sony pictures digital productions mid-range plan october 6, 2009
TRANSCRIPT
Sony PicturesSony PicturesDigital ProductionsDigital Productions
Mid-Range PlanMid-Range PlanOctoberOctober 6, 2009 6, 2009
FY10 Mid-Range PlanFY10 Mid-Range Plan
StrategyStrategy
OverviewOverview
Sony Pictures AnimationSony Pictures Animation
ImageworksImageworks
Imageworks Interactive Imageworks Interactive
MRP Financial ProjectionsMRP Financial Projections
Financial AppendixFinancial Appendix
StrategyStrategyOverviewOverview
Digital ProductionsDigital ProductionsStrategic ObjectivesStrategic Objectives
SPDP’s strategic objectives are:SPDP’s strategic objectives are: Produce financially successful CG Produce financially successful CG
animated films at a significantly animated films at a significantly lower cost than either Pixar/Disney lower cost than either Pixar/Disney or Dreamworksor Dreamworks
Remain a VFX leader and serve as Remain a VFX leader and serve as a ‘net cost’ resource for Columbiaa ‘net cost’ resource for Columbia
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Digital ProductionsDigital ProductionsStrategic Benefits to the StudioStrategic Benefits to the Studio
Digital Productions benefits the studio’s:Digital Productions benefits the studio’s: Overall release strategyOverall release strategy
SPA’s family-oriented animated and hybrid films are SPA’s family-oriented animated and hybrid films are critical to SPE in a challenging industry environment critical to SPE in a challenging industry environment (family constitutes 5 of the top 10 films to date in (family constitutes 5 of the top 10 films to date in 2009)2009)
Cloudy’s Cloudy’s box office success indicates the potential for box office success indicates the potential for these filmsthese films
Profitability Profitability Imageworks’ 3Imageworks’ 3rdrd party VFX business lowers production party VFX business lowers production
cost and increases quality for SPA and Columbiacost and increases quality for SPA and Columbia MarketingMarketing
Imageworks Interactive continues to deliver industry-Imageworks Interactive continues to deliver industry-leading sites and digital campaigns to internal clients leading sites and digital campaigns to internal clients at below market costsat below market costs
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Digital ProductionsDigital ProductionsOverviewOverview
Challenges for SPDP include:Challenges for SPDP include: Achieving consistent level of SPA output, Achieving consistent level of SPA output,
while managing pre-greenlight costswhile managing pre-greenlight costs Continued price pressure on Imageworks Continued price pressure on Imageworks
as studios seek to contain costsas studios seek to contain costs Continue to shift Imageworks’ workforce Continue to shift Imageworks’ workforce
to lower cost satellite facilitiesto lower cost satellite facilities
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Sony Pictures AnimationSony Pictures AnimationWhy Family and Why Animation?Why Family and Why Animation?
Family is one of the most popular global genres in Family is one of the most popular global genres in the theatrical and DVD marketsthe theatrical and DVD markets
In success, CG animated films retain the upsideIn success, CG animated films retain the upside
CG animated family films lend themselves to CG animated family films lend themselves to theatrical or DVD sequels, which tend to have theatrical or DVD sequels, which tend to have high marginshigh margins
Live-action hybrids can also have significant, Live-action hybrids can also have significant, high-margin revenue upside (e.g., high-margin revenue upside (e.g., Alvin & the Alvin & the Chipmunks)Chipmunks)
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Sony Pictures AnimationSony Pictures AnimationStrategy & ProgressStrategy & Progress
Strategic Focus Progress To-DateCreate diverse production slate featuring: High-end CG films Mid-tier CG films Live-action hybrids Direct-to-Video (DTV)
Released high-end CG Cloudy to early box office success; Hotel Transylvania in pre-production
Live-action hybrid Smurfs in pre-production Released DTV financially successful Open Season 2; fast-
tracked Open Season 3 Considering ideas for Cloudy sequel Identifying other films from several promising projects
currently in priority development Completed significant development deals
Shepard Aardman relationship Arthur Christmas and Pirates! have been greenlit Aardman has been collaborating closely with SPA and
Imageworks in pre-production on Arthur Christmas Developing future projects to be brought to the U.S. with Nick
Park, creator of Wallace & Gromit
Mitigate risk of titles in production by seeking 3rd party financing
Continuing to explore financing opportunities
Develop ancillary revenue opportunities
Working closely with Marketing to identify significant consumer products licensing opportunities
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Even modestly successful Even modestly successful theatrical CG animated films theatrical CG animated films can become profitable can become profitable franchises:franchises: Open Season 2 Open Season 2 has has a 39% profit margin ($23.8MM a 39% profit margin ($23.8MM Gross Profit)Gross Profit)
Direct to Videos (DTVs) can be Direct to Videos (DTVs) can be opportunistically released opportunistically released theatrically overseas, which also theatrically overseas, which also enhances their home enhances their home entertainment performanceentertainment performance
Open Season 2 & 3 lifts the Open Season 2 & 3 lifts the overall profitability of the overall profitability of the franchise to 10.9% ($48MM franchise to 10.9% ($48MM Gross Profit)Gross Profit)
DTV also provides an excellent DTV also provides an excellent training ground for emerging training ground for emerging creative talent creative talent
CloudyCloudy is the next property to be is the next property to be considered for DTV or theatrical considered for DTV or theatrical releaserelease
Strategy – FranchisesStrategy – Franchises
OPEN SEASON FRANCHISE
OPEN SEASONOPEN SEASON
2 (DTV)SUBTOTALOSE & OSE2
OPEN SEASON3 (DTV)
TOTALFRANCHISE
RELEASE DATE September 26, 2006 J anuary 27, 2009 J anuary 20, 2011
TOTAL DOMESTIC BOX OFFICE $84,000 $0 $84,000 $0 $84,000
TOTAL INTERNATIONAL BOX OFFICE 106,000 9,000 115,000 8,000 123,000
DOMESTIC THEATRICAL NET (32,034) 0 (32,034) 0 (32,034)
INT'L THEATRICAL NET (21,186) 1,596 (19,590) 830 (18,760)
DOM. HOME VIDEO REVENUE 134,300 38,800 173,100 20,090 193,190
DOM. HOME VIDEO COSTS (45,550) (14,978) (60,528) (10,010) (70,538)
DOMESTIC HOME VIDEO NET 88,750 23,822 112,572 10,080 122,652
INT'L HOME VIDEO REVENUE 52,868 14,249 67,117 10,000 77,117
INT'L HOME VIDEO COSTS (24,868) (7,149) (32,017) (5,000) (37,017)
INT'L HOME VIDEO NET 28,000 7,100 35,100 5,000 40,100
TOTAL TELEVISION NET 60,706 2,792 63,498 1,060 64,558
NON-THEATRICAL 1,577 1,550 3,127 510 3,637
MERCHANDISE, MUSIC & OTHER 8,195 0 8,195 0 8,195
MERCH COST (1,548) 0 (1,548) 0 (1,548)
PRODUCTION COST (99,400) (11,250) (110,650) (8,200) (118,850)
OVERHEAD (13,000) 0 (13,000) 0 (13,000)
RESIDUALS (4,230) (1,780) (6,010) (980) (6,990)
TOTAL REVENUES $345,226 $61,116 406,342 $35,115 $441,457
RELEASING COSTS (212,766) (24,256) (237,022) (17,635) (254,657)
PROD, O/H, PART, RESIDUALS (116,630) (13,030) (129,660) (9,180) (138,840)
GROSS PROFIT (LOSS) $15,830 $23,830 $39,660 $8,300 $47,960
GROSS PROFIT MARGIN 4.6% 39.0% 9.8% 23.6% 10.9%
SPA is focused on these following films in SPA is focused on these following films in production and pre-production:production and pre-production: Open Season 3Open Season 3: DTV
In productionIn production Voice Talent: Mike Epps returning as voice for “Boog” (Tentative)Voice Talent: Mike Epps returning as voice for “Boog” (Tentative)
Smurfs: Smurfs: Live-action hybrid (under discussion for 3D)Live-action hybrid (under discussion for 3D) In pre-productionIn pre-production Director: Raja Gosnell; Producer: Jordan Kerner (Director: Raja Gosnell; Producer: Jordan Kerner (Charlotte’s WebCharlotte’s Web); );
Script: J. David Stern, David N. Weiss (Script: J. David Stern, David N. Weiss (Shrek 2, Jimmy NeutronShrek 2, Jimmy Neutron); ); Polish: Audrey Wells (Polish: Audrey Wells (George of the JungleGeorge of the Jungle))
Hotel Transylvania:Hotel Transylvania: High-end, CG animated (3D) High-end, CG animated (3D) In pre-productionIn pre-production Director: Jill Culton; Producer: Michelle MurdoccaDirector: Jill Culton; Producer: Michelle Murdocca
Arthur Christmas:Arthur Christmas: Aardman, CG animated (3D) Aardman, CG animated (3D) In pre-productionIn pre-production Directors: Sarah Smith, Barry Cook; Script: Peter Baynham Directors: Sarah Smith, Barry Cook; Script: Peter Baynham
