Pre-tax losses at the owner of multi-award-winning Brown Bag Films increased by 31% last year to €6.06m as the business continued to be hit by the downturn in the animation content industry.
New consolidated accounts filed by Scholastic Ireland Holdings Ltd show that the group's loss followed pre-tax losses of €4.62m in 2024.
Revenues last year increased by 24% from €30.18m to €37.4m, though the revenue figures are skewed as the 2024 figure was for a nine month period.
The directors state that the group has recorded €3.6m of exceptional costs in the year, which primarily related to impairment of content and a redundancy programme.
This followed a cost of €1.5m under the same heading for the prior year.
The directors state that "this reflects changes in the industry which left the group with the unfortunate course of action to reduce its headcount".
A note concerning the €3.6m exceptional cost discloses that €2.17m arose from 'redundancy and other’ while impairment of minimal guarantees totalled €1.44m.
The note states that in the prior year "a decision was announced to restructure operations by downsizing which the directors feel will allow the Group to achieve efficiencies and boost profitability over the long term".
Numbers employed by the group reduced from 202 to 194 during the year though staff costs increased from €15m to €17.73m.
The loss takes account of combined non-cash amortisation and depreciation costs of €4.5m along with €647,472 in trade-mark write-off costs and €291,241 in the write-off of a financial asset.
The accounts show that the group - which operates studios in Dublin, Toronto and Bali - paid out a dividend of €1.68m last year.
On the risks facing the business, the directors state that "rapidly changing technology and platforms are altering the broadcasting landscape and existing business models and driving growth in direct-to-consumer and digital markets.
They state however that the Group "believes it has sufficient experience to meet these risks while delivering profitable revenue growth".
The Brown Bag business was founded in Dublin in 1994 by Cathal Gaffney and Darragh O’Connell.
Brown Bag Films was acquired by Canada-based 9 Story Media Group in 2015. 9 Story Media was purchased by the US-based Scholastic in March 2024, for $185m.
Some of the the studio’s global hit TV shows include Doc McStuffins, Daniel Tiger’s Neighborhood, Henry Hugglemonster, Bing, Peg + Cat, Peter Rabbit, Wild Kratts, Olivia, Noddy in Toyland, The Magic School Bus: Rides Again, and Octonauts.
Shareholder funds at the end of May last year totalled €43.12m, which included accumulated profits of €1.19m.
Cash funds declined from €11.5m to €7.6m.
Reporting by Gordon Deegan
