(AOF) – Technicolor Creative Studios has issued a 2022 earnings warning due to an unprecedented level of employee attrition. Technicolor Creative Studios has revised its expectations for adjusted EBITDA after rents. For 2022, the estimates are revised downwards from 120-130 million euros previously to 45-65 million euros at budget rates or 50-70 million euros at actual rates.
According to a preliminary estimate for 2023, it is expected to be stable or slightly higher compared to the planned landing in 2022, compared to 140-160 million euros previously estimated.
According to the visual effects specialist, the expected improvements in recruitment, attrition and efficiency are not materializing at the expected rate, preventing him from delivering on time or at the costs initially anticipated.
Recently, many high-margin sales could not be made at The Mill (Advertising), due to a lack of senior team resources. Some major projects at MPC (Visual Effects Films & Series) are affected by reduced production efficiency, leading to delivery delays, additional expenses and lower margins.
In addition to the numerous actions already implemented since the summer, the group is actively working on a broader transformation program encompassing the recruitment of several new senior key employees, associated with further optimization of processes and monitoring parameters, and the transfer of a larger volume of production to India.
New company resulting from the split of Technicolor, Technicolor Creative Studios made its first steps on the Stock Exchange on September 27th.
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Series of acquisitions
At the beginning of 2022, Microsoft acquired the American publisher Activision Blizzard (franchises “Call of Duty”, “World of Warcraft” and “Candy Crush”) for 69 billion dollars. This is the largest M&A transaction ever in tech. Following this operation, Microsoft will become the third largest player in the industry in terms of turnover behind the Chinese Tencent and the Japanese Sony. The latter recently acquired Bungie, creator of the “Halo” franchise, for $3.6 billion. As for the American publisher Take-Two (behind the flagship titles “Grand Theft Auto” and “Red Dead Redemption”), it has taken over Zynga, one of the biggest players in mobile video games with franchises such as “Farmville”, “Empires & Puzzles” and “Words With Friends”. The operation was made on the basis of a valuation of 12.7 billion dollars.