ProSiebenSat.1 sees surprise Q4 earnings rise as advertising revenues improve

The Masked Singer Germany

Embattled Germany giant ProSiebenSat.1 has recorded a higher than expected increase in earnings in Q4 of 2023, with advertising revenues finally showing some improvement.

Germany’s ad market had slumped around 10% in consecutive years, prompting an overhaul that saw the company cut a swathe of jobs earlier amid a “realignment” to a digital-first business.

Group CEO, Bert Habets, said during MIPCOM in October that the strategy would help the broadcaster navigate what he described as “an unprecedented decline in the TV advertising market” and its preliminary results suggest the moves are having an effect.

Adjusted EBITDA was up by 11% compared to the previous year quarter to around €335m ($360m), exceeding its previous earnings expectations for the all-important Q4 segment.

Bert Habets (Source: ProSieben Sat.1)

The Masked Singer Germany broadcaster, which had previously expected only slight year-on-year growth in adjusted EBITDA in Q4, said improved overall business performance had helped the figures as well as various smaller and non-recurring earnings effects.

For the full year, ProSiebenSat.1 Group generated adjusted EBITDA of around €578m, down from €678m in 2022, with revenues at €3.85bn, down from €4.16bn.

However, some €1.28bn of the revenue total was attributable to Q4, up from €1.27bn the prior year.

ProSiebenSat.1 also said its net financial debt decreased to around €1.55bn in Q4 from €1.775bn at the end of September.

Updating its outlook for 2024, the group said it continues to assume adjusted EBITDA at the previous year’s level, but now anticipates an increased adjusted EBITDA of around €575m with a variance of plus/minus €50m.

The new total takes into account the group’s previously announced increase in local programming investments but is based on the unchanged assumption of a slight increase in consolidated revenues.

Martin Mildner, group CFO said: “We ended 2023 on a good note. In the crucial fourth quarter, our advertising revenues in the DACH region were slightly above the previous year’s level and we were able to improve our performance in many parts of the Commerce & Ventures portfolio.

“At the same time, our cost measures are taking effect, which strengthens our profitability. This gives us confidence for 2024, even if the economic environment remains challenging.”