13 March 2019, Luxembourg
Luxembourg, 13 March 2019 − RTL Group announces its audited results for the year ended 31 December 2018.
RTL Group reports record revenue for the fourth consecutive year
Q4/2018: Digital businesses and Fremantle drive fourth quarter revenue
Segments10: all major business units made strong full-year EBITDA contributions
“Total Video 2.0 means building local streaming champions and strengthening our content creation.”
Bert Habets, Chief Executive Officer of RTL Group, says:
“With rapidly changing consumer behaviour and the rise of global tech giants and streaming platforms, we’ve moved from a local to a global competitive landscape. At the same time, international media markets are experiencing unprecedented change and consolidation. This is why 2018 saw the start of our transformation journey to foster organic growth within our portfolio, through our Total Video 2.0 strategy.
With this strategy we will focus on two clear priorities: building local streaming champions and strengthening our content creation. Accordingly, RTL Group will invest at least an additional €350 million to boost the expansion of our streaming services over the next three years – €300 million of which will be dedicated to content investments across all genres. As our streaming services are deeply integrated in our families of TV channels, these investments will generate sizeable additional revenue and will thus have limited impact on our operating profit. Every investment in local, exclusive content is an investment for the long run, strengthening both our linear TV channels and streaming services. In other words: we will continue to generate very healthy profit margins.
At the end of 2018, RTL Group passed the first million mark of paying subscribers, combining the subscriber bases of TV Now Premium in Germany and Videoland in the Netherlands. We plan to start similar services in other countries. Over the next three years, we aim to grow our total number of paying subscribers to at least 3 million. Our streaming services already show very promising growth rates in a highly dynamic market – thus we will always have the flexibility to further increase our ambitions in this space. This growth will help to further diversify RTL Group’s revenue streams.
With Fremantle we continue our push into drama production. As drama series are also key for the expansion of our streaming services, we have developed an ambitious growth plan for scripted series. Based on this growth plan, international drama productions are forecast to generate more than €500 million in revenue in 2021.”
Elmar Heggen, Chief Financial Officer of RTL Group, comments:
“For 2018 we once again report record revenue and strong EBITDA results. RTL Group’s digital revenue continues to grow dynamically, and we reached our target – that at least 15 per cent of the Group’s total revenue originates from digital – clearly ahead of time. To provide highly transparent financial information and guidance for the capital markets, we now disclose additional figures on our digital activities, as well as new concrete goals and ambitions for our focus areas: video-on-demand and content.
Despite new ambitions and goals that will require significant investments, RTL Group confirms its dividend policy as we have the strength to provide attractive dividend payments to our shareholders. The Group stands for an excellent earnings profile and high cash generation. That is why the Board of Directors has once again decided to propose to the AGM a final dividend of €3.00 per share on top of the interim dividend of €1.00 per share paid in September 2018.”
Strengthening video-on-demand services
Developing more exclusive content
Outlook
RTL Group is reverting back to guidance on EBITA in its outlook statement. The Group believes this will provide a better operational KPI than continuing to use EBITDA. The Group notes that the analyst community continues to use EBITA – some on an exclusive basis – as the main KPI for the Group’s profitability. Reverting back to EBITA will therefore align the Group’s guidance to the expectations of the investment community. In addition, the Group’s EBITDA will be affected by the new IFRS 16 (Leases) standard from 2019 onwards. Both EBITDA and EBITA will continue to be reported on for the Group’s business segments. As outlook guidance will revert back to EBITA, RTL Group will also comment primarily on EBITA as the KPI for operating profit in 2019.