(Academy Award nominee for (Academy Award nominee for BoratBorat)) Pirates!: Pirates!: Aardman, Stop-Motion (3D)Aardman, Stop-Motion (3D)
Sony Pictures AnimationSony Pictures AnimationDiversified SlateDiversified Slate
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Sony Pictures AnimationSony Pictures AnimationDiverse Slate DevelopmentDiverse Slate Development
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Changelings: Changelings: CG animated Director: Brian Pimental; Producers: Kevin Lima
& Chris Chase Dark Samurai: Dark Samurai: CG animated
Director: Jerome Chen; Producer: Michelle Murdocca, Executive Producer: Avi Arad; Writer: Mark Frost
Familiars: Familiars: CG animated Executive Producers: Sam Raimi, Josh Donen
Hip Hop: Hip Hop: Live-action hybrid Live-action hybrid Producers: Peter Abrams & Andrew Panay
(Wedding Crashers) Going South: Going South: CG animatedCG animated
Adam Sandler project Cloudy 2: Cloudy 2: CG animated DTV
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Sony Pictures AnimationSony Pictures Animation Development RelationshipsDevelopment Relationships
Development relationships focus on Development relationships focus on identifying future films from which other identifying future films from which other franchises can emerge:franchises can emerge: First look deal with Gotham GroupFirst look deal with Gotham Group First look deal with Fred SeibertFirst look deal with Fred Seibert Development deal with Avi Arad (1 project, Development deal with Avi Arad (1 project,
2 pending)2 pending) In discussions with Henry SelickIn discussions with Henry Selick In discussions with Peter Baynham on an In discussions with Peter Baynham on an
exclusive animation writing dealexclusive animation writing deal
FY10FY10
Q2
Cloudy with a Chance of Meatballs (09/18/09)
Q2
Cloudy with a Chance of Meatballs (09/18/09)
FY11FY11
Q4
Open Season 3 DTV (Jan 2011)
Q4
Open Season 3 DTV (Jan 2011)
FY12FY12
Q2
Smurfs (Hybrid) (7/29/11)
Hotel T (9/20/11)
Q3
Arthur Christmas (11/11/11)
Q4
TBD DTV FY12 (Jan 2012)
Q2
Smurfs (Hybrid) (7/29/11)
Hotel T (9/20/11)
Q3
Arthur Christmas (11/11/11)
Q4
TBD DTV FY12 (Jan 2012)
FY13FY13
Q2
TBD Animation FY13 (9/28/12)
Q3
Pirates (Fall 2012)
Q4 TBD DTV FY13 (Jan 2013)
Q2
TBD Animation FY13 (9/28/12)
Q3
Pirates (Fall 2012)
Q4 TBD DTV FY13 (Jan 2013)
FY14FY14
Q1
TBD Hybrid FY14 (Hybrid) (5/15/13)
Q2
TBD Animation FY14 (9/20/13)
Q4
TBD DTV FY14 (Jan 2014)
Q1
TBD Hybrid FY14 (Hybrid) (5/15/13)
Q2
TBD Animation FY14 (9/20/13)
Q4
TBD DTV FY14 (Jan 2014)
FY15FY15
Q1
TBD Aardman FY15 (5/16/14)
Q2
TBD Animation FY15 (9/19/14)
Q3
TBD Hybrid FY15 (Fall 2014)Q4 TBD DTV FY15 (Jan 2015)
Q1
TBD Aardman FY15 (5/16/14)
Q2
TBD Animation FY15 (9/19/14)
Q3
TBD Hybrid FY15 (Fall 2014)Q4 TBD DTV FY15 (Jan 2015)
FY16FY16
Q2
TBD Animation FY16 (9/18/15)
Q3
TBD Hybrid FY16 (Fall 2015)
Q4
TBD DTV FY16 (Jan 2016)
Q2
TBD Animation FY16 (9/18/15)
Q3
TBD Hybrid FY16 (Fall 2015)
Q4
TBD DTV FY16 (Jan 2016)
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Sony Pictures Animation Release Schedule
Development SpendingDevelopment SpendingFY10-FY13FY10-FY13
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Holding development spend within historic levels while Holding development spend within historic levels while supporting an expanded and diversified slatesupporting an expanded and diversified slate
FY10-FY13 Development Spending Budget ($000)FY10-FY13 Development Spending Budget ($000)
Serve SPA and Columbia as a dependable source Serve SPA and Columbia as a dependable source of digital animation and VFX expertiseof digital animation and VFX expertise
Maintain industry leadership in qualityMaintain industry leadership in quality Become even more price competitive:Become even more price competitive:
Bring down overall labor costs further through Bring down overall labor costs further through minimizing artist gap time and recruiting lower cost minimizing artist gap time and recruiting lower cost talenttalent
Simplify production technology and standardize software Simplify production technology and standardize software tools to increase efficiencytools to increase efficiency
Reduce real estate cost through more efficient use of Reduce real estate cost through more efficient use of Imageworks’ space Imageworks’ space
Continue to shift work to satellites in tax and cost Continue to shift work to satellites in tax and cost advantaged areas (New Mexico and India) while advantaged areas (New Mexico and India) while exploring Vancouver in depth as an additional satellite exploring Vancouver in depth as an additional satellite locationlocation
Continue to use 3Continue to use 3rdrd party work as a means to party work as a means to reduce SPA and Columbia production cost (less reduce SPA and Columbia production cost (less gap cost, shared overhead, shared R&D, stronger gap cost, shared overhead, shared R&D, stronger talent pool)talent pool)
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ImageworksImageworksStrategyStrategy
Continue to focus on renewed relationship with Continue to focus on renewed relationship with Columbia as a critical resource for VFX expertiseColumbia as a critical resource for VFX expertise All services provided internally are at ‘net cost’ All services provided internally are at ‘net cost’ Providing early support for Providing early support for Spiderman 4, Spiderman 4, including including
access to character models, pre-visualization and 3D access to character models, pre-visualization and 3D teststests
Providing last-minute post-production services for Providing last-minute post-production services for This Is This Is ItIt
Produced test for Produced test for Battle LABattle LA Provided resources for Columbia to more effectively Provided resources for Columbia to more effectively
evaluate external VFX bids for evaluate external VFX bids for Green HornetGreen Hornet Serving the studio – and company – as the “go to” Serving the studio – and company – as the “go to”
resource on 3D through availability of key staff, resource on 3D through availability of key staff, technology and facilitiestechnology and facilities
Key collaborator on the studio’s digital backbone projectKey collaborator on the studio’s digital backbone project
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ImageworksImageworksStrategic Objectives – Columbia Strategic Objectives – Columbia
ResourceResource
ImageworksImageworksStrategic Objectives – Clients and TechnologyStrategic Objectives – Clients and Technology
Strengthen relationship with large studio clients – Strengthen relationship with large studio clients – Disney and Warner Bros. – increasing the amount Disney and Warner Bros. – increasing the amount of business from these sources as well as of business from these sources as well as improving overall facility utilizationimproving overall facility utilization
Use innovative technology and partnerships to Use innovative technology and partnerships to increase efficiency, reduce development costs, increase efficiency, reduce development costs, and position Imageworks’ technology as the and position Imageworks’ technology as the industry standardindustry standard Imageworks’ Open Source initiative, the first of its kind Imageworks’ Open Source initiative, the first of its kind
for a major VFX house, has already seen significant for a major VFX house, has already seen significant adoptionadoption
Prospective partnership with the Foundry, an industry-Prospective partnership with the Foundry, an industry-leading VFX software developer, creates immediate leading VFX software developer, creates immediate savings from free or significantly reduced access to their savings from free or significantly reduced access to their suite of software as well as shared developmentsuite of software as well as shared development
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Aggressively utilize satellite production to further Aggressively utilize satellite production to further reduce overall cost and become more price reduce overall cost and become more price competitive on internal and third party bidscompetitive on internal and third party bids India is well-positioned to do increasing amount of 3D India is well-positioned to do increasing amount of 3D
workwork Revenues have increased 32% in FY10 while costs have Revenues have increased 32% in FY10 while costs have
been held flat from prior yearbeen held flat from prior year Note: Prior management negotiated what is expected to be a $2.5-$4.5MM Note: Prior management negotiated what is expected to be a $2.5-$4.5MM
total payout to minority partners occurring in FY11 & FY12total payout to minority partners occurring in FY11 & FY12
New Mexico has been fully integrated into bids, taking New Mexico has been fully integrated into bids, taking full advantage of the state tax creditfull advantage of the state tax credit
