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00:37 Thank you, operator, and thank you everyone for joining us today. Speaking on the call today are Eric Ellenbogen, our CEO; and Aaron Ames, our CFO.

Also with us and available during the question-and-answer session are Josh Scherba, President; and Danielle Neath, EVP of Finance and Chief Accounting Officer. 00:56 First, we have some standard cautionary statements.

The matters discussed on this call include forward looking statements under applicable securities laws with respect to WildBrain, including but not limited to statements regarding the future growth and financial and operating performance of WildBrain and its subsidiaries, including expected revenue growth for WildBrain Spark in Q1 of the company's fiscal twenty twenty two. 01:23 Activation of the company’s IP and results there from, the timing for certain product rollouts, the future, financial and operating results of the company, including revenue and adjusted EBITDA for the company's fiscal twenty twenty two, investments of the company and benefits there from, and the strategic priorities, business strategies and operational activities at the company and its growth and long term prospects.

01:45 Such statements are based on information currently available and factors and assumptions management believes are reasonable, but which may prove to be incorrect. A number of risks uncertainties and other important factors could cause actual events performance results to differ materially and adversely from those described in the forward looking statements, including the risk factors set out in the company's most recent MD&A and AIF.

02:09 Please note that all currency numbers are in Canadian dollars. For the question and answer that will follow, we ask that each analyst keep to one question with one follow-up so that everyone has a chance to ask question.

If you would like to ask an additional question, please rejoin the queue. 02:25 With that, I'll now turn it over to our CEO, Eric Ellenbogen.

02:31 Thank you, Nancy, and thanks everyone for joining us today. Fiscal twenty twenty one was turning point for WildBrain, during we returned to growth, driven by our focus on creativity digital media and IP.

Aaron’s going to talk to about the numbers in a few minutes, but I'd like to highlight at the outset is that compared to last year in both Q4 and the full fiscal, we saw growth in revenue, adjusted EBITDA and free cash flow. 03:02 Now, this growth reflects the work that we've been focused on over the last two years.

When I joined WildBrain in late August twenty nineteen, I set the goal of turning the company around and propelling it on a path of sustainable growth and profitability. And I'm pleased to see that the three sixty degree IP strategy that we put in place is starting to show results as more of our IP is switched on, and we maximize the earnings power of our assets.

03:32 The management team and I will be providing a deeper dive into how that strategy has transformed the company for the future at our Investor Day on October fifth. But today, I'd like to highlight some of our key achievements and then take a closer look at a few of our more recent announcements.

03:50 First, we've executed against numerous high profile content partnerships, including two major deals with Apple TV+, new original series, making the streaming service home to both peanuts, more recently Yo Gabba Gabba! 04:08 We struck a partnership with Netflix and SEGA to launch a brand new Sonic, the Hedgehog series and also for Netflix we delivered three original series, Johnny Test, Chip & Potato, and Go, Dog.

Go! 04:24 We also created the U.S.

rights for Caillou and have since licensed the series to Warner’s Cartoon network, exclusively for that market. In brand management, licensing and digital, we re-launched just announced strawberry short for new generation of kids.

04:42 We are seeing early success with the re-launch of Teletubbies for the adult Gen Z audience, and at our licensing agency, WildBrain’s CPLG, we expanded our operations in the U.S., India, Germany, and Italy. 04:57 At our AVOD network, WildBrain Spark, we forged partnerships with emoji company and Moose Toys to launch a new series for original IP, with licensing representation by WildBrain’s CPLG.

In addition to these commercial achievements, we’ve realigned our senior management team, built our bench strength, we've hired top executive talent across content distribution and licensing, and we've also successfully refinanced our debt on favorable terms, removing the financial maintenance covenant, from our senior secured term loan. 05:32 I'm really proud of the team's accomplishments in the last two years and can tell you there's a lot more to come.

We've been working steadfast executing on exactly the goals that I set from the start and we're majorly hitting our stride now, which is starting to show in our results. 05:50 I'd like to speak to you now about some detail about a few of the partnerships and initiatives, including our just announced deal with Apple TV+ on Yo Gabba Gabba!

