ERT Enter Rights.

RNS Number:0472M
Entertainment Rights PLC
18 January 2008


                            Entertainment Rights Plc
                        ("ER", the "Company" or "Group")


                        2007 PRELIMINARY TRADING UPDATE


Entertainment Rights Plc (LSE: ERT) The Board of Entertainment Rights Plc wishes
to update shareholders in relation to trading for the year ended 31 December
2007.

The Board notes that the outturn for results in the year ended 31 December 2007
remains subject to the Company receiving detailed reporting from its key third
party distributors and licensees. In particular, the Board notes the
announcement, released on 11 January 2007, regarding UK DVD manufacturing and
reiterates that the Company is awaiting receipt of reporting from Universal
Pictures (UK) Limited ("UPUK") prior to being in a position to fully assess the
impact of the issues encountered by UPUK.

The Company has now received preliminary reporting regarding the performance of
the Group's US home entertainment business during the key Christmas trading
period. Despite a challenging consumer environment in the US, the Board is
pleased to note that the preliminary reports indicate year-on-year growth in
revenue from the sale of the Christmas DVD titles in the US of 25%.

Despite the increase in revenue from the US Christmas titles, Group revenue and
underlying EBITDA during this key trading period did not meet the Board's
expectations. The Board anticipates that Group revenues for the year ended 
31 December 2007 (on a constant currency basis) are expected to be slightly 
below the lower end of the current range of market expectations with a 
consequent impact to reported profitability.

The Board notes that net debt at 31 December 2007 was �107.7m and that the net
interest charge on the Group's borrowings for the full year is estimated to be
�9.0m.

The Group incurred a further �1.4m of costs associated with the integration and
restructuring of Classic Media in the second half of 2007. The full year
integration and restructuring charge is estimated to be �4.6m. The Board is very
pleased with the integration and restructuring of Classic Media, which was
acquired by ER on 11 January 2007, and notes that the increase in revenue from
the sale of the Christmas titles demonstrates the discipline and brand
management focus that ER applies to its global business. The Board confirms that
cost synergies from the acquisition are in line with its original expectations.

As a significant supplier of children's and family content and brands across
consumer products and home entertainment in both the US and the UK, the Group is
not immune to the effects of a challenging consumer environment. Whilst the
update on 2007 trading is disappointing to report, the Board notes that the
Group has experienced significant growth in its TV Distribution business across
all of its key brands and is greatly encouraged by the growth in its brands
across key territories.

Recent brand highlights include:

   *Basil Brush(R) is currently starring in Basil's Swap Shop on BBC2 on
    Saturday morning;
   *The Postman Pat(R) brand re-launch is underway with Postman Pat - Special
    Delivery Service in production for CBeebies for transmission in Autumn 2008.
    The new toy range from master toy licensee Character Options is previewing
    at London Toy Fair later this month;
   *The new animated series of George of the JungleTM has debuted on Cartoon
    Network in the US with strong initial ratings. International television
    sales of the series have been exceptionally strong across key territories
    including the UK, France and Germany;
   *Rupert Bear(R) - Follow the Magic, continues to be a rating success on
    Five's Milkshake! and a live Rupert Bear tour across 56 UK venues launches
    in February 2008 and will run through to September 2008; and
   *The Pirates Who Don't Do Anything - A VeggieTales Movie! was released by
    Universal across more than 1,300 cinemas in the US on Friday, 11 January
    2008.


The Board will continue to keep shareholders updated regarding 2007 trading as
appropriate.


Mike Heap, CEO, Entertainment Rights Plc, commented: "Whilst it is disappointing
to report a trading period that is below our expectations (the first in seven
years), the Board remains confident that ER's business model is robust and is
convinced that the acquisition of Classic Media in January 2007 has already
proven itself to be a significant strategic acquisition for the Company.


ER owns one of the most extensive and valuable independent portfolios of
children's and family intellectual property assets in the world, with an
estimated library replacement value in excess of �900m. The Board will continue
to focus on the generation of revenues and cash from these assets and remains
confident that they will create significant long term value for shareholders."


                                     -ends-


Enquiries:


Entertainment Rights plc
Mike Heap, Chief Executive Officer
Elizabeth Gaines, Chief Finance and Operations Director
Simon Avis, Head of PR                                          020 8762 6200


Bell Pottinger Corporate & Financial
David Rydell / Amy Rajendran / Helen Tarbet                     020 7861 3232



About Entertainment Rights:

* Entertainment Rights Plc ("ER") is the UK's leading global media group
    specialising in the ownership of high quality children's and family
    programming, characters and brands
* ER owns or controls the rights to many global characters including Basil
    Brush(R), Postman Pat(R), Jess the CatTM, Little Red TractorTM, Rupert Bear
    (R), He-Man(R) and the Masters of the Universe(R), Fat Albert and the Cosby
    kidsTM, She-Ra(R), and Jim Jam & SunnyTM
* In January 2007, ER acquired Classic Media, the US-based owner of an
    extensive portfolio of children's and family characters and brands including
    Lone Ranger, Lassie, Rudolph the Red-Nosed Reindeer, Casper the Friendly
    Ghost and George of the Jungle
* As part of the Classic Media acquisition, ER acquired Big Idea
    Productions Inc. Big Idea is the leading creator, producer and owner of
    faith based programming in the US and is best known for its award-winning
    VeggieTales animated series which, to date, has sold over 50 million DVD/VHS
    units in the US
* Where's Wally(R), the worldwide publishing phenomenon, joined the ER
    stable of brands in January 2007. Where's Wally(R) presents significant
    opportunities as a multi media property. ER will create new animated and
    live action content with multi-platform application to launch worldwide in
    2008/2009
* Since 1999, when ER owned rights to just 39 episodes of programming,
    ER's library has grown to circa 8,700 episodes of high quality children's 
    and family characters and brands. This includes certain rights to global 
    brands such as Mattel's BarbieTM, Scholastic's CliffordTM and Hasbro's 
    TransformersTM
* ER's wholly owned subsidiary Tell-Tale Productions, created and
    produced The Tweenies, one of the UK's most successful pre-school brands
* ER has grown rapidly. Annual revenues have increased from �1.8m in 1999
    to �29.7m in 2006, the last reported financial year


Visit www.entertainmentrights.com




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