Wednesday, December 31, 2008

Imagi's Financial Future?

Variety Asia has an article about the financial status of Imagi. Apparently, things aren't looking too rosy. While the animated Astro Boy movie is apparently on course for release in October, there is some concern over the company's future after that. Let's hope that these concerns are dealt with over the coming year, because I know that Imagi has a lot of creative gas in the tank, and it would be a total shame for the company to undergo any problems.

You can read the article on Variety Asia Online or read an archived version right here by clicking the link below.

Financial concerns continue to dog Imagi
Written by Patrick Frater
Tuesday, 30 December 2008

HONG KONG – Auditors delivered a 'going concern' qualification to the half year results of Hong Kong- and LA-based animation firm Imagi Int'l which last year delivered "Teenage Mutant Ninja Turtles" for Warner Bros and Weinstein Co.

Company statement said that Imagi is on course to deliver CG-animated fantasy "Astro Boy," with a starry voice cast headed by Freddy Highmore, Nicolas Cage and Bill Nighy, for release in October 2009. And it revealed progress on the three upcoming projects, "Gatchaman," "Tusker" and "Cat Tale."

But audit firm Deloitte Touche Tohmatsu said "it is uncertain whether the Group will have the necessary financial resources to complete these animated pictures."

"At 30 September 2008, the group had bank and cash balances of approximately HK$88.9 million ($11.5 million,) while it is expected to incur approximately HK$512 million ($66 million) cash outlay to complete its animation pictures and to meet its daily operating expenses in coming years up to June 2010 (of which approximately HK$353 million [$45.6 million] is required within the next 12 months) before revenue from the animation pictures is generated," Deloitte said.

"The directors are actively pursuing various funding sources to meet the group's cash flow requirements…. However, it is uncertain whether these fund raising exercises will be successful," Deloitte said. "Consequently, in the absence of evidence that the group will be successful in raising the necessary funding as and when it is required, we consider that there is a material uncertainty which may cast significant doubt on the group’s ability to operate as a going concern."

Deloitte did not qualify the company's 2007-08 annual report which it audited in July.

For the half year to September, company reported losses of HK$21.8 million ($2.81 million) compared with HK$27.1 million ($3.50 million,) on revenues down from HK$12.5 million ($1.61 million) to HK$1.56 million ($0.2 million).

Imagi said that in line with expanded use of 3-D by competitors Pixar, DreamWorks and Disney, Imagi said that the most exciting sequences of "Astro Boy" will be delivered in Stereo 3-D and said that "Gatchaman and "Tusker" will be entirely in stereo 3-D. "Tusker," an India-set elephant tale which was once set up at DreamWorks, is to be directed by Lorna Cook from a script by Ted Talley and produced by Brooke Breton.