Our reporter Xie Ruolin

　　With the end of the annual report disclosure, the industry is basically clear.

Among all industries, the film and television industry has always been a unique existence. It was once the target of cross-border mergers and acquisitions in the capital market. However, under the influence of multiple factors in recent years, the film and television industry has lost its luster.

　　According to the secondary classification of Shenwan Industry (2021), 22 film and television companies will have a total revenue of 41.441 billion yuan in 2021, and a total net profit loss of 1.303 billion yuan, of which 11 companies are in a state of loss.

Most of the companies whose performance is under pressure are production-based companies, including many established studios, such as Huayi Brothers, which focuses on movies, and Ciwen Media, which focuses on TV series.

　　"The annual report inventory of film and television companies can be called a miserable conference." A brokerage analyst in the media industry told the "Securities Daily" reporter that since the epidemic, the availability rate of film and television content has dropped significantly, which has directly led to a shortage of content on the middle and lower distribution and broadcast ends. , cost reduction and efficiency increase will become the industry norm in the next few years.

Cost reduction and efficiency increase throughout the upstream and downstream

　　Judging from the financial reports of individual stocks, the epidemic is the primary factor affecting performance.

"Under the epidemic, the number of project approvals and startups by the crew has decreased." A person in charge of the film and television base told reporters.

　　According to data from the State Administration of Radio and Television, 194 TV dramas and 6,736 episodes will be produced and distributed nationwide in 2021, a record low since statistics.

According to the reporter's statistics, from 2018 to 2020, the number of TV dramas produced and distributed nationwide were 323, 254, and 202, respectively. According to the number of episodes, they were 13,700, 10,600, and 7,476 episodes.

That is, compared to three years ago, 2021 will produce 51% fewer episodes.

　　During the Shanghai Film Festival last year, Wang Changtian, chairman of Enlight Media, once said: "Beginning in the second half of 2018, the attitude of the entire capital towards the film and television industry has undergone a major change, resulting in a sharp decrease in investment in the entire industry. For example, in equity investment, there are few companies in the industry. In the early stage of establishment, or during the operation period, equity investment can be obtained. The investment in the project itself has also decreased sharply, resulting in many projects not being able to start construction.”

　　In the context of collective losses, the procurement and broadcast-side streaming media platforms also frequently put forward the goal of "cost reduction and efficiency improvement".

Tencent said that we are taking steps to optimize costs and reduce Tencent Video's financial losses while maintaining its leadership.

Gong Yu, founder and CEO of iQIYI, said that China's long-form video industry has entered a new stage, which is characterized by the pursuit of efficiency, loss reduction, and ultimately profitability, rather than the simple pursuit of market share and rapid growth.

　　"Procurement platforms continue to compress budgets. It is foreseeable that in the future, the standards for content project approval will be stricter, the competition among producers will be more intense, and cost reduction and efficiency enhancement will become the norm for the entire industry for a long time in the future." The above analysts said.

Destocking is a priority

　　From the perspective of cash flow, the situation of the film and television industry in 2021 is not optimistic.

In 2021, only 9 film and television companies will have a positive year-on-year growth rate of net cash.

　　Take Ciwen Media, which has tight cash flow, as an example.

According to the financial report, the net cash flow generated by Ciwen Media's operating activities in 2021 will be 90.7787 million yuan, and the net profit will be a loss of 249 million yuan.

The company's losses were mainly due to the provision for bad debts of receivables, provision for impairment of goodwill and provision for inventory depreciation.

　　In 2021, Ciwen Media will have a credit impairment loss of 127 million yuan and an asset impairment loss of 142 million yuan, of which the inventory depreciation reserve is as high as 125 million yuan.

As of the end of 2021, the company's inventory accounted for 59.56% of its assets.

　　The high inventory is not a dilemma faced by a company of Ciwen Media. In 2021, the total inventory of 22 film and television companies will reach 15.563 billion yuan, and the total inventory depreciation reserve will be 2.606 billion yuan.

It should be noted that by the end of 2021, the average inventory turnover days in the film and television industry were 356.34 days, and the longest corporate turnover days were as high as 1357.98 days.

　　The above-mentioned analysts told the "Securities Daily" reporter that the inventory of film and television companies is mainly film and television dramas, including products that have not yet been filmed, those that have not been approved for reflection after filming, and those that have been filmed and have been approved for screening but have not been sold.

In recent years, due to the frequent appearance of bad actors and the changing preferences of audiences, many film and television dramas have been in a state of waiting, and it is normal for a drama to wait three or four years for broadcast. This has caused a lot of cash flow pressure.

Therefore, destocking has become a top priority in the current film and television industry.

(Securities Daily)