U.K. animation studio HIT Entertainment has posted a 27% increase in pretax profits to US$2.3 million for the six months ending January 1999. According to chief executive Peter Orton, the growth is a vindication of HIT’s decision to expand from a TV distributor to a company that creates, develops and owns rights.

Recent deals include acquiring the rights to U.S. character Foxy, created by author James Marshall, and plans to produce an animation series based on comic book characters the Numbskulls-a group of tiny men who live inside a boy’s head, controlling all his bodily functions. The Numbskulls strip has appeared for decades in U.K. publisher DC Thomson’s best-selling Beano and Dandy comics. HIT is also expanding its relationships in the U.K. through a joint venture with Channel 4 to create 125 hours of preschool programming for the network.

In addition to developing new properties, HIT is also expanding its U.S. licensing presence with a new Beverly Hills-based licensing division (see ‘New U.S. division HITs Licensing Show,’ page 109). AF