RTL Group reports strong revenue growth in the first quarter of 2019
In the first quarter of 2019 reported group revenue was up 7.2 per cent to €1,518 million. The digital revenue was up 15.8 per cent to €220 million. There was strong growth in paying subscribers for RTL Group’s video-on-demand platforms in Germany and the Netherlands: up 59 per cent year on year. RTL Group confirms full-year 2019 outlook.
RTL Group today published the quarterly statement for the first three months of 2019 (Q1/2019). Thomas Rabe, Chief Executive Officer of RTL Group, said: “RTL Group had a good start to 2019, with revenue up 7.2 per cent driven by content and digital activities and the timing of the delivery of key Fremantle productions. To further improve our growth profile, our Total Video 2.0 strategy focuses on two priorities: building local streaming champions in the European countries where we have strong families of channels, and strengthening our global content arm Fremantle. We continue to make good progress on both priorities: at the end of March 2019, RTL Group registered 1.15 million paying subscribers for its video-on-demand platforms in Germany and the Netherlands – up 59 per cent year on year. Fremantle continues to fuel its pipeline for drama productions with the upcoming launches of ‘Beecham House’, ‘Baghdad Central’ and ‘La Jauría’.”
Thomas Rabe: “In the first three months of 2019, RTL Group has continued to actively manage its portfolio with the acquisition of the UK-based video technology company, Yospace, and the sale of Universum Film in Germany, which was completed in April 2019. Also during this period, Groupe M6 announced its plans to acquire TV businesses from Lagardère Group, including the famous children’s channel Gulli. This will be a major step towards strengthening our position in France, RTL Group’s second largest market. At the same time, we have decided not to acquire the remaining shares of BroadbandTV.”
Reported Group revenue was up 7.2 per cent to €1,518 million (Q1/2018: €1,416 million), mainly driven by Fremantle and digital activities. Underlying revenue was €1,496 million (Q1/2018: €1,396 million), resulting in an organic growth rate of 7.2 per cent. Revenue from RTL Group’s broadcasting operations was down 2.0 per cent, to €1,084 million (Q1/2018: €1,106 million), due to soft TV advertising markets in Germany, partly due to the Easter effect, the Netherlands and Belgium.
Content revenue, which represents Fremantle, was up 41.3 per cent to €383 million (Q1/2018: €271 million), mainly driven by the delivery of “American Gods” and “America’s Got Talent: The Champions”. For the full year 2019, RTL Group still expects Fremantle’s organic revenue to grow between 4 and 7 per cent, excluding any impact from foreign exchange movements.
Digital revenue generated by RTL Group’s MPN activities and SpotX was up 25.0 per cent to €105 million (Q1/2018: €84 million), thanks to growth at both BroadbandTV and SpotX. VOD revenue , generated by RTL Group’s broadcasting operations, was up 10.9 per cent to €51 million (Q1/2018: €46 million). As a result, RTL Group’s total digital revenue was up 15.8 per cent to €220 million (Q1/2018: €190 million).
As of 31 March 2019, RTL Group had a net debt position of €334 million (31 December 2018: net debt of €470 million).
Net TV advertising market growth rates and RTL Group audience shares in main target groups
RTL Group estimates that the net TV advertising markets were down across RTL Group’s key markets – except France. A summary of RTL Group’s key markets is shown below, including estimates of net TV advertising market growth rates and the audience share of the main target audience group.
At the end of March 2019, RTL Group registered 1.15 million paying subscribers for its video-on-demand platforms (the pay services TV Now in Germany and Videoland in the Netherlands), up 59 per cent year on year. On RTL Television in Germany, the broadcast of the German national football team’s first qualifying match for the Uefa Euro 2020, against the Dutch, was very successful with an average total audience share of 34.1 per cent and 11.84 million viewers. Fremantle had a very successful start to 2019 with the formats “The Greatest Dancer” and “America’s Got Talent: The Champions”. Fremantle also continued its push into drama production with the launch of the second season of “American Gods”, which was commissioned for a third season shortly after. In March 2019, RTL Radio Deutschland launched Audio Now, a central audio platform for Germany. It offers exclusive audio content as well as popular established podcasts.
RTL Group confirms its outlook for the full year 2019, as most recently communicated at the full-year 2018 results presentation on 13 March 2019: RTL Group expects its total revenue for the fiscal year 2019 to grow moderately (+2.5 per cent to +5.0 per cent) excluding foreign exchange rate effects, driven by the Group’s digital businesses and Fremantle. RTL Group expects its reported EBITA to decrease moderately (-2.5 per cent to -5.0 per cent), reflecting investments into the broadcasters’ TV schedules and VOD services.