Wildbrain Ltd ((TSE:WILD)) has held its Q2 earnings call. Read on for the main highlights of the call.
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During WildBrain Ltd’s recent earnings call, the sentiment was generally positive, highlighting strong growth in global licensing and substantial free cash flow. Despite challenges in content creation and non-cash impairments, the company expressed optimism about its overall performance.
Strong Global Licensing Performance
WildBrain Ltd reported a remarkable 32% year-over-year increase in global licensing revenue, reaching $80 million. This impressive growth marked a record licensing quarter for the Peanuts franchise, with significant contributions from North America, APAC, and Latin America.
Peanuts Franchise Success
The Peanuts franchise recorded its highest-ever quarter in licensing revenues. This success was driven by broad-based growth across various geographies and categories, including exciting new partnerships like the Snoopy MoonSwatch collaboration with Omega and Swatch.
Strawberry Shortcake and Teletubbies Growth
Licensing revenue for Strawberry Shortcake surged by over 200% year-over-year, while Teletubbies experienced over 100% growth. Strawberry Shortcake achieved its highest licensing revenue since acquisition, showcasing the strong appeal of these beloved brands.
Strong Free Cash Flow
The company reported a substantial increase in free cash flow, which reached $49 million, compared to $5 million in the same quarter the previous year. This significant improvement highlights the quality of WildBrain’s asset performance.
Expansion in Audience Engagement
Minutes viewed of WildBrain content across global FAST platforms doubled to approximately 15 billion in calendar 2024. There was also double-digit growth in views and watch time on WildBrain channels, reflecting the expanding audience engagement.
Content Creation Revenue Decline
WildBrain faced a 20% year-over-year decline in content creation and audience engagement revenue, affected by the timing of content distribution deals and live-action production.
Net Loss from Continuing Operations
The company reported a net loss from continuing operations of $69 million, a shift from a net income of $7 million the prior year. This was mainly due to non-cash unrealized foreign exchange losses and impairments.
Impairment of Intangibles
Non-cash impairments led to a reduction in the net book value of lesser-known titles, resulting in a write-down in investment in film and television and acquired intangibles.
Forward-Looking Guidance
WildBrain reaffirmed its fiscal 2025 guidance, projecting a revenue growth of 10-15%, including discontinued operations, and adjusted EBITDA growth of 5-10%. The ongoing sale of a two-thirds stake in WildBrain Television is expected to provide further strategic flexibility, with regulatory approvals currently underway.
In summary, WildBrain Ltd’s earnings call reflected a positive outlook, driven by strong global licensing growth and increased free cash flow, despite some challenges in content creation revenue. The company remains confident in its fiscal 2025 projections and strategic initiatives.