Financial Review
In € million |
2018 |
2017 |
Per cent change |
Revenue |
6,505 |
6,373 |
+2.1 |
Underlying revenue14 |
6,516 |
6,339 |
+2.8 |
EBITDA15 |
1,380 |
1,464 |
(5.7) |
EBITDA margin (per cent) |
21.2 |
23.0 |
|
EBITA |
1,171 |
1,248 |
(6.2) |
EBITDA |
1,380 |
1,464 |
|
Impairment losses of goodwill |
(105) |
– |
|
Impairment of investments accounted for using the equity method | (2) | (6) | |
Depreciation, amortisation and impairment |
(224) |
(233) |
|
Re-measurement of earn-out arrangements and gain/(loss) from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree |
|
|
|
EBIT16 |
1,076 |
1,246 |
|
Net financial expense |
(13) |
(24) |
|
Income tax expense |
(278) |
(385) |
|
Profit for the year |
785 |
837 |
|
Attributable to: |
|
|
|
Non-controlling interests |
117 |
98 |
|
RTL Group shareholders |
668 |
739 |
|
Reported EPS (in €) |
4.35 |
4.81 |
|
1Adjusted for scope changes and at constant exchange rates
2EBITDA for the year 2017 adjusted for the significant positive one-off effect from the sale of RTL Group’s buildings in Rue Bayard, Paris (+€94 million in 2017)
3“Digital” refers to the internet-related activities with the exception of online sales of merchandise (“e-commerce”). Digital revenue spreads over the different categories of revenue, i.e. other advertising sales, revenue from distribution and licensing of content, consumer and professional services
4Revenue generated across all distribution platforms (cable, satellite, IPTV) including subscription and re-transmission fees
5See note 3 to the Consolidated Financial Statements in the RTL Group Annual Report 2018
6See note 3 to the Consolidated Financial Statements in the RTL Group Annual Report 2018
7See note 3 to the Consolidated Financial Statements in the RTL Group Annual Report 2018
8See note 3 to the Consolidated Financial Statements in the RTL Group Annual Report 2018
9Frankfurt Stock Exchange
102017 comparatives have been re-presented as if the following transfers had occurred on 1 January 2017:
• The transfer of the international activities of Smartclip from Mediengruppe RTL Deutschland to SpotX (shown in ‘Other segments’);
• The transfer of Smartclip Benelux from Mediengruppe RTL Deutschland to RTL Nederland
11As at 31 December 2018 compared to 31 December 2017
12As at 31 December 2018 compared to 31 December 2017
13OTT only
14Adjusted for scope changes and at constant exchange rates
15See note 3 to the Consolidated Financial Statements in the RTL Group Annual Report 2018
16See note 3 to the Consolidated Financial Statements in the RTL Group Annual Report 2018
Communications & Investor Relations
Oliver Fahlbusch
Executive Vice President
Communications & Investor Relations
RTL Group
T.: +352 / 24 86 5200
Communications & Investor Relations
Irina Mettner-Isfort
Senior Director
Media & Investor Relations
T.: +49 221 456-56410
E: irina.mettner.isfort@rtlgroup.com
About RTL Group
RTL Group is a leader across broadcast, content and digital, with interests in 60 television channels, eight video-on-demand platforms and 30 radio stations. RTL Group also produces content throughout the world and owns several rapidly growing digital video businesses. The television portfolio of Europe’s largest broadcaster includes RTL Television in Germany, M6 in France, the RTL channels in the Netherlands, Belgium, Luxembourg, Croatia, Hungary and Antena 3 in Spain. RTL Group’s families of TV channels are either the number one or number two in eight European countries. The Group’s flagship radio station is RTL in France, and it also owns or has interests in other stations in France, Germany, Belgium, Spain and Luxembourg. RTL Group’s content production arm, Fremantle, is one of the largest international creators, producers and distributors of scripted and unscripted content in the world. Fremantle has an international network of production teams, companies and labels in over 30 countries, producing over 12,700 hours of original programming and distributing over 20,000 hours of content worldwide. Combining the on-demand services of its broadcasters, the multi-platform networks BroadbandTV, StyleHaul, Divimove, United Screens and Fremantle’s more than 300 YouTube channels, RTL Group has become the leading European media company in online video. RTL Group also owns the advanced video ad serving platform SpotX. For more information, please visit RTLGroup.com and follow RTL Group on Twitter @rtlgroup.
RTL Group – Entertain. Inform. Engage.