This is one exciting stock

Unlike most other film/video production companies, CCN are not exposed to films that flop, that was my main concern.

Basically they have two divisions, The Film Consortium and the Works.

The Film Consortium (TFC) have investors that put up cash for investment in films and TFC advise investors what films they should invest in and find investment for films. This is 'green lighting' or giving the films the go ahead. TFC make money doing this. It isn't TFC whose money goes into the films so if a film tanks it isn't their worry, they only lose a bit of cred I guess and give an investor or two the hump.

The Works (TW) sell the licenses to areas for Films, DVD, VHS and TV for the investor/fim makers. This will be a up front guaranteed fee that they sell to the licensee - the licensee then sells the film thoughout his given area. Each film license is sold with say a license fee of 'at least' 100K for example, depending on how well the film sells then further fees are paid. These are called overages and can boost how much CCN get big time. I think this is why CCN are excited about My Summer of Love, as it looks like there will be lots of overages on this film, and there are overages on other films coming in.

The third revenue stream is The Works selling licenses for third party films they have had nothing to do with organising the funding of - sales agents basically and the more well known The Works gets, the more of these they expect to come in.

For the year gone they have organised 1.2m of funding towards 15 films. That doesn't mean each film is only 80K to make, it means they have organised part of the funding for a number of films but the films may have other backers. The year ahead will see 7m of funding organised through Surefire which is going toward that 40m of films in production they mention in the results. They expect to have these canned by Christmas in order to get the tax breaks before April 1 (100% tax allowance in the first year on films below 15m budget).

Lottery funding has finished as far as being one of 3 main lottery recipients for funding goes but they can apply on a per film basis to get lottery funding. In it's place is Surefire. Surefire is a dedicated business for finding film investors and they are pumping in lots of money (that 7m for starters this year) so the investment to go into films should be much greater. Two directors that have been running Surefire have become non execs on the CCN board.

They also have a new major shareholder Fandango, who bought the 29.9% stake held by former Civilian founder Richard Thompson. These are Italian film makers and are set to put 3 films the way of CCN each year.

The FD was saying that they have only really started to get this business focussed as they have only just disposed of the last remains of the old CCN business which was a canned meat business so it's in its infancy in a way.

There is no reason I can see why this business should trade on a PE as low as 8. They have got rid of two thirds of the staff and boosted gross margins massively from 40 odd per cent to 92%. They don't get hit when a film flops, the worst that happens is films get delayed and so earning might slip back, but they don't disappear with big chunks of investment down a black hole.

Growth here could be huge, the 2.2p forecast for this year could well be smashed big time. This is a completely transformed business that is just getting up and running. Fandango have 29.9%, the two directors from Surefire have 4% and they are all set to synergise with each other over the coming years.

I can't begin to think what the growth could be like here but at a guess it is going to be massive. Overages create much, much higher earnings. If TFC organise great films for investment and then find the licensees and the films sell (as seems to be happening) then they are going to do fantastically imo.

These don't have the risk associated with the likes of Winchester Entertainments and so the PE should be much higher imo.

2.2p eps looks like being beaten easily imo. I'm sure these will re-rate to a PE of 12-15 and will do at least 2.5p eps this year which could mean 37p a share by the financial year end. They also will have 2m in cash come year end so one third the market cap is cash - that has to be worth another few pence on the share price.

If they beat 2.5p eps this year and do 3p as I suspect then come the financial year end they will be on an historic PE of 12, probably a forward PE of 8 (if the share price is 37p) and 2m in the bank with an absolute ton of films in production for their clients. If that were the case I reckon that would see the share price at 50p+ in 12 months time.

They seem very confident about the next twelve months and films in production are growing rapidly and in value size.

There's one last sweet spot - there is always the chance they hit on a Harry Potter the more films they get involved with. If they do then earning go ballistic.

They have 6.5m losses on the P&L account so no tax to pay on earnings for some time. They are also able to extract decent grants from the Lottery Fund on a one off basis and get grants from the British Film Council too.

Worth a look imo.

CR

Mentioned first @ 17p/18.5p and strong moves to 18p/19p.Something happening here.Expect return to 20p-25p with possibilities of breakout above 25p.imho.

^19p/21p.Short term target price 30p.imho.

Still got all mine :-)

capa

capa,getting exciting isn't.Sell off was always overdone.Added more and topped up again this a.m.Money makers may try tree shake with earlier buys showing as sells.Would think about buying any dips below 20p which in normal circumstances with 33% rise would expect.Are these normal circumstances though?.Breakout and mms short of stock.imho.

enjoy the ride 20p/22p.

here comes the treeshake & some profit taking.

Up and down like a yo yo.18p/20p.

