The European media group RTL reported on Wednesday that it operated with higher revenues and profits in the second quarter, highlighting a good result from its production branch FremantleMedia, which mitigated weaker results in the television advertising market.
The group concluded the second quarter of this year with nine percent higher revenues compared to the same period last year, amounting to 1.57 billion euros.
Thanks to a one-time positive effect in the French subsidiary M6, related to the gradual phasing out of the M6 Mobile contract, earnings before interest, taxes, depreciation, and amortization (EBITDA) at the group level increased by four percent in the second quarter, reaching 362 million euros. Excluding this one-time effect, EBITDA decreased by 7.4 percent.
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Net profit fell by 11 percent during the observed period, to 209 million euros, according to the business report.
From April to June, the group’s revenues were supported by the production subsidiary FremantleMedia, with RTL Group particularly highlighting the television drama “American Gods.”
Weaker results were recorded in the “challenging” television advertising market, which accounts for just under half of the group’s revenues.
RTL estimates that all of their television advertising markets in Europe recorded a decline in the first half of this year.
The largest decline from January to June was recorded in the Croatian television advertising market, at 8.9 percent, according to RTL’s and industry estimates.
– RTL Croatia recorded better results than the market, maintaining stable revenues of 19 million euros, the report states.
The Croatian branch concluded the first half of the year with a loss before taxes, interest, depreciation, and amortization of three million euros, with this result “mainly reflecting higher programming costs,” the report states.
A significant decline in the television advertising market was also recorded in Belgium, estimated at 8.3 percent, and in the Netherlands, at 6.2 percent. In the home German market, the decline is estimated to be between two and three percent, the report shows.
In the French and Spanish markets, revenues from television advertising have almost stagnated, according to estimates from independent sources cited by RTL.
– The challenging trends in the television advertising markets where we are present are a clear signal that we need to accelerate the implementation of our strategy, stated the executives Bert Habets and Guillaume de Posch.
The television group, majority-owned by the German media group Bertelsmann, announced the acquisition of full ownership of the advertising platform SpotX and additional investments in advertising technology. Their stake in SpotX currently stands at 65 percent, having purchased it in 2014 for 144 million dollars.
They confirmed the projected estimates for profit and revenue for 2017, according to the business report. They anticipate moderate growth in total revenues at the group level, ranging from 2.5 to 5.0 percent, primarily relying on digital business and Mediengruppe RTL Deutschland.
Annual EBITDA is expected to remain at last year’s level.
