Swedish media group MTG (Modern Times Group) has posted record Q1 sales of SEK 4,674 million (€450.3m) with 9 per cent organic growth. Profits were up 73 per cent as the group prepares to split into two by spinning off Nordic Entertainment Group.
In a statement, CEO Jørgen Madsen Lindemann said: Q1 has been a busy and exciting quarter at MTG. We have delivered both top and bottom line growth while also preparing to take the final step in our transformation by splitting MTG into two separate listed companies.
Q1 was the seventh consecutive quarter of more than 5% organic sales growth. This growth is a result of the investments that we have made in our content portfolio and digital products. Our digital sales were up 88% in Q1 and accounted for 35% of total sales. Furthermore, we have translated this growth into higher profits with EBIT up 73%.
Nordic Entertainment delivered another quarter of higher sales and profits, even though we had tough comps from last year and the Winter Olympics on rival channels and services. Viaplay continues to be the main driver of the growth but almost all of our markets and products grew their sales.
MTGx sales were up 226% on a reported basis and 27% on an organic basis. We turned the reported EBITDA loss a year ago into a profit of SEK 45m with the help of the contribution from InnoGames. All three digital verticals all grew with ESL generating particularly high growth from owned and operated events.
One becomes two
We are today the number one integrated entertainment provider in the Nordics, with the best and broadest content offering, and world-class streaming services in Viaplay and Viafree. We have also firmly established MTGx as one of the most exciting players in the digital entertainment space. We are the world’s leading esports company and we have proven concepts in the online gaming space – two industries that are global by nature.
The Nordic Entertainment and MTGx businesses and teams are ready to stand and succeed separately, which is why we are now taking the next step by preparing to split MTG into two separate listed companies. Please read all about it at www.mtg.com/mtg-nordic-entertainment-split/. We are big believers that this will accelerate the development of both companies and create additional shareholder value through a sharpened strategic focus, more flexibility, and faster decision making. It will also provide investors with two distinct and attractive but inherently different investment cases. We intend to propose the distribution and listing of the Nordic Entertainment Group at an Extraordinary General Meeting in the second half of this year and provide regular updates throughout the process
9% organic growth and 73% profit growth clearly show the potential of this Group. Now we are preparing to split MTG in two in order to accelerate the speed of development and drive shareholder value. We have created two unique businesses that are leaders in their fields and very well positioned for the future.”