Peace Arch Entertainment Group Inc. (AMEX: PAE) (TSX: PAE-LV.TO)

Dear Reader,

Last week we introduced you to Peace Arch Entertainment Group Inc. (AMEX:PAE) rather hastily via a breaking news story on the company.  The news from Peace Arch was so compelling that we wanted to bring it to you as quickly as possible.

Since that time, the team at StockUpTicks has been able to pull together our usual detailed company profile for your perusal and review (below).

Peace Arch is different from any company that we’ve ever covered… it’s a dynamic entertainment company working with some of the biggest businesses in Hollywood.  We strongly encourage you to review the profile below.
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About Peace Arch Entertainment

Peace Arch Entertainment ("PAE") (Peace Arch") creates, acquires and distributes feature film, television and specialty programming throughout the world both directly and via third party licensees. Peace Arch has three operating divisions – film, television, and home entertainment – with offices in Toronto, Los Angeles, London and Vancouver.

Peace Arch licenses the Company’s own projects as well as third party productions to many of the world’s leading distributors.  The Company’s Peace Arch Films label handles theatrical film productions and its Archetype Films banner focuses on DVD and pay television premieres in the horror, thriller and action genres. Peace Arch current productions and library include a stable of well known actors and actresses including: Lindsay Lohan, Harvey Keitel, Dennis Hopper, Ally Sheedy, Christopher Plummer, Ron Perlman, and Christian Slater. 

The Company’s film division produces or acquires four to six films per year for international theatrical distribution and an additional ten to twelve DVD or pay television premieres annually. Peace Arch’s television division produces or acquires MOWs, mini-series, lifestyle series and documentaries that it licenses to broadcasters and pay television networks throughout the world. Peace Arch recently entered into an agreement with Castle Hill Productions and Dream LLC to purchase their library of more than 500 classic, contemporary and genre films, which is expected to supplement Peace Arch's own annual output of more than two dozen new feature films and long form television programs.

Through its home entertainment subsidiary, kaBOOM! Entertainment (acquired in January 06), Peace Arch now distributes DVDs and related products to every major retail and rental outlet in Canada, representing such brands as Lions Gate Films, Nelvana and Sesame Workshop. Following its acquisition by Peace Arch, kaBOOM! announced its best-ever year of sales and profits reporting unaudited sales of CAN$25.6 million, and Normalized EBITDA of approximately CAN$2.9 million, for the 12 months ended April 30, 2006. 

The Peace Arch Market

PAE is currently in production or post-production on four theatrical films, nine DVD premiers, one cable television movie, and a ten-hour mini-series, all of which are expected to be completed by the end of 2006. While the explosion of technology in the millennium has grown exponentially, 'content' has lagged behind and Peace Arch is well positioned with major theatrical productions to take advantage of the global need for high quality productions delivered to numerous channels including theaters, cable, and DVD. 

STATUS: Post-Production  PRINCIPAL CAST:  Jared Leto - Requiem for a Dream, Panic Room Lindsay Lohan – Herbie: Fully Loaded,  Mean Girls, Freaky Friday  GENRE: Drama - YEAR OF PRODUCTION: 2006 SYNOPSIS: New York City. December 1980. Mark Chapman arrives in New York with the intent to kill John Lennon.  The story portrays Chapman’s mental collapse as his demons win over and persuade him to shoot Lennon on the steps of Lennon’s apartment building, The Dakota.

STATUS: Post-Production PRINCIPAL CAST: Steve Buscemi – Ghost World, Fargo Alison Lohman – Big Fish, Matchstick Men Michael Pitt – Last Days, The Village GENRE: Comedy - YEAR OF PRODUCTION: 2005 SYNOPSIS: New York City. Present day. Les is a small time celebrity photographer aching to get that one great picture that will get him noticed. He meets Toby, a homeless young man with no direction except a vague desire to become an actor.  Luck intervenes for Toby when he gets a chance meeting with K’Harma Leeds, the hottest pop star of the moment. Instant chemistry sparks between them, causing friction between Toby and new found friend Les.

