Viacom management emphasized on its quarterly earnings conference call Thursday that Paramount Pictures' film slate financing deal with two Chinese partners was on track despite concern amid China's recent moves to keep money in the country.
As THR reported in March, Paramount had back then yet to receive the first payment it had expected from the deal.
Viacom CEO Bob Bakish said on Thursday's call that the company has "moved ahead" with the deal. Viacom CFO Wade Davis gave analysts more details, saying that Paramount's slate deal with Shanghai Film Group and Huahua Media remains "remains on track and is in operation."
And he added that the two companies are actually committing more money. "The partners have elected to upsize their commitment from 25 percent to 30 percent," he said.
The deal has been known to be worth around $1 billion and run over a three-year period. Davis said that remains the case, also mentioning the partners' option to extend for a fourth year.
"We never really had concerns about payment," Davis said. "There is a payment schedule in the agreement, and we are going to receive cash this quarter per the schedule that was always in the agreement."
Paramount's cash infusion from China was announced in January, but believed to be in jeopardy because of increased scrutiny from Beijing regulators and a recent leadership shakeup at the studio that brought in Jim Gianopulos as chairman and CEO to take over from Brad Grey.
Sources said Gianopulos spent much of a recent week in Beijing meeting with executives from the two Chinese investors. The talks were a continuation of discussions held between the parties in Los Angeles in the weeks prior, sources said. Gianopulos' primary task during the talks was to sell his vision and establish a relationship, sources said.
On the call, Bakish also gave a shoutout to Gianopulos, calling him a "smart, seasoned executive" who is looking to reenergize the studio and its film pipeline. He also said Gianopulos was working with the company's TV networks to develop co-branded projects, Bakish said.
Bakish said he has already felt the presence of the new studio boss in a positive way, saying he was "very optimistic" about its outlook under the new leader. "There is no question that Paramount will turn," Bakish said.
Davis added that Gianopulos has "jump-started the culture there" and fine-tuned certain processes at Paramount. The CFO said those are some things that "we expect to have a positive impact on '18."
The CFO also said there could be more, but smaller film unit charges ahead as Gianopulos assesses previously ordered films. He signaled the new studio boss could, for example, choose not to go ahead with select projects if he doesn't see real potential in them. Viacom previously took a $115 million for Monster Trucks, which was released in the first calendar quarter of this year.
Bakish also articulated what specific changes Viacom has made in its pursuit of a turnaround and what's still to come. He reiterated the need to refit the organization, create partnerships instead of adversaries, especially in affiliate sales, and a focus on core brands and values.
He highlighted that MTV remains a particular focus as it will need time to gain traction by concentrating on its traditional live and unscripted programming. Bakish said he was excited about an expanded slate of new content and new talent set to debut on MTV in the near future.
The call took place after Viacom earlier on Thursday reported better-than-expected underlying financials for its fiscal second quarter.