Viaplay surpasses 4m paying subs
February 8, 2022
NENT has reported that its Viaplay streaming service has seen paying subscribers rise by 33 per cent YoY to just over 4 million, with 397,000 subscribers added QoQ.
NENT also reported 12 per cent organic sales growth with reported sales of SEK 3,553 million (€340.2m).
Anders Jensen, NENT President and CEO, commented: “We ended the year by surpassing the milestone of 4 million paying Viaplay subscribers, having added almost 1m new subscribers during the year, and almost 400k in Q4 alone. The total addressable market for Viaplay increased dramatically in 2021 as we doubled the number of markets that we are in. We met and exceeded both our Nordic and international subscriber targets, and have had a particularly strong start in Poland. Q4 was also our fourth consecutive quarter of double digit organic sales growth, with group organic sales up 17 per cent for the full year and Viaplay sales up 22 per cent. 2022 has started well and we expect the Viaplay subscriber and revenue growth to accelerate further this year as planned, as we add very attractive new content and sports rights, and launch Viaplay in the Netherlands and the UK.
Our 12 per cent YoY group organic revenue growth in Q4 was primarily driven by Viaplay, which is our largest revenue generating unit and grew by 21 per cent. Our Nordic Viaplay revenues (34 per cent of sales) were up 16 per cent YoY on an organic basis after 15 per cent YoY subscriber growth. We added 163k Nordic subscribers in Q4 and 438k YoY. The revenue growth also reflected the price adjustments introduced earlier in the year.
The Viaplay international operations added 234k subscribers in Q4 and 547k YoY, with the revenue levels reflecting the relatively early stage of development in the Polish market in particular.
Viaplay customers streamed a total of 13.4 billion minutes of content as viewing of our 152 seasons of originals continued to grow, and our coverage of the Bundesliga, English Premier League, UEFA competitions, Formula One and Winter sports all attracted large scale audiences. We are now again raising our ambition to more than 70 Viaplay originals to be premiered in 2022. We have secured the major sports rights for many years to come, and therefore have full visibility on our cost base moving forward.
We launched Viaplay in the US in December through a partnership with Comcast, and now have our strongest ever content line-up for the launch in the Netherlands on 1 March. This features a number of the most popular sports rights, as well as local agreements with leading distributors and a global exclusive partnership with newly crowned F1 world champion Max Verstappen. Our target for 2022 is to grow the total Viaplay subscriber base by over 60 per cent to approximately 6.5 million.
Other subscription revenues (32 per cent of sales) were up 13 per cent YoY on an organic basis, and reflected rising prices for the enhanced content offerings and new agreements with distributors.
Advertising revenues (32 per cent of sales) were up 3 per cent YoY on an organic basis, as advertising spending continued to recover and led to high sold-out ratios.
External sales for the Viaplay Studios production businesses (2 per cent of sales) were up 25 per cent YoY on an organic basis due to higher production volumes.
The profitability of our Nordic operations exceeded our previous outlook, and included the planned reinvestment of the 2020 savings back into the business. We added key new sports rights and continued to scale up our original content. The total EBIT before associates included the previously flagged investments into the international expansion of Viaplay, which were in line with expectations. All of these investments will drive our long-term growth, profitability and cashflow.
16 per cent full year organic sales growth and 31 per cent like for like profit growth for our Nordic operations demonstrate the health and potential of the business. We expect approximately 20 per cent Nordic revenue growth in 2022 with rising Nordic profits. The international expansion will add to this growth and enable approximately 28 per cent group revenue growth, while the investments in this growth will reduce group profits in 2022 before group profits rise again significantly in 2023.
Our joint venture Allente has now taken its planned integration costs in 2021 and is on track to deliver the SEK 650m of full run-rate cost synergies in 2022, as well as continuing to upsell Viaplay to the rest of its subscriber base. We expect significant earnings and cash flow contributions moving forward.
We will soon launch our new 5-year sustainability strategy, roadmap and targets, with the focus on producing and delivering content sustainably and becoming the most diverse and inclusive entertainment company. The pandemic has not only accelerated and broadened the adoption of streaming and the hunger for diverse content, but also highlighted how relevant our values-based and purpose-led culture is. 2022 is a very exciting year for Viaplay and NENT Group, and one in which we will take major steps towards our 2025 targets.”