RTL Group Ups Profit 8.4 Percent in First Quarter
The broadcast giant posts strong figures despite weak advertising markets across Europe.
CANNES -- RTL Group, Europe's largest commercial broadcaster, continues to squeeze healthy profits out of the ever-sickening Euro ad market.
The group, which is controlled by Germany's Bertelsmann, posted operating profits (EBITA) of $267 million (€207 million) for the first quarter of this year, an 8.4 percent increase over last year's first quarter and the company's best-ever first-quarter result. Revenue over the same period was flat, up just 0.5 percent at $1.7 billion (€1.33 billion).
“We’ve had a solid start to the year, with our best-ever first-quarter EBITA and high levels of net profit and cash conversion,” said RTL Group's co-CEOs Anke Schaferkordt and Guillaume de Posch in a joint statement. ”Performance in Germany has been particularly strong, and our other businesses are resilient facing the current economic conditions".
In fact, Germany was the only TV advertising market in continental Europe not to show a drop this quarter, instead growing a still-meager 1.3 percent. And it was Germany that, again, provided RTL with the bulk of its profits. EBITA at the company's German operations, Mediengruppe RTL Deutschland, were up an impressive 23 percent at $173 million (€134 million), the best-ever Q1 performance for the division.
Things weren't so rosy at RTL's other traditional money-making machine, its Brit-based production operation FremantleMedia, producers of The X Factor and American Idol. Phasing effects in Germany, the U.K. and Australia contributed to a first-quarter drop in revenue to $391 million (€303 million) compared to €311 million over the same period last year and operating profits slipped to $13 million (€10 million), compared to €13 million last year.
Given the less-than-sunny prospects for the European economy in general and the TV ad business in particular, RTL said it was not certain its full-year profit would match its 2012 performance.