Alliance Atlantis Communications dropped the axe on its Entertainment Group this month, cutting 33 of its 183 permanent full-time employees from its offices in L.A. and Toronto, and from Salter Street Films in Halifax. Entertainment Group CEO Peter Sussman has also been recalled from L.A., where he has been based since 1991, and will now work out of Toronto.

The cuts represent 4% of AAC’s total workforce and are effective March 31, the last day of its fiscal year. None of the offices have been closed.

Among those cut are producer Ian McDougall (Nuremberg, Haven) and head of casting Dierdra Bowen.

‘While making a decision to reduce staff is a very difficult one, it is imperative that we align our human resources to our production levels,’ said Sussman in a statement. AAC is partway through plans to cut production levels and raise profits – shifting from mass production of for-syndication shows to smaller numbers of prestige series and movies.

CFO and senior exec VP Judson Martin says the cuts, all to production-related jobs, ‘reflect exactly our reduced production level.’

AAC will spend roughly $2 million in severance fees but expects to save $5 million per year, starting with fiscal 2004. AAC previously cut 80 jobs in January 2002, and its broadcast team lost 35 people the following April.

AAC’s A and B class shares continue to slide on the Toronto Stock Exchange, both trading near the $13 mark, just above 52-week lows of $13 and $12.05, respectively, down from highs of $21 and $21.15.

At press time, AAC was trying to finalize the sale of post houses Tattersall Casablanca, Salter Street Digital and Calibre Digital Pictures to Hollywood-based Point 360 by March 31. Point 360’s option to buy expired on March 21, but the deal, said to be worth US$14 million, is still in the works, according to an AAC spokesperson.

-www.allianceatlantis.com