SINGAPORE (Aug 14): Entertainment group mm2 Asia has announced earnings of $6.4 million for the first quarter of FY18, up 30% from the $4.9 million in earnings it posted a year ago on higher revenue.
Revenue for the quarter nearly doubled to $24.6 million from $13.4 million in 1Q17 on the back of $6.2 million generated from the group’s event production and concert promotion business, as well as the result of the group’s acquisition of business assets from Mega Cineplex.
Notably, concert and event promotion revenue from the group’s newly-acquired subsidiary, UnUsUaL, contributed to 25% of the group’s revenue for the quarter.
In line with the higher revenue, cost of sales increased nearly threefold to $9.3 million from $3.6 million a year ago.
General and administrative expenses grew 61.6% to $5.6 million on higher employee compensation costs, due to newly-acquired businesses and staff enlargement, as well as depreciation costs due to the purchase of equipment by UnUsUaL.
Gross profit consequently grew by 52% to $15.4 million from $10.1 million in the previous year, contributed to in part by its event production & concert production business, cinema business, core business as well as cafe business.
The group also incurred one-off trading income over the quarter which was earned by UnUsUaL during the period to raise other income to approximately $246,000 compared to $11,000 a year ago.
Cash and cash equivalents grew to $74.9 million as at end-June compared to $25.8 million as at end-4Q17 due to a $43 million increase from the group’s core business, partly contributed by proceeds received in advance from the financial institution for share allotment.
In its outlook, mm2 says it will continue to focus on its core business in Singapore and Malaysia as well as expand it to Hong Kong, Taiwan, China and also the USA, with expectations of its productions in North Asia to continue forming a bigger part of its revenue in FY19.
With the increase in demand for concerts and events by well-known entertainers and a steady stream of concerts and events in the region, the group believes UnUsUaL will continue to expand out of the Singapore and Malaysia region, and move up the value chain as an originating producer to sign artistes for regional tours.
Looking ahead, mm2 says it will continue to source for growth opportunities in Singapore and the region to expand its businesses in the areas of film and TV/online production and distribution, post-production, cinema business and concert and event production and production, to further strengthen its financial performance.
As at 9:23am, shares in mm2 are trading 1 cent higher at 48 cents.
