Media News - Thursday, August 27, 2009

RTL posts loss, forecasts no ad recovery

RTL Group, Europe's largest broadcaster, Wednesday swung to a first-half net loss due to restructuring charges, write-downs on its operations in the UK and start-up losses in Greece. The company said it sees a positive full-year net result, despite forecasting no improvement on advertising markets in the second half. The pan-European broadcaster posted a net loss of €105 million in the six months ended June 30, from a net profit of €338 million a year earlier. RTL's bottom line was dented by a €22 million write-down at its U.K. channel Five and €35 million in startup losses, mainly related to its Greek TV channel Alpha, which it bought last year. Revenue fell 9.6 percent as the slump in advertising markets across Europe persisted. RTL Group said it expects no improvement in advertising markets in the second half and kept its focus on cost cutting. It said that, excluding restructuring costs and other one-off effects, operating costs fell €198 million on the year, as many operations have already reduced their costs by more than 10 percent in the core TV business. Chief Executive Gerhard Zeiler said RTL is open to exploring growth opportunities and reiterated it will invest further in content production and digital activities. Other European free-to-air broadcasters have also felt the full force of the advertising downturn, and have aggressively cut costs in response. (Wall Street Journal)

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