Thunderbird Entertainment has warned investors that its financial outlook for the remainder of fiscal 2023 will be lower than expected, according to filings from its Q2 results.

The Vancouver-based company said the start of “several scheduled productions” were delayed due to “industry-wide economic factors, along with the uncertainty regarding the potential proxy contest.” As a result, some income earnings will be pushed to fiscal 2024 and 2025, with the company anticipating a lower adjusted EBITDA in 2023 compared to the previous fiscal year.

The company added that it “has not lost any planned work and its pipeline remains robust.”

Thunderbird reached an agreement with U.S. hedge fund Voss Capital in January, after the shareholder called for a change to its board of directors and issued a public criticism of the board’s strategic direction for the company.

The agreement led to the resignation of majority shareholder Frank Giustra and interim chair Marni Wieshofer from the board, and the addition of Asha Daniere and Mark Trachuk, while CEO Jennifer Twiner McCarron became chair. Thunderbird will appoint a third independent director from candidates put forward by Voss following its annual general meeting on March 6, according to a press release.

Thunderbird earned $48 million in revenue for the quarter, up 45% from $33 million in the previous year’s Q2. However, the company reported a net loss of $288,000 in Q2 2023 compared to a net income of $1.4 million in the previous Q2. The loss was attributed to the timing of IP programming deliveries, and partially offset by a growth in service productions.

Free cash flow came to $8.6 million in Q2, down 52% from $16.4 million in the same period in 2022, which was attributed to “positive changes in working capital partially offset by repayment of interim production financing.”

The company had 26 programs in production during the quarter, including eight considered owned Thunderbird IP. Among the titles in production in Q2 was the scripted film Boot Camp, based on a story on Wattpad, produced by subsidiary Great Pacific Media. Projects in production at subsidiary Atomic Cartoons included Netflix’s Oddballs (pictured) and Princess Power, and Disney+’s Night at the Museum: Kahmunrah Rises Again.

“Though 2023 holds a level of global economic uncertainty, our commitment to providing quality premium content ensures that we remain very well-positioned in our industry to capitalize on all opportunities,” said McCarron in a statement. “We have invested in initiatives to support future growth and we know that these investments will bear fruit in future years and generate great returns for our shareholders.”

Image courtesy of Netflix