Substantial share of recent 3Substantial share of recent 3rdrd party bids for party bids for Zookeeper Zookeeper and and Green Lantern Green Lantern were based in New Mexicowere based in New Mexico
SPA productions are also relying on the facility more SPA productions are also relying on the facility more heavilyheavily
Explore creation of a satellite facility in Vancouver to Explore creation of a satellite facility in Vancouver to take advantage of 50% effective tax credit on labor and take advantage of 50% effective tax credit on labor and deep local talent pooldeep local talent pool
ImageworksImageworksStrategic Objectives – Satellite ProductionStrategic Objectives – Satellite Production
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2121
Imageworks Cost Savings Imageworks Cost Savings FY08-FY13FY08-FY13
Imageworks has dramatically reduced non-billable costs by Imageworks has dramatically reduced non-billable costs by increasing production efficiency and also trimmed non-increasing production efficiency and also trimmed non-essential overheadessential overhead
$3MM ahead of plan in FY10$3MM ahead of plan in FY10FY08-FY13 Non Billable Costs Budget vs. Actuals, ($000)FY08-FY13 Non Billable Costs Budget vs. Actuals, ($000)
CAGR, FY08-FY13: -38.6%
Over MRP period, Imageworks becomes less Over MRP period, Imageworks becomes less dependent on VFX work relative to prior yearsdependent on VFX work relative to prior years
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Imageworks Revenue MixImageworks Revenue MixFY10-FY13FY10-FY13
FY0-FY13 Imageworks Composition of Revenues, $(000)FY0-FY13 Imageworks Composition of Revenues, $(000)
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Deliver industry-leading support to internal Deliver industry-leading support to internal clients at below market rates:clients at below market rates: Continue close collaboration with SPE’s Digital Continue close collaboration with SPE’s Digital
Marketing to assist in development of digital Marketing to assist in development of digital strategy and execute on best of breed sites strategy and execute on best of breed sites and campaignsand campaigns
Investigate shifting an appropriate share of Investigate shifting an appropriate share of workforce to Canada in tandem with workforce to Canada in tandem with Imageworks’ evaluation of building an Imageworks’ evaluation of building an additional satellite facilityadditional satellite facility
Further develop 3Further develop 3rdrd party business to party business to reduce overall cost for internal clients reduce overall cost for internal clients while serving as a source of innovation, while serving as a source of innovation, mirroring Imageworks modelmirroring Imageworks model
Imageworks Interactive Imageworks Interactive StrategyStrategy
MRP Financial Projections MRP Financial Projections & Headcount Summary& Headcount Summary
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SONY PICTURES DIGITAL PRODUCTIONSFY 2010 MID-RANGE PLANREVENUE & EBIT SUMMARY
($000's)
FY 2010 0 FY 2011 0 FY 2012 0 FY 2013
Q2 FORECAST 10/09 MRP 10/08 MRP Variance 10/09 MRP 10/08 MRP Variance 10/09 MRP
NET REVENUESPI $175,390 $155,000 $150,000 $5,000 $155,000 $150,000 $5,000 $155,000Interactive 525 500 750 (250) 750 1,000 (250) 1,000
Imageworks 175,915 155,500 150,750 4,750 155,750 151,000 4,750 156,000Animation 226,555 84,992 252,896 (167,904) 451,619 551,477 (99,858) 539,436TOTAL NET REVENUE $402,470 $240,492 $403,646 ($163,154) $607,369 $702,477 ($95,108) $695,436
EBITSPI $0 $0 $0 $0 $0 $0 $0 $0Interactive 1,350 91 184 (93) 141 235 (94) 190
Imageworks 1,350 91 184 (93) 141 235 (94) 190Animation (29,700) 7,684 (6,384) 14,068 (84,141) (28,635) (55,506) (190)TOTAL EBIT ($28,350) $7,775 ($6,200) $13,975 ($84,000) ($28,400) ($55,600) $0
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SONY PICTURES DIGITAL PRODUCTIONSFY 2010 MID-RANGE PLAN
MRP PLAN TO PLAN EBIT RECONCILIATION($000's)
FY11 FY12
EBIT PER 10/08 MRP ($6,200) ($28,400)
VariancesImageworks• Increased revenue ($150M to $155M) 5,000 5,000
• Lower salary & fringe driven by aggressive cost mitigation efforts 867 1,134 (lower average salaries, reduced fringe, improved utilization/lower gap costs)
• Current plan opportunity - EBIT tracking at ($4.5M) vs. ($8M) (3,500) • Current plan challenge - EBIT tracking at ($2M) vs. break-even 2,000 • Prior plan general challenge removed (718) (5,688)
• Albuquerque rebate - 100 hc vs 200 in prior plan (1,926) (1,956) • Depreciation (861) (1,753) • Overhead cost reductions (rent, maintenance, outside services, advertising, materials & supplies, refreshments, etc) 1,138 1,263
• Interactive - driven by lower 3rd party work and associated margin (93) (94) Subtotal Imageworks (93) (94)
Animation• Smurfs - release shift from FY11 to FY12 (net of Columbia share) 17,265 (16,809) • Arthur Christmas - pre-release marketing (5,000) • Arthur Christmas - reduction in ultimate from PY MRP including video release delay to FY13 (30,226) • Hotel T - pre-release marketing (5,000) • Hotel T - reduction in ultimate from PY MRP (2,341) • Cloudy - timing of PPV, DTV, ITV offset by lower WHE ultimate 7,183 • Open Season 3 - higher ultimate than PY MRP 2,774 • Pirates - pre-release marketing spend (4,680) • Animation TBD - pre-release marketing spend (4,680) • Other net (380) 456
Subtotal Animation 14,068 (55,506)
TOTAL VARIANCE $13,975 ($55,600)
EBIT PER 10/09 MRP $7,775 ($84,000)
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SONY PICTURES DIGITAL PRODUCTIONSFY 2010 MID-RANGE PLAN
RECEIPTS & CASH FLOW SUMMARY($000's)
FY 2010 0 FY 2011 0 FY 2012 0 FY 2013
Q2 FORECAST 10/09 MRP 10/08 MRP Variance 10/09 MRP 10/08 MRP Variance 10/09 MRP
NET RECEIPTSSPI $175,390 $155,000 $150,000 $5,000 $155,000 $150,000 $5,000 $155,000Interactive 22,137 25,854 25,492 362 27,693 27,977 (284) 30,837
Imageworks 197,527 180,854 175,492 5,362 182,693 177,977 4,716 185,837Animation 0 0 0 0 0 0 0 0TOTAL NET RECEIPTS $197,527 $180,854 $175,492 $5,362 $182,693 $177,977 $4,716 $185,837
NET CASH FLOWSPI $5,684 ($4,163) $1,732 ($5,895) ($257) $1,829 ($2,086) $2,725Interactive 545 477 260 217 440 151 289 570
Imageworks 6,229 (3,686) 1,992 (5,678) 183 1,980 (1,797) 3,295Animation (152,574) (232,814) (239,811) 6,997 (267,383) (262,896) (4,487) (260,795)TOTAL NET CASH FLOW ($146,345) ($236,500) ($237,819) $1,319 ($267,200) ($260,916) ($6,284) ($257,500)
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SONY PICTURES DIGITAL PRODUCTIONSFY 2010 MID-RANGE PLAN
MRP PLAN TO PLAN CASH FLOW RECONCILIATION($000's)
FY11 FY12
CASH FLOW PER 10/08 MRP ($237,819) ($260,916)
VariancesImageworks• Increased receipts 5,000 5,000 • Lower salary & fringe driven by aggressive cost mitigation efforts 867 1,820
• Current plan opportunity - SPI load to SPA tracking at ($4.5M) vs. ($8M) (3,500) • Current plan challenge - SPI load to SPA tracking at ($2M) vs. $0 2,000 • Prior plan challenge removed (718) (5,688)
• Albuquerque rebate - 100 headcount vs. 200 in prior plan (3,058) (2,136)
• FY11 Imageworks India put option - ($1.2M EBIT x 8 x 49.9% x 33%) (1,518) • FY12 Imageworks India put option - ($1.2M EBIT x 8 x 49.9% x 67%) (3,082)
• Capital expenditures (3,175)
• Interactive 217 289 • Other 207 -
Subtotal Imageworks (5,678) (1,797)
Animation• Hotel T timing shift 2,627 (4,565) • Arthur Christmas timing shift 6,553 (2,658) • Increase development for Aardman (2,000) (2,000) • Reduced Surf's Up participation 4,629 • Other, net (183) 107
Subtotal Animation 6,997 (4,487)
TOTAL VARIANCE $1,319 ($6,284)
CASH FLOW PER 10/09 MRP ($236,500) ($267,200)
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SONY PICTURES DIGITAL PRODUCTIONSFY 2010 MID-RANGE PLAN
ESTIMATED HEADCOUNT AT YEAR END
FY 2010 FY 2011 0 FY 2012 0 FY 2013
Q2 FORECAST
10/09 MRP 10/08 MRP Variance 10/09 MRP 10/08 MRP Variance 10/09 MRP
SPI 630 890 708 (182) 800 690 (110) 800Interactive [A] 125 144 140 (4) 149 146 (3) 161
Imageworks [B] 755 1,034 848 (186) 949 836 (113) 961Animation [C] 90 113 110 (3) 128 138 10 114Exec Management & Marketing 12 12 12 0 12 12 0 12TOTAL 857 1,159 970 (189) 1,089 986 (103) 1,087
SPI AVERAGE HC:Q2
FORECAST10/09 MRP 10/08 MRP Variance 10/09 MRP 10/08 MRP Variance 10/09 MRP
Average Headcount [B] 712 714 708 (6) 709 690 (19) 709
[A] Interactive headcount supports studio clients and is based on website production needs. Costs are 100% absorbed by clients.[B] SPI headcount fluctuations are driven by production timing. MRP headcount reflects year-end levels and varies from prior year due to timing of production needs.Average headcount is essentially flat as the pipeline of work remains fairly constant over the MRP period compared to prior year.[C] Animation headcount increases are based on production.
