RTL Group, the German-based TV entertainment company, has reported modest Q1 growth in the face of currency headwinds, highlighting the challenge they face to streamline and modernise.
Reported Group revenue was stable at €1,416 million (up from €1,405 million in Q1 2017), as higher revenue contributions from Mediengruppe RTL Deutschland and RTL Nederland were partly balanced by negative exchange rate effects amounting to €29 million; underlying revenue was up 2.6 per cent
RTL Group’s digital revenue was up 6.7 per cent to €190 million (€178 million in Q1 2017).
Segments: Growing advertising revenue in key markets
Bert Habets, Chief Executive Officer of RTL Group, commented: “During the first quarter of 2018, we generated higher TV advertising revenue in our key markets of Germany, France and the Netherlands. However, this good revenue growth was offset by negative exchange rate effects. Our profitability remains at a high level, and with the strong operating performance of our major business units, we are in a very good position to write the next chapter in RTL Group’s success story.
As we have said before, the first quarter is not necessarily an indicator for the full year – in particular in years with major sporting events such as the upcoming football World Cup. Thus, we will keep a close eye on seasonal swings in advertising spend and expect 2018 to be more back end loaded than the prior years.
In the first quarter of 2018, we launched three new video-on-demand platforms – in Hungary, Croatia and Belgium – all based on the 6play platform of Groupe M6. This is a textbook example of how closer collaboration across our Group can be key to scaling up digital businesses. We will increase investments in our video-on-demand services with a clear focus on local, exclusive content, and gradually adopt a hybrid model – combining a free, advertising-financed service with a premium pay product.”