CLT-UFA announces a sharp rise in profitability in core businesses and heavy investments in new projects
CLT-UFA Luxembourg, February 19, 1998,
CLT-UFA, Europe's leading broadcasting Group, has raised already substantial investments in new TV projects and increased its profitability in major core businesses. This was the key message of today's Board of Directors, where the Management Board of CLT-UFA presented its estimated consolidated results for 1997. Due to heavy investments, CLT-UFA reported an unaudited net group loss of LUF 2.9 billion in 1997, the first year following the merger, compared to a LUF 3.4 billion profit in 1996. The Board of Directors stated that the losses were in line with expectations and welcomed the Group's growth-oriented strategy.
The Board of Directors agreed unanimously on the Group's budget for 1998. The profitability of CLT-UFA's core businesses will continue to increase more than 50% to an estimated LUF 7 billion, driven by the projected performance of RTL Television and other main profit centers. In addition, CLT-UFA will heavily invest in Premiere's digital pay-TV venture. This investment and other start-up losses will lead to an expected loss of LUF 8 billion in 1998. Nevertheless, CLT-UFA expects a good performance from its investments and double-digit growth in turnover compared to 1997. The shareholders will support the development of the company.
In 1997, CLT-UFA set up a growth-oriented portfolio - its strategy of expansion has allowed major investments in development, while the profitability of core businesses continued to increase:
RTL Television confirmed its leading position in viewership and increased its profitability by an estimated 20%. This trend is set to increase further in 1998
M6 reached a full-year overall household audience share of 13.2% compared with 12.5 % in 1996
RTL remained market leader in French radio by far, with an average audience share of 19.1% in 1997 (18.8% in 1996)
All other core business, including RTL TVI, RTL 2, German radio, Luxembourg activities, production, fiction and sports rights trading, continued to do well. Restructuring measures at HMG in the Netherlands are paying off.
At the same time, CLT-UFA continued to expand with two successful channel launches:
Channel 5, launched on March 30, 1997, reported a performance in line with forecasts
RTL KLUB, launched on October 27, 1997, appears to have established itself as a serious contender in Hungarian media with a market share of about 20%.
With 1.6 million subscribers, Premiere had a challenging but successful year, and the company is currently awaiting the decision of the European Commission to continue its involvement in German digital pay TV. TPS turned in an outstanding performance in 1997, with 350,000 subscribers at the end of the year.
CLT-UFA holds shares in 44 radio and TV stations all over Europe, most of them market leaders (e.g., RTL in France, RTL Television in Germany, RTL TVI in Belgium and HMG in the Netherlands).