Financial AppendixFinancial Appendix
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SONY PICTURES ANIMATIONSUMMARY OF EBIT BY TITLE
2009 MRP(In thousands)
FY11 FY12 FY13
Title 10-09 MRP 10-08 MRP VAR TO MRP 10-09 MRP 10-08 MRP VAR TO MRP 10-09 MRP
Open Season 1,213$ 1,133$ 80$ 925$ 780$ 145$ 736$ Surf's Up 1,279 2,256 (977) (3) 288 (291) 2,181 Open Season 2 DTV 1,798 656 1,142 922 790 132 504 Cloudy with a Chance of Meatballs 24,813 17,630 7,183 12,872 11,176 1,696 2,451 Open Season 3 DTV 3,431 2,969 462 3,638 864 2,774 505 Hotel Transylvania (5,000) - (5,000) (25,957) (23,616) (2,341) 25,715 Arthur Christmas (5,000) - (5,000) (57,876) (27,650) (30,226) 33,964 TBD DTV (FY12) - - - 3,426 2,969 457 3,638 Smurfs (3,500) (20,765) 17,265 (1,378) 15,431 (16,809) 2,145 Pirates - - - (4,680) - (4,680) (33,279) TBD Animated (FY13) - - - (4,680) - (4,680) (26,624) TBD FY13 DTV - - - - - - 3,426 TBD Hybrid (FY14) - - - - - - (7,042) Development Reserve (9,300) (10,235) 935 (9,300) (9,678) 378 (9,700) EBIT Challenge - - - - - - 3,240 Overhead (2,050) (28) (2,022) (2,050) 11 (2,061) (2,050)
Earnings Before Interest & Taxes 7,684$ (6,384)$ 14,068$ (84,141)$ (28,635)$ (55,506)$ (190)$
- - - - - - (6,420.00)
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CLOUDY WITH A CHANCE OF MEATBALLS CURRENT ULTIMATE(WW Rights, PG Rating, Animated Model, Release Date 9/18/09)
PRE-REL FY10 BUD GREENLIGHT GP BREAK
RETENTION RATE 52% 52% 52% 52% 52% 52% 52% 52% - Given $85M Target DBO per SPR
DOMESTIC BOX OFFICE $83,900 $93,900 $103,900 $113,900 $85,000 $85,000 $85,000 $98,000
IMAX BOX OFFICE $6,100 $6,100 $6,100 $6,100 $2,500 $6,100
TOTAL DOMESTIC BOX OFFICE $90,000 $100,000 $110,000 $120,000 $87,500 $85,000 $85,000 $104,100
INTERNATIONAL BOX OFFICE 90,000 100,000 110,000 120,000 128,000 128,000 128,000 104,000 - IBO:DBO Ratio at 100%
INTERNATIONAL PRINTS 4,360 4,460 4,540 4,630 5,090 5,090 5,090 4,480 -DVD UNITS 8,020 8,610 9,200 9,750 8,140 9,250 9,250 8,890 - 78% of FY10 Animation PG Model Per SPHE 9-4-09
DOMESTIC RENTALS 46,830 52,030 57,230 62,430 45,420 44,200 44,200 54,160
DOMESTIC ADVERTISING
BASIC (10,700) (10,760) (10,910) (11,060) (10,000) (10,300) (10,300) (10,820) - Per Marketing 9-30-09
PRE-OPEN MEDIA (27,700) (27,700) (27,700) (27,700) (27,700) (27,700) (27,700) (27,700) - Per Marketing 9-30-09
SUPPORT MEDIA (3,580) (3,710) (4,570) (4,570) (3,380) (5,910) (5,910) (4,160) - Per Marketing 9-30-09
IMAX ADS (100) (100) (100) (100) (100) 0 0 (100) - Per SPR (Digital Cinema Operations) 8-13-09
TOTAL DOMESTIC ADVERTISING (42,080) (42,270) (43,280) (43,430) (41,180) (43,910) (43,910) (42,780)
DOMESTIC PRINTS (6,280) (6,280) (6,280) (6,280) (6,280) (5,725) (6,400) (6,280) - 4,178 prints @ $1,503/print
DOMESTIC 3D GLASSES (3,620) (4,060) (4,490) (4,920) (3,670) (8,520) (3,670) (4,230) - Per SPR (Digital Cinema Operations) 6-17-09
OTHER COSTS (4,130) (4,410) (4,700) (4,980) (3,460) (2,980) (2,980) (4,530) - Per FY10 Model; includes IMAX shares
DOMESTIC THEATRICAL NET (9,280) (4,990) (1,520) 2,820 (9,170) (16,935) (12,760) (3,660)
INT'L RENTALS 37,000 42,000 46,000 50,000 53,000 53,000 53,000 43,000 - Per SPRI 9-17-09
INT'L ADVERTISING (25,770) (25,770) (25,770) (25,770) (25,770) (28,910) (28,910) (25,770) - Per SPRI 9-17-09
INT'L PRINTS (13,050) (13,050) (13,050) (13,050) (13,050) (11,690) (13,000) (13,050) - Per SPRI 9-17-09 - includes $50K for IMAX DCP
INT'L 3D GLASSES (2,990) (3,320) (3,650) (3,980) (4,250) (4,560) (4,250) (3,450) - Per SPR (Digital Cinema Operations) 6-17-09
OTHER COSTS (3,800) (3,800) (3,800) (3,800) (3,800) (3,580) (3,580) (3,600) - Per SPRI 9-17-09 - includes IMAX shares
INT'L THEATRICAL NET (8,610) (3,940) (270) 3,400 6,130 4,260 3,260 (2,870)
DOM. HOME VIDEO REVENUE 95,130 101,830 108,280 114,510 96,490 109,650 109,650 105,740 - 78% of FY10 Animation PG Model Per SPHE 9-4-09
DOM. HOME VIDEO COSTS (30,530) (32,900) (35,270) (37,340) (31,000) (38,430) (35,230) (34,060) - 78% of FY10 Animation PG Model Per SPHE 9-4-09
DOMESTIC HOME VIDEO NET 64,600 68,930 73,010 77,170 65,490 71,220 74,420 71,680
INT'L HOME VIDEO REVENUE 27,340 30,040 32,240 34,470 36,130 50,170 45,160 30,590 - 72% of FY10 Family PG Model Per SPHE 9-4-09
INT'L HOME VIDEO COSTS (9,920) (10,900) (11,690) (12,500) (13,100) (18,200) (16,380) (11,090) - 72% of FY10 Family PG Model Per SPHE 9-4-09
INT'L HOME VIDEO NET 17,420 19,140 20,550 21,970 23,030 31,970 28,780 19,500
PAY TELEVISION 15,210 16,280 17,340 17,650 15,330 15,330 15,330 16,710 - Starz/Encore License Fees
NETWORK TV 5,870 6,570 7,270 7,970 5,950 5,950 5,950 6,860 - Per SPT 8-25-09
DOMESTIC SYNDICATION 450 510 560 620 460 460 460 530 - Per SPT 8-25-09
INTERNATIONAL TELEVISION 37,530 40,790 43,320 45,790 47,610 50,110 50,110 41,430 - Per SPTI 9-9-09
PAY PER VIEW 2,270 2,540 2,810 3,080 2,300 2,300 2,300 2,650 - Per SPT 8-25-09
TV COSTS (500) (500) (500) (500) (500) (500) (500) (500) - $500K @ All Levels.
