Bertelsmann Financials for First Nine Months Rise Despite Euro Crisis
COLOGNE, Germany – German media giant Bertelsmann on Tuesday delivered solid third-quarter results that boosted its financials for the first nine months of 2012.
The company has faced turbulence, both on the outside world, as the European markets struggle with the ongoing Euro-zone crisis, and inside as chairman and CEO Thomas Rabe takes Bertelsmann through a restructuring.
Little of that upheaval was evident in Bertelsmann's numbers for the first nine months of this year. Revenue was up 5.7 percent to $14.5 billion (€11.4 billion) and profit improved to $672 million (€528 million) from €377 million a year earlier.
“We are satisfied with our business performance during the first nine months of the year. Bertelsmann is growing organically, profitability remains high, and we are making good progress on reshaping the group,” said Rabe in a statement. “We continue to expect moderate revenue growth and a continued high operating [profit before interest and taxes] for the full year."
He added: "Group profit will be impacted in particular by special items from the print business and several direct-to-customer businesses, as well as from our operations in Southern Europe. Also, the subdued economic outlook and the Euro crisis make it difficult to predict our future performance at this point.”
The still-chugging engine of the German TV market helped Bertelsmann paper over the worst of the Euro crisis as stronger growth at its RTL network of channels in Germany offset weaker performances elsewhere on the continent. Bertelsmann's TV production group FremantleMedia, maker of the Got Talent and X Factor entertainment formats, also continues to deliver, with Fox in the U.S. renewing X Factor for a third season and Got Talent named the globe's top entertainment format for the second year running in 2012, with local versions on air in more than 50 territories worldwide.
Rabe has set Bertelsmann ambitious goals for the coming year as he moves to pull the European-focused, old-media heavy conglomerate into a digital, and global, world. Rabe has said the company's focus must shift from the slow-growth territories of Western Europe to Asia and South America. Rabe is also pushing Bertelsmann's operations, which in addition to TV group RTL include publishing giant Random House (which recently announced a merger with Penguin) and magazine giant Gruner + Jahr, have to capitalize on possibilities opened up by digital sales and distribution.