4Kids Posts Losses, Re-Focuses on Anime
American licensing and distribution company 4Kids Entertainment released its fourth quarter fiscal report on Tuesday. According to the report, the company saw a net loss of $21.3 million for the quarter, and a loss of $42 million for fiscal 2009. Losses are up from 4Kids' 2008 report, which showed a quarterly loss of $19.6 million and an annual loss of $36.8 million. The company posted net revenues of $17 million for the quarter, up from last year's posting of $12.8 million for the same period. Annual revenues showed a drop to $36.7 million from 2008's $57.2 million.
Bruce Foster, 4Kids's Chief Financial Officer, stated that the loss is primarily due to different accounting treatments with CW, in regard to advertising revenues. Foster also noted decreased international sales of their franchises, and the decreasing popularity of Chaotic.
CEO Alfred Kahn stated that fiscal 2009 was "a hideous year for 4Kids and for our shareholders and for our employees." He revealed that the company reduced its workforce by over 50%, from 223 employees to 111 employees, and revealed that he saw the company as "smaller, leaner, and more focused." Kahn apologized to shareholders for the losses incurred in the past three years, and revealed that he will look into opportunities for the company, which could include capital infusion, a sale of the company, or a merger.
Kahn revealed that the company needs to return to its roots: a company that specializes in licensing and translating Japanese programming. He continued, saying that the company would not produce much content on its own going forward, since it is more expensive than releasing Japanese content.
Kahn stated that he worked closely with his partners in Japan over the past 18 months, and signed an agreement for a "very important Japanese property" on Monday. In addition, the company will rebrand the 4Kids TV network by the fall season with new titles, most of which being "substantial Japanese hits."
According to Kahn, Yu-Gi-Oh! sales remain constant, and continues to be a main source of revenue for the company. The company is participation in the creation of a new 3-D Yu-Gi-Oh film.
4Kids will announce their new property in the next few days.