HALIFAX — Shares in DHX Media Ltd. plunged 33 per cent to their lowest close in more than six years on Thursday after the entertainment company provided a weaker-than-expected preview of its fourth-quarter results.
The Halifax-based company's shares closed at $1.13, down 56 cents from the previous close and the lowest since Aug. 16, 2012, when they ended the day at $1.07.
The Thursday stock drop came after DHX said it expected its fourth-quarter revenue to total $99 million and anticipated losses for the fourth quarter and full year when it reports its results on Sept. 25.
The company, which creates and distributes animated and live programming for Canadian and international audiences, said the quarter will include $12-million in write-downs of investment in content and intangible assets.
The 2017-18 financial year has been billed as a transitional year for DHX Media, which borrowed heavily to acquire an 80 per cent interest in the Peanuts and Strawberry Shortcake animation franchises last year for US$345 million.
Michael Donovan, executive chair and CEO of DHX Media, said in a statement that the company has taken "significant corrective actions" that aren't yet reflected in its reported results.
After the year end, DHX used net proceeds from a sale of nearly half its 80 per cent share in Peanuts to Sony for US$161.3 million to repay a portion of its outstanding debt.
For the 2018 financial year ended June 30, DHX said its operating activities generated $37.4 million of cash, before $24.4 million of acquisition and related financing costs.
DHX says it expects the fourth-quarter net loss will be in a range of $18 million to $20 million, and a full-year net loss of between $6 million and $8 million.
Analysts had estimated a $6.4-million profit for the quarter and a $14-million profit for the year, according to Thomson Reuters Eikon.
They also estimated it would have $126.8 million of revenue for the three months ended June 30.
Companies in this story: (TSX:DHX)
The Canadian Press