ProSiebenSat.1 said it expected trading to be heavily impacted in the second quarter, with ad revenues falling by 40% year-on-year in April .
The media group said it could not provide an outlook for the second quarter or the rest of the year until the full impact of the crisis becomes clearer.
Group revenues for the first quarter were more or less flat year-on-year, growing by only 1% to reach €913, even before the full impact of the coronavirus was felt.
EBITDA was down to €157 million from €190 million, while net income fell from €94 million to €58 million.
The company said that advertising revenues were hit in the second half of March, with SevenOne Entertainment Group’s sales falling by 3% over the quarter.
A decline in revenues from Red Arrow Studios as production activity ground to a halt was cushioned to some extent by growth at digital unit Studio71, with the overall business unit seeing revenues fall by 0.5% to €134 million.
The company said its financial liquidity remains solid. It drew €350 million of a revolving credit facility at the beginning of this month to ensure access to liquidity reserves.
“Our business was well on track until mid-March when first COVID-19 effects started to affect our performance across all segments. As the duration and full implications of the pandemic still remain uncertain, it is impossible to provide forecasts on our full-year results at this moment. Therefore, we decided to withdraw our financial outlook for 2020 as well as the 2019 dividend proposal,” said chairman and chief financial officer Rainer Beaujean.
Analysts at Berenberg said that they expected “ things will get worse before they get better for the broadcasters and that May, not April, will be the trough for ProSiebenSat.1” with any improvement due to relaxation of lockdown rules in Germany being felt in June, “given the need for advanced bookings”. The analysts said that the Q1 performance was “actually a touch better than expected” given the sharp decline in ad sales in the second half of March.
Berenberg said that the mixed nature of ProSiebenSat.1’s NuCom ecommerce portfolio meant that this division was likely to be more stable than other parts of the company.
ProSiebenSat.1 has been the object of speculation that it could be the target of an acquisition or break-up. Mediaset, which has made no secret of a desire to lead pan-European media consolidation, recently upped its stake in the company and indicated that it wanted to do more if German regulators did not object.
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