News Column

NRJ GROUP - Press release first half results 2014

July 31, 2014

PR Newswire/Les Echos/ Paris, 30 July 2014 2014 half-year earnings * All-time record audience figures for NRJ radio, France's number 1 radio station(1). * Limited contraction in revenues and current EBIT before dissimilar barters and excluding "1789 Les Amants de la Bastille", -4.4% and -5.0% respectively. * Significant reduction in current operating losses for NRJ 12. * Strong growth in profitability for the Broadcasting division and International Business. 6 months to 30 June - in million euros 2014 2013(R) Change Revenues excluding dissimilar barters 181.5 208.9 -13.1% Revenues including dissimilar barters 183.4 211.3 -13.2% Current EBIT excluding dissimilar barters 15.4 18.1 -14.9% Current EBIT 15.2 18.0 -15.6% Net income Group share 8.9 10.2 -12.7% In million euros 30 Jun 31 Dec Change 2014 2013(R) Net cash position* 101.8 102.6 -0.8% Shareholders' equity (Group share) 510.7 513.8 -0.6% * Current cash net of current and non-current financial liabilities (R): In accordance with IFRS 11, backdated to 1 January 2013, the companies that were previously proportionately consolidated are now consolidated on an equity basis; the figures for the first half of 2013 have therefore been restated In relation to the data presented when publishing 2013 first-half revenues and 2013 first-half earnings. The application of this standard has not had any material impact on the Group's consolidated revenues or consolidated current EBIT. The Group's consolidated revenues excluding dissimilar barters came to 181.5 million euros for the first half of 2014, compared with 208.9 million euros for the first half of 2013, down -13.1% (-13.0% on a comparable basis and at constant exchange rates). The first half of 2013 was marked by the success of the musical "1789 Les Amants de la Bastille". Excluding "1789", revenues for the first half of 2014 are down -4.4% compared to the first half of 2013, with an improvement in the trend during the second quarter (-3.9%) compared with the first quarter of this year (-5.0%). The Group's current EBIT (excluding dissimilar barters) came to 15.4 million euros for the first half of 2014, down -14.9% (-16.8% on a comparable basis and at constant exchange rates). Excluding "1789 Les Amants de la Bastille", the current EBIT before dissimilar barters for the first half of 2014 is down -5.0% compared to the first half of 2013. The Group's first-half earnings reflect the intrinsic qualities of its business model (resilience, flexibility and responsiveness of the operational structure). After taking into consideration 0.6 million euros in financial income, as well as the 6.2 million euro income tax charge, the positive share in income from affiliates for 0.5 million euros, and a 0.1 million euro share attributable to minority interests, net income Group share for the first half of 2014 totalled 8.9 million euros, versus 10.2 million euros for the first half of 2013. As of 30 June 2014, the net cash position represented 101.8 million euros, down 0.8 million euros from 31 December 2013. (1) MÉdiamÉtrie 126,000 Radio, April-June 2014, Monday to Friday, 13 year olds and over, 5am-midnight or timeslots indicated - Year-on-year change April-June 2014 wave compared with April-June 2013. NRJ aggregate audience: 6,880,000 listeners Breakdown of revenues and current EBIT (excluding barters) for each business: 6 months to 30 June In million euros 2014 2013(R) Change Music Media and Events 92.3 98.9 -6.7% Television 38.0 41.9 -9.3% International Business 19.6 19.0 +3.2% Shows and Other Productions 2.2 22.4 -90.2% Broadcasting 29.4 26.7 +10.1% Revenues excluding dissimilar barters 181.5 208.9 -13.1% Dissimilar barters 1.9 2.4 -20.8% Revenues including dissimilar barters 183.4 211.3 -13.2% 6 months to 30 June 2014 2013(R) Change In million euros Music Media and Events 16.1 22.6 -28.8% Television (14.6) (17.7) NA International Business 5.0 4.3 +16.3% Shows and Other Productions 0.5 3.3 -84.8% Broadcasting 10.2 7.3 +39.7% Other business (1.8) (1.7) NA Current EBIT excluding dissimilar barters 15.4 18.1 -14.9% Income from dissimilar barters (0.2) (0.1) NA Current EBIT 15.2 18.0 -15.6% (R): In accordance with IFRS 11, backdated to 1 January 2013, the companies that were previously proportionately consolidated are now consolidated on an equity basis; the figures for the first half of 2013 have therefore been restated In relation to the data presented when publishing 2013 first-half revenues and 2013 first-half earnings. The application of this standard has not had any material impact on the Group's consolidated revenues or consolidated current EBIT. * Music Media and Events 51% of Group revenues During the first half of 2014, the Music Media and Events business generated 92.3 million euros in revenues, down -6.7% from 98.9 million euros in the first half of 2013. For the Radio business alone, revenues contracted by -6.3%. The outstanding audience results associated to commercial actions paved the way for the radio business to return to revenue growth in June. However, the performance from the beginning of the half-year period was not made up for by these initial signs of improvements. As a result, current EBIT excluding dissimilar barters came to 16.1 million euros for the Music Media and Events business, compared with 22.6 million euros for the first half of 2013. According to MÉdiamÉtrie's latest audience survey from April to June 2014, NRJ Group (NRJ, Nostalgie, ChÉrie