TOTAL TELEVISION NET 60,830 66,190 70,800 74,610 71,150 73,650 73,650 67,680
AIRLINE / NON-THEATRICAL 1,850 1,850 1,850 1,850 1,850 1,500 1,850 1,850 - Per SPR (WW Non-Theatrical and Repertory Sales) 7-6-09
MERCH, MUSIC & OTHER REVENUE 1,750 1,750 1,750 1,750 1,750 1,600 1,750 1,750 - Per SPCP 6-18-09
NON THEATRICAL COSTS (3,200) (3,200) (3,200) (3,200) (3,200) 0 (3,200) (3,200) - WPF costs
CONSUMER PRODUCTS COSTS (750) (750) (750) (750) (750) (910) (750) (750) - Per SPCP 6-18-09
TOTAL PRODUCTION COST (117,700) (117,700) (117,700) (117,700) (111,500) (122,000) (111,500) (117,700) - Per SPA 9-17-09
OVERHEAD (30,300) (30,300) (30,300) (30,300) (36,500) (26,000) (36,500) (30,300) - Per SPA 9-17-09
RESIDUALS (3,520) (3,820) (4,080) (4,300) (4,000) (4,390) (4,330) (3,920) - Reduced Residuals
CREATIVE SHARES 0 (60) (60) (60) 0 0 0 (60) - DBO Bonuses
TOTAL REVENUES 271,230 296,190 318,650 340,120 306,290 334,270 329,760 305,270
RELEASING COSTS (146,620) (151,210) (156,430) (160,500) (150,010) (167,915) (162,760) (153,290)
PROD, O/H, PART, RESIDUALS (151,520) (151,880) (152,140) (152,360) (152,000) (152,390) (152,330) (151,980)
GROSS PROFIT (LOSS) ($26,910) ($6,900) $10,080 $27,260 $4,280 $13,965 $14,670 $0
GROSS PROFIT MARGIN NA NA 3.2% 8.0% 1.4% 4.2% 4.4% 0.0%
FY 2010 GROSS PROFIT (LOSS) (53,140) (41,060) (31,070) (20,280) (31,370) (33,600) (36,910)
34
SMURFS Assumes co-production with Paramount, no 3D, $95M production cost 2009 MRP(WW Rights, PG Rating, Case 2, July 29, 2011 rel. date)
GP BREAK PY MRP VarianceRETENTION RATE 52% 52% 52% 52% 52% 52% 52% 52% 52% 52% 52% 52% - Given $90M Target DBO per FY11 Model 53% -1%
DOMESTIC BOX OFFICE $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 $110,000 $120,000 $130,000 $140,000 $150,000 $85,200 $105,000 ($15,000)
INTERNATIONAL BOX OFFICE 67,000 80,000 93,000 106,000 120,000 133,000 146,000 160,000 173,000 186,000 200,000 113,000 142,000 (22,000)
WORLDWIDE BOX OFFICE 117,000 140,000 163,000 186,000 210,000 233,000 256,000 280,000 303,000 326,000 350,000 198,200 6,200 203,800
INTERNATIONAL PRINTS 0 0 0 0 0 0 0 0 0 0 0 0 - 6,200 (6,200)
DVD UNITS 760 840 900 960 1,010 1,060 1,100 1,130 1,170 1,200 1,220 990 - 111% of FY11 Model - Family 8,270 (7,260)
DOMESTIC RENTALS 26,000 31,200 36,400 41,600 46,800 52,000 57,200 62,400 67,600 72,800 78,000 44,300 55,130 (8,330)
DOMESTIC ADVERTISING 0 0 BASIC (15,000) (15,000) (15,000) (15,000) (15,000) (15,150) (15,300) (15,450) (15,600) (15,750) (15,900) (15,000) - Per Marketing - 8/14/09 - $90M DBO Target (17,420) 2,420
PRE-OPEN MEDIA (33,000) (33,000) (33,000) (33,000) (33,000) (33,000) (33,000) (33,000) (33,000) (33,000) (33,000) (33,000) - Per Marketing - 8/14/09 - $90M DBO Target (37,420) 4,420
SUPPORT MEDIA (2,500) (2,500) (3,000) (3,750) (4,500) (6,000) (7,500) (9,000) (9,000) (9,000) (9,000) (4,140) - Per Marketing - 8/14/09 - $90M DBO Target (5,550) 1,050
TOTAL DOMESTIC ADVERTISING (50,500) (50,500) (51,000) (51,750) (52,500) (54,150) (55,800) (57,450) (57,600) (57,750) (57,900) (52,140) (60,390) 7,890
DOMESTIC PRINTS (6,680) (6,680) (6,680) (6,680) (6,680) (6,680) (6,680) (6,680) (6,680) (6,680) (6,680) (6,680) - 4,500 Prints @ $1,484 per Print (8,960) 2,280
OTHER COSTS (4,020) (4,720) (5,410) (6,100) (6,800) (7,500) (8,180) (8,880) (9,580) (10,280) (10,960) (6,460) - Per FY11 Model - incl. 3D Cost (4,300) (2,500)
DOMESTIC THEATRICAL NET (35,200) (30,700) (26,690) (22,930) (19,180) (16,330) (13,460) (10,610) (6,260) (1,910) 2,460 (20,980) (18,520) (660)
INT'L RENTALS 0 0 0 0 0 0 0 0 0 0 0 0 - 133% IBO:DBO Ratio 59,540 (59,540)
INT'L ADVERTISING 0 0 0 0 0 0 0 0 0 0 0 0 - Per FY11 Model (44,580) 44,580
INT'L PRINTS 0 0 0 0 0 0 0 0 0 0 0 0 - Per FY11 Model (addtl. Dubbing for Animation) (21,560) 21,560
OTHER COSTS 0 0 0 0 0 0 0 0 0 0 0 0 - Per FY11 Model - incl 3D Costs (3,230) 3,230
INT'L THEATRICAL NET 0 0 0 0 0 0 0 0 0 0 0 0 (9,830) 9,830
DOM. HOME VIDEO REVENUE 38,650 47,300 56,120 64,450 71,930 78,820 84,070 88,570 92,990 97,430 101,330 68,370 - 111% of FY11 Model - Family 101,980 (30,050)
DOM. HOME VIDEO COSTS (12,370) (15,230) (18,180) (21,000) (23,570) (26,030) (27,760) (29,240) (30,690) (32,160) (33,440) (22,290) - 111% of FY11 Model - Family (32,380) 8,810
DOMESTIC HOME VIDEO NET 26,280 32,070 37,940 43,450 48,360 52,790 56,310 59,330 62,300 65,270 67,890 46,080 69,600 (21,240)
INT'L HOME VIDEO REVENUE 0 0 0 0 0 0 0 0 0 0 0 0 - 106% of FY11 Model - Family 54,820 (54,820)
INT'L HOME VIDEO COSTS 0 0 0 0 0 0 0 0 0 0 0 0 - 106% of FY11 Model - Family (19,880) 19,880
INT'L HOME VIDEO NET 0 0 0 0 0 0 0 0 0 0 0 0 34,940 (34,940)
PAY TELEVISION 11,130 12,530 13,740 14,800 15,860 16,920 17,650 17,650 17,650 17,650 17,650 15,350 - Starz/Encore License Fees 17,560 (1,700)
NETWORK TV 3,500 4,200 4,900 5,600 6,300 7,000 7,700 8,400 9,100 9,800 10,500 5,960 - FY11 Animation Model - Per SPT 6/29/09 10,500 (4,200)
DOMESTIC SYNDICATION 270 330 380 430 490 540 600 650 710 760 810 460 - FY11 Model - 7.75% of First Window 810 (320)
INTERNATIONAL TELEVISION 0 0 0 0 0 0 0 0 0 0 0 0 - FY11 Model (Pay and Free) 53,810 (53,810)
PAY PER VIEW 2,000 2,400 2,800 3,200 3,300 3,300 3,300 3,300 3,300 3,300 3,300 3,300 - FY11 Model - Animation 1,900 1,400
TV COSTS (500) (500) (500) (500) (500) (500) (500) (500) (500) (500) (500) (500) - Fixed Allocation (500) 0
TOTAL TELEVISION NET 16,400 18,960 21,320 23,530 25,450 27,260 28,750 29,500 30,260 31,010 31,760 24,570 84,080 (58,630)
AIRLINE / NON-THEATRICAL 930 1,120 1,300 1,490 1,670 1,860 2,050 2,230 2,420 2,600 2,790 1,580 - FY11 Model - PG rating 1,890 (220)
MERCH, MUSIC & OTHER REVENUE 14,700 12,990 11,530 10,040 9,250 8,850 9,280 10,210 10,060 10,210 10,140 9,560 - Incl Payments From / (To) Paramount 0 9,250
PRODUCTION COST (47,500) (47,500) (47,500) (47,500) (47,500) (47,500) (47,500) (47,500) (47,500) (47,500) (47,500) (47,500) - - (86,200) 38,700
CO-FINANCING PROCEEDS 0 0 0 0 0 0 0 0 0 0 0 0 0 0
OVERHEAD (4,280) (4,280) (4,280) (4,280) (4,280) (4,280) (4,280) (4,280) (4,280) (4,280) (4,280) (4,280) - 9.0% of Production Cost (8,600) 4,320
RESIDUALS (3,470) (4,100) (4,710) (5,280) (5,790) (6,270) (6,640) (6,900) (7,150) (7,410) (7,640) (5,560) - Full Residuals (16,140) 10,350
