DHX Media completes strategic review with agency deal for Peanuts in China and Asia

Canadian media production and broadcasting company DHX Media Ltd (NASDAQ:DHXM, TSE:DHX) said it has signed a “multi-million-dollar” agency agreement for Peanuts in China and Asia with CAA Global Brand Management Group LLP, a division of Global Brands Group, as it completed its strategic review.

This follows the previously announced sale of a minority stake in Peanuts written and illustrated by Charles M. Schulz to Sony (NYSE:SNE) for C$235.6 million (US$178 million), the company said Monday.

“The strategic review marked the end of an important stage in the evolution of DHX Media,” CEO Michael Donovan said in a statement. “In the first stage of the company, we grew rapidly by acquisition to assemble a world-leading library of children’s and family content. In the second stage, we began to upgrade the necessary team, systems and processes to monetize that portfolio in the global market.”

READ: DHX Media strikes deal to acquire Charlie Brown and Snoopy

Donovan said the company was “well positioned” to enter its next stage of growth, focused on what it identified during the strategic review as the two largest opportunities for kids’ and family content: accelerating investment in its WildBrain network to capitalize on the rising popularity of kids’ content on YouTube and better leveraging its IP portfolio to produce premium originals for major streaming services.

“We believe this refocusing of our strategy will allow us to deliver significant growth, while generating free cash flow to pay down debt,” said Donovan.

The children’s entertainment company has also suspended its quarterly dividend, a move it says will free up $10 million a year to invest in its WildBrain animation studio business and pay down debt.

“We are going to continue to invest in WildBrain where we see tremendous potential for value creation and continued double-digit growth,” said Donovan. 

The combined strategic and internal review process, once fully implemented, is expected to generate $11 million in annualized operating savings.

Full-year results reported

DHX also reported a loss attributable to shareholders of $14.1 million, or $0.10 per share, on $434.4 million in revenue for the financial year ended June 30.

WildBrain revenue grew to $57.3 million vs $34.0 million, driven by a 136% increase in watch time to over 129 billion minutes

Shares of the company climbed 4.7% to $1.12 on the tech-laden Nasdaq and traded flat at $1.07 in Canada.

Contact Uttara Choudhury at [email protected]

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Story by ProactiveInvestors