Our re-launch on Strawberry Shortcake and our activities around Teletubbies and Caillou and our partnership with Moose Toys and Akedo through WildBrain Spark and CPLG. 06:12 Last week, as I mentioned, we announced another partnership with Apple TV+ and that platform should become the global home for our highly popular show Yo Gabba Gabba!

With the show's creators, we're co-producing a brand new twenty episode series for Apple TV+. We also licensed our full Yo Gabba Gabba!

library of sixty six episodes and two specials. 06:36 And like our prior Apple TV+ agreement, we saw the platform become the home for our new Peanuts content as well as peanuts classic specials.

This Yo Gabba Gabba! partnership is an excellent example of how having successful branded IP in our portfolio can drive larger deals for new content with premium SVOD platforms.

07:01 Yo Gabba Gabba! is a perennial family favorite.

We previously licensed the Gabba library to telecasters worldwide and it's been adored by millions on screen and sold out live stage shows and through innovative toys and consumer products. And as we've seen with Peanuts, we believe that the global platform of Apple TV+ will help power our consumer products licensing and live experiences for the brand.

07:29 Igniting kids IP is what we do at WildBrain. With our integrated capabilities, we take our brands all the way from new content development of production, to global distribution and audience delivery through WildBrain Spark, and to consumer products by our licensing agency, WildBrain’s CPLG.

We are truly unique in the marketplace as the only independent media company with all of these kids assets and capabilities under one roof. 08:00 Yo Gabba Gabba!

is not the only legacy brand from our vault that we've been busy at in the last quarter. Just last week, we announced an ambitious re-launch for Strawberry Shortcake, a wholly-owned WildBrain property.

First introduced in nineteen seventy three is just a greeting card, Strawberry Shortcake became a wildly popular brand in the early nineteen eighties as a line of toys, apparel, consumer products, and multiple TV series. 08:29 The brand has tremendous history at retail selling over five hundred million dollars per year, U.S.

dollars of licensed consumer products annually at its peak, including over five million of its famous strawberry scented dolls. The franchise to date has generated more than four billion dollars at retail.

08:50 Our re-launch marks the beginning of a new era for Strawberry Shortcake as we take these beloved characters into the future, fully engaging our expertise in brand management, igniting the franchise with new original content, digital distributions through WildBrain Spark, and a robust consumer products program through WildBrain CPLG. 09:12 The licensing program rolling out through twenty twenty two includes a new toy line from Moose Toys, ten original songs, new books from Penguin Random House and retail partnerships with name brands such as Sunkist among others.

So please watch out for our new Strawberry Shortcake animated series titled Berry in the Big City, which launches this Saturday on WildBrain Spark in five languages around the world. 09:37 And consistent with our always on strategy of content across every media, a second forty episode season of Berry in the Big City has been green, WildBrain Studios is developing a slate of new CG animated Strawberry Shortcake family specials for major streaming platform and in early October we are premiering our first ever Roblox Game, starring Strawberry Shortcake.

And Roblox as many know is one of the most popular 3D digital gaming platforms for kids and teams, with every day within twenty million kids playing games on that platform. 10:14 The Strawberry Shortcake brand re-launch has been a labor of love for our creative teams, while staying through to what makes Strawberry Shortcake special is sweetness or scent strawberry motif.

This new vision aims to inspire today's kids with relevant post-social and empowering themes of diversity, sustainability, and entrepreneurship. And this digital first re-launch of Strawberry is designed to appeal to today's kids wherever they're playing games or watching content.

10:45 We're ready to return Strawberry Shortcake to our past glory, and we believe today's are going to make strawberry short a big part of their lives. We're also the as a pop culture icon for Gen Z.

Today's young adults with the original loyal Teletubbies audience when they were toddlers. These adults have a great fondness and nostalgia for Teletubbies and we've been successfully engaging them through PR stunts, marketing campaigns, and character appearances at events like pride month and New York Fashion week going on just now.

11:21 Our goal is to amplify the brand and to create a stream of licensing opportunities that will allow these fans to engage with brand through events consumer products. Another evergreen title we're bringing to new life is Caillou.

Earlier in the year, we consolidated the U.S. rights to Caillou along with our strategy to aggregate ownership and perfect the chain of title for our IP.

