Thunderbird Entertainment Group Inc. (TBRD.V) Earnings Call Transcript
December 6, 2021
Earnings Call Speaker Segments
Thank you for standing by. This is the conference operator. Welcome to the Thunderbird Entertainment Group Inc. Annual General and Special Meeting. [Operator Instructions] The conference is being recorded. [Operator Instructions] I would now like to turn the conference over to Brian Paes-Braga, Chair. Please go ahead.
Thank you, and good morning, and welcome to the Annual Special Meeting of the Shareholders of Thunderbird Entertainment Group Inc. My name is Brian Paes-Braga, and I am the Chair of the Board of Directors of the company. I hope everyone has been staying safe during these continuing challenging times. Thunderbird is pleased to be able to host today's meeting through the Lumi virtual meeting platform. This platform is accessible to all of our shareholders and duly appointed proxy holders, regardless of their physical locations, and allows registered shareholders to vote and submit questions and comments to the moderator to be read and addressed at the meeting. If you have a question or comment, please submit it through the system now, and we will answer at the appropriate time. I will preside as Chair of this meeting, and with your approval, I'll ask Sarah Nathanson to act as Secretary of the meeting. Following the conclusion of the meeting, shareholders and proxy holders will have the opportunity to ask general questions by submitting them through the Lumi platform. I would also like to take a moment to acknowledge the members of Thunderbird's Board of Directors who are here with us virtually today. Joining me are Jenn McCarron, also our CEO; Frank Giustra; Linda Michaelson; Azim Jamal; Paul Sparkes; and Marni Wieshofer. Also joining from management is Barb Harwood, our CFO. For the purposes of this meeting, Lia Zandvliet of Odyssey Trust Company will be appointed as scrutineer of the meeting. The company has been provided with an affidavit of mailing from Odyssey Trust Company, confirming the mailing on November 8, 2021, of the applicable meeting materials to all shareholders of record as of the close of business on November 1, 2021, in accordance with applicable law. I direct that the affidavit of mailing be attached to the minutes of this meeting as a schedule. The scrutineers have advised me that prior to the meeting, proxies were received from the holders of a sufficient number of common shares to constitute a quorum. I, therefore, declare the meeting to be regularly called and properly constituted for the transaction of business. I direct that the formal report of the scrutineers be annexed as a schedule to the minutes of this meeting. I'd like to take a moment to comment on the procedures to be used to submit questions and vote on matters at today's meeting. Shareholders and proxy holders listening online are able to submit questions or comments to the meeting at any time, which we will address at the end of the presentation. [Operator Instructions] With respect to voting, we will conduct the votes on the matters before us today by a poll. On a poll, every shareholder entitled to vote on the matter has 1 vote in respect of each voting share held. Only registered shareholders who held shares in their name as a close of business on November 1, 2021, or their validly appointed proxy holders are entitled to vote at this meeting. If you've already voted or sent in a proxy, there's no need for you to vote by poll unless you would like to change your vote. The poll will be open for all resolutions at the same time. This will allow you to choose to vote on each resolution immediately, or you may wait until each resolution discussion has concluded prior to casting your vote. I now declare the polls open on all resolutions. In the interest of expediting the business of the meeting and in accordance with corporate laws and Thunderbird's articles, no motion need be second -- sorry, seconded. We will now run through each of the items on the agenda. First will be the presentation of the audited financial statements of the company for the financial year ended June 30, 2021, together with the report of the auditors thereon. Second, shareholders will be asked to fix the number of directors at 5 and elect the directors of the company. Third, shareholders will be asked to appoint the auditor of the company and authorize the directors of the company to fix their remuneration. Fourth, shareholders will be asked to reapprove the company's stock option plan. Lastly, shareholders will be asked to approve the company's long-term incentive plan. As a point of information for the meeting, I've been advised by the scrutineers that proxies deposited for the meeting have been overwhelmingly voted for the resolution proposed for consideration at the meeting. The first item of business is the presentation of Thunderbird's audited financial statements for the year ended June 30, 2021. Copies of the financial statements have been mailed to those shareholders who requested to receive copies in accordance with applicable law, and with the permission of the meeting, I will dispense with reading them at this meeting. I would ask that any questions on the financial statements or auditor's report be postponed until after the formal business of the meeting has been completed. It is proposed that the number of directors of the company to be set at 5 directors. Pursuant to Section 13.1 of the company's articles, the number of directors is set by ordinary resolution. I now ask for a motion that the number of directors of the company be set at 5.