CREATIVE SHARES (2,420) (2,730) (3,030) (3,330) (3,600) (3,870) (5,430) (8,480) (11,500) (14,330) (15,410) (3,470) - (10,630) 7,030
CO-FINANCIER OVERAGES 0 0 0 0 0 0 0 0 0 0 0 0 0 0
TOTAL REVENUES $97,180 $112,070 $127,170 $141,610 $155,600 $169,290 $181,850 $193,410 $203,830 $214,550 $224,520 $148,880 $357,940 ($202,340)
RELEASING COSTS (74,070) (77,630) (81,770) (86,030) (90,050) (94,860) (98,920) (102,750) (105,050) (107,370) (109,480) (88,070) (195,780) 105,730
PROD, O/H, PART, RESIDUALS (57,670) (58,610) (59,520) (60,390) (61,170) (61,920) (63,850) (67,160) (70,430) (73,520) (74,830) (60,810) (121,570) 60,400
GROSS PROFIT (LOSS) ($34,560) ($24,170) ($14,120) ($4,810) $4,380 $12,510 $19,080 $23,500 $28,350 $33,660 $40,210 $0 $40,590 ($36,210)
GROSS PROFIT MARGIN NA NA NA NA 3.0% 7.8% 11.0% 12.6% 14.4% 16.1% 18.3% 0.0% 11.3%
HOTEL TRANSYLVANIA(WW Rights, PG Rating, Animated Model, Q2 2012 rel. date)
GP BREAK PY MRP VarianceRETENTION RATE 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% - Given $75M Target DBO per FY11 Model 53% -3%
DOMESTIC BOX OFFICE $40,000 $50,000 $60,000 $70,000 $75,000 $80,000 $85,000 $90,000 $95,000 $100,000 $110,000 $90,400 $110,000 ($10,000)
INTERNATIONAL BOX OFFICE 52,000 65,000 78,000 91,000 98,000 104,000 111,000 117,000 124,000 130,000 143,000 118,000 144,000 (14,000)
WORLDWIDE BOX OFFICE 92,000 115,000 138,000 161,000 173,000 184,000 196,000 207,000 219,000 230,000 253,000 208,400 254,000 (24,000)
INTERNATIONAL PRINTS 4,250 4,470 4,640 4,850 4,910 5,010 5,100 5,190 5,250 5,330 5,500 5,190 - 6,190 (860)
DVD UNITS 3,750 4,420 5,100 5,790 6,140 6,500 6,850 7,210 7,570 7,930 8,420 7,210 - 100% of FY11 Model - Animation 10,890 (2,960)
DOMESTIC RENTALS 20,000 25,000 30,000 35,000 37,500 40,000 42,500 45,000 47,500 50,000 55,000 45,200 57,750 (7,750)
DOMESTIC ADVERTISING
BASIC (10,000) (10,000) (10,000) (10,000) (10,000) (10,080) (10,150) (10,230) (10,300) (10,380) (10,530) (10,230) - Current Estimate - $75M DBO Target (17,490) 7,110
PRE-OPEN MEDIA (27,700) (27,700) (27,700) (27,700) (27,700) (27,700) (27,700) (27,700) (27,700) (27,700) (27,700) (27,700) - Current Estimate - $75M DBO Target (37,420) 9,720
SUPPORT MEDIA (1,300) (1,430) (2,180) (2,930) (3,300) (4,050) (4,800) (5,550) (6,300) (6,600) (6,600) (5,610) - Current Estimate - $75M DBO Target (6,300) (300)
TOTAL DOMESTIC ADVERTISING (39,000) (39,130) (39,880) (40,630) (41,000) (41,830) (42,650) (43,480) (44,300) (44,680) (44,830) (43,540) (61,210) 16,530
DOMESTIC PRINTS (6,160) (6,160) (6,160) (6,160) (6,160) (6,160) (6,160) (6,160) (6,160) (6,160) (6,160) (6,160) - 4,200 Prints @ $1,467 per Print (5,220) (940)
DOMESTIC 3D GLASSES (1,240) (1,560) (1,870) (2,180) (2,330) (2,490) (2,640) (2,800) (2,960) (3,110) (3,420) (2,810) - Per SPR Estimates (Digital Cinema Operations) (3,110)
OTHER COSTS (1,570) (1,820) (2,070) (2,330) (2,460) (2,580) (2,710) (2,840) (2,960) (3,090) (3,350) (2,850) - Per FY11 Model (4,460) 1,370
DOMESTIC THEATRICAL NET (27,970) (23,670) (19,980) (16,300) (14,450) (13,060) (11,660) (10,280) (8,880) (7,040) (2,760) (10,160) (13,140) 6,100
INT'L RENTALS 21,840 27,300 32,760 38,220 40,950 43,680 46,410 49,140 51,870 54,600 60,060 49,360 - 130% IBO:DBO Ratio 60,500 (5,900)
INT'L ADVERTISING (21,290) (23,220) (24,770) (26,560) (27,140) (28,000) (28,840) (29,660) (30,190) (30,980) (32,500) (29,660) - Per FY11 Model (38,050) 7,070
INT'L PRINTS (11,100) (11,510) (11,830) (12,220) (12,330) (12,520) (12,690) (12,860) (12,970) (13,120) (13,430) (12,860) - Per FY11 Model (addtl. Dubbing for Animation) (16,210) 3,090
DOMESTIC 3D GLASSES (1,110) (1,390) (1,660) (1,940) (2,090) (2,220) (2,370) (2,500) (2,650) (2,770) (3,050) (2,520) - Per SPR Estimates (Digital Cinema Operations) (2,770)
OTHER COSTS (1,080) (1,270) (1,470) (1,660) (1,750) (1,850) (1,950) (2,040) (2,140) (2,230) (2,430) (2,700) - Per FY11 Model (addtl. Dubbing for Animation) (3,270) 1,040
INT'L THEATRICAL NET (12,740) (10,090) (6,970) (4,160) (2,360) (910) 560 2,080 3,920 5,500 8,650 1,620 2,970 2,530
DOM. HOME VIDEO REVENUE 48,930 57,170 65,550 73,950 78,180 82,400 86,650 90,900 95,160 99,190 105,100 91,780 - 100% of FY11 Model - Animation 128,030 (28,840)
DOM. HOME VIDEO COSTS (15,380) (18,130) (20,920) (23,750) (25,180) (26,630) (28,090) (29,550) (31,030) (32,490) (34,430) (29,550) - 100% of FY11 Model - Animation (41,730) 9,240
DOMESTIC HOME VIDEO NET 33,550 39,040 44,630 50,200 53,000 55,770 58,560 61,350 64,130 66,700 70,670 62,230 86,300 (19,600)
INT'L HOME VIDEO REVENUE 24,230 28,760 32,460 36,810 38,250 40,390 42,520 44,630 46,040 48,140 52,310 44,630 - 100% of FY11 Model - Family 55,600 (7,460)
INT'L HOME VIDEO COSTS (8,840) (10,470) (11,800) (13,380) (13,910) (14,690) (15,470) (16,250) (16,760) (17,530) (19,070) (16,250) - 100% of FY11 Model - Family (20,160) 2,630
INT'L HOME VIDEO NET 15,390 18,290 20,660 23,430 24,340 25,700 27,050 28,380 29,280 30,610 33,240 28,380 35,440 (4,830)
PAY TELEVISION 9,510 10,860 12,210 13,450 13,960 14,470 14,980 15,490 16,000 16,520 17,540 15,530 - Starz/Encore License Fees 17,650 (1,130)
NETWORK TV 2,800 3,500 4,200 4,900 5,250 5,600 5,950 6,300 6,650 7,000 7,700 6,330 - First Window sale per FY11 Model 7,700 (700)
DOMESTIC SYNDICATION 220 270 330 380 410 430 460 490 520 540 600 490 - FY11 Model - 7.75% of First Window 600 (60)
INTERNATIONAL TELEVISION 20,170 23,490 26,170 29,290 30,310 31,810 33,280 34,730 35,680 37,080 39,800 34,730 - 75% FY11 Model (Pay and Free) 54,410 (17,330)
PAY PER VIEW 1,600 2,000 2,400 2,800 3,000 3,200 3,300 3,300 3,300 3,300 3,300 3,300 - FY11 Model - Animation 2,970 330
TV COSTS (500) (500) (500) (500) (500) (500) (500) (500) (500) (500) (500) (500) - Fixed Allocation (500) 0
TOTAL TELEVISION NET 33,800 39,620 44,810 50,320 52,430 55,010 57,470 59,810 61,650 63,940 68,440 59,880 82,830 (18,890)
AIRLINE / NON-THEATRICAL 740 930 1,120 1,300 1,400 1,490 1,580 1,670 1,770 1,860 2,050 1,690 - FY11 Model - PG rating 1,990 (130)
MERCH, MUSIC & OTHER REVENUE 0 0 0 0 0 0 0 0 0 0 0 0 - No Merchandising, Sndtrck Assumed 2,000 (2,000)
PRODUCTION COST (112,000) (112,000) (112,000) (112,000) (112,000) (112,000) (112,000) (112,000) (112,000) (112,000) (112,000) (112,000) - Includes 3D conversion (117,300) 5,300
