The Board of Directors of RTL Group (previously Audiofina) approved on 12 September 2000 the results for the six months ended 30 June 2000. The Group is reporting two sets of figures – those for Audiofina as a listed company on the Belgian and Luxembourg exchanges (under Luxembourg GAAP), and proforma six months figures for the newly formed RTL Group now listed on the London, Brussels and Luxembourg stock exchanges (under International Accounting Standards), both for the six months ended 30 June.
In a separate statement, RTL Group is today announcing that it will increase its interest in Spanish private broadcaster Antena 3 from 10 per cent to 16.23 per cent.
Audiofina Interim Results for the six months ended 30 June 2000
(Luxembourg GAAP)
Audiofina was renamed RTL Group when CLT-UFA and Pearson Television merged into Audiofina on 25 July 2000. Audiofina which had controlled 50 per cent of CLT-UFA recorded an unaudited net turnover of EUR 937 million and a net result (group share) of EUR 113.3 million under Luxembourg GAAP in the first half year 2000. This compared to a net turnover of EUR 773 million and a net result of EUR 221 million in the same period of 1999. The decrease in reported net income over that reported in 1999 primarily reflects exceptional gains in the 1999 interim figures resulting from the disposal of CLT-UFA’s 45 per cent stake in German pay-tv channel Premiere.
RTL Group Proforma Interim Results to 30 June, 2000 (IAS)
Background
RTL Group is today reporting proforma results for the six months ended 30 June 2000 which will form the basis for future comparisons. On the occasion of the merger and the London listing, the new Group decided to adopt International Accounting Standards (IAS). RTL Group’s unaudited proforma figures have been prepared using these standards and the pro forma statements as disclosed in the listing particulars issued on 30 June 2000.
Since January 2000, RTL Group has strengthened its position in core markets. The Group has laid formidable foundations from which to continue developing through internal and external growth.
The Group has TV and radio operations spanning 11 countries. It produces approximately 160 television programs in 35 countries and provides over 10,000 hours of programming to broadcasters every year. It is well positioned to leverage its valuable portfolio of brands, buying strengths and tremendous cross promotional power internationally. RTL Group’s unique position as a pan-European integrated broadcaster and content owner will enable it to develop new contents and formats, be at the forefront of new media development and attract entrepreneurial and creative talents.
The Group’s earnings profile traditionally has, and will continue to be, slightly weighted towards the first half of the year. The planned investment during this year in new media activities will further increase this weighting. The Group firmly intends to increase its current free float from 10.3 per cent to 15 per cent in order to join the FTSE 100 Index over the medium term.
Financial Highlights
· Sales:
· Total sales increased by 21 per cent to EUR 2,028 million compared to EUR 1,677 million a year earlier.
· Like for like sales, excluding the contribution from the German TV channel Vox, increased by 15 per cent.
· EBITA (Earnings before Interest, Tax and Amortisation of Goodwill 2 ):
· Total EBITA increased by 46 per cent to EUR 316 million compared to EUR 217 million a year earlier. Like for like EBITA was up by a similar amount as Vox recorded a broadly breakeven result over the period.
· Group EBITA margin increased to 15.6 per cent from 12.9 per cent.
· Net Earnings:
· Net Earnings fell to EUR 71 million from EUR 198 million reflecting exeptional gains in the 1999 interim figures resulting from the disposal of a 45 per cent stake in Premiere.
· Adjusted earnings per share:
· Adjusted earnings per share increased 16 per cent to 1.07 EUR from 0.92 EUR. For the purpose of the proforma accounts, the number of shares taken into account is 154.7 million. The adjusted earnings per share represent net earnings adjusted for goodwill amortization and the gain or loss (after income tax) from sale of subsidiaries, joint ventures, associates and investments.
Business Highlights
· Principal Acquisitions:
· Germany: increased stake in German TV channel Vox bringing total ownership to 99.7 per cent; and acquisition of the outstanding 11 per cent of RTL Television bringing total ownership to 100 per cent
· UK: an additional 11.7 per cent stake in Channel 5, bringing the total stake to 64.6 per cent; and the outright purchase of Talkback Productions
· France: an additional 2 per cent stake in M6, the French television station, bringing the total stake to 42.2 per cent
· Netherlands: purchase of the outstanding 35 per cent of HMG bringing the total stake to 100 per cent
· Completion of the formation of the new Group and its London listing
· Appointment of new unified executive management team under CEO Didier Bellens
· Primary listing for RTL Group shares on London Stock Exchange in addition to the listing on Luxembourg and Brussels stock exchanges
· With audience shares either constant or rising and the overall economic and industry position positive, the outlook for 2000 is very encouraging.
Operational Highlights
· Television: A 22 per cent increase in sales and 45 per cent improvement in EBITA reflecting a strong performance from all of the Group’s television operations. This was achieved through a buoyant advertising climate, the strength of these businesses in their markets, inter-group synergies and finetuning of operating conditions.
· Radio: A 6 per cent increase in sales and 12 per cent increase in EBITA reflecting further strengthening of our leading French radio business, and especially the performance of Fun Radio.
