It’s the Independents’ Day as exports boom
Pact today (4 July 2012) publishes the Independent Production Sector Financial Census and Survey 2012. It shows that independent sector revenue has grown by 2.3% overall in the last year to around £2.4bn.
This is the seventh annual Pact census. The key finding in the new Pact census is the continuing overseas demand for British content.
The census shows a mixed picture. In the calendar year 2011, headline revenue growth has slowed. Profitability has weakened and production companies across most parts of the industry are reporting declining net margins.
The exports market is a remarkable success story. Overseas revenue increased more than 15% on 2010 figures – in four years, UK indie exports have increased by well over 100%.
Debbie Manners, Chair of Pact, said:
“The UK’s independent TV production sector is a modern British success story. While domestic commissions have certainly suffered through our recession, the overseas markets can’t get enough of British productions. Quality remains king - our indie producers know no bounds when it comes to innovation and creativity in their content.
“Profitability is a concern of course - and there is pressure despite initial signs of recovery in 2010. With the domestic market fairly flat, it’s vital that our indie sector has the flexibility to match their entrepreneurship so that they can continue to grow their businesses at home and overseas.”
John McVay, Chief Executive of Pact, said:
“We have many reasons to be confident in our indie sector – the growth in exports in recent years is nothing short of an economic boom and it just goes to show our sector’s adaptability. The response to domestic recession also shows the continued importance of our agreed terms of trade, which has ensured a competitive and successful market.”
Mark Oliver, Chief Executive of Oliver & Ohlbaum, said:
"The Pact census conducted by O&O once again reveals the important stories behind the headline published turnover numbers from UK indies. The census shows a continued shift from UK primary commission income to overseas commissioning and secondary and ancillary rights revenues as UK indies continue to play a lead role in the globalisation of the TV content sector.
“A marked increase in co-production activity this year shows that UK producers continue to look for new ways to internationalise and diversify their businesses in order to sustain growth."
Stand-out findings in the 2012 census include:
- Primary UK commissions are down from £1.36bn (2010) to £1.25bn (2011) – and down by approximately 17% since 2008 (£1.50bn);
- international buyers spent £652m on UK indie productions in 2011, up from £495m in 2010;
- since the UK recession started in 2008, indies more than doubled overseas commissions;
- international rights revenues income from UK indie content was £284m in 2011 – this has grown for six years in a row and is double the 2006 income;
- overall company profitability has shrunk from 13% in 2010 to 6.7% in 2011; and
- the only companies with overall growth in profitability are the ones with a £1m to £1.5m turnover – the biggest companies (turnover of £70m+) saw profitability drop to 6.2%.