FM and Rire & Chansons) had more than 12.4 million daily listeners(2), confirming its position as France's leading private radio offering. From April to June 2014, the NRJ radio station gained 358,000 new daily listeners(3) year-on-year and consolidated its position as France's number 1 radio station in terms of aggregate audience figures. In June 2014, NRJ confirmed its position as France's number 1 webradio brand(4), with more than 24 million active listening sessions over 30 seconds. With its selection of 220 webradio and 33 million active listening sessions in France (42 million active listening sessions in France and internationally), NRJ Group (NRJ, Nostalgie, ChÉrie FM and Rire et Chansons) is still the webradio market leader in France. MÉdiamÉtrie 126,000 Radio, April-June 2014, Monday to Friday, 13 year olds and over, 5am-midnight or timeslots indicated (2) NRJ GROUP aggregate audience: 12,368,000 listeners (3) Aggregate audience (4) Source: OJD, global webradio broadcasting, June 2014. Active sessions (or active listening sessions): total number of listening sessions for a webradio, opened for 30 seconds or more, all connection locations (France + internationally) and all devices NRJ.fr has also consolidated its leading position among music radio sites, with 1.7 million unique visitors per month(5). Lastly, NRJ is still the number 1 radio brand for smartphones, with nearly 780,000 unique visitors per month(6). * Television 21% of Group revenues The Television business recorded 38.0 million euros in revenues for the first half of 2014, compared with 41.9 million euros for the first half of 2013, down -9.3% in a still highly competitive advertising market. Despite this difficult environment, NRJ Group successfully reduced its losses in terms of current EBIT excluding dissimilar barters by 3.1 million euros to 14.6 million euros during the first half of 2014, while continuing to further strengthen its identity-building brands. The Television business' operating margin factors in the investments made in ChÉrie 25 as a result of the increased broadcasting costs linked to the deployment of HD DTTV across France. NRJ 12's costs have continued to be kept strictly under control, making it possible to benefit from a more profitable programming schedule, resulting in a significant improvement in its profitability. During the first half of 2014, NRJ 12 consolidated its fourth place ranking among all DTTV channels with its three priority targets, i.e. all viewers aged four and over, with a 2.1% audience share, as well as 25 to 49 year olds, with a 2.6% audience share, and women under 50 in charge of purchases, with a 2.9% audience share(7). Each day, the channel is watched by nearly 8.6 million viewers(8). The prime time strategy that was rolled out is continuing to deliver benefits, with the arrival of new programmes (Knight Rider : Le Retour de K2000, SOS ma Famille a besoin d'aide, Les People Passent le Bac, Les Animaux font leur Show...), further strengthening the existing schedule alongside identity-building productions. All audiences combined, CHERIE 25 has an audience share of 0.3%, up +0.1 points year-on-year(9). CHERIE 25 has continued to perform well for women aged 25 to 49, with its audience share growing +0.2 points year-on-year to reach 0.6%(9). The channel has the highest level of affinity among all the free channels with women aged 15 and over, who make up 72% of its viewers (0.4% of its audience share)(10). Each day, the channel is watched by more than 2.2 million viewers(8). Lastly, NRJ HITS has confirmed its strong leading position among music channels in the Cable-Satellite-ADSL sector for all audience indicators(11). Each month, the channel is watched by more than 5.7 million viewers(12). NRJ HITS is the top-ranking music channel for all the standard targets published by MÉdiamÉtrie(13). On 20 March 2014, the NRJ Group submitted a request to return frequency to the French audiovisual supervisory authority (CSA) for its NRJ Paris channel. This was approved on 14 May and the channel stopped broadcasting at midnight on 30 June 2014. The costs involved with this closure have been allocated in full to non-recurring expenses for the first half of 2014. (5) Source: MÉdiamÉtrie/Netratings, unique visitors for nrj.fr domain, April 2014 (6) Source: OJD, Mobile application rankings, June 2014 Source MÉdiamÉtrie, MÉdiamat, Consolidated audience from 30 December 2013 to 29 June 2014, 03:00-27:00, extrapolated average rate, extrapolated aggregate rate and audience share, Monday to Sunday, 4 year olds and over and targets indicated (7) Audience share (8) Extrapolated aggregate rate, viewing threshold 10 consecutive seconds (9) Audience share, change for first half of 2014 versus first half of 2013 (10) Average rate structure as a % (11) Extrapolated average rate, extrapolated aggregate rate, audience share and monthly coverage, wave 27 (complete), January-June 2014 (12) Monthly coverage, viewing threshold 10 consecutive seconds (13) Extrapolated average rate 4+ * International Business 11% of Group revenues International Business revenues came to 19.6 million euros for the first half of 2014, up +3.2% from 19.0 million euros in the first half of 2013, thanks in particular to business growth in Germany and Belgium. Current EBIT excluding dissimilar barters is up +16.3% to 5.0 million euros, continuing the ongoing trend for growth that began in 2011. * Shows and Other Productions 1% of Group revenues The Shows and Other