Good sports: EM's lineup change pays off
EmptyThe strategy of EM.Sport Media, the German media group previously known as EM.TV, to focus exclusively on sports television seems to be paying off.
In its first-half results Tuesday, EM showed a 7% jump in revenue to €112 million ($151 million) and a profit of €3.4 million ($4.6 million), compared with a €200,000 profit in the same period last year.
Operating cash flow jumped from €3.6 million in first-half 2006 to €16.1 million ($21.7 million) this year.
CEO Werner Klatten gave all the credit to the company's sports division, which includes free-to-air sports channel DSF, sports events production company Plazamedia and online portal Sport1.
"Our sports activities have once again been excellent," Klatten said. "They have strengthened their earnings potential and their competitive position. … Our first-half figures underpin our strategic decision to focus wholeheartedly on sporting activities."
EM's children's entertainment unit, once the company's core business, is now on the auction block. While the division booked a €4.6 million profit in first-half 2006, it lost €1.4 million ($1.9 million) this time.
EM said it has received several offers from media companies in Germany and outside for the kids unit as well as bids from private-equity groups.
The division includes a massive library of children's animation series, the kids pay TV channel Junior.TV, Australian-based production house Flying Bark and a 22.5% stake in new U.S.-based children's VOD platform Kabillion.
EM increased its forecast for operating cash flow and earnings before interest and tax for the full year based on Tuesday's results. However, it is sticking to its original revenue target of €215 million ($290 million).