MTG Q1 Profits Up 63 Percent

STOCKHOLM: On revenues that were up to SEK3.1 billion ($494.3 million), Modern Times Group’s net profit increased by 63 percent to SEK490 million ($77.5 million).

“Our Q1 sales and operating profits are at record levels following 10-percent sales growth at constant exchange rates and a 15-percent increase in operating income excluding associates," said Hans-Holger Albrecht, MTG’s president and CEO. "All of our business segments delivered sales growth at constant exchange rates and the group operating margin increased to 14 percent excluding associates."

He continued, “The Scandinavian TV advertising markets have continued their strong development with price increases in each country, which enabled us to generate 11-percent sales growth at constant exchange rates and a 25-percent operating margin for our free-TV business, whilst our Nordic pay-TV Nordic business grew its sales by 10 percent at constant exchange rates and delivered an increased margin of 19 percent. The recovery in advertising spending in the emerging markets is lagging and, with the exception of the Baltics, we are yet to see a return to sustained market growth, but we are taking market share in almost all of our operating territories. At the same time, the profits that we are making in our emerging markets wholesale pay-TV channel business, which now has over 58 million subscriptions, are being reinvested into the development of our exciting new satellite platforms in Ukraine and Russia, which are developing according to plan. Our content is today more broadly available than ever and we have the largest geographical broadcast footprint in Europe. Our 28 free-TV channels in 11 countries, 38 pay-TV channels in 32 countries, and satellite platforms in 9 countries, attract a total of 125 million viewers. In the first quarter alone, we launched a new free-TV channel in the Czech Republic, introduced several new HD channels and produced the first live 3D broadcast of a sports event in Scandinavia, launched four new pay-TV channels in Africa, and fully introduced our Viaplay online on-demand video streaming service that is available to any web-connected device in Scandinavia.

Albrecht concluded, “All in all then, we are on track with our strategic objectives and are maintaining our discipline of investing in long term and profitable growth. We have a healthy financial position and have used our cash flows to invest in our existing operations, expand into new areas, further reduce our already low gearing levels, and propose an increased annual dividend. We continue to review opportunities to enhance our competitive market positions and enter attractive new markets.”