The Spanish free-to-air commercial TV business’s prospects seem increasingly bleak, according to analyses of the two leading groups in the market by investment bank Berenberg. Berenberg predicts that the overall Spanish advertising market will decline by 4% for the year even with a recovery in the second half.
Berenberg analysts said that Atresmedia, owner of Antena 3, had experienced “a very weak quarter”, reflecting an overall advertising market that was down by 9%.
Berenberg said that the market had performed worse than it expected and that a “nice rebound” in the second half that Atresmedia management had been factoring in “now looks far less likely”.
While content and other non-advertising revenues were down by 6%, compared with a 10% decline in ad revenues for the group, Atresmedia said that content sales were likely to be stronger in the second half. However, Berenberg said that this means that further declines in the ad market could have a negative impact on the full year.
Berenberg predicted “another round of downgrades” and cut its profit forecasts for the group.
The poor first half in the market generally means that Mediaset España also suffered. Berenberg was somewhat more positive about Mediaset España, based on the likelihood of a “modest” improvement in the company’s ad performance in the second half. The analysts expressed a degree of comfort that “at least now estimates are being rebased to expect continuing negative trends rather than a strong rebound”.
Berenberg is also positive about plans for a merger with Mediaset España’s major shareholder Mediaset as part of the latter’s plan to create a single European Netherlands-based media group, which it says “could result in significant value creation”.
Mediaset España posted revenues of €482.5 million for the first half at the end of last week, down 5% year-on-year. adjusted EBITDA was up 2.4% at €163 million.
Atresmedia had earlier posted first-half revenues of €540 million, down 1.9%, and adjusted EBITDA of €104 million, up 2.5%.
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