Suggestion on advfn that there is a large buyer in the background which would explain movement last few days.Summit definitely up.20p-21.5p up 7.8% next R=22.5p br=23p imho.

barnetpeter - 12 Feb'05 - 21:18 - 817 of 821
Just seen MSOL winning BAFTA for best film above some strong opposition. This surely will give it a big boost on DVD release and in US?

barnetpeter - 12 Feb'05 - 21:35 - 819 of 821
Wonder if one of the big boys like the ODEON chain will now give it a proper run rather than the odd screen? "Best British film" will really help in the US bearing in mind it beat films like VERA DRAKE and HARRY POTTER!

James - I am sure you are right. Civilian bosses must be estatic, not just because of the revenues from MSOL but because of the reputation it gives them to attract funds in the future.

The Alexander Korda Award for the outstanding British film of the year
Nominations are:

DEAD MANS SHOES Mark Herbert / Shane Meadows

HARRY POTTER AND THE PRISONER OF AZKABAN David Heyman / Chris Columbus / Mark Radcliffe / Alfonso Cuar

MY SUMMER OF LOVE Tanya Seghatchian / Christopher Collins / Pawel Pawlikowski

SHAUN OF THE DEAD Nira Park / Edgar Wright

VERA DRAKE
Simon Channing Williams / Alain Sarde / Mike Leigh

And the winner is: My Summer of Love!

spawny100 - 12 Feb'05 - 22:08 - 820 of 821

Cheeky mm's must have had a whiff of this on Friday and tried in vain to flush a load of shares from weaker holders or those who had just bought at 16ish and didn't want to see their profits slip away. Predictions as to how the share price will open on Monday? I reckon open at 19 and end at 21.

lex1000 - 12 Feb'05 - 22:16 - 821 of 821 edit

Good news this evening.MSOL wins BAFTA.Surely a wonderful boost for sales.

I know the people, the company, the product and the sales team quite well - it's my business and I work with them from time to time.

I wish them and you well, but be careful -it's a really fickle old world out there in film financing in the UK currently, thanks to the Government being unable to leave any policy decisions alone for more than 5 minutes.

If you want to see some other direct results from SUMMER OF LOVE tune into CFL (confusingly named ContentFilm, but no connection with Civ Cont) who are the UK distributors of the film. Hasn't done much for their SP has it? It's only a small film financially, but perfectly formed creatively so BAFTA assures us - won't do $50 million box office in US (IMVHO) which is what Chariots of Fire, Waking Ned, Four Weddings etc all did to truly make a difference to investors' lives.

You really need to know the names of the other films in their slate and who is directing them and who is acting in them and who has pre-bought them to get the first idea of whether success will filter through to the SP. Even then it's a very specialist product and bears no relationship to the multi $10 million productions from the US. A major source of production finance has been cut off in its prime by change in Government tax rules relating to Film Finance recently. The whole UK is in the doldrums as a result with no immediate prospect of alternative legislation being either forthcoming or workable when it does.

The recent little peak in SP seems to me to have come before the announcement, then subsided back to its usual level. Look at the RNS, there is a history of announcements which I suspect are aimed at boosting the SP for the benefit of the directors. Theat's a terribly cynical view I know, but I just get the whiff of it in the slightly breathless announcements based on rather slim reality.

In spite of being tempted into a brief, educational and tiny loss-making flutter with CFL (share price couldn't drop further than that could it? Oh, yes it could!), I have decided henceforth not to invest both financial capital and human capital in the same sector. CFL have also lost their major source of production equity for same reason.

But, tomorrow the SP may rise again, what do I know - nothing! DYOR. Good luck if you like being associated with show biz.

SD

This could be a very interesting buy now. News on the 31st March.

Brit Gov have just exteneded tax breaks by 9 months while they sort out its replacement - some small comfort for Civ Cont but still massive uncertainty in project finacning all round. Be careful - or shrt term trade on specific film releases.

SD

With the prelims (30th March) being more than 2 months earlier this year than last year (last year 4th June), one would expect the statement to be quite good and potentially very good.

Based on what product sold at what price in what volume versus what operating costs? Do you know?

On no available fundamentals and a totally indeterminate chart (to my amateur eye) on what basis would you make any decision?

They may want to publish results earlier to get them included in the next money raising inforation memorandum which I expect them to be issuing asap in light of Thursday's Chancellor's announcement of extension of Section 48 tax break. This is positive in the sense they get to breath again, but whether the child will put on weight and muscle and develop into a healthy adolescent is, as I say, indeterminate (and I mean either way, not just negatively).

I await with keen interest what the accounts say.

