PANTAFLIX: “We already have a six-digit number of users – and it’s growing fast”

With its preliminary figures for FY 2017, PANTAFLIX recently beat analyst expectations. The stock price, nonetheless, has come under pressure. In an exclusive interview with the staff of www.4investors.de, PANTAFLIX CEO and COO, Dan Maag and Stefan Langefeld, emphasize that the company is on a very good path. In their conversation with our editors they speak about the global expansion of the video-on-demand (VoD) platform. User numbers were one topic as well as further partnerships. Maag and Langefeld also speak of the new plans with Florian David Fitz and Matthias Schweighöfer and their alternative marketing strategies. The managers also find clear words about the valuation of the company.


(Zur deutschsprachigen Version des Interviews: hier klicken).


www.4investors.de: Mr Maag, the PANTAFLIX AG share came under considerable pressure due to a sceptical press report and a negative analyst comment. Can you comprehend the investors’ reaction?

Maag: Our company is on a very good path. We are doing our work and consistently achieving our goals. Recently we published excellent preliminary business figures for the lapsed financial year 2017. With growth in the triple-digit percentage range, we are one of the fastest growing companies in the world within the entertainment industry. Our pre-tax earnings of EUR 2.3 million also mean we surpassed all the analyst estimates, even the critical ones. The fact that we succeeded in this during the cost-intensive ramp-up phase of our VoD business in particular illustrates the strength of our company.

It’s understandable that analysts especially will view our company with criticism. We see the ball in our court here and must significantly increase our efforts in matters of investor education and transparency.

We are currently changing the sales structures of an industry that is more than 100 years old. It should be clear to everyone that this doesn’t happen within a few weeks. We must use more transparent communication to make it clear to sceptics in particular that we already now are tapping gigantic potential by doing this. Maybe our focus to date has been too much on achieving operating targets and we have not prioritized the corresponding communication accordingly. We will now change that because we are increasingly recognizing how disruptive the approach we follow is and therefore how much explanation it requires.

www.4investors.de: The VoD platform PANTAFLIX has scarcely become known to the public so far. When will you launch a large advertising campaign to make the brand better known and to position yourself in the competition with Amazon, Netflix and others?

Langefeld: First, it should be noted that we are not in direct competition with Amazon, Netflix and others. Unlike our competitors, we don’t address customers in a specific country. Instead, we address a nationality. It’s secondary which country they live in because we want to specifically reach out to expats. This means our marketing is managed in a way that is different than traditionally expected. We are disrupting well-known marketing strategies here, too, and are exploring new ways of acquiring and activating customers. For example, we are mapping out a global cooperation with one of the largest expat platforms. Digital performance marketing is an important element, with Google just one of many.

www.4investors.de: Will you provide the capital market with more detailed information on the current development of the VoD platform in the next few months?

Langefeld: Even in this early phase, we already have a six-digit number of users – and it’s growing fast. We have actually already planned to give a transparent insight into current development during the course of the year. We find ourselves in the conflict area between the colliding interests of the company and the interests of the capital market. It’s understandable from the point of view of the company that you wouldn’t want to give a complete overview of user numbers from the first day, especially if you want to acquire high-quality content. Investors, of course, have a legitimate interest in being able to assess the growth of VoD based on the development of the users with transparency and as promptly as possible. We will comply with this interest.

www.4investors.de: What impetus have the content deals with Disney and STUDIOCANAL provide PANTAFLIX so far?

Langefeld: First of all, literally worldwide there has been an overwhelming response to the deals. Now we have large content providers who want to speak with us about worldwide distribution of their content, because even in Hollywood distribution strategies are being re-thought. Exciting dynamics have been created. Disney and STUDIOCANAL had not been available on our platform until recently. What we see is that not only are current blockbusters extremely popular, which could be expected, but that our catalog is, too. Our customers are proper movie lovers – so more agreements with content partners can be expected.

www.4investors.de: In terms of the internationalization of PANTAFLIX, how many markets is the platform available on now? How do the expansion plans look for 2018?

Langefeld: We are in the middle of another wave of global roll-outs. In the near future, we will finish a cluster of English-speaking countries, which include Australia, South Africa and Canada to name the large ones. We plan to bring our business to Latin America by Q4/2018 in order to tap the language area of a total of 400 million Spanish speakers worldwide. As usual, we will then offer Spanish as a language option on all apps, meaning that the platform will then communicate with our customers in Spanish as a system language.

www.4investors.de: What role does China play for the VoD business?

Langefeld: Chinese expats are very important to us as both a target group and a language group. As the first major step to develop this business area, we began offering our whole system in Mandarin at the end of 2017 in order to serve the Chinese target group. The next step now is to expand the relevant and exciting line-up for this target group.

www.4investors.de: Mr Maag, what new large projects are you currently tackling? On the production side or on the VoD platform?

Maag: We are looking forward to the start of our next cooperation with AMAZON and Warner Bros. We have now finished the second season of the global hit series “You are Wanted”, which will celebrate its world premiere in May. We are currently shooting our next big picture with our stars Florian David Fitz and Matthias Schweighöfer: “100 Things” will surely be an outstanding cinematic experience. We are set to release the film in theatres in Germany, Austria and Switzerland in December of this year.

The production books are full, and our plans in 2018 also include filming our first movie project in English which will be called “Resistance”. The lead roles will be played by Jesse Eisenberg and Matthias Schweighöfer. Like “You are Wanted”, we will market this film worldwide.

The digital infrastructure that we created with our VoD platform will soon allow us to supply every corner of the world – by then at the latest our production business will also be online and at best internationally positioned.

www.4investors.de: What is the current financial state at PANTAFLIX?

Maag: We have a very solid equity base enabling us to continue investing aggressively in growth and achieving our goals independently. For example, even the entire cost-intensive set up of our VoD platform and its related infrastructure occurred without incurring financial debt. This philosophy marks a fundamental difference between us and many other companies in the tech sector. We are proud of that. With positive business figures for 2017 and the successful capital increase in October 2017, we are currently in a better financial position than ever before. This offers us a sound foundation for further aggressive growth.

www.4investors.de: What measures do you intend to use in order to react to the most recent share price decline and to calm investors and build new trust on the capital market?

Maag: We have spoken with numerous important investors and described our views on things to them. We’ve known for a long time that we have a lot of very knowledgeable investors who have been supporting us on our clear path particularly now. The more people understand about the distribution business, the more they are impressed by our approach and, above all, by how we have been implementing it. Of course, we intend to create more awareness in this area and are confident that this will lead to a revaluation of the company in the near term.