Despite posting earnings before interest and tax (EBIT) of Euros -11.8m in the 2003 financial year, German producer-distributor Constantin Film is upbeat about its future performance and predicts sales growth of 55% for 2004.

In its annual financial statement for 2003, Constantin reported a 13% decrease in consolidated sales from 2002's Euro 131.2m to Euro 114.3m.

Constantin said that the negative EBIT was "due essentially to the lower than expected sales in the theatrical operations and depreciation charges made in relation to the final three films distributed on the basis of the output deals with Spyglass Entertainment and USA Films. Valuation of the TV licenses was also adjusted because of the ongoing poor market environment."

Looking to the current financial year, Constantin is planning a "substantial increase" in sales to over Euro 180m and a positive EBIT of at least Euro 6m.

It cited its strong theatrical distribution line-up which includes current release The Passion Of The Christ, Michael "Bully" Herbig's (T)Raumschiff Surprise - his follow-up to 2002 hit Manitou's Shoe, Bibi Blocksberg II, Mädchen Mädchen II, The Downfall and Alexander.

In addition, Constantin expects its market position to have been strengthened by the collaboration with Highlight in the field of video and DVD since January 1 and by the successful integration of Constantin Entertainment into the Constantin Film Group.

While Constantin has total credit lines of Euro 154m available for investment in production and license trading, the Group's net liquidity fell to Euro -15.7m at the end of last year due to a 75% year-on-year increase on investments in film assets to Euro 158.9m.

The bulk of these investments - Euro 108.4m - was for in-house productions such as Resident Evil - Apocalypse, The Downfall, Autobahnraser, Werner - Gekotzt Wird Spaeter, and new seasons of the TV sitcoms Bewegte Maenner and Hausmeister Krause.