I so move.
A motion has been made that the number of directors be set at 5. The next item of business is the election of directors of the company for the ensuing year. I note the company's articles provide a process requiring advanced notice to the company in respect of any person seeking to be nominated for election at today's meeting. The company did not receive notice of any director nominations in connection with the meeting within the prescribed time periods. Accordingly, the only persons eligible to be nominated at the meeting for election to the Board are the following 5 nominees: Frank Giustra, Jennifer Twiner McCarron, Azim Jamal, Linda Michaelson, Marni Wieshofer. I now ask for a motion that Frank Giustra, Azim Jamal, Jennifer Twiner McCarron, Linda Michaelson and Marni Wieshofer, be elected as directors of the company to hold office until the next Annual Meeting of Shareholders or until their successors are elected or appointed.
I so move.
The next item of business is the appointment of auditors. I now ask for a motion that PricewaterhouseCoopers LLP be appointed as auditor of the company to hold office until the close of the next Annual Meeting of Shareholders or until their successors are appointed and that the directors be authorized to fix their remuneration.
I so move.
A motion has been made to appoint PricewaterhouseCoopers LLP as auditors of Thunderbird for the ensuing year and that the directors be authorized to fix their remuneration. The next item of business is the reapproval of the company's stock option plan by ordinary resolution. Details of the stock option plan are set out in detail in the information circular prepared for the meeting. I now ask for a motion that the company's stock option plan be reapproved by the shareholders.
I so move.
A motion has been made to reapprove the company's stock options plan. The next item of business is the approval of the company's long-term incentive plan by ordinary resolution. Details of the long-term incentive plan are set out in the information circular prepared for the meeting. I now ask for a motion that the company's long-term incentive plan be approved by the shareholders.
I so move.
A motion has been made to reapprove the company's stock option plan. For those of you who have not voted on all of the resolutions, please do so now as I will shortly close the polls. Please be reminded that if you have already voted or sent in a proxy, there is no need for you to vote by poll unless you would like to change your vote. I will close the polls on all resolutions presented in 1 minute to allow online views to catch up. [Voting]
The polls are now closed. I've been advised by the scrutineers that based on the votes represented by proxy at this meeting, a sufficient number of votes have been cast in favor of each of the resolutions presented at this meeting. I therefore declare each of the resolutions carried. Rather than hold up the meeting for the final tabulation of votes cast through the online voting system, I direct the final results of each poll be included with the minutes of this meeting. Unless there are any questions from the floor, I would entertain a motion that the meeting be terminated.
I so move.
As there are no questions, the scrutineer has advised me that today's vote is in favor of this motion. Accordingly, the motion is carried. Now that the formal business of this meeting has concluded, our CEO, our most amazing CEO, Jennifer McCarron, has a brief company presentation to share.
