Shares dive as Premiere posts steep loss
German pay TV group's results set off selling spreeCOLOGNE, Germany -- Shares in Germany’s leading pay TV group Premiere nosedived Monday after the company, which is partially controlled by News Corp, announced a net loss of 269.4 million euros ($344 million) for last year.
The loss -- more than five times the 52 million euros net loss Premiere booked in 2007 -- set off a selling spree, and Premiere stock fell more than 13% Monday morning to around 2.45 euros ($3.1).
Premiere’s revenues last year inched up slightly to 941.1 million euros ($1.2 billion) but net debt moved in the opposite direction, increasing to 318 million euros ($406 million) from 307 million euros in 2007.
Premiere CEO Mark Williams has told shareholders to expect a weak first half, with subscriber figures broadly flat. Growth, Williams said, will only return after Premiere’s re-launch in Q3, timed to coincide with the start of the German soccer season.
"2008 was a very difficult year, during which we suffered a large financial loss and a liquidity crisis which threatened the company’s existence,” Williams told Premiere shareholders.
“The long-term financing structure agreed in December with News Corp. and our bank syndicate was key to our survival. The most critical step now is the approval of the required capital increase by shareholders at the extraordinary general meeting on February 26 and the completion of the rights issue expected during the first half 2009.”
If all goes as planned, Premiere hopes to boost program spending by 50 million euros ($64 million) in the second half. Williams target is to return the company to profitability by 2011.