Mondo TV is a global media group focused on the production, acquisition and exploitation of animated children’s television series. It owns the rights to >1,600 TV episodes and films, which it distributes across 75 markets. 83% of revenues are generated in Asia, with the remainder from Europe and South America.
Mondo TV has returned to profit in the first half of FY19, on its rebased business model with a more concentrated portfolio. Financial performance is tracking to management’s plan and our only forecast changes reflect IFRS 16 adoption. Visibility through H219 and into FY20 on the production pipeline is improving. The streaming of YooHoo & Friends on Netflix raises the group’s profile and the Toon2Tango partnership opens more European opportunities. The shares are valued well below global content peers.
The upcoming Mipcom at Cannes (12–17 October) will set the mood for the global content market. The disruption from new streaming platforms (Disney+, Apple TV+, WarnerMedia, NBCUniversal etc.) drives competition for quality content, but much of the additional spend is focused on ‘tent pole’ properties. Children’s content is valued to attract household subscriptions and traditional broadcasters have been less open to commission new series for some time. Licensing and merchandising markets have been lacklustre in recent months, on poorer economic conditions and the impact of (and threat of further) US Chinese trade sanctions also weighing on advertising revenues.