German commercial broadcaster ProSiebenSat.1 generated 50% of its revenues in the first half of this year from non-advertising activities for the first time, helping deliver solid revenue and profit growth for the group.
Overall, ProSiebenSat.1 saw its second-quarter revenues grow by 9% to reach €962 million (US$1.14 billion), while adjusted EBITDA rose by 6% to €270 million. First-half revenues grew by 11% to €1.872 billion, with adjusted EBITDA rising 8% to €458 million.
Revenue from the group’s German broadcasting activities dipped by 2% for Q2 to €529 million, reflecting a softening of the advertising market, down 4% for the quarter, according to ProSiebenSat.1.
Cost-cutting enabled the broadcasting unit to turn in improved EBITDA of €208 million, up 4%, however.
Notably, content production and global sales at Red Arrow International saw growth of 15% in the three months to June to €89 million, with EBITDA rising to €12 million. The US production business made the biggest contribution to the uplift.
Among ProSieben’s other non-advertising revenue sources, the broadcaster’s digital entertainment revenues actually fell in Q2, albeit by a modest 2% to €108 million thanks to the deconsolidation of its games business at the end of last year.
However, digital ventures and commerce grew by 50% in the same period to reach €227 million, contributing to a 58% rise in EBITDA from the unit. The growth was primarily driven by the group’s online dating business.
The quarter saw the group acquire a majority stake in ‘experience gift’ provider Jochen Schweizer, and sell its shares in online travel agency Etraveli. ProSiebenSat.1 also established online advertising initiative the European Broadcaster Exchange in partnership with TF1 Group and Mediaset.
ProSiebenSat.1 said it expected the advertising market to pick up in the second half of the year, with full-year growth of between 1.5% and 2.5%. However, the group is more cautious about its expectations for its own share of the pie, expecting revenue growth from advertising at the lower end of this scale. It said it expected high single-digit revenue growth overall for the full year.
“We continued our profitable growth despite the weaker development of the advertising market in the second quarter and anticipate an again positive environment within the TV advertising market for the second half of the year,” said CEO Thomas Ebeling.
“We are further dynamically growing in the digital areas that are strategically important to us. The investments in our commerce business are paying off. Furthermore, we are driving the expansion of addressable TV, ad-tech and data, which are strategic growth areas for us.”
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15th February 2019