Has Central European Media Enterprises (CME), one of the oldest players on the CEE television block, finally turned the corner?
It’s hard to believe that it is now 20 years since the company announced its entry into the market by launching TV Nova, one of the region’s first national commercial TV stations, in the Czech Republic.
Since then it has experienced numerous highs and lows, entered new markets and left others. However, there is no doubt that the last few years have probably been the most difficult, due to the challenges brought about by the global financial crisis and slump in TV ad revenues in the six regional countries it is currently present in.
Last year saw major changes in the company’s senior management, with Adrian Sarbu stepping down from the position of CEO and being replaced by Christop Malnusch and Michael Del Nin, who now share the role.
Results published by the company at the end of February also show that it managed to reduce its debt in 2013, both in the full year and last quarter.
They were accompanied by the news that CME is to refinance 2016 notes with the help of Time Warner in a move that could raise the company nearly $400 million.
The conference call accompanying the results was largely given offer to clarifying financial details and provided few if any insights into the company’s strategy for this year and beyond.
Key points included that the refinancing should effectively raise Time Warner’s stake in CME from 65% to 70% and eventually between 70% and 78.5%.
Looking at specific markets, the management noted that audience shares had improved in the Czech Republic but suffered in Bulgaria and Slovenia due to competitors.
It also said that negotiations on carriage fees had been successful in Romania, with an increase it cost per subscriber on the 2013 level.
There have also been recent managerial changes in Bulgaria and Romania that it is believed should improve the company’s performance in the two countries.
While 2014 is unlikely to be a make or break year for CME, it will be a crucial one as it attempts to get back on track in the CEE marketplace.
