May 2, 2023

05/02/2023 | 04:42pm EDT Message : *Required fields (Alliance News) - Videndum PLC on Tuesday said it expects short-term demand for some of its products to be impacted by a writers strike in the US. Videndum manufactures hardware and software for the content creation market, including broadcasters and film studios. It is based in London. Shares in the firm closed 9.2% lower on Tuesday in London. The Writers' Guild of America, which combines two different US labour unions representing TV and film writers in New York and Los Angeles, called a strike on Tuesday. The strike has caused some US cine/scripted TV productions to be paused, Videndum said. Consequently, the company said that short-term demand for its cine and scripted TV products in the US - which represents around 20% of company revenue - has been affected. This, it said, will likely increase the second-half weighting of the company's performance in 2023 and is also creating a "wider range" of possible outcomes for the year than previously expected. Videndum said if there is a prolonged writers' strike, its financial 2023 performance will likely be below expectations. It added, however, that it is "difficult" to forecast the possible length and impact of the strike. Current company-compiled consensus for 2023 sees adjusted pretax profit in a range of GBP53.1 million to GBP55.3 million. The last US writers' strike in 2007 lasted 100 days. More positively, Videndum noted that it was performing well in some other regions and segments, such as Media Solutions where it noted a post-lockdown back in China as well as a return to growth in Europe. Chief Executive Stephen Bird said: "The long-term drivers of the business, however, remain attractive and we continue to execute self-help actions to streamline our cost base, to ensure the business is even better positioned. [National Association of Broadcasters] was the largest global broadcast convention held in the last four years and we are extremely pleased with the response to our new product launches, which will drive growth. Products we have launched within the last three years are likely to account for about half of current year revenue." The company said it will publish its first-half results on August 10. By Heather Rydings, Alliance News senior economics reporter