Spackman Entertainment posts narrower 1H21 net loss as Covid hits results

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South Korean drama producer Spackman Entertainment reported Friday its first half net loss narrowed to US$2.63 million from US$4.13 million in the year-ago period as the pandemic disrupted operations.

Revenue for the January-to-June period increased 73 percent on-year to US$9.61 million, mainly on a higher percentage of completion for the films “Broker” and “The Box,” the company said in a filing to SGX.

Cost of sales more than doubled to US$9.14 million from US$4.50 million in the year-ago six-month period, mainly on higher production costs for the films “Broker” and “The Box,” Spackman said.

Gross profit dropped 56 percent on-year in the first half to US$470,000 as the Frame Pictures segment’s leasing of equipment revenue declined as the Covid-19 pandemic dampened demand, Spackman said.

Spackman pointed to the impact of the Covid-19 pandemic on its outlook.

“In terms of distribution, Covid-19 affected the release timing of the group’s projects such as ‘#ALIVE,’ ‘Stone Skipping,’ ‘The Box,’ and ‘Guardian,'” Spackman said. “In terms of production and other related projects such as camera equipment leasing and artist-related projects, if the Covid-19 situation continues to prolong, the group anticipates disruptions as well due to the Covid-19 measures and restrictions implemented at the workplace and the social environment.”

Spackman added that investors in the near term may be “less keen” to invest in movies due to pandemic-related uncertainty, and that participation in projects will remain challenging.

“However, the group plans to pursue opportunities to produce, finance and participate in U.S. films targeted for the global audience, in line with its intention to strategically diversify into the production and financing of U.S. movies and to overhaul the overall direction of the group’s business,” Spackman said.