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Entertainment One - Trading ahead of forecasts

March 2014

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • ETO
  • Price:
  • 345p
The shares had been moving higher for days and finally erupted after EOne said it expects to beat market expectations. On a constant currency basis, the first ten months to end January saw revenues up a barnstorming 56%, with pro forma revenues (assuming Alliance had been owned for both periods) up 7.5%.  Gross margins increased, driven by better than targeted cost synergies achieved from the Alliance acquisition; a greater contribution from the higher margin TV division; and growth of digital revenues which doubled year-on year (now 20% of sales).The film side grew sales 4% with 235 films released in the period, compared to 194 in the prior year period. A further 35 will be released in the final two months and next year's sl ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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