Viaplay to sell Paprika Studios as shares dive 75% on Q3 results & recapitalisation plan

Love Me (Source: Viaplay)

Viaplay has seen its shares dive 75% this morning after unveiling a recapitalisation plan ahead of its delayed Q3 results, with the embattled Nordic streamer also confirming it will be selling its Central and Eastern European production group Paprika Studios.

The streamer revealed its operating income had declined SEK321 ($31m) in Q3 while net income had plumetted SEK693, with the company blaming “substantial losses” in “non-core international markets” such as the UK, which it confirmed in July it would be exiting.


Viaplay, which had delayed its Q3 results for the second time earlier this week, is selling its UK-based Premier Sports operation back to the company it bought it from less than a year ago.

Nordic profits were also impacted by lower advertising sales, inflation in content costs and currency exchange rate fluctuations, but the company blamed the decline on operations in Poland, the Baltics and the UK.

Losses in these markets will now be higher than expected, the company said, adding that it still plans to exit the Baltic and Polish markets by summer 2025, with the cost of that move estimated at SEK 2.2bn.

Shortly before its Q3 numbers were released, Viaplay detailed a new recapitalisation plan with its largest shareholders and debt providers that will see SEK 4bn being injected into the company.

The plan, which is being supported by Canal+ and PPF, will see new shares issued and SEK 2bn of debt being written down.

It prompted the Stockholm-based firm’s shares to fall dramatically to just over SEK6 apiece, however, down from more than SEK217 at the start of June.

Viaplay to sell Paprika Studios

The Nordic streamer, which has been led by president & CEO Jørgen Madsen Lindemann since the exit of Anders Jensen in June, added that it is now also planning to sell Paprika, which operates across nine countries in CEE.

The future of the production group, one of the largest across CEE, had been unclear following the vast restructuring taking place at Viaplay this year.

Paprika is led by CEO Akos Erdos and produces more than 600 hours of programming annually for broadcasters and streamers, with both scripted and unscripted on its slate.

The company has been behind shows including Polish Murderesses and is also one of the regions biggest service providers, with its sale set to leave Viaplay with only its in-house production operations.

Jorgen Madsen Lindemann

The company sold the majority of its unscripted production interests in 2021, with 12 companies picked up by Fremantle, including Strong Productions in Denmark, Norwegian outfit Monster and Swedish duo Baluba and Strix Television.

It also sold NENT Studios UK (fka DRG) to All3Media as part of a strategy to fuel Viaplay’s streaming efforts, which saw it launch in CEE, the US and across Europe. Almost of all that plan has now been scrapped.

The streamer has also curtailed much of its original content commissioning having been prolific over recent years, notably in scripted with shows including Danish crime drama Trom, Norwegian thriller Furia, Swedish drama Threesome and Ronja, The Robber’s Daughter.

Lindemann said the overhaul, which has seen it cut 30% of jobs including numerous senior execs and introduce a country-based operating model, had translated into an improved performance in its home markets.

“Our core Nordic, Netherlands and Viaplay Select operations have stable Viaplay subscriber volumes and rising ARPU [Average Revenue Per User] levels, a much-improved content mix and growing content sales to third party platforms. We are well on track to reach our year end revenue and profitability targets for these operations, as we set out in July,” he said.

Nordic ad revenue down 10%

However, Lindemann added that the performance in non-core markets had hit group revenues hard, while combined advertising sales oin the Nordics were down 10%.

“The route to profitability for these operations is not clear or realistic, which is why we have now reached agreement to sell our UK operation, subject to regulatory approval, and we will exit the Baltic and Polish markets by summer 2025.


“The negative cash effect of exiting these loss-making operations will be approximately SEK 2.2 billion over the coming years. In addition, we have reached agreement to sell our Paprika Studios content production business, subject to shareholder approval, which will further sharpen our Nordic focus.”

Group organic sales were up 7% in Q3, primarily driven by 17% organic sales growth in Viaplay, which now accounts for 52% of group net sales.

Nordic organic sales growth was 3%, with Viaplay delivering 9% organic sales growth and accounting for 43% of total Nordic net sales. Full year operating losses are now expected to come in at between SEK 1bn-1.5bn.

“We understand the current state, and future potential, of the business, our products, and our people. The energy, enthusiasm, and enterprise of our teams, especially in these challenging times, is fantastic to see.

“We have much to achieve together and the proposed recapitalisation of the business is a necessary part of resetting the Group for a much more sustainable future, where our attention and resources are focused on those markets where we can compete for the long term, and where our products are relevant, popular and generate healthy returns,” Lindemann said.

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