Thank you so much, Brian, and thank you, everyone, for tuning in. 2021 was another exciting year for Thunderbird and our 2 main divisions, Kids and Family, Atomic Cartoons and Factual Great Pacific Media, amidst incredible demand and an ever-evolving industry due to the ongoing COVID pandemic, Thunderbird has further solidified our position as a go-to production studio for premium quality content, and we are well on our way to becoming a major global studio. Our growth path is very intentional. And as content creators we recognize the unique position we are in to influence society through the content we create. This is why our teams are leading among our peers on the extremely important industry mandate of increasing female and authentic representation of the BIPOC and LGBTQ2S+ communities on screen and in our company. We want to grow as a company, telling stories where every person can see themselves reflected back in a positive way, no matter the race, gender, sex, sexual orientation or cultural background. We strive to create teams that are diverse and inclusive, reflecting not only our direct communities but also those underrepresented within the media. Our working culture and people are our priority, and we believe that this focus has and continues to drive Thunderbird's success. As we reflect on the past year, we are so proud of what we've accomplished. Before I share some company highlights, I want to share how grateful I am to be part of the Thunderbird team. There is truly something special happening at our company. And I feel so lucky to work in an environment that is so supportive and where we're always looking for ways to raise each other up. Across the company, we're unified in shared values such as kindness, trust, teamwork, innovation through pushing boundaries and we try to have some fun. I want to underscore how amazing it is to be working in this creative field of content. Our teams grow together and we learn together and this is where magic can happen. Our company's success is attributed to the teams fully and how dedicated and talent everyone is at Atomic Cartoons, Great Pacific Media and Thunderbird. So without further ado, here is a small snapshot of our 2021 highlights, which are a true testament to the hours of collaboration, the nurturing of countless great relationships and the hard work of our phenomenal team. Thank you for being with us. And now I'm just going to list a couple of 2021's highlights. We started 2021 with the launch of our new Global Distribution and Consumer Products division, led by industry veteran, Richard Goldsmith. In addition to handling third-party distribution for partners around the world, this division enhances our business by increasing our ownership potential and leveraging our IP opportunities to produce merchandise, video games, toys and bedsheets, you name it. We're also thrilled when our Factual division, Great Pacific Media, announced its partnership with Wapanatahk Media, a new production studio focused on indigenous storytelling. Co-founded by female indigenous producers, Tania Koenig-Gauchier and Shirley Mclean, both of whom who have lived-knowledge of indigenous creative communities. Wapanatahk Media's first series, Dr. Savannah: Wild Rose Vet, has already been sold to APTN and Blue Ant, and the second season has already been renewed before this first episode even went to air. In 2021, several of the brilliant individuals who we have the privilege of working with were acknowledged for their hard work and immense talent, including CFO, Barb Harwood, being named by Report on Business as 1 of the top 50 corporate executives in Canada for her financial stewardship and also by Business in Vancouver as only 1 of 5 CFO of the Year recipients. Head of 2D Animation Nadine Westerbarkey being recognized by the YWCA Women of Distinction Awards in the category of arts, culture and design; Melody Zhang, Atomic Cartoon's Human Resource Manager being named the finalist in the Rising Star of the Year category in the 2021 Canadian HR Awards; And Head of Production, Joel Bradley, being named as Business in Vancouver's Top Forty Under 40. Way to go, Joel. Representing my team and the entire company, so not me, the team, I was recognized by BC Business as the Equity and Inclusion Champion in the 2021 Women of the Year Award and was included on the Bay Street Bull's inaugural Women of the Year list as well. Add to this, several of our Board members were also recognized by Business in Vancouver's top 500 list as influential business leaders, Azim Jamal, Frank Giustra and myself on behalf of Thunderbird. In 2021, Thunderbird was named to the 2021 TSX Venture 50, a ranking of top performing companies traded on the TSX Venture. And our company for its collective efforts was also named by BC Business as the winner of BC Business of Good Award in the category of Diversity and Inclusion. We could not be more proud. Thunderbird also received an honorable mention in the category of Workplace Wellness. Our fiscal performance is strong. In fiscal year '21, we saw year-end revenues of over $111 million, 37% year-over-year increase and free cash flow of $12.3 million, 68% year-over-year increase with 0 corporate debt. Throughout this year, Thunderbird continued to share