· Content: A 21 per cent increase in sales reflecting a strong performance in France, the UK and the Netherlands offsetting a margin decline in Germany which resulted in EBITA being at similar levels to last year.
· New Media: strongly branded sites recording over 100 million page impressions in August 2000 (against 32 million in January 2000) produced sales of EUR 13 million and an EBITA loss of - EUR 12 million.
RTL proforma sales and EBITA for the six months to 30 June 2000
Sales
| EUR million |
6 months
to June 2000 |
6 months
to June 1999 |
per
cent change |
Year to
December 1999 |
TV |
1,405
|
1,153
|
+22
|
2,346
|
Content |
446
|
369
|
+21
|
849
|
Radio |
121
|
114
|
+6
|
234
|
| New Media |
13
|
-
|
NS
|
-
|
| Others |
43
|
41
|
+ 5%
|
81
|
| RTL Group |
2,028
|
1,677
|
+21
|
3,510
|
EBITA
| EUR million |
6 months
to June 2000 |
6 months
to June 1999 |
per
cent change |
Year to
December 1999 |
TV |
228
|
157
|
+45
|
248
|
Content |
68
|
68
|
-
|
125
|
Radio |
38
|
34
|
+12
|
57
|
| New Media |
(12)
|
0
|
NS
|
(1)
|
| Others |
(6)
|
(42)
|
NS
|
(21)
|
| RTL Group |
316
|
217
|
+46
|
408
|
Didier Bellens, Chief Executive Officer (CEO) of RTL Group said:
"This is an excellent set of half-year results. They demonstrate the strong sales growth potential in our markets, and leave us confident that the newly formed RTL Group will deliver enhanced operating performance in the future. In record time, we have created a unique and powerful business with a clear and consistent strategy, a strong and united management team and a solid base for future growth."
A meeting for analysts and investors will be held at Pearson Television, 1 Steven Street, London W1 at 9.30am. This meeting will be webcast live and can be accessed through RTL Group and Finsbury websites (www.RTL-Group.com and www.finsbury.com). Broadcasters requiring video footage of the Group can contact MediaLink on MEDIALINK Intl. 7 Fitzroy Square, London, W1P 5AH United Kingdom (EU)
Map Link:
http://www.streetmap.co.uk/streetmap.dll?P2M?P=W1P5AH&Z=1
Switchboard Tel. +44 207 554 2700 / Direct Line. +44 207 554 2760
Direct Fax. +44 207 681 3095 / GSM (Mobile/Cell) +44 777 176 1825
Email. jfrost@btinternet.com / jfrost@medialink.com
Internet: http://www.rtl-group.com/
OPERATIONAL REVIEW
TELEVISION
Sales
| EUR million |
6 months
to June 2000 |
6 months
to June 1999 |
per
cent change |
Year to
December 1999 |
Germany |
841
|
699
|
+20
|
1,363
|
France |
184
|
152
|
+21
|
302
|
Netherlands |
178
|
164
|
+9
|
322
|
UK |
137
|
88
|
+56
|
250
|
Others |
65
|
50
|
+30
|
109
|
| TV |
1,405
|
1,153
|
+22
|
2,346
|
EBITA
| EUR million |
6 months
to June 2000 |
6 months
to June 1999 |
per
cent change |
Year to
December 1999 |
Germany |
152
|
114
|
+33
|
189
|
France |
45
|
34
|
+32
|
60
|
Netherlands |
20
|
7
|
+186
|
21
|
UK |
3
|
(2)
|
NS
|
(25)
|
Others |
8
|
4
|
+100
|
3
|
| TV |
228
|
157
|
+45
|
248
|
The Group has consolidated its position in different core markets by acquiring the following stakes:
· Germany: The shareholding in Vox was increased by 74.8 per cent taking the total holding from 24.9 per cent to 99.7 per cent. An additional 11 per cent of RTL Television was acquired and the station is now 100 per cent owned.
· UK: An extra 11.7 per cent was acquired in Channel 5, raising the stake to 64.6 per cent. A 100 per cent shareholding was purchased in the production company Talkback.
· France: The stake in M6 group was increased by 2 per cent to 42.2 per cent.
· Netherlands: The remaining 35 per cent of HMG was acquired taking the total stake now owned to 100 per cent.
During the period, sales in the television businesses grew by 22 per cent to EUR 1,405 million from EUR 1,153 million. Excluding Vox, which was fully consolidated for the first time, sales in the television segment increased by 13 per cent. In France (M6, VCF), Netherlands (RTL4, Veronica, RTL5) and UK (Channel 5), television sales climbed to a total of 499 EUR million. EBITA of the Group's television operations rose by 45 per cent to EUR 228 million from EUR 157 million a year earlier. German operations contributed EUR 152 million, up 33 per cent from EUR 114 million in 1999. HMG, M6, and RTL-TVI in Belgium all made increased contributions and Channel 5 made a positive contribution for the first time. Through the first half of 2000, Vox and RTL Klub in Hungary reached EBITA break even.
The increase in profits in the television segment is due to the buoyant advertising climate and the fact that the strong market positioning of most of RTL Group’s operations enabled them to outperform their markets.