11:46 We've seen immediate returns on our investment as we license the show's entire back catalog to WarnerMedia’s cartoon network, as well as multiple seasons of new Caillou shorts being made by WildBrain Spark. And in addition to that, we've also now five new CG animated Caillou Specials.

Caillou remains a massively popular show worldwide, evidenced by the fact that its WildBrain Spark channel ranks among the top one percent of kids channels on all of YouTube. 12:18 So to paraphrase Mark Twain, reports of Caillou’s demise are greatly exaggerated.

[He’s] [ph] alive and well, perhaps still annoying to adults, but absolutely beloved by preschoolers and there are great things to come. 12:34 Turning now to WildBrain Spark, which is our AVOD network, it continues to add commercial partnerships and to create and manage digital content that drives revenue across all of our business units.

We recently announced a content and licensing partnership with Moose Toys to produce, again a digital first series with their new Akedo Toy brand. WildBrain handles worldwide distribution of the new series and WildBrain CPLG is managing the Global licensing program.

We will also enjoy a share of revenues from toys, distribution and consumer products. 13:12 We also saw a normalization of views and watch times in Q4 compared to last year, reflecting the end of COVID-nineteen lockdowns.

This hit a bottom in April twenty one and has been improving sequentially month to month since then. Views and watch increased twenty six percent twenty percent respectively from April to August.

13:35 Advertising rates also trended up, showing an average increase of one hundred and sixty three percent since April, and in terms of views, Spark has been outperforming its peers and the overall kids' genre on YouTube. 13:49 We're are also focused on growing higher value views, promoting content where we have IP ownership or sharing consumer products and our core of audience is watching longer on WildBrain Spark as shown in the growing average duration of views, which is up seventeen percent over last year.

Kids and families are spending more time on our network and joining our premium full length content, which is replicating the TV experience. 14:19 WildBrain Sparks revenues were up eighty one percent in the current quarter, reflecting ongoing improvements in advertising rates and ad placements and if these positive trends continue together with our focus on higher value of views and holistic partnerships, we expect to see continued growth at WildBrain Spark for the full year and we forecast Q1 twenty two revenue increasing by at least sixty percent over last year’s Q1.

14:48 So, I'm confident that we're on track with our strategy, doing exactly what we set out to do when I joined the company two years ago. We're leveraging our three sixty degree capabilities for our own and partner IP across content, distribution, and audience delivery, building franchises that fuel consumer products upside and drive revenue across all of our business lines.

15:13 This momentum provides excellent visibility on and confidence in our future revenue and earnings. And it positions us for long term growth.

So now, I'll turn the call over to Aaron to tell you what this means for our output.

15:30 Thank you, Eric. As Eric mentioned, our results reflect the building momentum across our businesses.

Further, our recently announced IP launches coupled with our robust pipeline of high quality deals continue to enhance our visibility around future revenue and earnings. We have also been working hard over the past few years to implement and upgrade our forecasting, planning, and analysis systems.

15:53 As a result of these improvements in both the process and visibility, we wanted to give some guidance around our business this year. We expect revenue of approximately four eighty million to five hundred million and adjusted EBITDA between eighty seven million and ninety three million in fiscal twenty twenty two based on our latest projections in our current pipeline, as well as expected timing around revenue recognition on our production projects.

16:19 Our growth this year is net of the significant investments we've made and are making across the organizations. These investments largely fall in five key buckets.

First, we're investing in creative to ensure we have top product, creative drives, everything. Secondly, in marketing to drive awareness for our IP and brands and to drive licensing opportunities.

16:42 Thirdly, in technology, to build out our proprietary software tools, which drive insights, awareness and monetization at Spark. Fourth across commercial teams, to optimize how we bring our product to market, and fifth we're doubling down on our digital content pipeline and product roadmap to grow high quality viewership and monetization across our Spark network.

And we're attracting the very best talented people to drive our long term value. 17:10 While these investments are impacting margin in the short term, they are critical to our future growth.

As we have said, we will begin to scale these investments as we move through this year, and it will accelerate from there and will provide meaningful future returns as we move through twenty twenty two and beyond. 17:26 We've begun to see traction, but it's early days.

