During the adjustment period, Wanda Light Huayi's performance diverges 2017 Pictures may welcome the reshuffle pattern

recently, according to figures released by the State Film Special Resources Office, the country's total box office totaled 14.23 billion yuan in the first quarter of 2017, down 1.7 percent from the same period last year, a further slowdown following the slowdown in box office growth in 2016. This cooling also led to a divergence in the performance of the studio.

recently, according to figures released by the State Film Special Resources Office, the country's total box office totaled 14.23 billion yuan in the first quarter of 2017, down 1.7 percent from the same period last year, which is a further cooling following the slowdown in box office growth in 2016. This cooling also led to a divergence in the performance of the studio.

the main performance indicators of Wanda Cinema Co., Ltd and Beijing Light Media Co., Ltd are still on the rise. And Huayi Brothers Media Co., Ltd. a number of performance indicators have declined.

in response to this, Huayi Brothers said in a letter to reporters that the decline in performance was mainly affected by the overall adverse market environment and the poor performance of the film business. With regard to the slowdown in box office growth, the industry has taken the initiative to reflect since last summer, which is a sign of the maturity of the industry. After reflection, the leaders of the industry have begun to adjust, and there is still a lot to be done in the future market.

in this context, for the film market situation in 2017, a number of interviewed experts told reporters that the film industry may usher in a reshuffle in 2017. In the case of full marketization, content manufacturing is still the most important in the future. Zeng Maojun, president of Wanda Cinema, also told our reporter: "there is a ceiling in the box office revenue of the film."

< strong > Wanda Ray's performance remains optimistic < / strong >

according to the 2016 annual report released by Wanda Cinema, the total operating income of Wanda Cinema reached 11.209 billion yuan during the reporting period, an increase of 40.1% over the same period last year; net profit reached 1.366 billion yuan, an increase of 15.23% over the same period last year.

of the total revenue of 11.209 billion yuan, Wanda Cinema earned 7.6 billion yuan at the box office, an increase of 20.5% over the same period last year, and 184 million people went to the cinema, an increase of 22% over the same period last year. Of which, 6.2 billion yuan at the domestic box office and 164 million people went to the cinema. The above performance is optimistic against the background that the national film market grossed 45.7 billion yuan in 2016, an increase of 3.7% over the same period last year, and the domestic box office growth rate is slowing down.

it is worth noting that the non-box office business of Wanda cinema accounted for more than 1/3 of the revenue in 2016. According to its 2016 annual report, during the reporting period, Wanda Cinema achieved non-box office revenue of 3.9 billion yuan, an increase of more than 100 percent over the same period last year, and non-box office revenue accounted for 35 percent of operating revenue, an increase of 12 percent over 2015.

Zeng Maojun told our reporter at the Wanda cinema's shareholders' meeting: "there is a ceiling for film box office revenue, but there is no ceiling for other business revenue growth."

in addition, Wanda Cinema established Wanda Media in 2016, acquired Mtime, laid out the game industry, and vigorously expanded its business in advertising media, film integrated marketing, online live streaming, derivatives, game industry and other fields; at the same time, start the construction of online cinema and online ticketing platform. With the construction of the ecological circle of the whole industry chain of Wanda Cinema Line, Wanda Cinema Line has also issued a special announcement to change the Chinese name of the company from "Wanda Cinema Co., Ltd." to "Wanda Film Co., Ltd.".

however, under the background that most of the performance indicators remain optimistic, Wanda Cinema still has some problems. Its annual report shows that the gross profit margins of the three major products of Wanda cinema line have all declined. Gross profit margins from cinema revenue, merchandise, catering sales and advertising revenue fell by 7.67%, 7.80% and 12.09%, respectively, compared with the same period last year.

in addition, since it is going to be renamed "Wanda Movie", it is necessary for Wanda cinema to invest a lot of efforts in content production. However, the 2016 "Warcraft" blockbuster invested by legendary Pictures, owned by Wanda Cinema, has earned more than 1 billion yuan at the domestic box office. However, it didn't go well at the box office in North America, with Warcraft grossing $432 million worldwide, with a box office loss of $15.6 million excluding production costs.

in addition, "the kidnapper" and "King Kong: skull Island" released in the first quarter of 2017 are also mediocre, and the lack of content is still a problem facing the transformation of Wanda cinema chain. Huang Guofeng, a senior analyst at Analysys Internet Entertainment, said that content is definitely more important now and in the future. Because only when there is new content, the channel is meaningful. If there is no good content, the audience will not buy it if there is no channel.