its progress by presenting at many investor events such as LD Micro Conference, SSN Networks Summer Virtual Event and the 12th annual Midwest IDEAS Investor Conference, the 33rd Annual ROTH Conference, the Canaccord Genuity 41st Annual Growth Conference and the Lytham Partners Spring 2021 Investor Conference. Our work has also continued to gain recognition winning various industries awards, including a Kidscreen Award for Best Inclusivity, 4 Canadian Screen Awards, 5 Leo Awards, the Telly Awards, Youth Media Alliance Award for Excellence in Animation, among many other prestigious nominations, most recently, including 2 new Kidscreen Award nominations just this November for Molly of Denali, Best One-Off, Special or TV Movie, and The Last Kids on Earth, Best Alternative Video Game. Aside from industry awards, renewals and shows being greenlit by broadcasters and streamers, also validate the extraordinary content that our teams are renowned for producing. In the Kids and Family division, Atomic Cartoons, Molly of Denali was renewed for a second season by GBH and PBS Kids. Dogs in Space was renewed for Season 2 by Netflix. Marvel's Spider-Man and his Amazing Friends Season 2 was renewed for Disney. Mighty Express was renewed for a fifth season with Spin Master for Netflix. And Atomic also announced that we are working on a new My Little Pony series for eOne and Hasbro, CoComelon Lane for Moonbug and Netflix, and Young Love which is highly anticipated series for HBO Max. In the Factual division, Great Pacific Media's Mud Mountain Haulers joined other successful international sale of Discovery's original program. Renewed for a second season, this series debuted in Germany this fall, showcasing the authentic story of adversity and triumph internationally. Additionally, Highway Thru Hell Season 11 and Heavy Rescue: 401, Season 7, were also renewed for new seasons. Corus Entertainment also greenlit 3 new great Pacific Media series, Deadman’s Curse that's a working title; Styled, also working title; and Gut Job. Additionally, we began expanding our scripted footprint with Strays officially premiering on CBC TV and CBC Gem in September of '21. We also announced a partnership with Modern Story Company on a new scripted series for Syfy called Reginald The Vampire starring Breakout Star Jacob Batalon from Spider-Man: Homecoming. This is currently shooting. We were thrilled to announce a formal update to our production fleet with 27 shows in production, an increase of 9 shows over the previous year. Our work, the team's amazing work now airs on Netflix, Peacock, Nickelodeon, Apple, Sony, PBS, Bell Media's Discovery, Disney+, Corus Media and CBC, among others. We have more than 50 shows in various stages of our IP development pipeline. And in 2021, we pitched more new series to platforms worldwide than in any other year in our history. Our team continues to grow. Since the pandemic was declared, Thunderbird has added over 430 new crew members, and the company now employs more than 1,400 people. Our studios in Vancouver, Los Angeles and Ottawa are fully booked in '21 and a production visibility with bookings well into 2024. We're also continuing to scale up to meet the increased demand for new streamers coming online and traditional broadcasters looking to offer quality viewing experiences. One example that shows our company's breadth and depth is GPM's new series in development, If: Imagine the Impossible. This series is based on Underknown Webby award-winning social media sensation, What If. And GPM recently announced that it's partnering with the talented director, writer and producer, Brad Peyton and visionary physicists, Michio Kaku to take it on. Another example involves Atomic's Last Kids on Earth franchise. This series is based on the New York best-selling book series owned by Max Brallier, and his apparel, toys and 3 seasons now available on Netflix. Our first-ever Netflix interactive special, the Last Kids on Earth's Happy Apocalypse To You, began streaming on April 21 and quickly jumped into the top 10 streaming movies on Netflix within days of its launch of all Netflix shows, not just kids and families. Our first video game based on the series of Last Kids on Earth and the Staff of Doom also launched in June this year. Throughout the year, we also continued to receive a lot of media attention with article in Forbes, [ Wolf Creek ], The Globe and Mail, Kid's Greek ,The Hollywood Reporter, among others. As you can see, 2021 was an amazing year for Thunderbird and we are beyond excited about what the future holds. The best is still yet to come. To the team, from my heart, thank you for everything you give this company. We appreciate your tireless efforts, commitments, creativity. Doing this all in a pandemic virtually is unbelievable. We are all wishing you a very relaxing and incredibly well-deserved holiday season. To all of our shareholders and investors, thank you so much for supporting Thunderbird on this journey. As we move into a new year, we see enormous opportunity and cannot wait to share our progress and updates with you. Thank you all for joining us today, and this concludes our AGM.
This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.
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