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Mediaset sees revenues slide and profits rise, marks progress on MFE

Mediaset has posted increased profits on reduced revenues in the first half, with the top line hit by the loss of pay TV revenues from Mediaset Premium and lower advertising sales in both Italy and Spain. Costs were also down due to the absence of the 2018 World Cup and the loss of football rights in Italy.

Few Italian shareholders meanwhile appear to have exercised withdrawal rights related to the company’s planned merger with Mediaset España and the creation of a new holding company, MediaForEurope (MFE), based in the Netherlands

The broadcaster reported revenues of €1.482 billion for the first half, down from €1.804 million last year. In Italy, revenues dropped from €1.297 billion to €1.002 billion due to lower Premium subscription revenues. Spanish revenues were down from €508 million to €482 million on lower ad sales.

In Italy, Mediaset’s revenues were also hit by the loss of advertising revenues from free-to-air coverage of Champions League football as well as the loss of Serie A rights.

Operating costs fell from €1.681 billion to €1.291 billion, with the absence of costs related to the 2018 World Cup a major factor, as well as costs associated with pay TV football contracts.

The good news for Mediaset was that EBIT was up 55% to €191.6 million, While EBIT in Spain rose marginally, in Italy the group turned a €28.3 million loss last year to positive EBIT of €39.3 million. Net profit rose by 155% to €108.9 million.

Mediaset has also provided an update on its merger plan, with holders of 480,885 Mediaset shares exercising withdrawal rights ahead of the deal, meaning that the company will have to pay an aggregate €1.332 million. Mediaset’s plan is subject to the condition that withdrawal payments do not exceed €180 million. The company will publicly announce the total number of shares in relation to which withdrawal rights were exercised this Thursday at the latest.