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EOne sees FY profit hit from film unit restructuring

Published 2017-05-12, 04:55 a/m
© Reuters.  EOne sees FY profit hit from film unit restructuring
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May 12 (Reuters) - Entertainment One ETO.L , the maker of children's TV show Peppa Pig, said it expects full-year profit to take a 47-million-pound ($60.42 million) hit from one-off costs related to the restructuring of its film division.

Canada's eOne, however, said it expects full-year underlying earnings before interest, tax, depreciation and amortisation to be in line with expectations, with the restructuring of its film division expected to drive improved underlying profitability and cash flow.

"One-off costs are a near-term negative, but show that ETO is pushing forward with its film restructuring under the new CFO and making the right pro-active decisions after several years of disappointment in this specific division," Investec analyst Steve Liechti said.

Earlier this month, the company -- which rebuffed a 1 billion-pound takeover offer from Britain's biggest free-to-air commercial broadcaster ITV Plc ITV.L last year -- appointed Joe Sparacio as permanent chief financial officer, after six months as interim CFO. March, the company said it continued to see a rebound in box office film revenues in the second half of the year, thanks to a strong slate of new releases including 'La La Land', 'Arrival' and 'The Girl on the Train'. the time, eOne -- which is headquartered in Toronto, Canada, but listed on the London Stock Exchange -- said it expects to release 170 new film titles this financial year, including director Steven Spielberg's 'The Post' and actor George Clooney's 'Suburbicon'.

The company said the one-off costs related to its film division restructuring include 27 million pounds from its move to digital distribution and a $25 million payment related to the renegotiation of an individual distribution agreement.

The company is scheduled to report full-year results on May 23.

Shares of the company fell nearly 3 percent to 236.9 pence in early trading on the London Stock Exchange, before paring losses to trade down 0.8 percent by 0849 GMT.

($1 = 0.7778 pounds)

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