STATUS: Post-Production PRINCIPAL CAST: Rupert Evans - Hell Boy Sir Derek Jacobi - Gladiator Natalia Verbeke - Son of the Bride  GENRE: Drama - YEAR OF PRODUCTION: 2005 SYNOPSIS: A chilling yet sensitive insight into the mind of a captive at Guantanamo Bay prison, as he struggles to separate fantasy from reality. Plunged into the music, colour, and romance of the vibrant culture of Havana, he tries to discover who he was and who he has become.

STATUS: Completed CAST: Harvey Keitel (The Piano), Joshua Jackson (Cruel Intentions), Claire Forlani (Meet Joe Black), Giancarlo Giannini (Hannibal)

STATUS: Completed CAST: Christopher Plummer (A Beautiful Mind), Brian Dennehy (Cocoon, Romeo & Juliet), Ted Danson (Saving Private Ryan, 3 Men and a Little Lady), and Ellen Burstyn (The Exorcist, Alice Doesn't Live Here Anymore)

STATUS: Completed CAST: Christian Slater (True Romance), Molly Parker (Sunshine), Stephen Rea (The Crying Game)

STATUS: Post-Production GENRE: Action Thriller CAST:  Michael Ironside, Ally Sheedy, Bobby Hosea DIRECTOR:  Sidney J. Furie WRITER:  J Stephen Maunder SYNOPSIS:  Returning to modern day Saigon, a Vietnam veteran turned preacher is confronted by an old comrade who forces him  to re-live the bloody battles of his past.

Warriors of Terra - 5ive Girls - The Last Sect - The Ultimate Killing Machine - Troubled Waters - Heartstopper

"Warriors of Terra" stars Edward Furlong ("Terminator 2") as a member of an animal rights group that penetrates a biotech facility and mistakenly releases a monster within.
"5ive Girls" stars Ron Perlman ("Hellboy") as a Catholic school priest who helps five teenage girls with supernatural powers battle the ancient demon Legion.
"The Last Sect" starring David Carradine ("Kill Bill") as a vampire hunter tracking a group of female vampires who use an Internet dating service to line up their victims.
"Ultimate Killing Machine" starring Michael Madsen ("Sin City") as the head of a top-secret U.S. military operation that turns misfits into genetically engineered soldiers.
"Troubled Waters" starring Jennifer Beals ("The L Word") as a determined detective with psychic powers investigating the suspicious kidnapping of a rich man's daughter. 
"Heartstopper" stars Robert Englund as a demon-possessed serial killer who has returned from the grave to stalk the corridors of a hospital butchering patients and staff. 

*Genius Products recently released on home video The Weinstein Company smash hit "Derailed," starring Jennifer Aniston and Clive Owen. Genius is the exclusive distributor of all films from the Weinstien Company.

In production - "The Tudors" a serialized drama starring Sam Neill, Jeremy Northam, Henry Cavill and Jonathan Rhys Meyers.  The Tudors is a 10-hour international event mini-series being co-produced and co-financed with Showtime.  The Tudors dramatizes the reign and marriages of England's King Henry the VIII. 

The "Eyes Project Development Corp" is a Peace Arch, wholly-owned, full service production and post production company based in Vancouver Canada. "The Eyes" also produces sponsored programming and provides post production services to networks and independent producers. Established in 1980, "The Eyes" is one of western Canada's largest and most established media companies.

"The Eyes" broadcast programs include; "Animal Miracles" (ANIMAL PLANET) "Alien Abduction" (UPN) "Rights of Passage" (TLC) "Raven in the Sun" (CBC) "Heroines" (BRAVO!) "Campus Vets" (NATIONAL GEOGRAPHIC CHANNEL) and "Love it or Lose it!" (HGTV) just to name a few.
 
