DOUGLAS, Isle of Man, April 29, 2022--(BUSINESS WIRE)--Eros Media World Plc ("Eros" or the "Company") (NYSE: ESGC), a global Indian entertainment company, today released the following statement from the CEO.
Pradeep Dwivedi, CEO, Eros Media World PLC, said
"After a challenging two-year period impacted by the global pandemic and a complex cross-border merger, we are diligently working on our business transformation and we remain committed to transparency and open communication with all our stakeholders, in the spirit of building a sustainable growth trajectory. With that objective, we want to share the following updates:
Debt Service Update
We reaffirm that we are current on all our debt obligations to our debt providers globally across India, the UK and UAE, including our UK retail bonds, and continue to focus on our financial and operational performance.
Asset Base Update
We have one of the largest film libraries in the Indian and South Asian media and entertainment sector. The Company will continue to continue to monetize its valuable library along with premium content creation and global distribution through our studio, Eros Motion Pictures, and streaming OTT service, Eros Now. It is this unique asset base that will serve as the springboard for our future business initiatives.
The Company is in the process of working to prepare and file the financial statements for the fiscal year ended March 31, 2021, and is working with its incoming auditor, M/s T R Chadha & Co LLP, Chartered Accountants. As previously communicated, the NYSE has granted the Company an extension until May 31, 2022, and the Company expects to meet that timeline.
The Indian Media and Entertainment industry has recently seen increased levels of domestic and cross-border consolidation driven by global events and as well as the positive secular trends of the local market. The recent strategic announcements by Sony Pictures, Zee Entertainment, Reliance Industries, Viacom, Lupa Systems among others are testimony to the salience and importance of the Indian market with its substantial long-term prospects. Given the current dynamic market environment, and strong market position and growth opportunities, the Company will consider all options."
Special Note Regarding Forward Looking Statements:
Information provided in this communication includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are subject to the safe harbors created thereby. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "approximately," "anticipate," "believe," "estimate," "continue," "could," "expect," "future," "intend," "may," "plan," "potential," "predict," "project," "seek," "should," "will", "trending" and similar expressions, including under the heading "Forward Guidance". All such forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we are expecting, including, without limitation: our ability to successfully and cost-effectively source film content; the Company’s ability to achieve the desired growth rate of Eros Now; our ability to maintain or raise sufficient capital; delays, cost overruns, cancellation or abandonment of the completion or release of the Company’s films; our ability to predict the popularity of its films, or changing consumer tastes; our ability to maintain existing rights, and to acquire new rights, to film content; our ability to successfully defend any future class action lawsuits we are a party to in the U.S.; anonymous letters to regulators or business associates or anonymous allegations on social media regarding the Company’s business practices, accounting practices and/or officers and directors; our ability to recoup the full amount of box office revenues to which the Company is entitled due to underreporting of box office receipts by theater operators; our dependence on our relationships with theater operators and other industry participants to exploit the Company’s film content; our ability to mitigate risks relating to distribution and collection in international markets; our ability to compete with other forms of entertainment; our ability to combat piracy and to protect our intellectual property; our ability to maintain an effective system of internal control over financial reporting; contingent liabilities that may materialize, our exposure to liabilities on account of unfavorable judgments/decisions in relation to legal proceedings involving the Company or its subsidiaries and certain of its directors and officers; our ability to successfully respond to technological changes; our ability to satisfy debt obligations, fund working capital and pay dividends; the monetary and fiscal policies of countries around the world, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange rates, equity prices or other rates or prices; our ability to address the risks associated with acquisition opportunities; risks that the ongoing pandemic and its spread, and related public health measures, may have material adverse effects on our business, financial position, results of operations and/or cash flows; challenges, disruptions and costs of the sale of the STX Entertainment subsidiary and related transactions, the amount of any costs, fees, expenses, impairments and charges related to the specific transactions of the Company; ; uncertainty as to the long-term value of the Company’s ordinary shares; and the completion of the Company’s fiscal 2021 audit and filing of its Annual Report on Form 20-F.
The forward-looking statements contained in this communication are based on historical performance and management’s current plans, estimates and expectations in light of information currently available and are subject to uncertainty and changes in circumstances. There can be no assurance that future developments affecting the Company will be those that it has anticipated. Actual results may differ materially from these expectations due to changes in global, regional or local political, economic, business, competitive, market, regulatory and other factors, many of which are beyond the Company’s control. Should one or more of these risks or uncertainties materialize or should any of the Company’s assumptions prove to be incorrect, the Company’s actual results may vary in material respects from what the Company may have expressed or implied by these forward-looking statements. The Company cautions that you should not place undue reliance on any of its forward-looking statements. Any forward-looking statement made by the Company in this communication speaks only as of the date on which the Company makes it. Factors or events that could cause the Company’s actual results to differ may emerge from time to time, and it is not possible for the Company to predict all of them. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by applicable securities laws.
USE OF NON-GAAP FINANCIAL MEASURES
To supplement our consolidated financial statements, which are presented in accordance with generally accepted accounting principles in the United States ("GAAP"), we also use Adjusted EBITDA as an additional financial measure, which is not required by, or presented in accordance with, GAAP. We believe that Adjusted EBITDA facilitates comparisons of operating performance from period to period and company to company by eliminating potential impacts of items that our management does not consider to be indicative of our operating performance. We believe that this measure provides useful information to investors and others in understanding and evaluating our consolidated results of operations in the same manner as they help our management. However, our presentation of Adjusted EBITDA may not be comparable to similarly titled measures presented by other companies. The use of this non-GAAP measure has limitations as an analytical tool, and you should not consider it in isolation from, or as substitute for analysis of, our results of operations or financial condition as reported under GAAP.
We define Adjusted EBITDA as EBITDA adjusted for impairments of available-for-sale financial assets, profit/loss on held for trading liabilities (including profit/loss on derivatives), transaction costs relating to equity transactions, and share based payments. We define EBITDA as net income before interest expense, income tax expense and depreciation and amortization (excluding amortization of capitalized film content and debt issuance costs). The non-GAAP financial measures included under the headings "Key Highlights" and "Forward Guidance" constitute forward-looking information, and the Company believes that a quantitative reconciliation of such forward-looking information to the most comparable financial measure calculated and presented in accordance with GAAP cannot be made available without unreasonable efforts. A reconciliation of these non-GAAP financial measures would require the Company to quantify several financial criteria, including inter alia: stock based compensation expenses, amortization expense of acquisition-related intangibles, tax impacts, asset impairment charges, amounts related to securities litigation, restructuring charges and gains or losses relating to sales of assets. These items cannot be reliably quantified due to the combination of variability and volatility of such components and may, depending on the size of the components, have a significant impact on the reconciliation. In addition, Net Debt is a non-GAAP financial measure, which we define as consolidated gross debt less cash and cash equivalents.
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Chief Corporate and Strategy Officer