Revenues at Bertelsmann’s Luxembourg-based RTL Group, a media giant which owns Fremantle, slid 5.1% to €3.1 billion ($3.4 billion) for the first half of 2023, financial results released on Tuesday have revealed.
Adjusted EBITA (Earnings Before Interest, Taxes, and Amortization) was down to down to €250 million compared to €501 million during the same period in 2022 and group profit was at €132 million, more than 50% down €304 million in 2022. The company attributes this to “challenging TV advertising markets, in particular in Germany.”
RTL group’s TV advertising revenue declined 12.5% to €1.18 billion (H1/2022: €1.35 billion). Compared to the first half of 2019 (pre-COVID-19), RTL group’s TV advertising was down 15.5%.
On the bright side, the group’s streaming services RTL+ and Videoland continued growing apace with paying subscribers up 34.1% to 6 million and streaming revenue up 16.9% to €152 million (H1/2022: €130 million). Distribution revenue was stable at €219 million (H1/2022: €220 million).
RTL’s content creation arm Fremantle saw a surge in revenues from €983 million to €1 billion but a dip in EBITA from €60 million to €36 million. The RTL results talk up the successes of “The Apprentice” and “Britain’s Got Talent” in the U.K. and “Got Talent” and “American Idol” in the U.S.
The group has reaffirmed that the growth target for Fremantle is to reach full-year revenue of €3 billion by 2025. “To achieve this goal, RTL group will invest in Fremantle – both organically and via acquisitions – in all territories across entertainment, drama and film, and factual shows and documentaries,” the group said.
The group now expects adjusted EBITA of around €950 million for the full year 2023 (previous guidance: €1 billion to €1.05 billion), subject to stable to slightly growing TV advertising revenue in the second half of the year, “given continued high level of uncertainties.”
The results also reveal that the group has strengthened its core business in Germany. RTL Deutschland’s combined audience share in the main commercial target group of viewers aged 14 to 59 increased to 27.6% (H1/2022: 27.3%), extending the lead over its main commercial competitor ProSiebenSat1 to 5.8 percentage points (H1/2022: lead of 4.9 percentage points). This was driven by the RTL channel, which scored an average audience share of 9.8% in the target group (H1/2022: 9.5%).
With an average audience share of 6.2% (H1/2022: 6.2%), Vox has become the number two commercial channel in the target group, ahead of Sat1 (6%) and ProSieben (5.6%), RTL said. “With this, RTL Deutschland has achieved a major strategic target, operating the number one (RTL) and number two (Vox) commercial channels in Germany,” the group said.
Thomas Rabe, CEO of RTL Group, said: “The market environment in the first half of 2023 was particularly challenging, with geopolitical and macroeconomic uncertainties in addition to the long-term structural shifts in video viewing.
The RTL group team remains focused on bringing our strategy to life: strengthening our core business, growing our streaming and content businesses, and building alliances and partnerships. Based on our strong balance sheet, we are investing into business transformation through the cycle – in premium content, leading national streaming services and in advertising technology.
Technology plays a key role in our transformation, and we see great opportunities from Artificial Intelligence (AI), in particular to increase efficiency and generate content. Today, we already apply AI at scale in advertising planning and have started to support content creation with generative AI.
We are convinced that investing through the cycle will put us in a strong competitive position when the advertising markets recover. The half-year results came in broadly in line with our expectations.”
Read More About:
Source: Read Full Article