 

kaBOOM! is a Peace Arch Company and one of the leading independent home entertainment studios. Since 1996 it has been providing a full range of services relating to the sales, marketing, licensing and distribution of DVDs, videos and ancillary merchandise.  It distributes sell-through and rental titles across a wide variety of genres, such as children’s, anime, television, special interest and live-action feature films.

The company partners with industry leaders such as Nelvana, Maples Pictures, DIC Entertainment, Sesame Workshop, First Look Studios and Sony Wonder, to name a few.  kaBOOM! is recognized as the leader in pre-school marketing and distribution, and represents leading properties such as Max & Ruby, Franklin the Turtle, The Berenstain Bears, Sesame Street, Miss Spider, Barbie, This is Daniel Cook, Strawberry Shortcake (French), and many more. 

Recent News from PAE

Press Release Source: Peace Arch Entertainment Group Inc.
Friday May 12, 6:30 am ET

TORONTO--(MARKET WIRE)--May 12, 2006 -- Peace Arch Entertainment Group Inc. (AMEX:PAE - News) (TSX:PAE-LV.TO - News), one of North America's fastest growing independent entertainment companies, announced the release of its Cannes 2006 Market Letters including film titles to be marketed and screened at the international film festival under its Peace Arch Films and Archetype Films banners.

The Company will present the films for international distributors and movie audiences at the high-profile Cannes Film Festival and Feature Market, May 17-28. The Peace Arch slate includes four new titles currently in production to be sold under the Peace Arch Films label. The Company will also market an additional seven new titles through its Archetype Films division, which focuses on films in the horror, thriller, action and sci-fi genres. All of the films will be offered to distributors in the U.S. and throughout the world along with other films already in the Peace Arch catalogue.

To view the entire release and disclaimer, Click Here
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Management at Peace Arch

Gary Howsam, Chief Executive Officer
Gary Howsam has been our Chief Executive Officer since December 20, 2002. Mr. Howsam’s responsibilities include all strategic planning, operations management and budgeting, corporate finance, recruitment, training and management of all employees. Mr. Howsam has more than 20 years of executive level experience in the Canadian motion picture industry. From 1997 to 2003, Mr. Howsam was President of Greenlight Film and Television Inc., which develops, finances, produces and distributes feature films.

John Flock, President, Member of Greenlight Committee 
John Flock became President of Peace Arch Entertainment Group in February 2005. He is responsible for overseeing all operations of the Company. He also serves as President of Peace Arch LA, which focuses on the development, financing, production and licensing of feature films for the US market.
Mr. Flock started his career as an entertainment attorney and then spent more than a decade financing and producing independent films. Prior to joining Peace Arch in May 2004, he served as a senior production and financing consultant to Cinefinance, one of the industry's leading completion guarantors.

Mara Di Pasquale C.A., Chief Operating Officer, Chief Financial Officer
Mara Di Pasquale is our Chief Financial Officer and Chief Operating Officer. Ms. Di Pasquale has had an extensive career, including acting as Vice President of Finance – Entertainment for Gullane Entertainment PLC, Chief Financial Officer and Chief Operating Officer for Catalyst Entertainment Inc. as well as Senior Vice President of Finance for Lions Gate Films. Ms. Di Pasquale is a Chartered Accountant and studied at McGill University in Montreal where she received her Graduate Diploma in Public Accountancy and at Carleton University in Ottawa where she received an Honors Bachelor of Commerce degree.

Lewin Webb, President, Peace Arch Motion Pictures
Lewin Webb is President and Head of Production at Peace Arch Motion Pictures Inc.; he is responsible for both overseeing the development and physical production of all PAMP productions. Lewin began his career as an Assistant Director on several noted films including “Legends of the Fall,” “The Long Kiss Goodnight,” “Fly away Home” and “The Ladies Man.” Lewin also produced ESPN's first Made-for-Television Movie, “A Season on the Brink.” 