OVERHEAD (28,000) (28,000) (28,000) (28,000) (28,000) (28,000) (28,000) (28,000) (28,000) (28,000) (28,000) (28,000) - 25.0% of Production Cost (28,000) 0
RESIDUALS (2,020) (2,360) (2,680) (3,020) (3,150) (3,320) (3,470) (3,630) (3,750) (3,900) (4,170) (3,640) - Reduced Residuals (4,970) 1,070
CREATIVE SHARES 0 0 0 0 0 0 0 0 0 (1,385) (1,385) 0 - DBO Bonuses (1,390) 5
TOTAL REVENUES $150,040 $179,280 $207,200 $236,100 $249,210 $263,470 $277,630 $291,650 $304,490 $318,230 $343,460 $293,040 $389,200 ($70,970)
RELEASING COSTS (107,270) (115,160) (122,930) (131,310) (134,850) (139,470) (144,070) (148,640) (152,620) (156,660) (163,170) (149,400) (191,560) 34,900
PROD, O/H, PART, RESIDUALS (142,020) (142,360) (142,680) (143,020) (143,150) (143,320) (143,470) (143,630) (143,750) (145,285) (145,555) (143,640) (151,660) 6,375
GROSS PROFIT (LOSS) ($99,250) ($78,240) ($58,410) ($38,230) ($28,790) ($19,320) ($9,910) ($620) $8,120 $16,285 $34,735 $0 $45,980 ($29,695)
GROSS PROFIT MARGIN NA NA NA NA NA NA NA NA 2.7% 5.1% 10.1% 0.0% 11.8%
2009 MRP
35
36
ARTHUR CHRISTMAS(WW Rights, PG Rating, Animation Model, Nov. 11, 2011 Release)
GP BREAK PY MRP VarianceRETENTION RATE 52% 52% 52% 52% 52% 52% 52% 52% 52% 52% 52% - Per SPR 5/19/09 53% -1%
DOMESTIC BOX OFFICE $50,000 $55,000 $60,000 $65,000 $70,000 $75,000 $80,000 $85,000 $90,000 $95,000 $74,100 $105,000 ($30,000)
INTERNATIONAL BOX OFFICE 80,000 88,000 96,000 104,000 112,000 120,000 128,000 136,000 144,000 152,000 119,000 168,000 (48,000)
INTERNATIONAL PRINTS 5,430 5,500 5,600 5,670 5,740 5,840 5,910 5,980 6,050 6,150 5,810 6,700 (860)
DVD UNITS 6,730 7,120 7,500 7,860 8,220 8,570 8,920 9,250 9,580 9,910 8,500 - FY10 Anim Model
DOMESTIC RENTALS 26,000 28,600 31,200 33,800 36,400 39,000 41,600 44,200 46,800 49,400 38,530 55,130 (16,130)
DOMESTIC ADVERTISING
BASIC (11,630) (11,700) (11,780) (11,850) (11,930) (12,000) (12,080) (12,150) (12,230) (12,300) (11,990) - Per Marketing 6-1-09 (17,420) 5,420
PRE-OPEN MEDIA (33,500) (33,500) (33,500) (33,500) (33,500) (33,500) (33,500) (33,500) (33,500) (33,500) (33,500) - Per Marketing 6-1-09 (37,420) 3,920
SUPPORT MEDIA (1,630) (2,000) (2,380) (2,750) (3,130) (3,500) (3,880) (4,250) (4,630) (5,000) (3,430) - Per Marketing 6-1-09 (5,550) 2,050
TOTAL DOMESTIC ADVERTISING (46,760) (47,200) (47,660) (48,100) (48,560) (49,000) (49,460) (49,900) (50,360) (50,800) (48,920) (60,390) 11,390
DOMESTIC PRINTS (6,980) (6,980) (6,980) (6,980) (6,980) (6,980) (6,980) (6,980) (6,980) (6,980) (6,980) - 4,200 Prints @ $1,661 per Print (8,960) 1,980
DOMESTIC 3D GLASSES (1,560) (1,710) (1,870) (2,020) (2,180) (2,330) (2,490) (2,640) (2,800) (2,960) (2,310) - Per SPR (Digital Cinema Ops) 8-25-09 0 (2,330)
OTHER COSTS (2,330) (2,590) (2,740) (2,890) (3,150) (3,300) (3,450) (3,710) (3,860) (4,010) (3,290) - Per Marketing 6-1-09 (4,380) 1,080
DOMESTIC THEATRICAL NET (31,630) (29,880) (28,050) (26,190) (24,470) (22,610) (20,780) (19,030) (17,200) (15,350) (22,970) (18,600) (4,010)
INT'L RENTALS 33,300 36,600 40,000 43,300 46,600 50,000 53,300 56,600 59,900 63,300 49,400 - 160% OF DBO Per SPR 5/19/09 68,040 (18,040)
INT'L ADVERTISING (27,700) (28,200) (28,900) (29,400) (29,900) (30,600) (31,100) (31,500) (32,000) (32,600) (30,400) - Per SPRI 6-1-09 (41,730) 11,130
INT'L PRINTS (17,000) (18,000) (18,000) (18,000) (18,000) (19,000) (19,000) (19,000) (19,000) (20,000) (19,000) - Per SPRI 6-1-09 (19,650) 650
INT'L 3D GLASSES (1,710) (1,880) (2,050) (2,220) (2,390) (2,560) (2,730) (2,900) (3,070) (3,240) (2,540) - Per SPR (Digital Cinema Ops) 8-25-09 (2,560)
OTHER COSTS (1,800) (1,900) (2,000) (2,200) (2,300) (2,500) (2,600) (2,800) (2,900) (3,100) (2,500) - Per SPRI 6-1-09 (3,660) 1,160
INT'L THEATRICAL NET (14,910) (13,380) (10,950) (8,520) (5,990) (4,660) (2,130) 400 2,930 4,360 (5,040) 3,000 (7,660)
DOM. HOME VIDEO REVENUE 80,330 84,870 89,270 93,550 97,720 101,780 105,760 109,650 113,460 117,200 99,710 - FY10 Anim Model 124,480 (22,700)
DOM. HOME VIDEO COSTS (25,200) (26,720) (28,200) (29,650) (31,080) (32,480) (33,870) (35,230) (36,580) (37,920) (32,200) - FY10 Anim Model (40,550) 8,070
DOMESTIC HOME VIDEO NET 55,130 58,150 61,070 63,900 66,640 69,300 71,890 74,420 76,880 79,280 67,510 83,930 (14,630)
INT'L HOME VIDEO REVENUE 31,520 33,510 36,190 38,240 40,300 43,090 45,160 47,240 49,340 52,170 43,450 - 90% of FY10 Family Model 61,950 (18,860)
INT'L HOME VIDEO COSTS (11,430) (12,150) (13,130) (13,870) (14,620) (15,630) (16,380) (17,130) (17,890) (18,920) (15,370) - 90% of FY10 Family Model (22,470) 6,840
INT'L HOME VIDEO NET 20,090 21,360 23,060 24,370 25,680 27,460 28,780 30,110 31,450 33,250 28,080 39,480 (12,020)
PAY TELEVISION 11,130 11,830 12,530 13,210 13,740 14,270 14,800 15,330 15,860 16,390 14,170 - Starz/Encore License Fees 17,560 (3,290)
NETWORK TV 3,500 3,850 4,200 4,550 4,900 5,250 5,600 5,950 6,300 6,650 5,190 - FY10 Model 7,350 (2,100)
DOMESTIC SYNDICATION 270 300 330 350 380 410 430 460 490 520 400 - FY10 Model 570 (160)
INTERNATIONAL TELEVISION 25,000 26,450 28,330 29,720 31,080 32,850 34,150 35,430 36,670 38,300 33,160 - 68% of FY10 Model due to UK share 41,360 (8,510)
PAY PER VIEW 1,350 1,490 1,620 1,760 1,890 2,030 2,160 2,300 2,430 2,570 2,000 - FY10 Model 2,840 (810)
TV COSTS (500) (500) (500) (500) (500) (500) (500) (500) (500) (500) (500) - $500K @ All Levels. (500) 0
TOTAL TELEVISION NET 40,750 43,420 46,510 49,090 51,490 54,310 56,640 58,970 61,250 63,930 54,420 69,180 (14,870)
AIRLINE / NON-THEATRICAL 880 960 1,040 1,140 1,230 1,320 1,410 1,500 1,600 1,700 1,310 - FY10 Model 1,890 (570)
MERCH, MUSIC & OTHER REVENUE 0 0 0 0 0 0 0 0 0 0 0 - No Merchandising, Sndtrck Assumed 5,720 (5,720)
NON THEATRICAL COSTS 0 0 0 0 0 0 0 0 0 0 0 0 0
CONSUMER PRODUCTS COSTS 0 0 0 0 0 0 0 0 0 0 0 0 0
PRODUCTION COST (97,000) (97,000) (97,000) (97,000) (97,000) (97,000) (97,000) (97,000) (97,000) (97,000) (97,000) - - (98,000) 1,000
CO-FINANCING PROCEEDS 0 0 0 0 0 0 0 0 0 0 0 0 0
OVERHEAD (14,550) (14,550) (14,550) (14,550) (14,550) (14,550) (14,550) (14,550) (14,550) (14,550) (14,550) - 15.0% of Production Cost (13,000) (1,550)
