Viva Communications sees profit doubling in ’08

Film and entertainment outfit Viva Communications Inc. is eyeing a net income of P330 million next year from a projected net income of P153 million in 2007, according to documents filed with the Securities and Exchange Commission.

In the 10 months ending October this year, Viva posted a net income of P121.42 million or more than double the P60.93- million net earnings reported for the full year of 2006. Revenues amounted to P722.13 million.

Viva is tapping the equities market next year to raise as much as P1.85 billion from the sale of 142.85 million shares.

The company is selling 92.86 million primary common shares and 49.999 million secondary shares at a price ranging from P9.72 to P12.93 per share.

Viva expects to generate P1.2 billion out of the total proceeds from the initial public offering (IPO) which the company plans to use to beef up the programming of its cable channels and local film production.

BDO Capital & Investment Corp. has been tapped as lead underwriter for the IPO while Abacus Capital & Investment Corp. is the co-lead underwriter.

The creation of programming for the cable channels is envisioned to take place within the first half of 2008 with an estimated related cost of P50 million for each channel.

The company also intends to produce six films in the first quarter of next year, two of which shall be co-produced with Star Cinema Productions with a budget of about P34 million per film. For the other four films, the company has allotted around P21.5 million.

For the first half of 2008, Viva is setting aside P60 million for the production of 10 concerts and P20 million for training and development of its artists/talents.

Other proceeds from the offering will be used to acquire foreign movie acquisition, digitization and restoration of the film library, acquisition of equipment necessary for archiving purposes and fund content.

The offering is expected to run from Jan. 14 to 21 while listing has been tentatively set on Jan. 25.

Viva was formed in 1981 to primarily engage in movie production. In 2007, the company was reorganized and renamed Viva Communications to solidify its leading position in the Filipino content creation industry and to seize opportunities brought about by the strong demand for Filipino content and the challenges from the vertical and horizontal expansion of distribution modes for content.

The company has produced about 800 films and television shows, several of which have been box office hits and have won international and local awards.

Viva has likewise released a total of 139 foreign films ever since it started in 2000.

It owns the biggest library of Filipino entertainment content, which it acquired over a period of 20 years and is composed of more than 2,400 movies.

Viva currently provides films for ABS-CBN, IBC-13, Cinema One, Star TV Group, Astro Asia Pacific, Mediaquest and PBO.