Gaga Communications, one of Japan's leading distributors, has recorded a pre-tax operating profit of $10.8m (Y1.34 billion) in the fiscal year 2001, ended Sept 30, up by 209% from the previous year.
Gaga attributed this increase largely to the success of The Mexican which grossed $21m (Y2.6 billion), and summer blockbuster Hannibal, which grossed $37m (Y4.6 billion), making it the company's second biggest-ever box office hit after The Green Mile, which earned $48.7m (Y6.0 billion).
Despite the disappointment of Final Fantasy, which generated $8m (Y1 billion) at the box office after its September 15 release on 259 screens, Gaga recorded a net operating profit of $3.8m (Y468 million) due to strong earnings from its video rights business, which accounts for 40.6% of the company's total revenue, compared to 36.5% from its film distribution business.
Together with the newly released hit Rush Hour 2, the company is anticipating strong returns from upcoming titles The Others, We Were Soldiers and Kate & Leopold. Gaga expects to make a net profit of $5m (Y 633 million) in the coming fiscal year, starting October 1, 2001 and ending September 30, 2002.
Gaga officially listed on the NASDAQ Japan market on June 29. Encouraged by the news of the company's profit growth on November 27, investors boosted its share price by $0.60 (Y15) to $7.00 (Y915) the next day.
To attract investors, Gaga set up an online IR service (www.gaga.co.jp) on June 26 to provide detailed information about the company, including its corporate profile, business trends, business results and stock charts.
"Individual investors account for 97% of our total shareholders and on our website we aim to provide them with almost the same volume of information we give analysts," said Gaga publicist Masaru Fukugakiuchi. "We have received a positive response to the site and 70% of our investors are satisfied with our service."
In a related development, Gaga has started providing shareholders with DVDs of the company's latest hit titles. Shareholders who own 100 shares get one DVD title, 500 shares, two titles and more than 1000 shares, three titles. Individual investors especially welcome such schemes as a supplement to capital gains and dividend payments.