Looking now at the key numbers for Q4 and fiscal twenty twenty one, revenue in Q4 grew twenty one percent to one hundred and twelve point six million, compared to ninety two point nine million in Q4 twenty twenty. 17:40 Full year revenue increased six percent to four hundred and fifty two point five million compared to four hundred and twenty five point six million in fiscal twenty twenty.

Q4 net income increased to eleven point four million compared to four million in Q4 twenty twenty. 17:56 Full year net loss improved to seven point one million compared to a net loss of two thirty six million in fiscal twenty twenty, largely due to a non-cash goodwill impairment taken in fiscal twenty twenty.

Positive free cash flow increased fifty percent in Q4 to thirteen point nine million compared to nine point three million in Q4 twenty twenty. 18:15 Fiscal twenty twenty one, positive free cash flow increased sixteen percent to thirty one point five million, compared to twenty seven point one million in fiscal twenty twenty.

Adjusted EBITDA in Q4 twenty twenty one increased three percent to nineteen point two million, compared with eighteen point seven million in Q4 twenty twenty. And adjusted EBITDA for fiscal twenty twenty one increased to eighty three point one million compared with eighty one point eight million last year.

18:42 I'll now turn the call back to Eric.

18:45 Thank you, Aaron. Fiscal twenty twenty one was truly a turning point for WildBrain and I'm incredibly proud of our team.

Our strong portfolio of IP brands and integrated management structure position us as a leader within the kids media business, and we expect to grow profitability and accelerate from fiscal twenty twenty two and beyond. 19:10 As we continue to invest in our business, we're just beginning to switch on the assets in our vault and to leverage WildBrain’s unique capabilities and content distribution, audience delivery and consumer products licensing to maximize profitability.

We’re looking forward to providing investors and analysts with more details at our upcoming Investor Day. 19:33 Before we open the call to questions, I want to note a change of date for the Investor Day, we originally scheduled it for September thirty.

However, a new federal holiday in Canada, called the National Day for Truth and Reconciliation was recently enacted on that date to recognize and commemorate the tragic legacy of residential schools. So, in observance of this important day, we've rescheduled to October fifth in New York and registration for that event is now open, which you can access on our corporate website.

20:09 So now, let me open it up to questions.

20:46 Good morning. Thanks for taking my questions and congrats on the year and the new signings.

I was wondering to start with Eric, maybe you can talk to how you see fiscal twenty twenty two playing out from a consumer products perspective, and obviously spinning over to twenty three when I sort of aggregate the announcements you’ve been making all the way back from sort the Peanuts licensing to Apple TV+ and now you'll have Strawberry Shortcake’s [Indiscernible], etcetera. What sort of acceleration should we think of when we look to, sort of project out consumer products, obviously, it has implications for margins as well?

Obviously, the timing I know changes different deals that would affect the numbers at various points, but wondering if you can help us with that. And secondly, for Aaron, respect to the television number, I know there was a sort of equity recruitment you've talked about, I was wondering if you can sort of clarify that a little bit.

Thank you.

21:55 Sure. Thanks for your question Aravinda.

I think you picked up correctly on the effect of the pipeline content activating the high margin, very valuable consumer product. And we are in full swing definitively when it comes to the peanuts business that already had a strong base – global basis, but that has stepped up now with the marketing spend reduction that is going quite strongly Apple TV+, delighted with that partnership and the caliber and quality content that's been introduced at our studios.

22:45 It’s providing a lot of excitement [Technical Difficulty] marketplace and [Indiscernible] other companies over COVID suffered a downturn and CP licensing saw an acceleration. So, kind of comfort food, but more than that exposure has been [Technical Difficulty].

23:07 As to effect of what we have in the pipeline line, since [Indiscernible] the year of content and there's a lag effect as far as the consumer products program. That said, we have signed some pretty formidable licensees, say Strawberry Shortcake as an example with content [Technical Difficulty] this Saturday, Roblox Game also I think [Indiscernible] and they are poised at marketing plans place.

23:43 R&D product development continues and based on long term plans that we've laid, but we know when they'll be coming into the market. But it is important that [chase success] [ph], in CP and I think unfortunately it may have been the case with the company in prior years trying to [Indiscernible] CP and that consumer [Technical Difficulty] social media obviously WildBrain Spark for our digital launches [Technical Difficulty].

