Declining advertising markets across Europe have resulted in significantly lower revenue and earnings, according to the RTL Group. It has responded with comprehensive cost cutting measures. The broadcaster has also said its audience performance has increased and it will invest in growth businesses.
The reported Group revenue was down 9.6% in Q2 to €2,588 million as TV advertising markets across Europe declined by double-digit rates.
RTL Group’s investments in content production and diversification businesses helped to better balance its financial position.
Reported EBITA was down 36.7% to €318 million due to a lower profit contributions from most profit centres.
Higher start-up losses (€35 million) mainly resulted from the
first-time full consolidation of Alpha Media Group in Greece, and significant one-time charges including restructuring costs in the UK, Germany and Greece totalling €20 million and a significant programme write-down at Five amounting to €22 million.
Since the fourth quarter of 2008, RTL Group has placed a strong focus on cost cutting in response to the substantial slowdown in advertising bookings.
On a constant scope basis, excluding restructuring costs and other one-off effects, operating costs fell €198 million compared to the first half of 2008.
RTL Group said its corporate strategy remains in place, with further investments in content production, digital activities and diversification businesses.
In total, the Group’s online platforms across Europe registered more than 470 million video streams, which delivered professionally produced content to viewers. This was an increase of 97% compared to the first half of 2008.
The RTL Group is expanding its catch-up TV services, with selected programmes from M6 Replay and RTL Now now available on mobile phones. Vox Now has launched in Germany and RTL Gemist will soon be available on TV screens on UPC in the Netherlands
The RTL Group is also investing in HDTV services in Germany, The Netherlands and France.