Penny Wolf, Managing Director, Peace Arch Films
Penny Wolf is Executive Vice-President of Peace Arch Entertainment Group and Managing Director of Peace Arch Films. She is responsible for all feature film acquisitions and the international sales and marketing of Peace Arch’s film productions. Ms. Wolf has more than 20 years experience in international sales and marketing, most recently as managing director of HBO Films, London, where she helped established the international sales operation for that company. While at HBO she supervised the worldwide distribution of such films as the Academy Award-nominated “Maria Full of Grace,” “The Life and Death of Peter Sellers” and Gus Van Sant’s “Elephant,” which won the Palme D'or at the 2003 Cannes Film Festival. 
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Financial Highlights for PAE

• Expanding Worldwide Market – Demand for new film and television content continues to grow sharply with the expansion of both traditional and fast-growing digital media and distribution methods in emerging markets such as Russia, Eastern Europe, Brazil and Turkey.
• New Technologies – New digital technologies like high definition DVD, HDTV, video-on-demand, Internet VOD, and content delivery to personal entertainments devices provide extraordinary growth opportunities for for providers of new and library content like Peace Arch.
• Genre Film Growth – Low cost, story driven genre films such as Saw, Hostel, Open Water and The Grudge continue to generate substantial box office returns domestically and abroad and are also consistently among the top earners in the DVD marketplace.
• Government Incentives - Governments continue to compete against each other in offering generous tax rebates and other incentives to producers and production companies willing to locate film and television productions in their country.

• Strong Content Pipeline – Peace Arch’s production and acquisition pipeline includes a diverse slate of 3 to 6 medium budget features per year for initial U.S. theatrical release; 10 to 12 low budget genre titles per year to premiere in DVD or pay TV markets; 3 to 5 movies of the week for U.S. networks or cable companies; 10 hours of high profile television programming in partnership with Showtime Networks; and more than 32 hours of “lifestyle” television series and television documentaries for initial broadcast in Canada.
• Multiple Revenue Streams – With a large number of diverse productions, numerous distribution outlets, the recent addition of home entertainment distributor kaBOOM! Entertainment, Inc. to its lineup and the acquisition of a substantial film library with recurring revenues in the near future, Peace Arch has a diversified portfolio of entertainment assets that help insulate it from the adverse effects of a single unsuccessful picture or television project.
• Production Financing Advantages – Canada provides some of the most attractive tax incentive packages in the world to English-language film and television producers. With offices in both Vancouver and Toronto, Peace Arch is among the industry leaders in securing Canadian tax credits. With additional office in London and Los Angeles, Peace Arch is also uniquely situated to take advantage of government subsidies wherever they may originate and leverage its production dollars for maximum return.
• Proven track record – Company management includes senior executives with proven track records in every aspect of the film and television industry including financing, production, international sales and distribution.
• Strategic Partnerships – Strategic partners include the Showtime cable network, with whom Peace Arch co-finances projects that premiere on Showtime in the United States while Peace Arch retains all distribution rights outside the United States; Motion Picture Distribution LP, a division of Alliance Atlantis Communications, Inc., who distribute substantially all of Peace Arch’s feature film productions in Canada, Spain and the United Kingdom; and Genius Products LLC, an emerging home entertainment company through whom Peace Arch distributes many of its genre productions in the United States.

• Produce or acquire a large volume of low cost genre productions with proven appeal in worldwide markets
• Supplement those productions with higher profile film and television projects that provide greater visibility in the entertainment marketplace
• Use the Company’s Canadian operating base to maximize international film and television subsidies 
• Accelerate growth by purchasing existing distribution and content assets.

1-Year Return = 166.667% Last Trade:  1.04 (05-22-06) 52wk Range:  0.31 - 1.69 Avg Vol (3m):  83,050 Market Cap:  22.67M Sector:  Services Industry:  Movie Production Full Time Employees:  30 Shares out 22.38 m State of Incorporation: BC Fiscal Year End: August 31 Transfer Agent: CIBC Mellon Trust

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