Coronavirus: RTL Group withdraws dividend proposal and outlook for 2020
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Editor
| 02 April 2020

Joining the plethora of media groups whose corporate trajectory has been jilted by the Covid-19 outbreak, RTL Group has informed the financial community that its Board of Directors has decided to withdraw its recent financial outlook statement.

The RTL board said that the 13 March announcement did not reflect the coronavirus outbreak. It added that given the current economic uncertainty, global economic development and prospects have significantly deteriorated since mid-March, when RTL Group gave its outlook statement. RTL said that it was currently not in a position to provide a new outlook for the full year 2020. While it expects Q1/2020 to be broadly in line with expectations, it conceded that cancellations of advertising bookings and postponements of productions will negatively impact the Group’s results in the coming months.

Looking at an action plan, RTL Group revealed that in such unprecedented circumstances as it found itself in, the preservation of liquidity was an essential precaution to safeguard the Group’s present operations and future prospects. The RTL board has decided to withdraw its earlier proposal of a €4.00 per share dividend in respect of the fiscal year 2019. No dividend will now be proposed to the annual meeting of shareholders on 30 June 2020.

That notwithstanding, RTL assured that its three-priority strategy – core, growth, alliances and partnerships – remained unchanged and that it was maintaining its mid-term targets for the TV Now and Videoland streaming services for Germany and the Netherlands respectively. In addition it was sticking to the targets set on 13 March 2020, namely, to grow its total number of paying subscribers to between 5 and 7 million, to grow streaming revenue to at least €500 million and to break even by 2025.

Given that RTL Group’s businesses are part of a country’s critical infrastructure, the company has activated business continuity plans across its footprint. These steps have been taken to ensure that the Group’s TV channels and radio stations continue their activities and include the implementation of counter measures to reduce costs and preserve liquidity. RTL Group has low levels of debt and significant, unused and committed Bertelsmann credit facilities with no maturities before 2023.