SD

SD,

I think you are looking in a bit of a negative light. For example their notice of results was the 14th March, before the budget ! What product sold and price and volume - well I do not think you are allowed that information, its called Interms or Prelims where that is clarified. Lets take IBM, before they announce their Int or Pre, does anyone know what they have sold, in what volume, at what price and what their operating cost is ?

The chart also does not look that bad, and is in fact quite readily poised for a large up on good news, or down to the support level on bad news.

Given the bringing forth of the prelims (and moved before any information from the budget), I am still very much, IMO, behind these being in fact very good prelims.

A recap on the news for CCN since the 20th Sept 04 Interims :

Trading Statement 20/09/2004
ch - "The board is hopeful of a good second half performance for 2004"

My Summer of Love 04/10/2004
The company is pleased to announce that international sales of "My Summer of Love" its most recent production have risen to US$2.30m, significantly exceeding management's expectations

2004 productions 26/10/2004
The company announced that following its recommendations to SureFire Films LLP, its joint venture partner, four British qualifying feature films have now been contracted for immediate production.
Chairman Crispin Barker said:
'As reported as our interim results, the company has entered an exceptionally
busy phase. Our current production slate is our largest to date. Additionally,
our sales arm The Works, continues to expand and in 2005 will represent a
growing number of independently produced films in the international
marketplace.'

06/01/2005 Director Shareholding

Civilian Content says chairman's total related holding in co up to 27.445 pct
LONDON (AFX) - Civilian Content PLC said that David Aspin has bought 350,000
shares in the company, representing 0.829 pct of the issued share capital.

David Aspin is a colleague of the company's chairman, Crispin Barker, and under
stock market rules the purchase of shares by Aspin is to be treated as a holding
by Socknersh Investments Ltd, a company owned by Crispin Barker.

Aspin's total holding is therefore aggregated with shares beneficially held by
Barker, and together these holdings amount to 11,590,885 shares and represent
27.445 pct of the issued share capital.

papal power - look at the RNS of 8th March for CFL a company with a very similar relationship with an external fund raiser Surefire kaiboshed by IR/Treasury rules. CFL also has a UK distribution arm which CCN does not, so they ahve even less revenue opportunities.

CCN financed 3 films (I'm not certain they got the fourth away, in spite of their own report) with Surefire money towards end of last year before change of rules for delivery May/June and release thereafter. No one has any idea if they will attract either international buyers or a UK audience - they are too small to have major actors and it is in the nature of these things that you just don't know what you've got till the buyers respond.

Since change of rules they have almost certaiubly been unable to raise new production finance.

Prior to that they got involved with (invested in too I think) a poorly managed New Zealand project beset by overcost and cast illness and director being fired. Can't see that film recovering to storm the worldwide market place.

Don't know what their sales division The Works has been selling, but they are not currently rated as exectly the hottest international sales co working out of UK. They have a known dog on their books - Country Of My Skull which will not perform for sales commission or recoup CCN's substantial equity investment in it.

I really can't imagine what good news could possibly be contained in the uopcoming report, but I live in hope for their sake.

So my negativity is quite mild compared to their apparent prospects, I would say.

SD

SD, the only recap I can give are the 2 RNS :

CIVILIAN CONTENT PLC

SIGNIFICANT INTERNATIONAL SALES FOR 'MY SUMMER OF LOVE'

4 October 2004


Civilian Content plc ('Civilian' or the 'Company') whose principal activity is
the finance and sale of feature films is pleased to announce that international
sales of 'My Summer of Love', its most recent production have risen to
$2,300,000, significantly exceeding management's expectations. This figure
includes a material sale of the North American rights to a subsidiary of
Universal at the Toronto Film Festival, demonstrating the film's popularity in a highly competitive international marketplace.

'My Summer of Love' premiered at the Edinburgh and Toronto Film Festivals in
September and has been greeted with universal critical acclaim. International
rights to all territories are being sold by The Works, Civilian's sales
subsidiary.


Chris Auty, Managing Director of Civilian Content said:

'We are tremendously excited by the sales performance of 'My Summer of Love' to
date. In particular, the sale of the North American rights to Universal Focus, one of the most highly regarded US distribution companies, is agreat
achievement and a reflection of our strong positioning in the international film sales marketplace. We believe the strength of sales to date on this title gives every reason to expect that The Works will exceed its sales target for the remaining available territories.'


Civilian Content PLC
26 October 2004

CIVILIAN CONTENT PLC
CONFIRMS 2004 PRODUCTIONS AND 2005 SALES SLATE



26 October 2004

Civilian Contentplc ('Civilian' or the 'Company') whose principal activity is
the finance and sale of feature films, is pleased to announce that following its
recommendations to SureFire Films LLP ('SureFire'), its joint venture partner,
four British Qualifying feature films have now been contracted for immediate
production. In each case, principal photography will be complete by Christmas
2004, and the films will be available for sale in 2005. The four films are as
follows: -

- The Best Man : A romantic comedy of errors about a hapless best man
who falls in love with the bride. To be directed by Stefan Schwartz (Shooting
Fish), and starring Stuart Townsend, Amy Stewart (Starsky and Hutch) and Seth
Green (Austin Powers).

