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MTG (Modern Times Group) saw record sales in the first quarter of 2015, with lower revenues in its Scandinavian free TV business offset by sales growth in Nordic pay-TV and free TV in emerging markets.
The improved efficiency in its traditional business helped MTG to fuel growth in its digital businesses and that profits were steady compared to last year – despite significant foreign exchange rate challenges and continued digital investment.
“The growth in online viewing is more than compensating for lower linear channel viewing levels in the Nordic region, and our combined Nordic TV businesses grew their sales,” said MTG president and CEO Jørgen Madsen Lindemann. “Our emerging market free-TV operations generated higher sales and improved profitability in seven out of eight markets as we took shares in generally stable or growing markets. Our emerging market pay-TV operations continue to be impacted by the geopolitical crisis and Russia’s ban on advertising on most pay TV channels.”
Overall, net sales were up 1 per cent year-on-year at constant exchange rates to SEK3.7 billion, while net income was SEK318m compared to SEK159 million in the same quarter last year.
Sales for MTG’s free TV Scandinavia business were down 8 per cent at constant FX, with the Swedish and Norwegian TV advertising markets estimated to have fallen in Q1 while the Danish market is said to have been stable.
However, sales were up in MTG’s pay TV Nordic markets by 4 per cent at constant rates, driven by the expansion of Viaplay. MTG reported Nordic growth in its third party network subscriber base and a decline in its satellite base. Overall Nordic pay-TV subscriber numbers came to 973,000, down slightly from 978,000 a year earlier.
In MTG’s emerging markets, free TV sales were up by 9 per cent and pay-TV sales were up 22 per cent at constant rates. The free TV results were mainly driven by sales gains in the Baltics, Czech Republic and Bulgaria, while the pay-TV figures were helped by the consolidation of Trace from July 2014.