" to seeing the business through to a period of stability and, after this, would be standing down as chairman at the company's year-end.
Bransgrove added that the board was "resolute" in its pursuance of a radical turnaround programme based on ER's range of global assets and library of entertainment.
Chief executive Nick Phillips said: "Our licensing business is trading strongly and we are continuing to hold promising discussions with broadcasters on future commissions, and this is a good indication that Entertainment Rights' underlying business is in good health.
"Our forecasts of retail activity have taken a conservative approach to Christmas trading in light of the wider economic conditions and the resultant impact on consumer confidence. I, together with my entire team, am making every effort to see that the business is placed firmly on track for long-term profitable growth."