European broadcast giant RTL has reported a 2 per cent decline in Q2 sales due to lower revenues at production unit FremantleMedia and competition for advertising revenue from the UEFA European football championship.
The Bertelsmann-owned company said it expected revenues to recover in the second half, and raised its full-year profit forecast and promised an interim dividend.
RTL said it now expected growth of 1 to 2.5 per cent in 2016 earnings before interest, tax and amortisation (EBITA) instead of broadly stable EBITA, and confirmed it expected revenue growth of 2.5 to 5 per cent.
EBITA grew 3 per cent in the quarter to €351 million, driven by French broadcaster M6 and RTL Germany.
“You can’t look at the production business on a quarterly basis simply because of the nature of the business,” co-Chief Executive Guillaume de Posch said in an interview with Reuters, pointing out the uneven occurrence of large contracts.
He added the financial impact of a deal announced with Amazon to show American Gods on Amazon Prime – part of a burgeoning business with OTT players – would first be felt in 2017.