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European broadcasting giant RTL Group has posted lower-than-expected Q3 profit as it paid the price for not having broadcasting rights for the key sporting events during the summer.
Earnings before interest, tax and amortisation dropped 3.3 per cent to €176 million. Net profit fell almost 10 per cent to €102 million, which was also weaker than the expected €115 million. Q3 revenues were stable at €1.352 billion.
RTL said the Q3 was weaker “as expected” because it missed advertising income from big sporting events such as the Euro 2016 football tournament and the Olympics in Rio, which were broadcast by competing networks.
A joint statement from Anke Schäferkordt and Guillaume de Posch, Co-Chief Executive Officers of RTL Group, said: “During the first nine months of 2016, RTL Group once again demonstrated the sustainable success of its diversified portfolio and growth strategy. Despite two major sport events during the summer, we were able to increase both revenue and EBITA once again. This result was mainly driven by the strong performance of Groupe M6, Mediengruppe RTL Deutschland and our rapidly growing digital business.”
“As expected, the results in the third quarter were weaker than the year before. This is the result of the expected front-loading we have experienced this year because of the sport events during the summer – namely the Uefa Euro 2016 and the Olympic Games. Nonetheless, we are in line with guidance for the full-year 2016 and on track for yet another record year.”
“At the presentation of the full-year results 2014, we said that we wanted to grow digital into a strong pillar of our company, with revenue reaching 10 per cent of the Group’s total revenue within the next few years. Looking at the 9-month figures 2016, we are happy to say that our digital businesses make up more than 10 per cent of our total revenue. We have reached this milestone much quicker than expected.”