Leaving the likes of failed take-overs behind, Nelvana is pulling out of service production, refocusing on proprietary product and fleshing out animation studio plans.

Coming off the annual general meeting this month, other news includes the launch of its first adult animation series in prime time. Bob and Margaret, a 13-episode series based on the nfb’s Oscar-winning Bob’s Birthday is already in production with Channel Four in the u.k. and although Nelvana co-ceo Patrick Loubert won’t reveal the Canadian broadcaster, odds are it’s not teletoon but CanWest Global. CanWest president Jim Sward confirms only that a ‘wonderful’ Canadian animation series is heading for a prime time slot on the Aspernet’s 1997/98 schedule.

While Nelvana completes financing on Rolie Polie Olie, its first 3d cgi animation project slated for delivery in 1998/99, two new animated series are in production. Both Anatole the Loveable Mouse and Dumb Bunnies are on tap for 13 episodes apiece. A live-action series Barbarella is also in development, as is an mow. A minimum of 117 half-hours will be added to the library this year.

Features

On the feature film side, the animated Babar, King of the Elephants is in production. Going forward, Hirsh says the goal is one animated feature per year with a feature’s contribution to the revenue stream on par with a 13-episode series.

Sales news includes two seasons of Ned’s Newt and Sticking Around to The Fox Kids Network, which having bought Family Channel, found itself with a 12-hour kidvid void to fill. teletoon picked up a total of nine series from the program library which increased last year by one animated feature and 130 episodes including 13 of The Magic Schoolbus.

Magic Schoolbus is one of the last remaining series for which Nelvana continues to provide service production. On the reduction in service episodes overall from 69 last fiscal to 13 this year, Hirsh says service production provides slim margins unless one maintains the distribution rights.

‘We’re emphasizing proprietary animation in order to build our library. The larger the library, the larger the revenue stream which contributes to increased earnings stability.’

For the year ending December 31, 1996, profit slid $4.5 million on revenue of $64.7 million. Profit in the first quarter for fiscal 1997 came in at $44,000 or $0.1 per share on revenue of $7.9 million down from $14.4 million in the comparable quarter. The decline is attributed in large part to the write-down of Jake and the Kid. Slim margins on service production and accounting procedures that fail to recognize tv delivery schedules are also playing part in the fluctuating quarterly reports, says Hirsh. Recording procedures will change this fiscal to reflect the ebb and flow of the production business.

In line with the stability strategy, the management structure is reformatting to see Hirsh and Loubert acting as co-ceos with Hirsh heading up sales and marketing and Loubert in charge of production. Michael Harrison, president of MacDougall MacDougall & MacTier is the new chairman.

Loubert says it’s too early to discuss details on the studio, but the initiative is part of the company’s renewed focus on proprietary product as well as creating a space in which to explore the limits of specialized animation production technology, including 3d.

‘Producing 3d d’esn’t take away from our talent pool in 2d,’ says Loubert. ‘It develops a whole new pool and lets us take advantage of what Sheridan has to offer. Utilizing different looks, taking advantage of changing tools is a means of diversifying within the animation genre.’

During 1996, Nelvana recognized $5.3 million in production and distribution financing from the federal and provincial government agencies and incentive programs of which $3.8 million related to live-action production including Jake and the Kid. It recorded $758,000 in non-refundable government grants.