MTG records US$84m of restructuring costs

The Modern Times Group has said its recent restructuring has cost it SEK700 million (US$84 million) in the most recent quarter.

The free and pay TV group has undertaken a company-wide restructure, announcing 300 job losses in August as part of a programme of cuts across its operations in Sweden, Norway, Denmark and the UK.

More than half of the restructuring charges, announced in 3Q results this morning, relate to redundancy payments to outgoing staff.

The company has said previously the restructuring will result in annual savings of about SEK600 million, taking full effect from 2017. MTG said this cash will be reinvested.

MTG has been investing in digital services, buying Turtle Entertainment and MCNS Zoomin.TV and Splay.

“We have then invested SEK1.2 billion in three market leading digital businesses in high growth online video categories, and we have also invested to secure key sports rights and studio deals for years to come,” MTG said. “This will enable us to develop our brands and products to deliver even more premium content across even more screens and platforms.”

The company posted 3Q revenues of SEK3.8 billion, a 5% increase year-on-year. Stripping out one-off restructuring costs and the SEK77 million cash from the sale of Swedish cabler Sappa, EBIT profit was up almost 10% at SEK240 million.

In the wake of the results, MTG CEO Jørgen Madsen Lindemann (pictured) said: “We are shaping the future of entertainment by creating and growing communities around brands, content and services that consumers love.”