- The Proposition: A powerfull gripping story set in 1890s Australia
written by music icon Nick Cave. To be directed by John Hillcoat, and starring
Guy Pearce (LA Confidential), Ray Winstone (King Arthur), John Hurt, David
Wenham and double Oscar nominee Emily Watson (Hilary and Jackie).

- Tara Road: A romantic drama set in Ireland, based on the popular novel
by award winning Maeve Binchy. To be directed by Gillies MacKinnon, and
starring Andie Macdowell (Four Weddings and a Funeral), Olivia Williams (Sixth
Sense), Oscar winner Brenda Fricker (My Left Foot) and Iain Glen.

- Heidi: The classic children's tale. To be directed by Paul Marcus
(Prime Suspect), and starring Emma Bolger (In America), Max Von Sydow (The
Exorcist), Geraldine Chaplin (Chaplin) and Diana Rigg. (The Avengers).

The Film Consortium ('TFC'), Civilian's film finance and production subsidiary,
will jointly with SureFire executive produce the four films and will
consequently earn fees during 2004 and 2005. Each of the films will be sold by
Civilian's sales agency, The Works except for Heidi which will be sold by an
American agency which specialises in the sale of .family entertainment.
Civilian will share in the commissions generated by the sale of Heidi rights.

These four pictures complete the 40 million+ production slate of nine films
Civilian has assembled during 2004. The other five films with which the
company is involved that have either completed or commenced production this year
are as follows: -

- Clean: A drama about a woman struggling to regain custody of her son.
Directed by Olivier Assayas, and starring Maggie Cheung and Nick Nolte (48
Hours).. The film won the Best Actress Award at the 2004 Cannes Film Festival.

- Country of My Skull: An evocative drama set around the South African
Truth and Reconciliation trials which premiered in Competition at the 2004
Berlin Film Festival. Directed by John Boorman (Deliverance) and starring
Samuel L Jackson (Pulp Fiction) and Oscar nominee Juliette Binoche (The English
Patient).

- My Summer of Love: A coming of age story about two sixteen year olds
(played by newcomers Natalie Press and Emily Blunt) who spend a long hot English
summer together. Directed by Pawel Pawlikowski, the film was part funded and
co-produced by TFC and won the Michael Powell Award for Best British Film at the
2004 Edinburgh Film Festival.

- Guy X: A black comedy in the vein of M*A*S*H and 'Catch 22'.
Directed by Saul Metzstein, and starring Jason Biggs (American Pie) and Natasha
McElhone (Solaris).

- River Queen: An epic tale about a young woman's struggle to find her
identity set against the backdrop of war in 19th Century New Zealand starring
double Oscar nominee Samantha Morton (Minority Report), Keifer Sutherland (24)
and Stephen Rea.

2005 Sales Pipeline

In addition to the above films, which TFC has packaged and executive produced,
The Works is already contracted to sell in 2005 rights to an additional 4 films
that have been independently produced: -

- Tickets: A drama about three stories that intertwine. Directed by
Ermanno Olmi, Abbas Kiarostami and Ken Loach.

- Wah Wah : A semi-autobiographical coming of age story set at the end
of Empire in 1969 Swaziland. Directed by Richard E Grant (Withnail and I), and
starring Oscar nominee Emily Watson (Hilary and Jackie), Miranda Richardson and
Julie Walters.

- The Mighty Celt : A gutsy story about a 14 year old boy who is forced
to grow up quickly when he isdrawn into the underworld of dog racing.
Directed by Pearse Elliott, and starring Robert Carlyle (Full Monty) and Gillian
Anderson (X Files).

- Love and Hate: A powerful modern-day Romeo and Juliet story set in the
North of England. Directed by Dominic Savage and starring Tom Hudson and Samina
Wawan.

Country of my skull is actually named now "In My Country" and opened March 11th 2005 in the US, a John Boorman film.

http://www.boxoffice.com/scripts/fiw.dll?GetReview?&where=ID&terms=8140

This one is not going to fly on international sales. Good script, bad film.

Which others are any good? How do you know?

SD

Well its results time today. We shall see what happens.

Yesterday was all buys (some reported as sells early) but later in the day after going up 7% buys where are full offer price of 15p.

Results being good, this one will rise strongly, very strongly today IMI.

Hope they are good ! ;-)