Entertainment One’s business in China has the potential to match the company’s U.S. revenue as the licensing and merchandising of Peppa Pig, PJ Masks and other properties expands in that country, CEO Darren Throop said in releasing first-half earnings.

Much of the company’s business in China is driven by recent SVOD distribution agreements for Peppa Pig and PJ Masks programming with Tencent, Mango, Youku, and iQiyi. But it also has 74 Peppa Pig merchandise licensing agreements in China, with master toy licensee Alpha Group expected to deliver an expanded assortment in 2019. Merlin Entertainment has opened a Peppa Pig World of Play park in Shanghai, and will open another park in Beijing next year. Entertainment One also co-produced, with Alibaba, the Peppa Pig: My First Cinema Experience film that’s to be released in China in February.

In addition to China, Merlin will open a Peppa Pig park in Dallas by year-end and add another in Detroit in 2019.

In the first half, Entertainment One’s EBITDA increased 10% to £60.1 million despite revenue declining 2% to £404.9 million. Peppa Pig-related revenue rose 44% to £41.7 million, due largely to SVOD agreements. PJ Masks revenue increased 18% to £29.9 million, driven by licensing and merchandising.

The company’s broadcast and (rights) licensing business posted a 20% revenue increase to £174.9 million, while those from the theatrical segment fell 45% to £33.2 million, owing to fewer releases and a decline in home entertainment.

Of Entertainment One’s new properties, the “Ricky Zoom” series will launch on Nick Jr. in January with consumer products expected to arrive in the second half of 2019, Throop said. “Cupcake and Dino: General Services” has launched on Netflix and “Ninja Express” has started production.

Contact:

Entertainment One, Joseph Sparacio, CFO, 416-646-2400, jsparacio@entonegroup.com