Productions division recorded 2.2 million euros in revenues for the first half of 2014, compared with 22.4 million euros for the first half of 2013. This significant contraction in revenues reflects the end of the musical "1789 Les Amants de la Bastille" following its final performance on 5 January 2014. As a result, current EBIT before dissimilar barters came to 0.5 million euros for the first half of 2014, compared with 3.3 million euros for the first half of 2013. * Broadcasting 16% of Group revenues The Broadcasting business has continued to develop, particularly on the DTTV market, with sustained profitable growth. Consolidated revenues excluding dissimilar barters are up 10.1% to 29.4 million euros for the first half of 2014. Current EBIT excluding dissimilar barters climbed 39.7% to 10.2 million euros, significantly higher than the 7.3 million euros reported for the first half of 2013. During the first half of 2014, towerCast "turned on" 260 new DTTV points of service and now offers nearly 2,300 broadcasting services on the primary and secondary networks, representing a market share of around 19%. Alongside this, towerCast acquired the LagardÈre group's radio self-broadcasting activities on 5 June 2014, with its portfolio now including nearly 200 new FM points of service - representing a 15% increase in the number of points of service - and 70 additional sites. This operation will make it possible to establish the trust-based relationship between LagardÈre Active and towerCast for the long term. At the end of June 2014, towerCast offered more than 1,650 radio points of service, with a private FM broadcasting market share of nearly 26%. Recent developments and outlook The Group is confident that it will be able to continue developing its business: * The strong level of audiences guaranteed by stable editorial lines is expected to enable the positive Radio revenue trend seen in June to continue over the second half of the year in France. However, the delay compared with the same period in 2013 will not be made up for during the second half of this year. * In the Television division, the Group is continuing to develop its differentiating editorial lines and its investments in CHERIE 25, while keeping its costs effectively under control. * Internationally, the Group is continuing to build on the work accomplished to date with a view to increasing the division's operating margin. * For the Broadcasting business, the Group's organic development is continuing on both Radio, with Radio France (invitations to tender launched), and DTTV, with the deployment of the R7 and R8 multiplex (phases 7 to 9). Additional information - The condensed consolidated financial statements for the first half of 2014 were approved by the Board of Directors on 30 July 2014. The procedures for a limited review of the condensed consolidated accounts have been completed. The statutory auditors' report will be issued once the necessary procedures have been finalised for filing the half-year financial report. - The French version of the 2014 half-year financial report will be available on the Group's website www.nrjgroup.fr by 31 July 2014 at the latest. Next date The Group will be releasing its third-quarter financials on 5 November 2014 (press release published after close of trading on the Paris stock exchange). About NRJ GROUP NRJ GROUP is one of the leading private media groups in France and an international player present in 13 other countries, either directly or under brand licensing agreements with NRJ/ENERGY, the number one international radio brand, and/or NOSTALGIE/NOSTALGIA. In France, the Group is the private radio market leader and one of the new players on the television market. The Group is also a significant player on the radio broadcasting market, through its subsidiary towerCast, number two on the French broadcasting market. NRJ GROUP is a publisher, producer and broadcaster, and markets its own media spaces. For several years, it has been supported by the strength of its radio media and its NRJ, NOSTALGIE, CHERIE FM and RIRE & CHANSONS brands, as well as its marketing expertise and commercial capabilities for deploying new media, particularly on television, or new means of consuming its media offer, especially online, and related activities around partnerships in order to follow and anticipate consumer developments, while offering a wider range of advertising services for its customers. NRJ GROUP shares are listed on the Euronext market in Paris (Compartment B). Codes - ISIN: FR00012169; Reuters: SONO.PA; Bloomberg: NRG FP. Analyst and Investor Information NRJ GROUP - Financial Communications, 46-50 avenue ThÉophile Gautier, 75016 Paris, France www.nrjgroup.frcomfinance@nrj.fr NRJ GROUP - French limited company (sociÉtÉ anonyme) with a capital of 810,815.35 euros - SIREN trade register number 332 036 128 PARIS Registered office: 22 rue Boileau, 75016 Paris, France The content and accuracy of news releases published on this site and/or distributed by PR Newswire or its partners are the sole responsibility of the originating company or organisation. Whilst every effort is made to ensure the accuracy of our services, such releases are not actively monitored or reviewed by PR Newswire or its partners and under no circumstances shall PR Newswire or its partners be liable for any loss or damage resulting from the use of such information. All information should be checked prior to publication.




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