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Inside Licensing News and Notes June 9, 2017 image

Inside Licensing News and Notes June 9, 2017

Lionsgate Forecasting $250 Million in Location-Based Licensing Revenue Over 10 Years

Lionsgate predicts that it will generate $250 million in location-based licensing revenue during the next 10 years, CEO Jon Feltheimer told analysts. More than half the total is guaranteed, he said. The revenue includes a Lionsgate zone at Dubai Parks and Resorts’ Motiongate Resort, the first portion of which opened in December.  The Hunger Games section of the Dubai facility is slated to debut in late August.  Also on tap is the 234,000 sq.-ft. Lionsgate Entertainment World in Hengqin, China that will be operated by Zhuhai Hengqin Laisun Creative Culture City Co. Ltd and open in late 2018. There are also several projects planned for the U.S. and Europe, he said. Among the U.S. projects was a Hunger Games theme park near Atlanta, but that was put on hold by developer Avatron Park in December.

The company also expects to get revenue from the Candy Crush game show it is producing that launches July 9 on CBS.

Contact: Lionsgate Entertainment, Sheila Clarke, SVP Consumer Products and Franchise, 310-255-3612,sclarke@lionsgate.com

G-III Dropping ‘Non-Essential’ Licensed Brands

G-III Apparel will drop some “non-essential” licensed brands later this year, either buying out the agreements or letting them expire, G-III CEO Morris Goldfarb told analysts. Goldfarb didn’t identify which brands would be affected. G-III’s top-selling brands include Calvin Klein, Tommy Hilfiger and Karl Lagerfeld; it also has agreements for Kenneth Cole, Guess, Ivanka Trump, Jessica Simpson and six other labels.

G-III’s licensing revenue is expected to be boosted by the recently acquired Donna Karan and DKNY brands, including a recent deal with PVH for menswear including dress shirts, neckwear and jeans, starting in spring 2018.

“The business is going to be increasingly based on a handful of megabrands” including Karl Lagerfeld, Donna Karan, Calvin Klein and Tommy Hilfiger — the latter two licensed from PVH, says a G-III spokesman.

G-III swung to a $10.4 million loss in Q1 ended April 30 from a $2.8 million profit a year earlier as it incurred $1.1 million in severance and professional fees in connection with the Donna Karan purchase. Revenue jumped 16% to $529 million, including $40 million from Donna Karan and DKNY. The Donna Karan brand posted a $14.8 million operating loss in Q1, but is expected to turn profitable in the second half of the fiscal year.

Contact: G-III Apparel, Nick Nackman, Chief Financial Officer, 212-403-5000

Rovio Readies Push In Live and Location-Based Entertainment

Fresh from forming a new licensing unit, Rovio Entertainment is readying a push to expand its business in live and location-based entertainment, says Rovio’s Simo Hamalainen. The venture into live entertainment would Rovio’s be first; expansion of location-based entertainment will be led by  Angry Birds World, the opening of which is now slated for this fall at Festival City in Doha, Qatar.

Licensee Kidgoland also has opened the first three Angry Birds activity centers at malls in China. Rovio already has rides or activity parks in China, Malaysia and the UK. Meanwhile, Rovio is planning several “halo” promotions around the launch of the new “Angry Birds Evolution” mobile game on June 15 in the U.S. for Android and iOS devices. The promotions are expected to focus on premium apparel targeting older players  – 15 years old and up – that are expected to be main audience for the game. Angry Birds games typically targeted 5-10-year-old children. Angry Birds Evolution has already been released in Finland, the UK and New Zealand. Rovio also will largely confine licensing for the Kit ‘n Kate animation series to Europe where it has a large fan base, say Hamalainen. Rovio formed a partnership with series creator Toonbox last year and is serving as the master licensee for the property. Rovio has signed a publishing deal for Kit ‘n Kate in Finland and is seeking one for toys.

Contact: Rovio, Simo Hamalainen, SVP Licensing, +358 50 585 9757, simo.hamalainen@rovio.com

Michael Kors Q4 Operating Profit Declines

Michael Kors’ licensing operating profit in Q4 ended April 1 fell 29.2% % to $11.1 million on a 6.2% revenue drop to $33.4 million as strong sales of Access smartwatches didn’t offset a decline in fashion models, Kors’ Chief Financial Officer Joseph Parsons told analysts.

Meanwhile, the company’s $500 million purchase of 111 licensed stores in China from Michael Kors Limited last year helped boost Q4 retail revenue 0.5% to $575.3 million despite a 14.1% decline same-store sales.

Kors, which has 960 stores, also unveiled plans to shut 100-125 outlets through 2019. Overall, Kors swung to a $26.8 million Q4 net loss from a $177 million profit a year earlier as revenue dropped 11% to $1 billion.

Contact: Michael Kors, Joseph Parsons, Chief Financial Officer,212-201-8100

Bebe Adding IP to Licensing Joint Venture with Bluestar Alliance

Bebe will transfer its domain name, social media accounts and international wholesale agreements to its licensing joint venture with Bluestar Alliance, the company said in an SEC filing. The move follows Bebe’s decision in April to close its stores, the last of which shut in May.

Bebe forged the pact with Bluestar last year, contributing trademarks and trademark licensing agreements in exchange for 50% ownership of the joint venture. Bluestar paid $35 million for its share of the venture, which will “aggressively pursue” licensing deals, Bebe said. Bebe had 148 stores, including 75 international licensees that operated across 20 countries.

Bebe’s net loss in Q3 ended April 1 grew to $51.8 million from $29.9 million a year earlier as revenue fell 17.8% to $65.7 million.

Contacts: Bebe, Walter Parks, Chief Operating Officer, 415-715-3900 ; Bluestar Alliance, Ralph Gindi, Pres., 212-290-1370, rgindi@bluestaralliance

Mr. Magoo Making a Comeback

Mr. Magoo is making a comeback. The French studio Xilam Animation is developing 78 new seven-minute episodes that are expected to launch in late 2018 and is negotiating to get consumer products rights for select global markets, Xilam’s Marie-Laure Marchand tells us. DreamWorks, now part of NBCUniversal, acquired the rights to Magoo in buying Classic Media in 2012. Xilam is making the show for public broadcaster France 3. Cartoon Network Asia also will carry the show. Mr. Magoo, a staple of broadcast TV in the U.S. in the 1960s, was last the subject of a Disney live-action comedy in 1997 and had a direct-to-video release – Kung Fu Magoo – in 2011.

Contact: Xilam Animation, Marie-Laure Marchand, EVP Global Consumer Products, +33 1 40 18 72 51

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