Light Media, which has the advantage of content production, has achieved optimistic results by cutting costs. According to the 2016 annual report released by Light Media, during the reporting period, Light Media achieved a total operating income of 1.731 billion yuan, an increase of 13.66 percent over the same period last year. Operating profit, total profit and net profit were 795 million yuan, 816 million yuan and 740 million yuan respectively, up 83.43%, 79.64% and 77.61% respectively over the same period last year.

when total revenue increases by only 13.66% year-on-year, profit and net profit can reach about 80% year-on-year growth. Light Media believes that this is the concentrated embodiment of the company's unswerving adherence to the "content is king" strategy for many years, and the market's growing desire for high-quality content. Light Media invested in, distributed and included in the 2016 box office receipts of 15 films, with a total box office of 6.42 billion yuan.

however, the loss-making cat's eye culture makes the performance of Light Media uncertain. From January to September 2016, the operating profit, total profit and net profit of Maoyan Culture were all-34.0517 million yuan, with an asset-liability ratio of 89.19%, according to Light Media's announcement.

in addition, the youth series featured by Light Media in recent years will also face challenges. Huang Guofeng said that no matter the youth movies or chick movies in previous years, as well as some so-called IP movies in recent years, are actually platitudes and do not have much innovation in content. If there is no great progress or innovation in content, the film market in 2017 may not be particularly optimistic.

< strong > New and old film production enterprises are still facing difficulties < / strong >

2016, but they are facing all kinds of problems for other new and old film production enterprises. The first to bear the brunt is Huayi Brothers.

Huayi Brothers' 2016 annual report shows that during the reporting period, the company's total operating income was 3.503 billion yuan, down 9.55% from the same period last year; operating profit was 1.177 billion yuan, down 15.21% from the same period last year; total profit was 1.288 billion yuan, down 13.94% from the same period last year; net profit was 808 million yuan, down 17.21% from the same period last year. In addition, the gross profit margin of the film and television entertainment sector, which accounts for the highest share of revenue, fell 2.27% in 2016 compared with the same period last year.

in response to the reasons for the decline in performance, Huayi Brothers told reporters that the decline was mainly affected by the overall adverse market environment and poor performance of the film business, but the net profit still ranked first among listed film and television entertainment companies, showing a high anti-risk ability in the overall layout.

in addition, the gross profit margin of the film and television entertainment sector, which accounts for the highest share of revenue, fell 2.27% in 2016 compared with the same period last year. Huayi Brothers said in its reply that it was mainly affected by three aspects. First, the economic environment and the growth rate of the film and television industry slowed in 2016, and the domestic box office growth rate declined as a whole; second, many commercial films of Huayi Brothers did not start or enter the market as scheduled in 2016. The lack of good commercialization and industrial films has also led to the loss of some audiences. Third, the rapid development of Internet entertainment affects the viewing habits of the audience, but also leads to the diversion of moviegoers.

and several other Internet film companies are also facing their own development difficulties. Although Letv Film grossed more than 100 million yuan at the box office in 2016, Letv's capital chain has been tight in the face of other money-burning sectors. As a new entrant, Tencent Pictures's first main control film, "Young", grossed only 15.908 million yuan at the box office, which was not entirely satisfactory. In addition, the "Warcraft" invested by Tencent Pictures and Wanda also suffered losses.

Huang Guofeng said: if we want to focus on large-scale investment and large-scale production, we will certainly have to invest a lot of money. At present, these video-based companies, such as Letv and Tencent, the most expensive part of their platform is the video business, and the video business has already dragged down so much of their money, so at least until the video money burning has not been better improved, these companies do not have so much money to invest in large-scale films, which can only be said to be a follow-up investment or a small share of investment.

in a multi-party scuffle, as for the development of the film industry in 2017, Huang Guofeng said that some movies and TV dramas with original IP will increase in the future, instead of going to transform a mature IP right away. It will be a good improvement for the original IP content creation in the future. In addition, there is also the possibility of reshuffle in the film and television industry.

an Xiaofen, president of Dasheng International Media, also said in an interview that there will be a reshuffle in the film industry in 2017. Because the change of the industry is combined with the change of the market, the market changes, the industry has to adapt to this change. The film market is a fully competitive market, as long as you do well, whether large companies, individuals or small companies, there is room to play, as long as any film is good, the audience will buy it. "in terms of movies, I think content is still king."

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Edit: queenie