Image Earnings Plummet In Fourth Quarter and Full Year of 2006

Image Entertainment, Inc. reported Wednesday for the fourth quarter of the 2006 fiscal year ending March 31, a net loss of $283,000 or $0.01 per share on revenues of $30.4 million. For the same reporting period in 2005, the Chatsworth-based independent distributor and producer of home entertainment had net earnings of $1.1 million or $0.05 per share on revenues of $28.9 million. Image also reported a net loss of $207,000 or $0.01 per share on revenues of $111.9 million for its 2006 fiscal year that ended March 31, a drop compared to net earnings for the 2005 fiscal year of $5.1 million or $0.27 per share on revenues of $118.3 million. Image President and Chief Executive Officer Martin Greenwald explained the company’s poor performance in the fourth quarter was due to higher market development costs as Image expanded its retail reach, a larger percentage of sales from higher profile but lower margin titles, and the filing of Chapter 11 bankruptcy by Musicland, a top 10 customer for Image titles. “Looking ahead, we’re optimistic about Image’s future and remain committed to growing our revenues and achieving consistent profitability,” Greenwald said. “Our exclusive library is stronger than it has ever been and we are presented with more opportunities for new programming on a daily basis.”