So that's how long-term success is created in our business. 24:35 It’s been very deliberate and hope everybody has been patient and I thank everybody for that.

We're really starting to see the dividends now of that strategy. So, I’d say it’s twenty three story.

24:51 And your question on the equity recruitment, so in television, we did have a two million dollars equity recruitment in Q4 of twenty twenty, related to a new series that we had made an investment in on family channel and that did not recur in Q4 twenty twenty one. So, that's why we're seeing that revenue decline.

There is some lumpiness with the recognition of equity recruitment.

25:18 Great. Thank you.

And just really quickly as a follow-up, with respect to the guidance, I mean, when I look at the EBITDA projection, there seems to be a little bit of an uptick on the SG&A front, we saw that in Q4 as well and I think it was alluded to as well during the prepared remarks. Can you just talk about what those incremental spend components are, sort of through the fiscal twenty or is it just a matter of the margin mix when you consider this the more faster growth from Spark?

25:52 Yes. We're seeing really significant growth in Spark.

Both in the algorithm and direct ad sales. And so, we're continuing to invest and so those investments relate to marketing and talent, and so exactly what you just said, that's what's, you know we're continuing to make those investments to continue the growth.

26:21 Excellent. Thanks very much.

26:22 I might add to that. I'll just add Aravinda that, if we're kind of investing for the ages here, as each of these brands get switched on, I really, I brought to the company some tremendous talent.

We've invested deeply and creative and we keep investing and it is about having a very, very strong foundational platform off of which we can continue to launch, and that's really going to lead to and I think we'll see this in future years, great operating leverage as we have this team in place now supported by these franchises. They actually have stuff to do and are extremely busy at work and this kind of integrated approach that we've taken across all the business divisions.

So, thanks.

27:16 Thank you.

27:33 Yes. Sorry, just trying to take myself up.

Anyways, I just think, like a, first of all, question just on the leverage. So you finish the year of five point seven times you indicate in your MD&A that you expect to get to mid-fours by same time next year.

And I was just kind of wondering how that's going to happen given the EBITDA guidance, it's some growth not a lot, and then the free cash flow profile [Indiscernible]. I'm just wondering how you expect to de-lever by over return on the year.

28:15 Yeah, hi David. Yeah.

So, we are very confident in our leverage and we've reaffirmed the guidance. So, we do expect it to be in that mid four range by the end of the year, and we continue to believe in that.

So, we maintain that guidance.

28:41 Okay. Well maybe I’ll ask in another way, when you look at your cash flow, when you look at the line, that investment in film and TV programs, is it net investment in twenty twenty one, are you expecting that to be a net positive in twenty twenty two and that will help to get that?

29:00 Yeah. So there are excess cash flow sweeps as well.

So, as you can see, we're continuing to generate cash. And so that's part of how we get to the improvement in the leverage.

29:16 Okay. And then can you comment at all about the financial impact that you expect from Strawberry Shortcake in fiscal twenty twenty two, I don’t know if you can comment about [MG’s] [ph] on the consumer product side?

Anything like that would help us out?

29:39 Hi, David, it’s Josh here. I would just say that it's minimal for twenty two.

This is really a set-up year and we expect that to come through in fiscal twenty twenty three.

29:49 Okay. And then you talked about in your guidance, how you expect the growth to, I think accelerate in twenty twenty two.

So should we expect that in Q4, the year-over-year growth can be higher than say Q1 and that will carry into twenty twenty three where we can actually see even higher growth in twenty twenty three? Is that kind of what you are thinking?

30:11 Yeah. So, we are not guiding on the quarterly basis, we're looking at the whole year.

And so, but we're very confident in our projections for next year. Based on the layering in of all the contracts as you saw, we just announced Yo Gabba Gabba!, we had the Peanuts deal, we have a Sonic deal, so that's giving us this confidence in our guidance that we're giving.

30:35 Okay. All right.

Thank you.

30:39 I'll just add one additional point on the CP buildup up, which is that our confidence stems from the MG’s and the quality of the licensees that we've been able to list based on their full exposure to the brand plan and to content that they've seen and that continues to come through the system. And from an accounting perspective, we do not take into revenue the MGs.

