Is Navarre turning Japanese? Deacon says the New Hope–based distributor of software and entertainment DVDs has experienced “extreme growth,” going from about $300 million in fiscal 2002 to an expected $720 million this year. In 2005, it purchased Funimation, a producer of Japanese anime DVDs. Navarre is now developing a television channel devoted to anime, whose following skews young.
The debt required for the Funimation acquisition resulted in several quarters of losses, and Navarre wants to pay down its millions in debt in order to purchase more content providers. This would follow Navarre’s acquisition three years ago of BCI, which produces budget-priced packs of genre films (Westerns, horror flicks, and cartoons like the old She-Ra series) on DVD. It’s a division that has “unlimited growth potential,” Deacon says.
Acknowledging the scary rollercoaster his company’s stock price (Nasdaq: NAVR) has ridden in the past few years—shares have been priced at about $4 recently after trading in the upper teens in early 2005—Deacon says “a lot of the things that caused that are behind us. We’re hoping to get out and demonstrate some good solid quarters back to back.”