Furthermore, operational gearing combined with an increased focus on operating efficiencies has driven margin growth. The "familiy" strategy e.g. in Germany has also led to revenue growth opportunities and increased co-operation between the stations. Finally, the constant finetuning of operating conditions, e.g. in the Netherlands, contributed to the Group’s profit increase.
RADIO
Sales
| EUR million |
6 months
to June 2000 |
6 months
to June 1999 |
per
cent change |
Year to
December 1999 |
Germany |
6
|
6
|
-
|
12
|
France |
113
|
106
|
+7
|
217
|
Netherlands |
-
|
-
|
-
|
-
|
UK |
2
|
2
|
-
|
5
|
Others |
-
|
-
|
-
|
-
|
| Radio |
121
|
114
|
+6
|
234
|
EBITA
| EUR million |
6 months
to June 2000 |
6 months
to June 1999 |
per
cent change |
Year to
December 1999 |
Germany |
1
|
4
|
NS
|
1
|
France |
37
|
32
|
+16
|
58
|
Netherlands |
-
|
-
|
-
|
-
|
UK |
0
|
(2)
|
NS
|
(2)
|
Others |
-
|
-
|
-
|
-
|
| Radio |
38
|
34
|
+12
|
57
|
Sales in RTL Group’s radio activities rose by 6 per cent to EUR 121 million driven by positive developments in France where the RTL, Fun Radio, and RTL2 stations account for the vast majority of radio segment sales. EBITA in the radio segment increased by 12 per cent to EUR 38 million from EUR 34 million. Fun Radio produced an impressive turnaround to record EUR 1 million EBITA in the period. This compared to a EUR 3 million EBITA loss in the same period a year earlier. Atlantic 252 in the UK also made progress breaking even at the EBITA level compared to a loss of 2 EUR million EBITA a year ago.
CONTENT
Content sales increased by 21 per cent to EUR 446 million from EUR 369 million a year earlier. The content activities increased sales mainly in Germany and UK to EUR 228 million from EUR 179 million and EUR 105 million from EUR 89 million respectively. EBITA in the content segment remained flat at EUR 68 million.
RTL Group acquired 100 per cent of Talkback Productions in June 2000 but did not consolidate it in the first half of 2000.
NEW MEDIA
RTL Group’s websites have shown impressive growth. Monthly page impressions rose to over 100 million in August 2000. Amongst the most visited sites are RTL.de and GZSZ.de ("Gute Zeiten, schlechte Zeiten"), both in Germany, M6.fr in France and Channel5.co.uk in the UK. RTLGroup plans to develop its current stable of 70 branded sites spread throughout Europe, through organic development and acquisition.
RTL Group is well positioned to leverage its strong brands and crosspromotional power into opportunities in the new media field. Strategically RTL Group will aim to deliver content across all platforms. In the first half of the year to June 2000, RTL Group generated sales of EUR 13 million in the new media segment and incurred an EBITA loss of EUR 12 million. This figure will increase as planned in the second half of the year.
FINANCIALS
Income from financing decreased from EUR 36 million a year earlier to EUR 12 million. This was mainly due to the decrease in net cash resulting from acquisitions of stakes in television channels Vox, Channel 5, HMG and M6 as well as of the production company Talkback.
Goodwill amortisation in the first half of 2000 due to:
· the disposal of the Premiere stake in April 1999
· the acquisition of stakes in TV channels and Talkback which occurred during the first six months and did not account for the full half year in terms of goodwill amortisation (e.g. HMG, Talkback).
There was no large disposal in the first half of 2000, unlike 1999, when CLT-UFA sold its 45 per cent stake in Premiere. As a result, the gain from sale of subsidiaries, joint ventures, associates and investments decreased sharply. The disposal of Premiere in 1999 had generated a gross capital gain under IAS of EUR 443 million and EUR 227 after tax.
For the same reason, net earnings decreased from EUR 198 million the year before to EUR 71 million in the first half of 2000.
Adjusted earnings per share increased 16 per cent to EUR 1.07 from EUR 0.92 before goodwill amortisation and the gain or loss (after income tax) from sale of subsidiaries, joint ventures, associates and investments.The difference between the growth rate of EBITA (plus 46 per cent) and earnings per share (plus 16 per cent) was mainly due to the decrease in financial income.
RTL Group’s net cash position as at June 30, 2000 was minus EUR 36 million versus EUR 276 million in the previous year’s period and EUR 363 million as of 30 December 1999. The decrease is due to the acquisition of stakes in TV channels Vox, Channel 5, HMG and M6, and Talkback.
BOARD STRUCTURE
The Board of RTL Group announced that Mr Gaston Schwertzer had resigned as a Board member. He had been the representative of Audiolux, which now holds a 0.84 per cent stake in RTL Group. The Chairman and the Board thanked Mr Schwertzer for his service as a member of the Boards of both the RTL Group and Audiofina.
Mr Onno Ruding, Vice Chairman of Citibank and Minister of Finance in the Netherlands from 1982 to 1989, was appointed new member of the Board.