MTG’s sales up 3%, but profits well down
Chris Forrester
21-10-2009


Modern Times Group, perhaps best known for its Viasat free and pay-TV operation, revealed its Q3 results Oct 21. Net sales for the 3 months were up in general 7% y-o-y, and 3% using a constant exchange rate. However, net profits, net income and operating income were all down compared with the same period last year.

Hans-Holger Albrecht, President and Chief Executive Officer, said: “We have delivered continued sales growth and a group operating margin of 12% in the seasonally smallest advertising sales quarter of the year, and despite the global economic recession.” Albrecht said MTG’s policy of having feet in both the pay-TV and free-to-view camps had helped the group.

MTG launched a new free-TV channel – Prima COOL – in the Czech Republic on April 1. The new channel was launched to complement the existing TV Prima channel following the award of new digital licenses as part of the ongoing digitalisation of the Czech TV market.

MTG also launched a new free-TV channel – TV3 PULS – in Denmark on March 23. The broad-based entertainment channel was launched to complement MTG’s existing TV3 and TV3+ channels.

Its Scandinavian free TV broadcast operation saw a 2% drop in net sales, but pay-TV net sales for the Nordic region rose 10%, while its Emerging Markets pay-TV efforts were rewarded with a 26% uplift in net sales.

Viasat’s Scandinavian free-TV operations reported a 2% year on year decline in revenues in the quarter but 2% growth for the year to date. Advertising expenditure levels continued to be down year on year in each of the Scandinavian countries but Viasat delivered further advertising market share gains in both the quarter and for the year to date.

Total operating costs were up 6% year on year to SEK 671 (632) million in the quarter and up 4% to SEK 2,121 (2,040) million for the year to date, which reflected ongoing programming investments and the launch of new channel TV3 PULS in Denmark.

The combined operations therefore reported lower operating profits for both the quarter and the year to date when compared to the same periods of 2008, but healthy operating margins of 15% (21%) and 20% (22%) for the two respective periods and 20% (22%) for the two respective periods.