There has been a string of announcements from various companies in Canada lately about production companies being shut down. At the moment, it looked like Mutant X, Andromeda from Fireworks are likely cuts and pretty much everything from Alliance now. The reason seems to be a permanent downturn in demand for 1 hour dramas and mini-series.
Salter Street Films, the small Oscar-winning Halifax-based production company behind This Hour Has 22 Minutes, will be shut down permanently early next year. Salter's parent company Alliance Atlantis Communications Inc. confirmed the move was made Monday as part of the "widespread review" of its money-losing entertainment division announced last week. The "less than 10 people" who work at Salter Street, which won an Academy Award in March for co-producing Michael Moore's anti-gun documentary Bowling for Columbine, were notified on Monday, Alliance Atlantis vice-president of corporate and public affairs Kym Robertson said Tuesday. "The only show that I have information on is This Hour has 22 Minutes, which will continue," she said. Besides Salter Street, offices will be shut at a small production company in Vancouver, the former Great North Production in Edmonton, and Cafe Productions in London, England. All of the office shutdowns will take place between February and May of next year. "In addition to the four cities were offices will actually close, positions were affected in basically every office where we have an entertainment group staff, including Toronto, Los Angeles and Ireland," Ms. Robertson told globeandmail.com, adding that all of workers were notified on Monday. Toronto-based Alliance Atlantis paid $82.3-million to acquire Salter Street in April 2001. Salter Street was founded by two brothers, lawyer and CEO Michael Donovan and his writer brother Paul. It is best known for its episodic series, This Hour Has 22 Minutes, Lexx, Made in Canada, Emily of New Moon and Blackfly, as well as made-for-TV movies such as Life with Billy. Salter Street also owns the Independent Film Channel Canada, which escaped the cuts because it is part of Alliance's broadcast group. Salter Street Digital, also based in Halifax, is one of three post-production facilities owned by Alliance Atlantis. A decision on the three businesses will be made in the next three to six months. Ms. Robertson said. Salter Street Digital was unsuccessfully out up for sale earlier this year. In line with the company's announcement last week, she said that between 60 and 70 people will be laid off from a total of 140 and 150 in the entertainment division. Alliance Atlantis had a total work force of 800 before the latest round of layoffs. "We think that the downturn in the market for much of what we produce is a permanent one and we need to adapt accordingly," Ms. Robertson said. The company announced last Friday that it would eliminate various productions, cut as many as 70 jobs and close some offices in response to a weak demand for prime-time television shows, independent films and TV movies of the week. As part of the review, Alliance said Friday that the entertainment group's chief executive officer Peter Sussman and president of production Seaton McLean will be leaving the company. Ms. Robertson said Tuesday that Alliance Atlantis will stop producing mini-series, movies of the week or feature films but will continue to produce existing drama series that are already contracted, as well as children's and documentary programming. "We have reduced our staffing levels to conform with what we think is an appropriate model for distribution and production going forward. In most cases that will mean we will acquire the distribution and other rights to projects, rather than producing them in-house with our own resources," she said. Alliance Atlantis said Friday that the review - which does not include its extremely successful CSI: Crime Scene Investigation show - will be completed by the end of the year ended Dec. 31. The company, which lost money in its latest quarter, said it will disclose the financial impact early next year and provide guidance for 2004 at that time. Analysts have been upbeat about the decision. "Managment is basically shutting down most non-CSI television production. Good," RBC Dominion Securities Inc. analyst Megan Anderson wrote in a research note released Thursday. "Production has been a constant source of uncertainty and disappointment (as has almost every company we have covered that operated in this asset class) and a prime source of doubt for the stock and management in the past." Analyst Tim Casey of BMO Nesbitt Burns Inc. called it a "positive development" for shareholders. He estimated that the layoffs and office closures would lead to cost savings of between $10 and $15-million, or 15 to 20 cents a share, after-tax. Cash costs linked to the "review" could be in the $20-million range, Mr. Casey wrote in a research note. _______________________________________________ Sndbox mailing list [EMAIL PROTECTED] http://a8.mewebdns-a8.com/mailman/listinfo/sndbox_sandboxmail.net
