Swedish media group MTG (Modern Times Group) has posted record Q4 sales of SEK 5,375 million (€516.1m) with 1 per cent organic growth.
Operating income before items affecting comparability (IAC) of SEK 568 million including transaction costs related to the proposed split of MTG of SEK 6 millio. Total operating income of SEK 596 million including IAC of SEK 28 million.
In a statement, Jørgen Madsen Lindemann, President & Chief Executive Officer, said: “The momentum continued in 2018 with full year sales, profits and margins all up. Sales grew by 4% on an organic basis and operating income before IAC grew by 24%. Nordic Entertainment sustained its strong performance, and MTGx was profitable on a full year basis for the first time.
Q4 organic sales were up and operating income before IAC was up 19%. Nordic Entertainment delivered its ninth consecutive quarter of higher sales and profits, as Viaplay again grew its subscriber base at a very healthy rate. The growth in the streaming platforms has continued to more than offset the falling linear viewing levels. Studios also delivered profitable growth driven by robust demand for scripted drama productions.
MTGx sales were down as expected with the organic growth in InnoGames and DreamHack offset by lower sales for ESL, Kongregate and Zoomin.TV. ESL’s owned and operated sales were up double digit percentage points while work-for-hire volumes were down as we continue to strategically transform the business. MTGx profits were up overall as ESL reported lower losses.
We have been working for almost a year now to prepare for the split of MTG into two by distributing NENT Group to shareholders and listing the shares on Nasdaq Stockholm. We recently published the information brochure to provide the decision-making material for the shareholder meeting on 7 February. The brochure includes the new financial targets for both companies, as well as the leverage ambition and dividend policy for NENT Group. It is in this context, and subject to the EGM’s approval of the Split, that the NENT Group Board will propose the payment of a dividend of SEK 6.50 per share to the NENT Group AGM to be held in May. MTG’s Board will propose to the MTG AGM on 21 May that no dividend be paid in 2019.
We are confident that both MTG and NENT Group have bright futures ahead of them as separate and even more focused organisations. The split will bring even greater clarity and speed, with two talented teams and product portfolios that are more relevant than ever for our customers. Both companies are operating in market segments that offer significant structural growth opportunities. NENT Group is an investment into the leading Nordic streaming and content provider, while MTG is a unique play on global esports and online gaming. We share a common heritage, approach and commitment that will serve both companies well in the future.”