With the end of the annual report disclosure, the industry is also basically clear. Among all industries, the film and television industry has always been a unique existence. It was once the target of cross-border M & A in the capital market, but in recent years, under the influence of multiple factors, the film and television industry is no longer bright. According to the secondary classification of Shenwan industry (2021), 22 film and television companies had a total revenue of 41.441 billion yuan and a total net profit loss of 1.303 billion yuan in 2021, of which 11 companies were in a state of loss.
Most of the companies whose performance is under pressure are companies with production as the main business, including many established studios, such as Huayi Brothers, which focuses on films, and Ciwen media, which focuses on TV dramas.
"The annual report inventory of film and television companies can be called a miserable conference." A media industry brokerage analyst told the Securities Daily that since the epidemic, the startup rate of film and television content has decreased significantly, which directly leads to the shortage of content at the middle and lower distribution and broadcasting ends. Reducing cost and increasing efficiency will become the norm of the industry in the next few years.
Cost reduction and efficiency increase run through the upstream and downstream
From the financial report of individual stocks, the epidemic situation is the primary factor affecting performance. "Under the epidemic, the number of project approval and startup of the crew has decreased." A person in charge of the film and television base told reporters.
According to the data of the State Administration of radio and television, 194 TV dramas and 6736 episodes were produced and distributed nationwide in 2021, a new low since statistics. According to the reporter's statistics, from 2018 to 2020, the number of TV dramas produced and distributed nationwide was 323, 254 and 202 respectively, which were 13700, 10600 and 7476 respectively according to the number of episodes. In other words, compared with three years ago, the number of TV series produced in 2021 is 51% less.
During the Shanghai Film Festival last year, Wang Changtian, chairman of ray media, once said: "since the second half of 2018, the whole capital's attitude towards the film and television industry has changed significantly, resulting in a sharp reduction in investment in the whole industry. For example, in terms of equity investment, few companies can get equity investment in the initial stage of establishment or during the operation period. For the investment in the project itself, the capital has also decreased sharply, resulting in many projects unable to start."
Under the background of collective loss, the streaming media platform at the purchasing and broadcasting end also frequently puts forward the goal of "reducing cost and increasing efficiency". Tencent said that we are taking measures to optimize costs, reduce the financial losses of Tencent video and maintain its leadership. Gong Yu, founder and CEO of iqiyi, said that China's long video industry has entered a new stage, which is characterized by the pursuit of efficiency, loss reduction and profit, rather than the previous simple pursuit of market share and rapid growth.
"The procurement platform continues to compress the budget. It can be predicted that the standards for content project approval will be stricter in the future, the competition among producers will be more intense, and cost reduction and efficiency increase will become the norm of the whole industry for a long time in the future." The analysts said.
Destocking is a top priority
From the perspective of cash flow, the situation of the film and television industry in 2021 is not optimistic. In 2021, only 9 film and television companies had a positive year-on-year increase in net cash.
Take Ciwen media, which has tight cash flow, as an example. According to the financial report, Ciwen media's net cash flow from operating activities in 2021 was 90.7787 million yuan, with a net profit loss of 249 million yuan. The loss of the company is mainly due to the provision for bad debts of receivables, goodwill impairment and inventory falling price.
In 2021, Ciwen media had a credit impairment loss of 127 million yuan and an asset impairment loss of 142 million yuan, of which the provision for inventory falling price was as high as 125 million yuan. By the end of 2021, the company's inventory accounted for 59.56% of its assets.
The high inventory is not the dilemma faced by Ciwen media. In 2021, the total inventory of 22 film and television companies reached 15.563 billion yuan, and the inventory falling price reserves totaled 2.606 billion yuan. More importantly, by the end of 2021, the average number of inventory turnover days in the film and television industry was 356.34 days, and the longest number of enterprise turnover days was 1357.98 days.
The above-mentioned analyst told the reporter of Securities Daily that the inventory of film and television companies is mainly film and television dramas, including the products whose shooting has not been completed, the products whose shooting has not obtained the reflection license, and the products whose shooting has obtained the projection license but not completed the sale. In recent years, due to the frequent occurrence of bad artists and the change of audiences, many film and television dramas are waiting to be broadcast. It is normal for a play to wait three or four years, which has caused considerable cash flow pressure on production companies and broadcasting platforms. Therefore, destocking has become an urgent task for the film and television industry.