RTL Group in “position of strength”
November 8, 2018
RTL Group has reported that in the first nine months of 2018 it continued its successful business development and Total Video strategy. Revenue from the period January to September was up for the fourth consecutive year – despite significant negative exchange rate effects and major sporting events such as the Winter Olympics and the FIFA Football World Cup 2018.
Based on its healthy financial position, RTL Group says it will continue to foster additional organic growth initiatives in two main areas: building VoD services, and continuing Fremantle’s push into scripted drama.
January to September 2018: Fremantle and digital businesses fuel revenue growth
- Reported Group revenue increased by 2.7 per cent to €4,468 million (January to September 2017: €4,350 million), reaching a new record level despite negative exchange rate effects of €64 million. This was driven by higher revenue from Fremantle, the Group’s rapidly growing digital businesses and RTL Nederland
- RTL Group’s digital revenue continued to show very dynamic growth, up 17.9 per cent to €660 million (January to September 2017: €560 million). This was mainly driven by organic growth at BroadbandTV, Fremantle and Videoland
- Platform revenue grew by 7.3 per cent to €251 million (January to September 2017: €234 million)
- RTL Group’s revenue is well diversified, with 46 per cent from TV advertising, 19.7 per cent from content, 14.8 per cent from digital activities, 5.6 per cent from platform revenue, 4 per cent from radio advertising and 9.9 per cent other revenue
- Reported EBITDA was stable at €892 million for the first nine months of 2018 (January to September 2017: €889 million). Higher contributions from Groupe M6 and RTL Nederland were partly balanced by lower contributions from Mediengruppe RTL Deutschland and RTL Hungary
- As a result, reported EBITDA margin was at 20 per cent (January to September 2017: 20.4 per cent)
- Net profit attributable to RTL Group shareholders was down year on year to €424 million (January to September 2017: €434 million)
Outlook
RTL Group confirms its outlook for the full-year 2018, as most recently communicated at the interim results presentation on August 29th 2018:
- RTL Group expects its total revenue for the fiscal year 2018 to continue to grow moderately (+2.5 per cent to +5 per cent), driven by the Group’s digital businesses and Fremantle (excluding exchange rate effects)
- The 2017 EBITDA included a positive one-off effect of €94 million from the sale of buildings in Rue Bayard, Paris. Normalised for this effect, RTL Group expects EBITDA in 2018 to be broadly stable (-1.0 per cent to +1.0 per cent)
Q3/2018: Fremantle and digital businesses drive Q3 results
- In the third quarter of 2018, reported Group revenue was up 3.6 per cent to €1,422 million (Q3/2017: €1,372 million), mostly due to higher revenue from Fremantle and the digital businesses
- EBITDA was down 3.4 per cent to €254 million (Q3/2017: €263 million), mainly as a result of lower EBITDA contribution from Mediengruppe RTL Deutschland, reflecting lower TV advertising revenue. This was partly balanced by the positive effect, at the level of Groupe M6, from the gain on disposals from the transfer of Girondins de Bordeaux players at the end of the season 2017/18
- Net profit attributable to RTL Group shareholders was down to €106 million (Q3/2017: €114 million)
Bert Habets, Chief Executive Officer of RTL Group, commented: “In the first nine months of 2018, RTL Group once again demonstrated its position of strength – even in challenging market conditions. This is thanks to our broad international footprint and well-diversified revenue mix. Our main goal is to grow organically across our portfolio, while maintaining attractive shareholder returns. The mixed developments of the European TV advertising markets show that we are on the right track with our clear focus on two growth areas: building and expanding our non-linear streaming platforms, and producing local exclusive content.”
“We will substantially increase the content offers of our streaming services across all genres – this includes showing programmes online first and developing original productions for these services. Combined with state-of-the-art user experience, RTL Group is determined to become the European pioneer for the next level of Total Video,” Habets concluded.