RTL GROUP : reports significant profit growth

RTL Group reports significant profit growth

• In the first nine months of 2013, RTL Group grew its EBITA 6.4 per cent to €714 million, while net profit was up 41.2 per cent to €535 million
  
  
• A promising start to the seasonally important fourth quarter

Luxembourg, 12 November 2013 - RTL Group, the leading European entertainment network, announces its results for the nine months ending 30 September 2013.

Highlights

In € million	January to September 2013	January to September  2012	Per cent change
Revenue	4,048	4,111	(1.5)
Underlying revenue1	4,065	4,111	(1.1)
Reported EBITA2	714	671	+6.4
Reported EBITA margin (%)	17.6	16.3
Reported EBITA	714	671
Reversal of/(loss on) impairment of investment in associates	72	(10)
Amortisation and impairment of fair value adjustments on acquisitions of subsidiaries and joint ventures	(7)	(8)
Gain/(Loss) from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree	5	(1)
EBIT	784	652
Net financial income/(expense)	16	(11)
Income tax expense	(207)	(192)
Profit for the period from continuing operations	593	449
Loss for the period from discontinued operations	-	(1)
Profit for the period	593	448
Attributable to:
Non-controlling interests	58	69
RTL Group shareholders	535	379	+41.2
Basic EPS continuing operations (in €)	3.48	2.48
Basic EPS discontinued operations (in €)	-	(0.01)
Reported EPS (in €)	3.48	2.47

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Regulated information. The figures presented in the interim management statement are unaudited
1Adjusted for scope changes and at constant exchange rates
2 EBITA (continuing operations) represents earnings before interest and taxes excluding impairment of goodwill and of disposal group, and amortisation and impairment of fair value adjustments on acquisitions of subsidiaries and joint ventures, reversal of/(loss on) impairment of investment in associates, re-measurement of earn-out arrangements and gain or loss from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree

RTL Group outperforms challenging market conditions

• Advertising market conditions remained challenging in the first nine months of 2013, in line with local macro-economic developments in Europe. Across the Group's larger markets, RTL Group estimates that only the German TV advertising market was stable (+0.1 per cent), while all other markets were down. Accordingly, reported Group revenue decreased slightly to €4,048 million (January to September 2012: €4,111 million) • Reported EBITA of €714 million, up 6.4 per cent, primarily driven by Mediengruppe RTL Deutschland• EBITA margin improved to 17.6 per cent (January to September 2012: 16.3 per cent)• Net profit attributable to RTL Group shareholders increased significantly by 41.2 per cent to €535 million (January to September 2012: €379 million). The increase reflects higher operating profit and a reversal of a 2012 impairment, totalling €72 million, on RTL Group's shareholding in the Spanish broadcasting company Atresmedia (formerly Grupo Antena 3). This reversal was already announced in the Group's half-year results end of August 2013• Net cash from operating activities was €694 million, resulting in an operating cash conversion of 110 per cent• Following the payment of an extraordinary interim dividend of €387 million on 5 September 2013, RTL Group had net financial debt of €451 million as of 30 September 2013 (30 June 2013: €224 million). In September, RTL Group exercised its put option to sell its 7.5 per cent shareholding in Russia's National Media Group; in the framework of this put option, RTL Group received a payment of €81 million

Solid results from all profit centres

• During the first nine months of 2013, EBITA of Mediengruppe RTL Deutschland increased significantly, by 9.0 per cent, to €399 million (January to September 2012: €366 million). This improvement was driven by a combination of higher revenue and continued cost discipline• In a declining French TV advertising market, estimated to be down 5.2 per cent in the first nine months, Groupe M6 continued to outperform and increase its market share. The company's EBITA was only slightly down to €154 million (January to September 2012: €161 million), mainly due to anticipated start-up losses for the digital channel 6ter, launched in December 2012• RTL Nederland's EBITA increased by 5.5 per cent to €58 million (January to September 2012: €55 million), mainly driven by higher digital distribution revenue• FremantleMedia's EBITA decreased to €77 million (January to September 2012: €82 million). Excluding the positive one-off effect in Q3/2012 resulting from the sale of a building in London, FremantleMedia's EBITA would have been up year-on-year

