Mediaset reports slight profit drop

Slow economic growth affecting ad sales

ROME -- Profits for Italian broadcast giant Mediaset contracted slightly over the first nine months of the year, the company reported Tuesday, though revenue improved.

Mediaset reported adjusted profits of 314.1 million euros ($405.2 million) over the first three quarters, down from 357.9 million euros ($461.7 million) in the year-ago period. Revenue rose to 3 billion euros ($3.91 billion), an increase from 2.8 billion euros ($3.64 billion) a year ago.

The broadcaster said its share of Italy's viewer hours slid to 39.8%, compared with 40.6% over the same period in 2007.

Overall, the company said conditions have been tough, with slow economic growth hurting advertising. The company said it expected the soft market to continue into 2009.

Guido Alarcon, a communications analyst with ABS Securities, said the results were more or less in line with what analysts expected, though guidance looking forward was weaker than anticipated.

"The indications are that the worst may not be over," Alarcon said.

Mediaset shares closed 5% lower in heavy trading Tuesday, ahead of the release of the nine-month results. After-hours trading was flat.