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Corus Entertainment Takes $128M Write-Down On Nelvana

In announcing its fourth quarter and August 31, 2002 year-end results, Corus Entertainment Inc. revealed it has taken a CAD$200 million (approx. US$128 million) write-down of its investment in Nelvana. Nelvana is a wholly-owned subsidiary of Corus Entertainment. The company took the write-down because of the slowdown in the production and distribution industry over the past year. The write-down includes $40 million (US$25.6 million) from Nelvana's library and $160 million (US$102 million) for goodwill and other intangibles. For the fourth quarter ended August 31, 2002, Corus reported a net loss of $190 million (US$121.6 million) or $4.45 (US$2.84) a share for the latest three-month period ended Aug. 31. That compares with a year-earlier quarterly net loss of $1.9 million (US$1.2 million) or 4 cents (US 2.5 cents) a share. In addition to the write-down, Corus announced the company plans to reduce Nelvana's production levels to less than 150 episodes in fiscal 2003, as opposed to 252 episodes produced in fiscal 2002. Corus hopes this will eliminate the need to invest additional cash in Nelvana. John Cassaday, Corus president and chief executive officer, said in a statement: "It was a tough year for Nelvana, but we have taken the necessary steps to put the business on a solid footing for the future."