RESIDUALS (2,680) (2,850) (3,040) (3,200) (3,350) (3,530) (3,680) (3,830) (3,970) (4,140) (3,510) - Reduced Residuals (4,510) 980
CREATIVE SHARES (5,020) (5,660) (6,440) (7,060) (7,680) (8,340) (9,110) (9,710) (10,320) (10,960) (8,250) - Aardman gross participation, DBO bonuses (12,800) 4,460
CO-FINANCIER OVERAGES 0 0 0 0 0 0 0 0 0 0 0 0 0
TOTAL REVENUES 213,280 228,460 244,710 259,620 274,240 290,000 304,370 318,660 332,850 348,200 287,320 386,890 (96,890)
RELEASING COSTS (142,970) (147,830) (152,030) (155,830) (159,660) (164,880) (168,560) (172,290) (175,940) (181,030) (164,010) (202,290) 37,410
PROD, O/H, PART, RESIDUALS (119,250) (120,060) (121,030) (121,810) (122,580) (123,420) (124,340) (125,090) (125,840) (126,650) (123,310) (128,310) 4,890
GROSS PROFIT (LOSS) ($48,940) ($39,430) ($28,350) ($18,020) ($8,000) $1,700 $11,470 $21,280 $31,070 $40,520 $0 $56,290 ($54,590)
GROSS PROFIT MARGIN NA NA NA NA NA 0.6% 3.8% 6.7% 9.3% 11.6% 0.0% 14.5%
2009 MRP
37
PIRATES(WW Rights, PG Rating, Animation Model, Sept. 28, 2012 Release)
CURRENT GP BREAK
RETENTION RATE 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% - Per SPR 11/20/08
DOMESTIC BOX OFFICE $40,000 $45,000 $50,000 $55,000 $60,000 $65,000 $70,000 $80,000 $90,000 $100,000 $60,800
INTERNATIONAL BOX OFFICE 71,000 80,000 88,000 97,000 106,000 115,000 124,000 142,000 159,000 177,000 108,000
INTERNATIONAL PRINTS 4,570 4,680 4,740 4,830 4,910 5,000 5,060 5,230 5,380 5,530 4,910 -DVD UNITS 610 650 690 730 760 790 820 870 920 960 760 - FY11 Anim Model
DOMESTIC RENTALS 20,000 22,500 25,000 27,500 30,000 32,500 35,000 40,000 45,000 50,000 30,400
DOMESTIC ADVERTISING
BASIC (11,630) (11,700) (11,780) (11,850) (11,930) (12,000) (12,080) (12,230) (12,380) (12,530) (11,940) - Per Marketing 11/20/08
PRE-OPEN MEDIA (30,000) (30,000) (30,000) (30,000) (30,000) (30,000) (30,000) (30,000) (30,000) (30,000) (30,000) - Per Marketing 11/20/08
SUPPORT MEDIA (3,130) (3,500) (3,880) (4,250) (4,630) (5,000) (5,380) (6,130) (6,880) (7,250) (4,690) - Per Marketing 11/20/08
TOTAL DOMESTIC ADVERTISING (44,760) (45,200) (45,660) (46,100) (46,560) (47,000) (47,460) (48,360) (49,260) (49,780) (46,630)
DOMESTIC PRINTS (6,850) (6,850) (6,850) (6,850) (6,850) (6,850) (6,850) (6,850) (6,850) (6,850) (6,850) - 4,300 Prints @ $1,593 per Print
DOMESTIC 3D GLASSES (1,240) (1,400) (1,560) (1,710) (1,870) (2,020) (2,180) (2,490) (2,800) (3,110) (1,890) - Per SPR (Digital Cinema Operations)
OTHER COSTS (2,030) (2,210) (2,400) (2,580) (2,770) (2,950) (3,140) (3,510) (3,880) (4,260) (2,800) - Per FY10 Model
DOMESTIC THEATRICAL NET (34,880) (33,160) (31,470) (29,740) (28,050) (26,320) (24,630) (21,210) (17,790) (14,000) (27,770)
INT'L RENTALS 29,600 33,300 36,900 40,600 44,300 48,000 51,700 59,100 66,500 73,900 44,900 - 150% OF DBO Per SPRI 11/20/08
INT'L ADVERTISING (25,690) (26,440) (26,950) (27,640) (28,320) (29,000) (29,500) (30,750) (31,760) (32,720) (28,320) - Per SPRI 11/20/08
INT'L PRINTS (11,050) (11,290) (11,430) (11,620) (11,800) (12,000) (12,130) (12,510) (12,840) (13,170) (11,800) - Per SPRI 11/20/08 (inc Anim Dubbing Exp)
INT'L 3D GLASSES (1,510) (1,710) (1,880) (2,070) (2,260) (2,450) (2,650) (3,030) (3,390) (3,780) (2,300) - Per SPR (Digital Cinema Operations)
OTHER COSTS (1,310) (1,450) (1,580) (1,720) (1,860) (2,000) (2,130) (2,410) (2,690) (2,960) (1,880) - Per SPRI 11/20/08
INT'L THEATRICAL NET (9,960) (7,590) (4,940) (2,450) 60 2,550 5,290 10,400 15,820 21,270 600
DOM. HOME VIDEO REVENUE 48,930 53,160 57,170 61,360 65,550 69,740 73,950 82,400 90,900 99,190 66,300 - FY11 Anim Model
DOM. HOME VIDEO COSTS (15,510) (16,910) (18,280) (19,680) (21,090) (22,500) (23,930) (26,810) (29,750) (32,700) (21,090) - FY11 Anim Model
DOMESTIC HOME VIDEO NET 33,420 36,250 38,890 41,680 44,460 47,240 50,020 55,590 61,150 66,490 45,210
INT'L HOME VIDEO REVENUE 30,250 33,190 35,370 38,250 41,100 43,930 46,040 51,610 56,450 61,280 41,100 - FY11 Anim Model
INT'L HOME VIDEO COSTS (11,000) (12,070) (12,860) (13,910) (14,950) (15,990) (16,760) (18,820) (20,600) (22,390) (14,950) - FY11 Anim Model
INT'L HOME VIDEO NET 19,250 21,120 22,510 24,340 26,150 27,940 29,280 32,790 35,850 38,890 26,150
PAY TELEVISION 8,320 8,910 9,500 10,090 10,680 11,270 11,770 12,660 13,560 14,450 10,780 - Starz/Encore ASSUMES 2012 RELEASE
NETWORK TV 2,800 3,150 3,500 3,850 4,200 4,550 4,900 5,600 6,300 7,000 4,260 - FY10 Model per SPT 11/14/08
DOMESTIC SYNDICATION 220 240 270 300 330 350 380 430 490 540 330 - FY10 Model per SPT 11/14/08
INTERNATIONAL TELEVISION 24,590 26,260 28,570 30,650 33,160 34,100 35,040 36,860 39,090 40,830 33,160 - Per SPTI 11/11/08
PAY PER VIEW 1,080 1,220 1,350 1,490 1,620 1,760 1,890 2,160 2,430 2,700 1,640 - FY10 Model per SPT 11/14/08
TV COSTS (500) (500) (500) (500) (500) (500) (500) (500) (500) (500) (500) - $500K @ All Levels.
TOTAL TELEVISION NET 36,510 39,280 42,690 45,880 49,490 51,530 53,480 57,210 61,370 65,020 49,670
AIRLINE / NON-THEATRICAL 1,580 1,580 1,580 1,580 1,580 1,600 1,610 1,630 1,660 1,690 1,590 - Per Airline 11/4/08
MERCH, MUSIC & OTHER REVENUE 0 0 0 0 0 0 0 0 0 0 0 - No Merchandising, Sndtrck Assumed
PRODUCTION COST (72,000) (72,000) (72,000) (72,000) (72,000) (72,000) (72,000) (72,000) (72,000) (72,000) (72,000) - -
CO-FINANCING PROCEEDS 0 0 0 0 0 0 0 0 0 0 0
OVERHEAD (7,200) (7,200) (7,200) (7,200) (7,200) (7,200) (7,200) (7,200) (7,200) (7,200) (7,200) - 10.0% of Production Cost
RESIDUALS (7,430) (8,030) (8,680) (9,330) (10,030) (10,540) (11,010) (11,980) (12,980) (13,900) (10,080) - Full Residuals
CREATIVE SHARES (3,350) (3,990) (4,640) (5,400) (6,080) (6,680) (7,260) (8,590) (9,770) (11,660) (6,170) -CO-FINANCIER OVERAGES 0 0 0 0 0 0 0 0 0 0 0
TOTAL REVENUES 167,370 183,510 199,210 215,670 232,520 247,800 262,280 292,450 322,380 351,580 234,460
RELEASING COSTS (121,450) (126,030) (129,950) (134,380) (138,830) (143,260) (147,230) (156,040) (164,320) (172,220) (139,010)
PROD, O/H, PART, RESIDUALS (89,980) (91,220) (92,520) (93,930) (95,310) (96,420) (97,470) (99,770) (101,950) (104,760) (95,450)
GROSS PROFIT (LOSS) ($44,060) ($33,740) ($23,260) ($12,640) ($1,620) $8,120 $17,580 $36,640 $56,110 $74,600 $0
GROSS PROFIT MARGIN NA NA NA NA NA 3.3% 6.7% 12.5% 17.4% 21.2% 0.0%
2009 MRP