31:09 It's only royalty income until the MG maybe earned. And our expectation is that the MG will almost be irrelevant because it will be by the flow of royalty income coming in as product goes into the market.

But that's further what gives us some visibility and confidence about where we're headed with these franchises. But thank you for your question.

31:37 Okay. Thanks very much.

31:51 Hi there. Two quick questions.

The first maybe for you, Eric, just in terms of Strawberry Shortcake, I mean you highlighted all digital launch in terms of the production and no doubt it's a brand that can resonate on AVOD on Spark specifically, but just curious, why the decision not necessarily to partner up with one of the streamers in that effort in terms of the re-launch. And then a second question, maybe sort of touching on Aravinda’s question around EBITDA, is there any disclosure that you can provide or maybe it comes perhaps in a couple of weeks time at the Investor Day, but just anything around the level of spending that is indeed occurring, both in terms of building up the talent team, obviously stepping up some of the marketing spend and how that level of spending last year fiscal twenty, sorry, fiscal twenty one going forward into twenty two is evolving with a potential step down perhaps in due course to further elevate margins maybe post twenty two?

Thanks.

33:00 David, thanks for your question. So the decision around the Strawberry Shortcake was quite intentional.

We chose wide distribution through our digital first WildBrain Spark network on our own platform because we are the ones who control audience delivery and engagement that we would not have with a third party. That said, there will be watch the space, some large specials CG very high end that will be producing for the streamers.

33:38 It's really about always on and on everywhere. It's about.

It's about social networks. It's talking to moms, talking to kids.

And what we know, of course, from the massive network effect of WildBrain Spark is not only the languages, the watch times, the audience engagement, watching follow-on episodes, etcetera, but it is the primary to this day, discovery network for new IP. 34:15 And that is the virtue of WildBrain Spark and the network that we built not only with our own proprietary content, but also with partner content, and that we're able to harvest just a massive amount of data and information about views and discovery.

It's the same reason why I think one of the most savvy toy companies in this area is our partner Moose Toys and that's why we're launching their Akedo brand as digital first launch on our Spark network. 34:49 Similarly Emojitown, yet another IP that came to us through our WildBrain CPLG subsidiary has gone with Emojitown, a brand new series.

It's kind of the way of the world. Now, that said, we picked the most appropriate platform and literally it's all of them when we can for property launches.

This one we just knew was right. We did a lot of focused group testing, the discovery process.

We also look at analogs like the explosive success of LOL Surprise, which was a digital first launch. 35:29 We see what the toy companies are doing now.

We're partnered with many of them and the way that they build and promote franchises. So, this just seems like the perfect pull together where I'm like incredibly excited about this because it galvanized every part of our company around this IP and make no mistake other than peanuts, this is as far as CP potential, these stand out with an incredible operating history and it is a beloved property, and so and that's the reason why there's no mistake that it's going out in LatAm, Spanish, and Portuguese, and French, we know where this works.

We tested in those territories. And I think that we're going into this with a great deal of confidence and momentum.

36:27 And on your other point, Adam, on our investment, we're investing in creative digital content and the tech at Spark because we see the tremendous growth potential at Spark and that this year was approximately eight million.

36:48 First off, so Eric thanks for the prior color, much appreciated. Aaron, just so eight million of spend in F twenty one and any color in terms of how that evolves into twenty two and whether or not there's a potential step down in that effort thereafter?

37:06 So what we expect is that we'll start to see those returns and the margin will improve over time. Because we'll have more scale.

So, the margin will continue to improve. Obviously, the people, some of the people still there and working for us and – but some of that is really one time tech build that we can use to grow our margins in the future.

37:32 Okay. And of course, you're not going to have the repeat of the government subsidies per se or at least they're certainly whittling down quite dramatically in Canada, and I guess that's another dynamic as it relates to where the margins are in F twenty two in the context of F twenty one, right?

Just something you need to overcome.

37:50 Exactly.

37:52 Okay. Thanks.

38:26 Thank you, operator, and thanks everyone for joining us today. We look forward to updating you further at our Investor Day on October 5.

Thank you and have a great day.