Q3/2013: Slight improvement of TV advertising market conditions

• The summer holiday season means that the third quarter is the weakest in terms of RTL Group's trading patterns • In the third quarter of 2013, reported Group revenue decreased by 2.1 per cent to €1,269 million (Q3/2012: €1,296 million), while reported EBITA was €162 million (Q3/2012: €165 million). Excluding the positive one-off effect in Q3/2012 resulting from the sale of a building in London, RTL Group's EBITA would have been up year-on-year by 7.3 per cent• TV advertising market conditions across Europe improved in the third quarter. The rates of decline slowed compared to the first half of the year. The German TV advertising market showed slight growth year-on-year

Highlights from RTL Group's operations

RTL Group continues to make good progress across its strategic fields: broadcast, content and digital.

Broadcast: investments in existing businesses and high-growth Asian markets

• New TV channels in Europe strengthen RTL Group's family of channels: RTL Hrvatska will launch its new children's and family channel, RTL Kockica, in winter 2013• International expansion focused on growth markets: RTL Group's partnership with CBS Studios International, announced in August 2013, is advancing. The first channel - RTL CBS Entertainment HD - is already on air in Malaysia, Thailand, Singapore and the Philippines

Content: enduring appeal of talent shows complemented by successful new format launches

• FremantleMedia's major talent shows - Got Talent, Idols and The X Factor - remained highly popular with audiences worldwide, being produced in more countries than ever before• FremantleMedia continues to invest in intellectual property. In 2013, the company launched 39 new formats - up 25 per cent year-on-year• FremantleMedia has strengthened its scripted business and Nordic footprint by acquiring a 51 per cent stake in Miso Film. The Danish independent production company is focused on high end prime-time TV series and films for the Scandinavian and larger European markets

Digital: leading presence in online video

• In September 2013, FremantleMedia acquired a minority stake in Divimove, the second largest Multi-Channel Network (MCN) on Youtube in Germany, with the potential of further investments in the future.  This strengthens RTL Group's position as the fourth largest MCN operator globally• RTL Group developed its strong and rapidly growing presence across all digital platforms. In the first nine months of 2013:o RTL Group's catch-up TV services and websites, including the Youtube MCN Broadband TV, attracted a total 10.1 billion online video views, up 122 per cent year-on-yearo FremantleMedia's 135 Youtube channels attracted 4.6 billion views, up 77 per cent year-on-yearo Online video advertising was up 53 per cent in Germany, 20 per cent in France, and 33 per cent in the Netherlands year-on-year

"We're executing our strategy from a position of strength"

Joint statement from Anke Schäferkordt and Guillaume de Posch, Co-Chief Executive Officers of RTL Group:

"With leading market positions, RTL Group is delivering strong and sustainable profits and cash flows, creating significant value for its shareholders. Performance in Germany has been particularly strong and our other businesses are resilient in facing the challenging economic conditions. 

We have had a promising start to the seasonally important fourth quarter. Looking to the rest of the year, we are confident of delivering more than €1 billion in EBITA for the full year of 2013.

We're executing our strategy from a position of strength, and making clear progress around our three pillars - broadcast, content and digital. From prudent levels of cash investment we have developed a series of initiatives that open up new sources for future growth.

More than two billion online video views per month make RTL Group the number one European media company in online video. With strong organic growth plus continued investments in the digital space, we see significant potential for extending this position further."

The interim financial report, slides from the analyst presentation and an MP3 file of the analyst conference call will be available to download at:

www.rtlgroup.com/results_q3_2013.aspx

For further information please contact:

About RTL Group
RTL Group is the leading European entertainment network, with interests in 54 television channels and 28 radio stations and content production throughout the world. 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 - the company also operates the joint venture channels RTL CBS Entertainment HD in Southeast Asia and Big RTL Thrill in India. 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, the Netherlands, Spain and Luxembourg. RTL Group's content production arm, FremantleMedia, is one of the largest international creators, producers and distributors of multi-genre content outside the US. With operations in 22 countries, FremantleMedia's comprehensive global network creates over 9,200 hours of programming a year and distributes over 20,000 hours of content worldwide. Combining the catch-up TV services of its broadcasters, the newly acquired Multichannel Network Broadband TV and FremantleMedia's more than 100 Youtube channels, RTL Group has become the leading European media company in online video.