Statement by Management on the annual report
Identifikation af den godkendte årsrapport:The Board of Directors and the Executive Board have today discussed and approved the annual report of M2 Animation Group A/S for the financial year 1. januar – 31. december 2022.
Management's review
Beskrivelse af virksomhedens væsentligste aktiviteter:Main ActivitiesM2 Animation Group A/S, a subsidiary under M2 Group A/S, specializes primarily in the development and production of animation within film, series, and animation content. As a global provider of animation to various media such as TV series, films, and Cinemagic trailers, we have established a strong market position. In addition, we have a portfolio of our own formats where we own the intellectual property rights. M2 Animation is an award-winning studio that provides complete service, from concept development to the final product. Economic and Activity Development2022 was a challenging year for M2 Animation Group, both economically and operationally. We recently carried out a significant expansion with the addition of M2 Animation in Mumbai, India, which was a necessary step to meet the increasing demand for our production. Although this expansion required substantial resources, we are proud to report that our Mumbai studio is now fully operational with a solid infrastructure. It is important to mention that the year was challenged by several factors that led to a deficit for 2022. We faced challenges with some of our animation projects, which required more time and resources than initially budgeted, especially due to failure from one of our subcontractors. This, combined with the postponement of the production of a major project from one of our key customers, led to an imbalance in our capacity utilization. It should be noted that our sales effort has a positive impact on the order intake for the remainder of 2023/24, the sales pipeline is above expectations in the number of projects and offers. Initiatives for Future SucessTo address these challenges, we have tightened our resource management, and we have increased the accuracy in our budgeting and project management. In addition, we have started hiring more freelancers and project employees, which will give us greater flexibility in our ability to scale our resources up and down according to business needs. There is an increased focus on contractual relations and ensuring to maintain a positive cash flow throughout the productions. We have made significant changes in our management. We have hired two experienced leaders with strong international and commercial competencies, who will be responsible for driving our studios in both Bangkok and Mumbai. We are confident that these leaders will be able to navigate M2 Animation Group through this challenging period and into a time of growth. Innovation and TechnologyDespite our current challenges, we remain committed to innovation and technological advancement. We are leaders in the implementation of new technologies like Unreal Engine and AI systems. These technologies enable us to work more efficiently, adapt to changes quickly, and maintain our position as a technological leader in the industry.
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