Despite acknowledging that it may have been overly ambitious in its original production goals, UK National Lottery studio franchise Pathe Pictures has sailed through its mid-term review by film super-body the Film Council.

The greenlight, which means Pathe can download the rest of its six-year lottery award of $48m (£33.12m), comes despite the franchise having produced only nine films to date. The franchise said in its original application for lottery funding that it aimed to make 35 films over six years, although the figure is a target rather than mandatory number.

Pathe UK chief Francois Ivernel acknowledged that the franchise was behind in its original production goals. "We have explained that in our first year we had trouble getting the first films going," he said. "I think at the end of the third year we were a year behind because development and building relationships takes time. We were probably over-optimistic."

Pathe was also asked about the decision not to renew long-term deals with a group of producers including Norma Heyman and Simon Channing-Williams. Many saw the presence of such well-known UK film-makers as crucial to the success of a French-backed bid for lottery cash.

Ivernel noted that Pathe retained first-look deals with producers such as Jake Eberts and Fragile Films who were part of the original bid. Pathe recently struck a first-look pact with Michele Camarda.

"You have got to end some deals," said Ivernel. "Its quite natural."

An apparent plus point was that Pathe remains the only franchise to boast in-house development, production and distribution. This year it looks set to be the leading independent distributor in the UK, offering franchise titles a potent outlet into their home market. Overseas, Pathe recently appointed Alison Thompson, formerly head of The Sales Co, to oversee a London-based international sales operation.

Pathe has financed the most commercially successful franchise film to date - Oliver Parker's An Ideal Husband. The Oscar Wilde adaptation grossed $4m in the UK and $18m in the US. The franchise also backed Lynne Ramsay's critically-acclaimed feature debut Ratcatcher.

Pathe becomes the second franchise to pass its mid-term review after The Film Consortium finally came through a stormy examination in October. The third franchise, DNA Films, is currently under review.